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The Texas Banking Department may consider the stablecoins as money, making them and exchanges that affect them based on a series of laws and licensing requirements of Texas, according to a Supervisory Memorandum published on January 2nd.
Supervisory Memorandum – 1037, published by the financial control body which examines the regulatory treatment of digital currencies under the Texas Money Services Act and addresses current trends in the sector, including the introduction of stablecoin on the market . Stablecoin is a sort of centralized cryptocurrency supported by the issuer with conventional currency, precious metals and sometimes algorithms.
The law states that the reception of a stablecoin sponsored by a sovereign state in exchange for "a promise" to make it available at a future date or in another place can be recognized as a transfer of money. As such, a stablecoin sovereignly can be considered money or monetary value under the law on monetary services. The document also reads:
"A license analysis will turn on if the stablecoin provides the holder with a right to redeem the sovereign currency, thus creating a credit that can be converted into cash or monetary value regardless of whether the right of redemption is expressly granted or implied by the issuer. "
Regarding the position of cryptocurrencies in Texas in general, the document specifies that "cryptocurrency is not money under the law on monetary services", thus receiving it under the same conditions in which the stablecoin are not considered a transmission of money.
"However, when a cryptocurrency transaction includes the sovereign currency, it can be the transmission of money depending on how the sovereign currency is handled." A license analysis will be based on sovereign currency management, "he said further.
As previously reported by Cointelegraph, the main exchange of US cryptocurrencies Coinbase blocked activities in the state of Wyoming after its operations had been considered subject to licensing restrictions. The license was suspended in mid-2014 due to the provisions of the state law that imposed the digital activities of state residents with fiat currency to all "double-reserve" exchanges.
However, in March 2018, the state legislature of Wyoming approved the draft law 19 concerning the exemption of virtual currencies from the Wyoming Money Transmitter Act. This allowed Coinbase to request a license with which it can resume operations such as a compliant and regulated exchange.
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