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US: Hawaii Representative Reveals Crypto Holdings of ETH, LTC After Rule Change

Hawaii’s Democratic Representative Tulsi Gabbard has joined the list of U.S. politicians who have invested in cryptocurrency, having disclosed purchases of Litecoin (LTC) and Ethereum (ETH), Bloomberg reports Thursday, August 23.

Citing an income filing from August 14, the publication notes Gabbard purchased between $1,001 and $15,000 worth of the two assets at some point in December 2017.

At the time, both were highly volatile, rising steeply towards the end of the month after Bitcoin (BTC) hit all-time highs around $20,000.

Depending on the exact date of the purchases, Gabbard could have secured ETH and LTC for as little as $444 and $87 or as much as $814 and $344 respectively, according to data from CoinMarketCap.

The value of both has since sunk below the December minimums as part of an overall cryptocurrency market slump which has continued throughout 2018.

In June of this year, the United States Office of Government Ethics (OGE) had announced in a notice that politicians must disclose cryptocurrency holdings in filings as part of “property held… for investment or the production of income.”

According to the new guidance, those that file are “required to identify the name of the virtual currency and, if held through an exchange or platform, the exchange or platform on which it is held,” Cointelegraph quoted.

At the beginning of August, chair of the Judiciary Committee of the U.S. House of Representatives and Congressman Bob Goodlatte had also reported that he owns between $17,000 and $80,000 in digital currency in his annual Financial Disclosure Statement.

Cryptocurrency acceptance meanwhile remains a perennial issue among both current and prospective US politicians, with some candidates announcing their intention to take crypto campaign donations despite the unclear legal framework.

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Hawaiian Bills Would Capture Crypto Under Money Transmission Law

Two bills introduced in the Hawaiian Senate last week are aiming to define and include virtual currencies within domain of the state’s Money Transmitters Act.

If passed, HI SB2853 and HI SB3082 would require those seeking to transmit virtual currencies in the state to have a license to do so. They would also mandate that these persons or businesses issue a warning to consumers prior to enabling such transactions.

However, the legislation notably exempts exchanges from section 489D-8 of the Act, which mandates money transmitters maintain cash reserves equal to the virtual currency funds held for clients. Hawaii’s Division of Financial Institutions previously indicated it planned to leave the requirement intact, prompting U.S. exchange Coinbase to terminate its services in the state.

Still, while including a carve-out, HI SB3082 further features a warning that cautions against the volatility of cryptocurrencies, and emphasizes that they are not backed or insured by any government or commodities.

It reads:

“You should be aware that there is a potential for you as a consumer to lose all of your virtual currency. Though cash can also be lost, with virtual currency this loss can occur because of a computer failure; malicious software attack; an attack, closure or disappearance of a virtual currency exchange company; lack of security; loss of your private key; or a sudden or dramatic change in value.”

Both bills come on the heels of the state’s adoption of the Uniform Regulation of Virtual Currency Businesses Act, a proposed model legislation published in 2017 as a guide for states seeking to enact policies and provisions relating to the technology.

Specifically, the template was drafted by the Uniform Law Commission (ULC), which authors non-partisan legislation to bring clarity to areas where it is wanting in state statutory law.

Map image via Shutterstock.

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