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New bill would permit blockchain stocks in California law

The State Senate’s Banking and Financial Institutions Committee have recommended a Blockchain related bill with a “do pass” status. If the full Senate approves the measure, Blockchain technology would be legally recognized.

California could join the slowly growing list of U.S. states allowing companies to use blockchain technology to store data.

Bill 838 has been receiving attention having recently been publicized. Although Senator Robert Hertzberg initially introduced the bill in January, the State Senate’s Banking and Financial Institutions Committee passed the document to the Judiciary Committee on 18th April after progressing it with a “do pass” recommendation. If the Judicial Committee approves the measure, it will go to a vote by the full Senate.

The document has been through several amendments with the most recent outlining the provisional allowances and stipulations of the law. The current version would permit “records administered by or on behalf of the corporation in which the names of all of the corporation’s stockholders of record, the address and number of shares registered in the name of each of those stockholders, and all issuances and transfers of stock of the corporation to be recorded and kept on or by means of blockchain technology or one or more distributed electronic networks.”

This is provided that specific requirements are met. This includes, but is not limited to, the need that data records must be capable to be “converted into clearly legible paper within a reasonable period of time”, “used to prepare the list of shareholders”, and “used to record transfers of stock required pursuant to this code”.

In a press release when the recent document was publicized, Hertzberg said that the “world around us is changing, and government must adapt with these rapidly evolving times” and offered that “California needs to continue our legacy of taking on new and developing technologies, especially ones like blockchain, which is being embraced worldwide and presents a strong level of security that is resistant to hacking.”

If the Committees accept the measure, California will be flanking Delaware and Wyoming in states which allow companies to use Blockchain technologies in administration.