NC Bitcoin Enthusiasts Rally for Better Cryptocurrency Legislation

But the efforts of its founders Rob Sherwood and Drago Bratic could be stifled if NC Senate Bill 680 passes, requiring anyone transmitting digital currency to pay $250,000 for a money transmitter license from the North Carolina Banking Commission. 

 

The threat of the bill has already prompted three bitcoin or blockchain technology startups to leave the state in recent months, and it’s made local enthusiasts fear that North Carolina will take a hard line on legislating the cryptofinance and technology industry (similar to recent New York legislation) rather than embracing the opportunity for innovation in one of the nation’s largest financial states. 

 

Says Sherwood, who also runs the web development agency Oak City Tech and accepts Bitcoin as payment: “Every day you hear of people moving out of New York because of this, and that’s not what I think North Carolina wants. It’s always been a hub of small business and technology, and if this happens, you’re going to stifle a huge part of the new technological age.” 

 

The legislation was a key topic of last weekend’s Cryptolina Bitcoin and Blockchain Expo in Charlotte, the second annual event for the Raleigh-based organization. More than 400 people attended the two-day conference, including enthusiasts and industry professionals as well as banking and finance executives from the likes of Wells Fargo, Bank of America and a slew of local credit unions. 

 

In fact, the biggest change from last year’s inaugural event in Raleigh, says co-organizer Dan Spuller, was the attendance of these banking professionals. 

 

“A lot of these guys were brushing us off last year,” Spuller says. “It shows a maturation phase for Bitcoin compared to 12 months ago.” 

 

It was an event full of energy where many came away with a better understanding of the technology that powers digital currency transaction, or “the blockchain,” and others came away wanting to fight harder for appropriate (and more lenient) legislation around the industry. 

 

Spuller was so motivated that he and co-organizer Faruk Oktecin, along with the BitBasics founders are creating an advocacy group to educate legislators about the industry and what’s at stake for bitcoin and blockchain innovation. They’ll host a discussion similar to those that happened last week in Charlotte next Tuesday night at The Frontier. It’s the second event for the new NC Triangle Bitcoin Meetup.

Besides Spuller and Sherwood, speakers include Perianne Boring, president and founder of the Washington D.C.-based Chamber of Digital Commerce, Todd Erickson, a regulatory affairs committee member of The Bitcoin Foundation, lobbyist Arika Pierce, local angel investor Bill Warner and Jameson Lopp, an early Triangle bitcoin meetup organizer who now works remotely for Silicon Valley and venture-backed bitcoin startup BitGo.

Sherwood will give a first-person account of the impact legislation could have on a business. In order to demonstrate how bitcoin works, BitBasics helps workshop attendees download a bitcoin wallet on their mobile devices and then transmits a small amount of the currency into the wallets to show how easy and fast it is.

Proposed legislation is vague enough, according to the meetup organizers, that it could prevent the nonprofit from doing these demonstrations. It also could prevent family members from transmitting bitcoin to each other, and small businesses from paying their supply chain with the currency. It’s also pretty unclear if other documents—medical records, deeds and titles, contracts, etc.—can be transmitted under the law.

“When we give people Bitcoin in their new wallet, that’s when the light bulb goes on,” Sherwood says. “We’re not going to be able to do that unless we pony up $250,000 for a transmitter license. As a startup nonprofit, that’s kind of ridiculous.”