Napoleon Nelson introduces blockchain technology bill package
HARRISBURG, Aug. 11 – State Rep. Napoleon Nelson, chair of the recently formed bipartisan Emerging Technologies Caucus, unveiled a blockchain legislative package aimed at promoting responsible and deliberative expansion of this growing industry in Pennsylvania.
Blockchain, which Nelson describes as a tamper-proof digital transaction ledger, is already a force to be reckoned with, projected to continue growing in the coming years.
The global blockchain market, he said, was estimated at $3 billion in 2020 and is expected to grow to nearly $40 billion by 2025, with its most widely known application being cryptocurrency like Bitcoin.
“But blockchain has many possible uses in addition to virtual currency, which tech specialists are still discovering,” said Nelson, D-Montgomery, who possesses an extensive background in finance and technology that includes holding a B.S. from Massachusetts Institute of Technology and an MBA from the Wharton School of the University of Pennsylvania. “That includes monitoring supply chains, medical recordkeeping, safeguarding title transfers, digital identification, and financial recordkeeping and transactions.
“At present, blockchain represents a regulatory gray area, as many of today’s laws and regulations did not envision the level of technology we now enjoy. To keep our commonwealth at the cutting edge of technological innovation, I have introduced two measures that will help develop a regulatory framework to support blockchain technology in a way that both promotes business development and protects consumers.”
The two proposals from Nelson – H.B. 1370 and H.R. 121 – would permit businesses in Pennsylvania to develop blockchain-based products in a controlled way, while exploring the regulatory environment in anticipation of future growth.
- H.B. 1370 would establish a two-year financial technology sandbox program, which would allow the Department of Banking and Securities to work with the Department of State to waive specific laws and regulations that do not currently permit blockchain-focused financial technologies to be offered to consumers. The approved businesses would be required to notify the consumer that the product is part of a sandbox program and is still under development.
- H.R. 121 would establish a blockchain working group tasked to create a master plan for growth of the blockchain industry in Pennsylvania, including developing appropriate recommendations for new laws and regulations.
Nelson, first elected in 2020 to represent the 154th Legislative District, established the Emerging Technologies Caucus in the spring to help the legislature keep pace with rapid tech growth and boost innovation.
This summer, he hosted a House Democratic Policy Committee on the development and transparency of digital currencies.