Calderon Bill Providing Legal Certainty for Use of Blockchain Technology Passes Assembly Privacy and Consumer Protection Committee
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 Privacy and Consumer Protection Committee today with bipartisan support.
“Defining “blockchain technology” in statute will provide greater legal certainty for businesses,” stated Majority Leader Calderon. “Without knowing the legal standing of blockchain, they might avoid innovating or utilizing blockchain as part of their business.”
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.
In 2017, Governor Ducey of Arizona signed HB 2417 into law. HB 2417 defines “blockchain technology” and “smart contract” and states that a record secured through blockchain technology is an electronic record under the Uniform Electronic Transactions Act (UETA). Other states such as Vermont, Nevada, Delaware, Hawaii, and Illinois have also passed legislation related to blockchain technology.
Currently, California defines an electronic record under UETA as a “record created, generated, sent, communicated, received, or stored by electronic means. AB 2658 would define “blockchain technology” for the first time in statute. The measure states that a record or signature secured through blockchain is an electronic record and electronic signature under UETA.
“It is in California’s best interest to encourage innovation with and investment in blockchain technology,” added Majority Leader Calderon. “Doing so will benefit consumers, result in economic growth, and maintain California’s role as a leader in technology and innovation.”
Contact: Lerna Shirinian (562) 692-5858