Crypto bills in limbo as Texas legislative session ends

The 88th legislative session for the government of the state of Texas will end on May 29 without any resolution to certain bills affecting aspects of the digital asset space.

Lawmakers in Texas have recently moved Senate Bill 1751 to the Committee on State Affairs. This legislation aims to restrict crypto mining firms by amending sections of Texas’ utilities and tax code, which has caused criticism from digital asset advocates. However, as of now, there has been no movement on S.B. 1751, making it unlikely that lawmakers will be able to address the bill until its next regular session starting in January 2025. Under the proposed legislation, crypto mining firms participating in a program intended to compensate them for load reductions on Texas’ power grid would have their incentives capped at 10%. Without movement on the bill, crypto companies will likely be able to continue to reap certain benefits from operating in Texas.

Although S.B. 1751 may be in limbo, two other crypto-related bills have already been passed by both chambers of the Texas Legislature and await approval or veto from Gov. Greg Abbott. In Texas, bills that make it through the Legislature and to Abbott’s desk automatically become law unless the governor actively vetoes them.

On May 15, Texas House Bill 1666 passed the state Senate. The legislation aimed to require exchanges to maintain reserves “in an amount sufficient to fulfill all obligations to customers” and submit reports to the Texas Department of Banking regarding their liabilities. Lawmakers also passed House Bill 591 on May 10, which allows Bitcoin ( BTC ) miners in Texas to use flare gas emissions as part of efforts to power their operations.

BREAKING: Texas Legislature passes HB 591! it clarifies that formerly flared or vented gas can be sold to on-site mobile data centers. This will be off-grid #bitcoin miners reducing the carbon impact by 63%! Thanks to @B_whitehead21 , @petromundo1 for your help!

— Lee ₿ratcher (@lee_bratcher) May 10, 2023

Both bills await Abbott’s approval or veto. Under Texas law, Abbott normally has a 10-day window to issue a veto on legislation he opposes, but this window increases to 20 days for bills sent to his desk within 10 days of the regular session ending. This suggests that H.B. 591 may already be de facto state law while Abbott has until mid-June to take action on H.B. 1666.

The Texas governor has previously referred to himself as a “crypto law proposal supporter” but has not suggested what he will do regarding the recent legislation. The Memorial Day holiday may also lengthen the time allowed, giving Abbott an opportunity to affirmatively sign the two bills into law.

Related: Texas lawmakers propose a gold-backed state digital currency

Many mining firms operate in Texas, leading to criticism at the federal level from anti-crypto lawmakers over concerns about energy usage and the environment. Lawmakers in the state have also moved forward on legislation to amend the Texas Bill of Rights to enshrine residents’ right to possess, retain and utilize digital currencies. The bill was referred to the Senate Committee on Business and Commerce on May 11.

Magazine: Crypto regulation: Does SEC Chair Gary Gensler have the final say?