Virginia cryptocurrency investors hope lawmakers will consider regulatory policies for the digital asset industry in the 2023 General Assembly, saying a framework is needed with the increasing number of investors and recent market volatility.
Cryptocurrency exchange FTX filed for bankruptcy on Nov. 11. It was one of the largest cryptocurrency exchanges, valued at $32 billion in January. FTX founder Sam Bankman-Fried released a statement on Twitter, saying he was “shocked to see things unravel the way they did.”
The company did not have enough emergency reserves to float the “bank run” of customer withdrawals, which led to bankruptcy, according to a statement released by Rep. Stephen F. Lynch, D-Massachusetts. Lynch is the chairman of the Task Force on Financial Technology.
At least $1 billion of FTX customer assets “are currently missing,” according to the release, though multiple reports include the total could be much higher.
FTX was headquartered offshore, and Lynch pointed to the need for “thoughtful regulation” to protect U.S. investors and maintain stability in the digital assets industry.
Only a few Virginia bills related to cryptocurrency have been previously introduced. Del. Glenn Davis, R-Virginia Beach, introduced House Joint Resolution 153 in 2018. The measure would have created a one-year subcommittee of 13 members — legislative and nonlegislative members — to study the potential implementation of blockchain technology in things such as government record keeping, delivery services and information storage, and also to study how blockchain technology could stimulate growth in Virginia’s information technology industry.
Del. Karrie Delaney, D-Fairfax, introduced a bill this year to create a two-year, 20-member subcommittee to identify opportunities and establish a potential regulatory framework for cryptocurrency and blockchain technologies.
The Virginia Blockchain Council is a tax exempt trade organization based in Central…
