TL;DR
- Michigan will allow state pension funds to invest in cryptocurrencies through regulated ETFs that meet specific requirements.
- Mining operations can use energy from abandoned wells if environmental damage is addressed. With tax benefits offered to miners.
- At the federal level, blockchain developers who do not control third-party funds will be exempt from financial licensing requirements.
Michigan and Washington are advancing parallel initiatives to regulate and promote cryptocurrency and blockchain technology. At the state level, Michigan’s House of Representatives approved a package of four bills covering topics from public crypto investments to tax incentives for miners and restrictions against CBDCs.
One key bill would allow state pension funds to invest in cryptocurrencies via regulated financial products like ETFs. These investments would be limited to assets that meet capitalization and oversight standards. The aim is to provide funds a safer way to gain exposure to crypto.
Another bill authorizes the reuse of abandoned oil and gas wells to power Bitcoin mining operations, provided companies take responsibility for environmental remediation at those sites. The proposal includes tax deductions for miners participating in these cleanup efforts, aiming to attract private investment while addressing legacy pollution.
Michigan Aligns with the Country’s New Pro-Crypto Approach
Additionally, the state passed a law prohibiting state and local authorities from imposing taxes, licensing, or restrictions exclusively based on the digital nature of cryptocurrencies. The law also prevents any state agency from promoting or supporting a central bank digital currency (CBDC), clearly distinguishing decentralized cryptocurrencies from government-issued digital money.
Meanwhile, in Washington, a group of congressmen reintroduced the Blockchain Regulatory Certainty Act, which seeks to clarify which blockchain developers and service providers must register as money transmitters under federal law. The bill proposes exempting protocol developers and platforms that never directly control user funds from financial licensing, restricting those requirements to entities that handle third-party assets.
It is clear there is a strong intent to regulate precisely without hindering technological progress. While Michigan focuses on attracting investments and solving environmental challenges related to mining, federal efforts aim to prevent current rules from pushing projects and talent out of the country.
