Nebraska Bill Proposes Allowing State Banks to Offer Crypto Services

Shine Li   May 11, 2021 10:03

Nebraska is contemplating a bill that will allow state banks to offer cryptocurrency services.

The bill is pending review and was first introduced by Republican Mike Flood in January. With Bill 649, the Nebraska Financial Innovation Act will be brought to the forefront and the importance of creating digital asset depository institutions will be highlighted.

The bill proposed by Nebraska senators will also look to provide appropriate charter, operation, supervision, and regulation of digital asset services. to the proposal, blockchain innovators have a harder time securing appropriate banking services for digital currencies, but this bill aims to change that.

Per the official statement:

“The rapid innovation of blockchain and digital ledger technology, including the growing use of virtual currency and other digital assets, has resulted in many blockchain innovators and consumers being unable to access secure and reliable banking services, hampering the development of blockchain services and products in the marketplace.”

The ultimate goal of the bill is to enhance and encourage digital innovation regarding blockchain and cryptocurrencies. The bill highlighted that this was essential in order to foster growth in the State’s “ever-evolving financial sector.” Per the bill:

“Authorizing digital asset depository institutions to be chartered in Nebraska will provide a necessary and valuable service to blockchain innovators and depositors, emphasize Nebraska's partnership with the technology and financial industry, safely grow this state's ever-evolving financial sector, and afford more opportunities for Nebraska residents.”

If approved, the initiative will make Nebraska the second state in the United States to establish a formal charter for cryptocurrency banks. Wyoming State was the first to do so, granting Avanti Bank and Trust, a bank charter a banking license in the last quarter of 2020. With that approval, Avanti became the second cryptocurrency company to receive a banking license in the United States, with Kraken crypto exchange being approved to operate as a US bank by the Wyoming State Banking Board last September.

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