Virginia in the United States Introduces Legislation Safeguarding Rights for Digital Assets Mining
Mitchell Nixon
The Virginia State Senate has introduced a bill outlining regulations for digital asset mining and transactions, including their tax treatment.
Senator Saddam Azlan Salim, aged 34 and the youngest member of the legislative body, proposed Senate Bill No. 339 on Jan. 9. Currently under Senate discussion, if approved, it will move to the House of Delegates for consideration before becoming law.
The bill offers exemptions for individuals and businesses involved in digital mining, waiving the requirement for money transmitter licences. It also safeguards miners by preventing discrimination, barring industrial zones from prohibiting or imposing stricter noise regulations on digital asset mining.
“No licence under this chapter shall be required of any person engaging in home digital asset 37 mining, digital asset mining, or digital asset mining business activities, as those terms are defined in § 38 15.2-2288.9.”
Furthermore, the law provides exemptions for issuers and sellers of digital assets from securities registration obligations, provided specific conditions are met, such as the digital asset not qualifying as an investment contract:
“An issuer or seller of a digital asset shall be exempt from the securities registration requirements of this chapter if (i) the digital asset cannot be considered an investment contract, (ii) the issuer or seller of the digital asset did not market the digital asset to the initial buyer as a financial investment, and (iii) the issuer or seller of the digital asset takes other reasonable precautions to prevent an initial buyer from purchasing the digital asset as a financial investment.”
Companies providing mining or staking services fall outside the scope of a “financial investment” as per the bill. Nonetheless, they are required to submit a notice to be eligible for this exemption.
Moreover, the law encourages the adoption of cryptocurrencies in day-to-day transactions by providing tax advantages. From Jan. 1, 2024, individuals have the option to exclude up to $200 per transaction from their net capital gains for tax calculations. This exclusion pertains to gains resulting from utilising digital assets for buying goods or services.