Texas To Permit State Banks Hold BTC On The Behalf Of Their Clients

Texas Senator and former presidential candidate Ted Cruz made headlines recently when he announced that he is in fact supportive of Bitcoin and the crypto industry, saying that it has potential. Texas is not the only state which seems to be in support of cryptocurrencies either, as both Miami, as well as Wyoming, have previously made continuous efforts to be able to attract various crypto companies. Miami had even recently hosted the Bitcoin Conference 2021 for the very 1st time in its recorded history.

Things look to improve even more as now, it looks as if banks that possess a national charter will be granted the opportunity to store cryptocurrency. Texas representatives have also claimed that this is applicable to the various state-chartered banks too.

Adequate protocols required

The state’s Department of Banking had issued a notice earlier today, according to which state-chartered banks were officially allowed to store cryptocurrencies on the behalf of their respective clients. However, the banks are only permitted to do this if ‘adequate protocols’ have been put in place, in order to comply with the local law.

Furthermore, as per the notice, the state-chartered banks in Texas have a history of providing customers with a wide variety of custody and safekeeping services for numerous kinds of assets. Of course, it must be said that the process of safekeeping and custody of the digital currencies shall be a bit different than the ones which would normally be linked with traditional assets. Nevertheless, the Department of Banking remains adamant in its belief that it is already allowed to provide said services as per the Texas Finance Code § 32.001, and is therefore not breaking any law or violating any terms of the agreement.

Private keys can now be stored

Also, as per the abovementioned notice, banks who are interested in taking part in this initiative will additionally have the choice to have copies of various private keys be stored, as well as be able to accept crypto transfers directly into the wallets. The wallets will also be completely controlled by the banks themselves. Moreover, the banks also have the option of partnering up with 3rd parties in order to seek assistance in actually providing the aforementioned services.

Lastly, the banks have an obligation to safely store any and all assets for their respective clients. This is also applicable to cryptocurrencies, as the trust powers granted to the banks will allow for the addition of fiduciary custody services. The banks are also required to safely return any assets completely unharmed and untouched if the request to do so is made.