Legislation governing crypto companies’ use of flare gas and a proof-of-reserves measure were both enacted by the state legislature and are currently pending Texas Governor Greg Abbott’s assent or veto as of May 29.
Senate Bill 1751 was forwarded to the Committee on State Affairs on April 24 following passing in the state senate, according to Texas legislative records. Advocates for digital assets have criticized the measure, which attempts to introduce limits for crypto mining companies to certain portions of Texas’ tax and utility codes.
S.B. 1751 was not moving at the time of publication, thus it is doubtful that parliamentarians will be able to discuss it until the next normal session of the Legislature, which will begin in January 2025. The Legislature meets every other year.
Bill to Cap Incentives for Crypto Miners
The incentives provided to cryptocurrency mining companies participating in a scheme designed to reimburse them for load reductions on Texas’ electricity system would be capped at 10% under the proposed legislation. Without progress on the bill, crypto businesses will probably be able to continue enjoying some advantages from doing business in Texas.
Despite the uncertainty surrounding S.B. 1751, two additional laws pertaining to cryptocurrency have already been approved by the Texas Legislature’s two chambers and are awaiting Governor Greg Abbott’s signature or veto. In Texas, unless the governor specifically vetoes a bill, it automatically becomes law if it makes it past the Legislature and to Abbott’s desk.
Two Crypto-Related Bills Passed by Texas Legislature
Texas House Bill 1666 was approved by the state Senate on May 15th. The measure, known as the “proof-of-reserves bill,” sought to compel exchanges to have reserves “in an amount sufficient to fulfill all obligations to customers” and to declare their liabilities to the Texas Department of Banking. House Bill 591, which permits Texas-based Bitcoin miners to employ flare gas emissions as part of their attempts to generate electricity, was also approved by lawmakers on May 10.
Gov. Greg Abbott will now determine whether to sign or reject these laws, determining their future. They could have an effect on the operations and regulatory obligations of cryptocurrency exchanges and Bitcoin miners in the state if they are passed and become Texas law.
The governor of Texas had previously identified himself as a “supporter of the crypto law proposal,” but he has not indicated what he will do in response to the recent legislation. Additionally, the Memorial Day vacation might extend the time frame, allowing Abbott a chance to formally sign the two laws into law.