While the investment potential of cryptocurrencies, including BitCoin, has been all over the news in recent weeks, state governments have begun to explore the practical applications of blockchain – the technology underlying BitCoin.  In New York, Assemblyman Clyde Vanel introduced four bills in late November related to blockchain technology. The first, Assembly Bill 8780, would amend the state technology law to allow signatures, records and contracts secured through blockchain technology to be considered valid electronic records and signatures and further to recognize the legal validity of the use of smart contracts in commerce. This proposed legislation, recognizing legal effect to blockchain transactions and smart contracts, is similar to laws recently passed in other states, including Arizona, Nevada and Vermont.

In addition to confirming the validity of blockchain transactions, three additional bills were proposed designed to explore the impact and practical applications of blockchain technology. Assembly Bill 8783 proposes creation of a digital currency task force to advise the Governor and legislature on potential effects of widespread implementation of digital currencies on state financial markets. The stated mission of the task force includes review of the Department of Financial Services’ BitLicense program on the use of digital currencies. Assembly Bill 8792 directs the State Board of Elections to study and evaluate the potential use of blockchain technology to protect voter records and election results. Last, Assembly Bill 8793 proposes creation of another task force to assess the feasibility, economic impacts and effectiveness of the implementation of blockchain technology in state record keeping, information storage and service delivery. This initiative is similar to legislation passed in Hawaii, Illinois, Maine and North Dakota designed to explore ways that blockchain technology could enhance record keeping functions. Assembly Bills 8780 and 8793 were referred to the Governmental Operations Committee. Assembly Bill 8783 was referred to the Banks Committee and Assembly Bill 8792 was referred to the Election Law Committee.