Wyoming Enacts Trailblazing Blockchain and Cryptocurrency Legislation

by Wilson Elser

Wilson Elser

During the week of March 5, 2018, Wyoming passed comprehensive legislation crafted to convince blockchain and cryptocurrency businesses to locate within its borders and avail themselves of what many consider favorable corporate and tax laws. The Wyoming Blockchain Legislation is significant as it represents the first comprehensive effort to address numerous nuances in securities law, corporate law, banking regulation and tax that have to date proven to be barriers to blockchain and cryptocurrency businesses flourishing in the United States. By being an early adopter, Wyoming may now become a jurisdiction of choice not only for sector-specific ventures in blockchain-related technology but also for exchanges of cryptocurrency and the issuance of non-securities “utility tokens” in arenas such as insurance and health care. 

The Wyoming Blockchain Legislation comprises five separate bills:

  • HB 19 provides an exemption for virtual currency (e.g., Bitcoin,  Ethereum, etc.) used within Wyoming from money transmitter laws and regulations, subject to providing “specified verification authority” to the Wyoming Secretary of State and the Wyoming Banking Commissioner. “Specified verification authority” entails representations and undertakings of the issuer of utility tokens to confirm beneficial ownership of virtual currency, as well as steps taken to prevent fraudulent duplication of those virtual currencies by unaffiliated third parties. Among other things, this bill permits Wyoming companies and trusts to conduct commerce with other Wyoming companies and trusts without being subject to money transmitter laws.
  • HB 70 provides that a person who develops, sells or facilitates the exchange of an open blockchain token (a utility token) is not subject to specified securities and money transmission laws, subject to providing “specified verification authority” to the Wyoming Secretary of State and the Wyoming Banking Commissioner. The primary purpose of this bill is to make clear that utility tokens issued for noninvestment purposes will generally be exempt from registration requirements under Wyoming’s securities laws.
  • SF 111 provides that virtual currency is not subject to taxation as “property” in Wyoming. While Wyoming does not impose income tax on its residents, this bill makes clear that virtual currency is personal property not subject to property tax in Wyoming. The choice of Wyoming corporations and trust structures to take custody of and hold virtual currency appears to be a primary objective of this bill.
  • HB 101 provides for the maintenance of corporate records of Wyoming entities via blockchain so long as electronic keys, network signatures and digital receipts are used. Lists of shareholders, nominee shareholders and attendant voting matters are intended to be encompassed through this legislation, thus paving the way for the development of transfer agencies and exchanges within Wyoming.
  • HB 126 modifies Wyoming’s corporate code to permit the formation of “Series LLCs.” Series LLCs often are used by hedge funds and private equity funds to create insulated “cells” within a corporate structure to limit liabilities of the parent LLC. This corporate structure is used frequently in the blockchain space as well. The intent of this legislation is to promote Wyoming as a jurisdiction of choice for securities formation and to compete with Delaware and Nevada for corporate registration revenue. 

While the regulation of blockchain and cryptocurrency activities on a federal level remains uncertain, the Wyoming Blockchain Legislation aims to facilitate the development of business in these fast-emerging areas by providing a predictable legal and regulatory environment. Businesses that are considering implementation of blockchain and virtual currencies as part of their overall plans should review carefully the Wyoming Blockchain Legislation to ascertain whether its provisions provide value propositions for their enterprises compared with other jurisdictions within and outside of the United States. Likewise, those who invest in cryptocurrency should consider whether the Wyoming Blockchain Legislation provides a corporate harbor for their holdings that also may present transactional opportunities now and in the future.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Wilson Elser | Attorney Advertising

Written by:

Wilson Elser

Wilson Elser on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.


JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.