The Satoshi Action Fund is pushing for state-level protections for Bitcoin custody, drawing inspiration from the success of the cannabis industry in navigating federal regulations. The goal is to create “safe haven” states for Bitcoin users, ensuring legal certainty for holding and using the digital asset.
CEO Dennis Porter argues that state laws take precedence when federal laws are absent, emphasizing that federal authorities cannot force state or local law enforcement to assist in enforcing contradictory laws. By establishing state-level protections, the fund aims to proactively safeguard Bitcoin rights before federal legislation is introduced, avoiding the decades-long setbacks experienced by the cannabis industry.
Porter highlights historical movements like women’s suffrage, civil rights, and same-sex marriage, which gained momentum at the state level before leading to federal legislation. He believes that increased state-level activity can prompt federal government action, citing studies that support this claim.
Despite the potential of state laws to protect Bitcoin custody, legal experts like Joe Carlasare caution that federal law typically supersedes state law. Carlasare acknowledges the limitations but believes that the federal government may not have the authority to ban self-custody of Bitcoin.
Pennsylvania has made significant progress by passing House Bill 2481, also known as the “Bitcoin Rights” bill. This bipartisan legislation, aimed at protecting residents’ rights to self-custody digital assets and establishing guidelines for taxing digital asset transactions, passed the House of Representatives with overwhelming support.
The bill’s advancement to the Republican-controlled Senate positions Pennsylvania as a state actively addressing crypto regulation in the absence of clear federal guidelines. With an estimated 1.5 million crypto owners, Pennsylvania’s actions may influence other states to follow suit in providing legal protections for Bitcoin users.
While challenges persist due to federal law supremacy, the momentum at the state level indicates a collective effort to establish regulatory safeguards for Bitcoin. The outcome of these initiatives could shape the future regulatory landscape of Bitcoin across the United States, especially as federal agencies continue to deliberate on digital asset regulation.
The Satoshi Action Fund’s proactive approach to securing state-level protections for Bitcoin custody reflects a growing trend in advocating for crypto-friendly regulations at the state level. By learning from past movements and leveraging state laws, the fund aims to create a supportive environment for Bitcoin users, potentially paving the way for broader regulatory acceptance of digital assets in the United States.
