Assembly Approves Calderon Bill Providing Legal Certainty for Use of Blockchain Technology
SACRAMENTO, CA – Assembly Bill 2658, a measure authored by Majority Leader Ian Calderon which defines “blockchain technology” for the first time in statute, passed the Assembly floor today with bipartisan support.
“It is in California’s best interest to encourage innovation with and investment in blockchain technology,” stated Majority Leader Calderon. “Defining “blockchain technology” in statute will provide greater legal certainty for businesses, will benefit consumers, and result in economic growth.”
A blockchain is a type of distributed ledger that keeps continuously updated digital records. As a distributed ledger, it does not have a central administrator but rather a network of replicated databases, which are synchronized via the internet. Blockchain networks can have a restricted membership or be publicly accessible.
The innovation of blockchain technology is that transactions or interactions between peers no longer need a central authority to validate them. Blockchain allows parties who have never met and have little reason to trust each other to conduct sensitive business transactions quickly and efficiently. This provides both security and efficiency benefits to potential users, businesses, and industries.
AB 2658 will also establish a blockchain working group to study the uses of, risks and benefits associated with, and the legal implications of the use of blockchain by state government and California-based businesses. The working group will be comprised of industry leaders, technical experts, representatives from privacy and consumer protection organizations, as well as state information officers. They will report their recommendations and findings on or before July 1, 2020.
AB 2658 is headed to the Senate next.
Contact: Lerna Shirinian (562) 692-5858