The domestic insurance companies in Wyoming, a US state have received a massive boost as following an insurance code, they can now the investment in bitcoin and other digital assets. The amendment comes into effect on 1st July, after the passing of amendment last month, according to the state’s legislative branch.
Digital assets definition in the Wyoming law is “a representation of economic, proprietary or access rights that are stored in a computer-readable format, and includes digital consumer assets, digital securities and virtual currency,” The new law states that the insurance companies now have the prerogative to invest in digital assets, which are primarily used for personal purposes or household.
While this news is a breakthrough and a first of its kind, it remains to be seen how the insurance company responds to it, according to Kramer, the US law firm.
The uncertainty is due to the nature of the insurance companies who are typically conservative in nature and save their investment for bonds and mortgages. What might tempts these companies is the benefit of noncorrelation to macroeconomic risk. There are some vague elements as the new law does not address topics of liquidity risk and valuation.
The CEO of Crypto Bank Avanti, based in Wyoming, Caitlyn Long has stated that she sees insurance company offering digital assets policies on variable short term basis rather than life long since she is of the view that the (National Association of Insurance Commissioners) capital charge would not be low.
Wyoming Leads The Way When it Comes to Digital Assets
Wyoming leads the way when it comes to digital assets and blockchain and has passed multiple laws in the last two years to help adoption and development. They have imposed favourable taxes on cryptocurrency and have recognized it as a legal source of money, making it one of the most progressive states in the US when it comes to the crypto world.
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