The US state of Wyoming has amended insurance laws to allow state insurers to invest in digital assets such as Bitcoin.
The modification has been through last month and took effect July 1, according to information from the Wyoming Legislature, the state's legislative branch.
The new law states that an insurance company may invest in "digital assets, as determined by W.S. 34‑29‑101 (a) (i) and excludes digital consumer assets in accordance with W.S. 34-29-101 (a) (ii). ”
Wyoming law defines digital assets as “an economic representation, ownership or access rights that are stored in a human-readable computer format and includes digital consumer assets, securities digital currencies and virtual currencies, ”including cryptocurrencies like Bitcoin.
Specifically, virtual money is defined as a "digital asset that is: (A) Used as a medium of exchange, unit of account or store of value; and (B) Not being legally recognized by the US government. ”
Under the new law, insurance companies are now allowed to invest in "digital consumer assets." They are defined as "digital assets - used or purchased primarily for consumer, personal or household use."
"The first clause of its kind"
Kramer Levin - a law firm based in the United States, said the amendment "is clearly the first provision of its kind nationwide." However, whether insurance companies take advantage of this law is still to wait and see.
This is because insurance companies have traditionally been cautious with their portfolios (with portfolios typically invested primarily in high-end bonds and mortgages), Kramer Levin said.
“However, insurance companies may recognize - especially in volatile financial markets - benefits that are not correlated with macroeconomic risks. The new law does not address issues like pricing, accounting or liquidity risk, ”the law firm added.
Caitlin Long, founder and CEO of Wyoming-based cryptocurrency bank Avanti, said: “It is likely that insurance companies will provide this as part of their life policies instead. whole life, because the capital costs of NAIC (National Association of Commissioners of National Insurance) will be high. ”
Wyoming remains one of the friendliest states with cryptocurrencies and blockchain. Over the past two years, the state of Wyoming has passed a series of laws, including recognizing cryptocurrencies as money and allowing favorable tax treatment for cryptocurrencies, among other measures.
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According to The Block
Translated by ToiYeuBitcoin