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CA Gov Gavin Newsom signs blockchain executive order

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NEWSOM ISSUES BLOCKCHAIN-RELATED EXECUTIVE ORDER

California Gov. Gavin Newsom on Wednesday signed an executive order to begin the process of creating a regulatory approach for so-called web3 companies — think cryptocurrency — and to assess how to deploy blockchain technology for state and public institutions.

“California is a global hub of innovation, and we’re setting up the state for success with this emerging technology — spurring responsible innovation, protecting consumers, and leveraging this technology for the public good,” Newsom said in a statement. “Too often government lags behind technological advancements, so we’re getting ahead of the curve on this, laying the foundation to allow for consumers and business to thrive.”

What’s a blockchain? the Massachusetts Institute of Technology Technology Review defines blockchain as a decentralized online record-keeping system maintained by a network of computers that verify and record transactions using cryptographic techniques.

Blockchain technology is critical in the world of cryptocurrency, which has exploded in use since it was introduced as a theory in 2008. You’ve probably heard of cryptocurrencies like Bitcoin and Dogecoin.

Did you know that California lawmakers are weighing a pair of bills that would make cryptocurrency legal tender for government services? Neither bill is likely to advance this legislative session, but it’s highly likely we’ll see more legislation on the topic in the near future. Ace Sen. sydney kamlager, D-Los Angeles, told The Sacramento Bee, “California shouldn’t be afraid. California should not be afraid of digital currency.”

Crypto assets and blockchain technology was valued at $3 trillion in November of last year, up from $14 billion five years prior, according to Newsom’s office.

“According to research, roughly 16% of adults have invested in, traded, or used cryptocurrencies,” according to the governor’s office.

Under Newsom’s executive order, the state has seven priorities:

  1. “Create a transparent and consistent business environment for companies operating in blockchain, including crypto assets and related financial technologies, that harmonizes federal and California laws, balances the benefits and risks to consumers, and incorporates California values ​​such as equity, inclusivity, and environmental protection .
  2. Collect feedback from a broad range of stakeholders, create a regulatory approach to crypto assets harmonized between federal and state authorities, explore and establish public-serving use cases (such as incorporating blockchain technologies into state operations), and build research and workforce pipelines.
  3. Collect feedback from a broad range of stakeholders for potential blockchain applications and ventures, with particular attention to crypto assets and related financial technologies. Engagement should include technical experts, stakeholders interested in addressing inequities and environmental impact, companies both based in and outside California, and more.
  4. Engage in a public process and exercise statutory authority to develop a comprehensive regulatory approach to crypto assets harmonized with the direction of federal regulations and guidance, creating consumer protections and solidifying California’s status as the premiere global location for responsible crypto asset companies to start and grow.
  5. Engage in and encourage regulatory clarity via progress on the processes outlined in the federal executive order, with state agencies coordinating closely with the Washington, DC Office of the California Governor.
  6. Explore opportunities to deploy blockchain technologies to address public-serving and emerging needs, working with the private sector, academia, and community to present pilots for innovative policies, programs, and solutions that demonstrate and showcase the potential of adopting blockchain technologies to respond to specific challenges identified by state agencies.
  7. Identify opportunities to create a research and workforce environment to power innovation in blockchain technology, including crypto assets. The goals will be to expose students to emerging opportunities, power emerging industries, and help ensure economic benefits are experienced equitably.”

ELIMINATING CANNABIS CULTIVATION TAX WOULD DOUBLE TAX REVENUE, STUDY SAYS

It may seem counter-intuitive, but eliminating California’s cannabis cultivation tax could actually result in the state receiving twice the tax revenue.

That’s the finding of a new Reason Foundation study, which you can read here.

“High cannabis taxes are the biggest reason California’s legal cannabis market is struggling. Eliminating the cultivation tax is how the state can start to fix it,” said study author Geoffrey Lawrence in a statement. “State leaders could double current monthly cannabis tax revenues by 2024 by eliminating the cultivation tax. Without the cultivation tax, our data show that lower cannabis prices would increase sales of legal products, which would increase the state government’s general sales tax revenue and more than replace losses from the eliminated cultivation tax.”

As the study notes, California’s taxes on cannabis far outstrip other states that have legalized recreational weed. Between state and local taxes, taxes on California cannabis can be as much as $1,441 per pound, compared to the average of $340 a pound in Oregon and $526 a pound in Colorado.

“Due to lower taxes and greater access to legal cannabis products, residents in neighboring Oregon spend 378% more per capita on legal cannabis and residents of Colorado spend 335% more per capita on legal cannabis products than Californians spend,” according to a statement from the Reason Foundation.

The study also recommends lowering the retail excise tax in order to help the legal cannabis market compete against the booming illegal one.

Gov. Newsom, for his part, has signaled that he intends to call for restructuring California’s cannabis tax system, and we can expect to see his proposal from him when he released his May Revision budget later this month.

TRIBAL COALITION LAUNCHES ADS AGAINST SPORTS BETTING MEASURE

Californians for Tribal Sovereignty and Safe Gaminga coalition made up of 33 tribal governments, has launched a pair of new television and digital ads, representing a $12 million ad buy to defeat an online sports betting measure which voters will decide on this November.

“These ads will help alert Californians that the promise of money for the homeless is illusory, and the real motive is increasing the corporate profits to send out of California. These out-of-state operators don’t care about California or the promises between Californians and the state’s native tribes,” said spokesman Roger Salazar.

The first 30-second ad is titled “Lottery,” and the second 30-second ad is titled “Loophole.”

The ads blast “out-of-state corporations” like fan duel and Draft Kings for “making big promises to Californians.”

“These guys didn’t write a plan for the homeless, they wrote it for themselves,” says the ad titled Loophole.

QUOTE OF THE DAY

“If men could get pregnant, this wouldn’t even be a conversation. This decision isn’t about strengthening families — it’s about extremism. It’s about control. We will fight for the right to choose.”

– Gov. Gavin Newsom, via Twitter.

Best of The Bee:

  • Think housing is already difficult to afford in California? Thanks to the Federal Reserve’s interest rate hike Wednesday, it could get even tougher, via David Lightman.

  • Credit card interest rates will go up. Home buyers will pay more each month for their mortgages. And there’s more increases to come as the year goes on, via David Lightman and hanh truong.

  • Immediately following a report that the United States Supreme Court justices would overturn Roe v. Wade, Gov. Gavin Newsom and other California leaders announced that they would work on putting the right to an abortion in the state Constitution. But California has been bracing for the Supreme Court to dump the 1973 precedent long before Politico published the leaked draft, via Gillian Brasil.

Andrew Sheeler covers California’s unique political climate for the Sacramento Bee. He has covered crime and politics from Interior Alaska to North Dakota’s oil patch to the rugged coast of southern Oregon. I have attended the University of Alaska Fairbanks.

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