Assemblyman Mukherji (D-Hudson), and Assemblyman Gordon Johnson (D-Bergen) are proposing for Bitcoin regulation. The 30-page bill (A4478) would create a regulatory framework for the companies that deal in digital currency and offer taxes breaks to companies that service or exchange it.
Assemblyman Mukherji (D-Hudson), who introduced the measure, admitted that he wants to encourage innovation here in New Jersey. He thinks there’s an opportunity for job creation as well in the entire digital currency ecosystem. Interestingly, companies that work with digital currency tend to oppose stricter regulation like the plan put forward in New York.
However, a lot of people who have been observing the BitLicense proposed by Ben Lawsky and the one that is being proposed by the two lawmakers in North Jersey believe that the latter is drafted better. They are pushing for the type of regulation contained in the New Jersey legislation, dubbed the “Digital Currency Jobs Creation Act.”
The one proposed by the North Jersey legislators is friendlier to the industry than the one that was proposed by Ben Lawsky. The bill would prohibit municipalities from putting their own regulations or taxes on digital currency. At the same time the companies who deal in the industry would have to register with the state Department of Banking of Insurance.
The business plan, registration fee, etc. will be set by the commissioner, and fingerprints and photographs of “key members” of the organization, among other things would also be taken care of. Looks like, the legislators want Bitcoin ecosystem to have some order, something concrete that not just gives cyber security but also ensures some norms are followed.
The Bill Incentivizes Job Promoting Bitcoin Companies
If the bill is passed, the companies would be required to establish and maintain an effective cyber security program and designate an employee as a chief information security officer to oversee it. The bill says that they would be required to keep records of their activity for at least five years.
The bill not just talks about regulation but also about incentives as well. The incentives are aimed at drawing the companies into New Jersey. For instance, companies that create at least 10 jobs would get favorable treatment under the state’s tax credit program, qualifying for up to $5,000 for each new job they create in addition to the base tax credit they qualify for.
Similarly, the companies which often use energy-consuming computer equipment would be exempt from paying taxes on money they spent on electricity.
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