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The 88th Legislative Session of the Texas State Government will end on May 29 without any decisions being made on some bills that affect aspects of the digital asset space.
According to Texas legislative documents, lawmakers submitted Senate Bill 1751 to the State Affairs Committee on April 24 after passing in the state Senate. The law aims to amend sections of the Texas utility and tax code to add restrictions on companies involved in cryptocurrency mining, drawing criticism from digital asset advocates. At the time of publication, there were no motions on SB 1751, so it is unlikely that lawmakers will be able to consider the bill before its next regular session, which begins in January 2025 – the Legislative Assembly meets every two years.
Under the proposed legislation, cryptocurrency mining companies participating in the program, designed to compensate them for reducing the load on the Texas power grid, will be limited to 10% incentives. Without changes to the bill, crypto companies will likely be able to continue to receive some benefits from operating in Texas.
While SB 1751 may be in limbo, two other cryptocurrency-related bills have already passed both houses of the Texas Legislature and are awaiting approval or veto by Gov. Greg Abbott. In Texas, bills that pass through the Legislature and reach Abbott’s desk automatically become law unless the governor actively vetoes them.
On May 15, Texas House Bill 1666 was passed by the State Senate. The legislation, the Reserve Confirmation Bill, sought to require exchanges to maintain reserves “sufficient to meet all obligations to customers” and report to the Texas Banking Department regarding their obligations. Lawmakers also passed House Bill 591 on May 10, a law allowing Bitcoin (BTC) miners in Texas to use flare gas emissions as part of an effort to sustain their operations.
BREAKING: Texas Legislature passes HB 591! it clarifies that formerly flared or vented gas can be sold to on-site mobile data centers.
This will be off-grid #bitcoin miners reducing the carbon impact by 63%!
Thanks to @B_whitehead21, @petromundo1 for your help! pic.twitter.com/9ac0tx7EaR
— Lee ₿ratcher (@lee_bratcher) May 10, 2023
Both bills are pending tacit or positive approval or veto by Abbott. Under Texas law, Abbott usually has a 10-day window to veto a bill he opposes, but that window is extended to 20 days for bills sent to his desk within 10 days of the end of a regular session. This suggests that HB 591 may already be de facto state law, while Abbott has until mid-June to take action on HB 1666.
The Texas governor has previously described himself as a “backer of the cryptocurrency bill” but has not suggested what he would do about the recent legislation. The Memorial Day holiday could also extend the time limit, giving Abbott the opportunity to sign two bills into law in the affirmative.
Related: Texas Lawmakers Propose Gold-Backed State Digital Currency
Many mining companies operate in Texas, drawing federal criticism from anti-cryptocurrency lawmakers over energy and environmental concerns. State legislators have also advanced legislation to amend the Texas Bill of Rights to secure the right of residents to own, hold, and use digital currencies. The bill was submitted to the Senate Business and Commerce Committee on May 11.