The Virginia State Senate has introduced legislation addressing digital asset mining and transactions, along with their tax treatment.
Senate Bill No. 339 (SB 339), proposed by 34-year-old Senator Saddam Aslan Salem on January 9, is currently undergoing debate in the Senate.
If approved, it will go before the House of Delegates for consideration before becoming law.
The bill includes important provisions, including eliminating requirements for individuals and companies involved in cryptocurrency mining to obtain money transmission licenses.
Additionally, it prevents discrimination against miners by preventing industrial zones from enforcing stricter noise laws or banning cryptocurrency mining.
Furthermore, SB 339 exempts issuers and sellers of cryptocurrencies from securities registration requirements under certain circumstances. The exemption applies if the cryptoasset is not considered an investment contract, is not marketed as a financial investment, and reasonable precautions are taken to prevent buyers from viewing it as such.
Also, while the bill does not classify mining or mortgage services as a “financial investment,” it does require companies to provide notice to qualify for the exemption.
The bill includes an encryption working group
To promote the use of cryptocurrency in everyday transactions, SB 339 also proposed tax benefits starting January 1.
Individuals can exclude up to $200 per transaction from their net capital gains for tax purposes, which applies to gains derived from cryptocurrency to purchase goods or services.
Salem's bill mirrors similar legislative efforts in states such as Nebraska, Indiana, and Missouri, all of which are supported by the Satoshi Action Fund.
This non-profit organization, focused on informing policymakers and regulators about the benefits of Bitcoin (BTC) and cryptocurrency mining, has developed model legislation to protect the rights of cryptocurrency users and miners at the state level.
What sets SB 339 apart from bills introduced in other states is its inclusion of a working group dedicated to studying and making recommendations regarding blockchain technology, digital asset mining, and cryptocurrency activity within the commonwealth.
The working group, which includes representatives of state agencies, academic institutions, industry associations and public interest groups, will explore current and potential uses of blockchain technology and cryptocurrencies, evaluate their benefits and risks, and establish regulatory and legal frameworks, best practices and standards.
