Texas House of Representatives, operating in the state crypto- voted to pass a new bill that would require exchange platforms to prove they have the reserves to back up their assets.
One blockchain The Texas House of Representatives passed HB1666 on April 20 in an effort to rebuild trust in the industry, according to a new press release by the Digital Chamber of Commerce, advocacy group.
First introduced by State Representative Giovanni Capriglione, the bill applies to crypto exchanges in the state that serve more than 500 customers or have at least $10 million in customer funds.
The bill requires crypto exchange platforms to “hold sufficient reserves to meet all their obligations to digital asset clients.”
It also instructs firms to formulate a plan that would commission crypto exchanges to provide quarterly accounting of assets held in their reserves as well as liabilities owed to customers. In addition, an auditor should be able to access and view the same information provided to clients at any time.
The legislative text also states that crypto-asset service providers may not mix their own funds with client funds, use client funds to secure a transaction other than transactions for clients contributing funds, or hold clients’ funds in such a way that users cannot fully withdraw or deposit their funds by unapproved means.
As Perianne Boring, CEO of the Digital Chamber of Commerce, stated in the press release,
“This legislation represents an important step towards ensuring the stability and security of the digital asset market, and it is very encouraging to see this bill move forward…
The proof of reserve requirement in this bill is exactly what custodians need to demonstrate that they have enough assets to cover all customer deposits.”
According to Legiscan, as we reported as Koinfinans.com, the bill was approved with 148 votes yes, zero no and one abstention. However, the bill must pass the State Senate to become law.