NH House Holds Public Hearing on Cryptocurrency

The New Hampshire General Court has begun its new legislative session in earnest as the first virtual public hearing focused on banking related matters took place yesterday. Of interest to credit unions were three legislative proposals relating to digital assets and cryptocurrency under consideration by the House Commerce and Consumer Affairs Committee led by Chairman John Hunt (Rindge). Ron McLean, Association President/CEO, offered written comments to assist, if and when, the proposals advance and become enacted:

•         HB 1502-FN: Establishes a needed framework and new chapter, RSA 397-C, for the delivery of financial services using digital currencies to ensure that consumers are protected similar to if they received financial services from a financial institution by including provisions governing collateralization, perfection of security interests and regulation under Article 9 of the Uniform Commercial Code;

•         HB 1502-FN: Mitigates the unique risks of cryptocurrencies through traditional means such as multi-factor authentication and limits on financial institution liability generally for the exercise of reasonable care; and

•         HB 1504-FN: Establishes a new Chapter, RSA 383-F, creating a special purpose depository institution and importantly segregates the application fee credited to its subaccount as a separate account from the financial institutions’ administration account.

Without question, providing a state framework authorizing local financial institutions to adopt cryptocurrency services can help credit unions engage and serve New Hampshire consumers while harnessing new technological developments. Most importantly, the Association strongly urged the Committee to consider parity amongst local financial institutions in creating a state framework to safely make cryptocurrency available to the residents of the Granite State.

During the public hearing, a significant amount of time was spent on educating the committee members about cryptocurrencies, discussing differences in how other states regulate in this area, and estimating the funding needed to create and staff a new regulatory office with the necessary expertise. Chairman Hunt scheduled a work session on January 26th for stakeholders to mark-up the bills. 

The Association’s public statement may be found HERE.