South Dakota governor Kristi Noem has formally rejected legislation that would have excluded bitcoin (BTC) and other cryptocurrencies from the definition of money.
Bill excluded crypto but classified CBDCs as money
The legislation, known as House Bill 1193, was intended to amend provisions of South Dakota’s Uniform Commercial Code to exclude digital assets from being defined as “money” in the state.
Explaining why she vetoed the bill, gov. Noem said that explicitly excluding crypto as money would make it difficult for South Dakota residents to use their crypto holdings and put them at a disadvantage when trading with people in other states.
Gov. Noem also stated that the definition of money in HB 1193 could create a loophole for the federal government to adopt central bank digital currencies (CBDCs) and make them the only viable forms of digital money.
Republican Mike Stevens introduced the 117-page bill in the state’s House of Representatives, which passed it earlier this month. It defines money as a possible medium of exchange only if it is “authorized or adopted” by a government.
The bill’s wording means that bitcoin (BTC) and other privately created digital currencies are not money, but government-controlled CBDCs such as the Chinese Digital Yuan are.
Bill attracted heavy criticism
Critics believed the bill would make it so that only governments could create “money,” therefore legalizing CBDCs while outlawing all other digital assets.
According to Dennis Porter, CEO and co-founder of Satoshi Action Fund, the same bill is being pushed in 21 different states across the U.S. He insinuated HB 1193 was part of a wider plan to assemble a coalition of pro-CBDC states that exclude digital assets like bitcoin from the definition of money.
Andy Roth, chair of the State Freedom Caucus Network, shared similar sentiments. He claimed that if gov. Noem had approved the bill, it would have paved the way for government-controlled CBDCs while prohibiting decentralized digital currencies such as bitcoin as payment.
Other critics of the bill included Club for Growth’s David McIntosh, who wrote a letter to gov. Noem urging her to veto HB 1193.
In his letter, McIntosh described the bill as an attack on individual liberty and national security. He also claimed it would stifle the free market and hinder innovation in the U.S.