Written by: Leonard Parker | Houston Business News | 14th June
Since the early days of the pandemic, cryptocurrency has enjoyed a huge boom. Now, the state of Texas is hopping on the bandwagon.
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Now, as first reported by Natalie Walters at The Dallas Morning News, Texas banks will be able to provide crypto banking services.
The Texas Department of Banking announced Thursday that state-chartered banks have the authority to provide custody or safekeeping services for virtual currencies.
Marcus Adams, the state banking department’s assistant general counsel, said it's good that Texas was able to get in front of the cryptocurrency boom. Adams told the Morning News that "Texas is seeing the rise in the virtual currency industry and trying to get out ahead of it and ensure our regulated banks are prepared to remain competitive."
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If someone has shares of Bitcoin or other virtual currencies like Ethereum or Litecoin, they can give that responsibility to a third-party bank in Texas. The bank can store a copy of the key as they do with important documents, or the customer can transfer the cryptocurrency into one of the state-chartered banks.
The Texas Department of Banking announcement comes before Abbott's signing ceremony for the forthcoming "Virtual Currency Bill" that recognizes virtual currencies' legality. Texas would become the second state after Wyoming to recognize blockchain and cryptocurrency.
Abbott is seemingly on board with virtual currency, as he's shared multiple tweets in support of the bill.
Cryptocurrency wins votes of confidence from Gov. Abbott & Texas Department of Banking.June 11, 2021
"Blockchain is a booming industry that Texas needs to be involved in. I just signed a law for Texas to create a master plan for expanding the blockchain industry in Texas," Abbott tweeted out last week.
Although this new role is available for banks, not all will be capable of taking it on once risk management is assessed.