Should the Ananich bill be signed into law and a commission forms to offer recommendations to state lawmakers, policymakers and observers of the crypto industry do see some low-hanging fruit.
Other states, such as Massachusetts, are forming similar commissions to explore crypto regulations, notes Brian Wassom, a partner in the Clinton Township office of law firm Warner Norcross + Judd LLP, with a practice focusing on emerging technologies such as blockchain.
The trend for state governments, says Wassom, has been to focus on more simple items such as defining a blockchain transaction, while leaving the “thorny issues,” such as whether crypto should be treated as a security, up to eventual guidance from the U.S. Securities and Exchange Commission.
While a commission makes for a “logical first step” for states to take, the crypto will likely remain highly speculative absent federal regulation, said Wassom.
“I think we don’t make real progress until we have some sort of national uniformity,” Wassom told Crain’s. “And the SEC has certainly been looking at these issues. I would expect to get SEC guidance on some of these bigger picture issues before long, like within the next couple years.”
Ananich, the Flint state lawmaker, also said he believes the federal government makes for the ideal place for regulations, but said some obvious areas to explore include allowing residents to pay their bills in crypto or invest some of their retirement accounts into the financial technology.
A recently updated version of the Ananich legislation — which is what was referred from the committee — includes upwards of a dozen areas for the eventual commission to explore.
Those range from how crypto can be used as legal tender, whether mining of cryptocurrency should be encouraged in the state, the environmental impact of doing so, and what kinds of consumer protections should be in place.
The proposed legislation is intended not as an endorsement of cryptocurrency, but rather as an acknowledgement of the growing importance of the technology, and “how does Michigan get ready,” state Sen. Jeremy Moss, a Southfield Democratic lawmaker, said during a committee meeting last week.
Ultimately, Wassom, the Warner Norcross attorney, said certainty is always the preference for the clients he advises. Some level of regulations helps achieve that, he said.
“The people I talk to and advise that are considering ventures in (the crypto) space, they would love to see more certainty and more … options for enforcing their rights when things go sour,” he said.
— Bloomberg contributed to this report
