Sen. Wendy Rogers’ latest plan to make Bitcoin legal cash might be difficult, given the United States Constitution prohibits states from creating their own legal tender.
Arizona State Senator Wendy Rogers has introduced legislation to provide the state with the authority to declare Bitcoin legal cash. The law, nicknamed ‘SB 1341,’ would allow people to elect to get their paychecks in bitcoin, while businesses would be free to utilise bitcoin anyway they pleased.
While Rogers has a dubious past – having assumed office in early 2021 and previously expressed support for the conspiracy theory organisation QAnon – this is not an unrealistic suggestion, considering what others are beginning to do throughout the United States and internationally.
Will the United States Constitution Prevail Over Rogers’ New Proposal?
SB 1341’s primary impediment will probably be the United States Constitution, which now prohibits states from creating their own legal cash.
For those who believe the US Constitution should be interpreted exactly as written, without reference to anything else, this is an easy “no” to Sen. Rogers’ proposal – whereas “modernists,” who view it as a “living document,” might argue that Arizona implementing its own legal tender is still within the Constitution’s bounds.
To put things into perspective, it’s important remembering that the law, in its present form, specifically specifies “bitcoin” – not other cryptocurrencies. SB 1341 must pass both the Arizona Senate and House of Representatives before being approved by Arizona Governor Doug Ducey.
Regrettably for Rogers, he faces an uphill road, since the United States Constitution presently lacks any provision(s) or amendment(s) allowing individual states to establish their own legal cash.
“The Congress shall have the authority…to create Money, to regulate its value and that of foreign Coin, and to establish the Standard of Weights and Measures…”
According to the Coinage Clause, Congress has the only authority to establish what constitutes “legal money.” However, one New York attorney believes that Sen. Rogers’ bill may not have the intended effect in Arizona.
“The Coinage Clause establishes that Congress alone has the authority to define what constitutes ‘legal cash,'” Preston Byrne, a lawyer at the Washington, D.C. law firm Anderson Kill, said. Byrne consults a broad variety of technological enterprises, including bitcoin miners and stakers, creators of decentralised protocols, hedge funds, and other institutional investors.
Byrne believes that even if the measure were to become law in Arizona, it would have little effect on the state’s bitcoin usage.
El Salvador Is the Forerunner, But Could Texas Follow?
As of now, El Salvador is the only government in the world that has declared Bitcoin its official currency alongside the US dollar, after El Salvador’s September decision to establish it legal tender alongside the US dollar.
Despite the historic precedence, El Salvador is under fire from the International Monetary Fund (IMF), which is encouraging the government to rethink its decision in view of the significant dangers to consumers:
“However, converting a cryptocurrency to legal cash carries significant dangers to financial and market integrity, financial stability, and consumer protection. Additionally, it may result in potential obligations.”
In August 2021, the IMF started speaking out against the use of cryptocurrency as legal cash. In nations with steady inflation, a strong currency, and trustworthy institutions, there is no need for families and companies to purchase or charge with cryptocurrency due to its volatility.
Another potentially intriguing suggestion comes from Texas, where Republican real estate mogul and current gubernatorial candidate Don Huffines recently claimed that if won, he will make bitcoin ‘legal tender.’
Rogers was selected to the Arizona Blockchain and Cryptocurrency Study Committee last year, where she claims she will try to make the state more crypto-friendly. The committee’s objective is to establish the means for integrating cryptocurrencies into the state’s pre-existing financial infrastructure. It is presently comprised of members of the Arizona State House and Senate, as well as representatives from the cryptocurrency sector.
Also Read: Banks Offering Cryptocurrency Services Are Expected To Double In Size By 2022
Wallets