So a very important Bill (at least to me being a Wyomingite) has been proposed on Digital Currencies here in Wyoming. I will post the links. But I have not been able to use Coinbase and other exchanges because of current Wyoming law. I have been asked to testify on behalf of the bill and I am looking for feedback on my speech. PLEASE be completely honest with what areas may need improvement, or wording that could be changed, or area's to emphasis. I only have 5 min. So below is my speech. I am spending the weekend practicing and looking here for corrections. So please if you have a moment look though my speech and leave some criticism, as well as any questions that bankers or legislators may throw at me, with good answers if you have them.. I just got the go ahead yesterday so sorry for the short notice. Thank you!!
Hopefully one of those works.
My name is Christopher Haefner, and I am here to testify on behalf of House Bill 26 which would amend a portion of the Wyoming Transmitter Act to include Digital Currencies as a permissive investment. (I will mostly refer to Bitcoin, one of many digital currencies, but probably is the most prominent and well known digital currencies, with the largest corporate backing)
First and foremost, if you are like most people, you have only a vague idea or more likely no clue what digital currencies such as Bitcoin even are. Bitcoin is a decentralized digital currency which can be sent directly from person to person without going through a bank or clearing house via the internet. So fees are lower and, your account (wallet) can never be frozen. I consider it to be a digital stand in for cash or gold. I will come back to this in a minute. There are several large exchanges that can exchange your countries currency to bitcoin and vice versa via that company’s website. Your bitcoins/digital currencies are kept in a downloadable wallet you can keep on your computer or phone. Bitcoin does not need centralized backing because of many volunteers who help run the bitcoin network, this is why it is a decentralized system. The bitcoin network is secured by these individuals from all around the world. They use their computers to keep track of as well as verify bitcoin transactions. All bitcoin transactions are then listed on an online open ledger everyone can see. Every single bitcoin transaction shows up on this public ledger. It is 100% transparent. People who volunteer their computing power to the network (known as miners) are rewarded with a very small amount of newly generated bitcoins. The reward amount is based off the amount of computing power you as a bitcoin miner can supply to the network to check the transactions. This reward is diminishing in order to prevent inflation in of the currency’s value. Every 4 years the reward is halved. You do not have to be a bitcoin miner, or donate any time or energy to the network, in order to use bitcoin, most people don’t. Bitcoins are as easy to use as a debit card, and can be spent where merchants accept them. However, they can also be bought and sold like gold or a stock (buy low sell high, make money) because the price of bitcoin varies from week to week based on current market trends. As of today one single Bitcoin is $381.60. Again Bitcoin is not the only digital currency, there are many.
Now that we have the basics of what digital currency is, I’d like to tell you a little about myself, before I explain why I think this bill should pass. Everyone here is working today to make Wyomingites lives better through legislation, so here is my history as a Wyoming native. I was born and raised 45 miles away in Laramie WY. My mom was born and grew up in Laramie, and my dad was born in Iowa city. He came here from Iowa to teach at the University of Wyoming. I had a great childhood, I was the oldest of 3 brothers. My mom stayed at home to raise us while dad worked at the University as well as a general carpenter on the side. Both of my parents worked very hard to give us everything we needed in life.
Technology and computers have been a fairly recent endeavor for me. During my teenage years I kept my grades just high enough to compete on the high school rodeo team. A lot of my summers were spent crammed in a van, headed to a rodeo, practice pen, or any place I could ride bulls. When I started college, rodeo started to end for me as a competitor. (pause) Mom and dad weren’t as willing to help pay an entry fee after they helped me with tuition and books. I started college in Torrington at EWC undeclared, I then moved to Casper and completed a degree I very much loved in fire science technology, as well as earned my Emergency Medical Technician certificate. I then spent several years working at multiple Ambulance Services in Wy (Rocksprings, Rawlins and Cheyenne) I also spent 3 summer seasons working as a wildland firefighter. The little time I had off from all of that I spent assisting the LCCC-Albany County Campus EMT instructor in teaching future EMTs. I loved it all, but I began to realize I would not physically or mentally be able to do these jobs to the very best of my ability up until I could retire. This brings me about to where I am now. I was lucky enough to marry my beautiful wife and best friend in August, as well as go back to school, majoring in the same department my dad used to teach in. In May I will be an internship away from graduating with my B.S. in Kinesology and Health promotion. I do not have a set plan after that as of yet, but it very well might be going on into a professional or doctoral program, but no matter what healthcare is my passion.
I ran into digital currencies while being a fulltime student in my early 20’s. I was living a normal college student life…. Broke, Sleep Deprived, and doing any odd job to make $10. I thought I hit a gold mine when I found a way to have my computer make money mining Bitcoins! Well that is far from what I got, but I did find a new passion which I enjoyed learning about. The backbone of the bitcoin network is called the Blockchain. This is what keeps people from simply copying and pasting coins (printing their own money) and using them over and over, and is how miners do their job in verifying transactions. This “Blockchain” is an open source program anyone can look at, as well as use, if they know it exists. Projects have already began using the technology for identification purposes, trading ownership of online products, as well as making voting easier for people without making it more susceptible to fraud. These items could really help keep American innovation in technology near the top in comparison to other countries.
Personally, I have dedicated time and spent plenty of money on special computers designed specifically to verify those bitcoin transactions I was speaking of earlier (mining) keeping the bitcoin network going. I do love doing it, I do like the reward I get…. sometimes. But this is not solely why I am involved. As an example, these machines use power to run, so this must be taken into account when mining. The newer and more advanced machine you have, the more transactions you can complete with better power use to work ratio. As an example when Bitcoin prices were higher ($800 range per coin) I could make $0.35 a day. In 2014 when it was $180.00 I was actually losing $0.18 a day. However, this doesn’t really bother me. I personally have been investing in Bitcoin as a digital stand in for gold. I mine and hold the bitcoin earnings I have and sell when prices are high. But within the last year I have encountered a huge barrier because of the current Wyoming law. You see the company I used to sell Bitcoins. Coinbase (Probably the largest Bitcoin Exchange), along with other exchanges, have stopped doing business with Wyoming. These major Digital currency exchanges take state laws on digital currencies very seriously. They are working very hard to make digital currencies into a legitimate companion/alternative payment system both buyers and merchants can use. In fact, Coinbase offers a free program for merchants so they can begin to accept Bitcoin with very little effort and it is a free program. Coinbase developed an insurance plan that would recover any lost or stolen coins that were in their online wallet, if something unexpected happened. The newest program I have heard of is an account they have put together where you can deposit Bitcoin and allow it to accumulate interest! Something I would absolutely love to be a part of. However, this program with countless others require the free membership with Coinbase which as of July 2014 has ceased operations in Wyoming because of the current law. As other exchanges try to compete with Coinbase, they employ the same types of rules to legitimize their company. Most recently a company call Glidera (similar to Coinbase) has informed me that they are ceasing operations with Wyoming clients indefinitely because of the current laws. As these companies compete more and more of them will stop business with Wyoming. As of right now if I chose to sell there is one exchange company based out of Australia (Circle) that will currently do business with Wyoming, however I think it is only a matter of time before they leave to. While I would still be able to go to Denver and buy goods from a handful of merchants that accept bitcoin, my main goal of saving and selling wouldn’t be able to continue unless I moved to another state, and essentially Wyoming would keep established Bitcoin companies from doing business in the state as well as killing any home grown Wyoming startups before they began.
So in conclusion, please vote to pass HB 26. This will allow these larger business to come back in and work with Wyomingites that chose to use them, as well as allow the growth of new Blockchain use ideas, as well as new bitcoin related business in the state. Thank you. I am open for questions.