Wyoming is Pushing for Crypto Payments, Trying to Beat the Fed to a Digital Dollar
![Wyoming is Pushing for Crypto Payments, Trying to Beat the Fed to a Digital Dollar](https://news7g.com/wp-content/uploads/2024/08/107427634-1718177122629-gettyimages-1236479139-SPAIN_MERCADONA-780x470.jpeg)
Gone are the days when venture capital poured into fintech startups with bold ideas — and little information about business metrics and fundamentals.
Bloomberg | Getty Images
As cryptocurrency investing becomes more mainstream and institutionalized through bitcoin ETFs, Wyoming is fueling the next phase of growth for cryptocurrencies: consumer payments.
The state is creating its own U.S. dollar-backed stablecoin, called the Wyoming Stable Token, which is expected to launch in the first quarter of 2025 to provide individuals and businesses with a faster and cheaper way to transact while also generating a new source of revenue for the state. The team behind the project hopes it can serve as a model for a digital dollar at the federal level.
Success would be “adopting a stablecoin… transparent, fully backed by our short-term Treasury [and] “It depends on the dollar,” Wyoming Governor Mark Gordon told CNBC at the Wyoming Blockchain Symposium in Jackson Hole. “One of the things that’s important to me is being able to bring a large portion of our debt back onshore, because if it’s purchased with Treasuries and backed by the Treasury, that helps stabilize that market to some extent.”
“It’s clear to me that digital assets have a future,” Gordon said. “The United States has to address this. Washington is a little conservative, which is why Wyoming, a nimble and entrepreneurial state, can make a difference.”
![Wyoming Hopes to Beat the Fed to a Digital Dollar](https://image.cnbcfm.com/api/v1/image/108023030-17241783671724178364-35915490312-1080pnbcnews.jpg?v=1724178366&w=750&h=422&vtcrop=y)
The Cowboy State is no newcomer to pushing the boundaries of business law. It created the LLC in 1977 and has passed more than 30 pieces of cryptocurrency legislation to create a favorable regulatory environment for businesses and investors since 2018.
The project’s development is taking place at a time when many cryptocurrency market participants are wondering what will happen next. Bitcoin ETF Available to US Investors in January It was a huge feat. It was the result of more than 10 years of industry effort, and it sent prices to new records this year. But while the market has remained bullish, trading has been limited for months.
Additionally, cryptocurrencies and their underlying blockchain technology were always intended to be used for more than just price speculation. Consumer payments, in many cases via stablecoins, are widely seen as the killer app for cryptocurrencies and the gateway to real-world adoption of the technology.
Vision
Wyoming is currently vetting potential partners and providers with more technological expertise to help build a stable token. An exchange and wallet provider will be needed – Cryptocurrency and Kraken, for example, offer both — for buying and holding tokens. The state plans to issue tokens to an exchange so that the exchange can issue them to retail users. From there, it will just be another payment method for everyday things, said Flavia Naves, a commissioner at the Wyoming Stable Token Commission.
“When you walk into Cowboy Coffee in Jackson, Wyoming and want to buy a latte, you’ll have a wallet in Solana that you can use to buy coffee with Wyoming tokens,” she shared when describing her vision for the stablecoin.
It also has a public interest bias: the committee plans to invest the reserves backing each circulating token into Treasuries and reverse repurchase agreements, and use the returns from those investments to fund public schools.
At the conference, Gordon stressed the importance of resisting the urge to focus too much on how much money the state can make here and instead prioritizing reserve management.
Keep the balance
Stablecoins are supposed to be valued at par with an underlying asset, usually the US dollar, but they can and have deviated from their pegged price due to spikes or drops in demand — especially when there is a lack of liquidity — poor collateral, regulatory crackdowns or network congestion.
Naves stressed that there would be a “buffer” in the reserve to account for any potential discrepancies and full transparency to establish and maintain public trust.
“There will be public audits of the number of tokens [are] in circulation [and] how much money is in the supported bank account, so you can always see there is a 1-1 ratio [stablecoin-to-dollar ratio]“This is also a public token so like any public service, all the information is available.”
The Commission invites the public to attend online meetings on stable tokens and posts the minutes to website Later.
“This is completely reserved and part of what we’ve done … is to make sure that we can fully back up whatever we’re going to do,” Gordon said. “Plus the fact that our laws say that when someone buys a Treasury or a repo, we’ll have that evidence, you’ll be able to see that. So hopefully we can avoid the de berling issues.”
Digitizing the Dollar – and Beyond
Naves reiterated that Wyoming’s stablecoin is partly a response to Federal Reserve’s reluctance to create one central bank digital currency, or CBDC, at the federal level. According to Atlantic CouncilMore than 30 countries are piloting CBDCs, including a digital euro, and 19 G20 countries are currently in advanced stages of development.
![Organizations Gather in Jackson Hole for Crypto Summit](https://image.cnbcfm.com/api/v1/image/108023589-17242545381724254536-35926852628-1080pnbcnews.jpg?v=1724254537&w=750&h=422&vtcrop=y)
CBDCs have been widely criticized due to concerns around privacy and oversee government-run blockchains. But Naves said that won’t apply here because Wyoming plans to use public blockchains, such as Ethereum or Solana, rather than private networks. The group hasn’t specified exactly which networks it will use but has said it wants the coin to be available on a number of different platforms.
If successful, it could go beyond the dollar range.
“In the future, the goal is to use the same technology… to enable other elements to be tokenized and placed on the blockchain, whether it’s commodities like gold or oil, whether it’s real estate, other government obligations – those things are yet to be determined,” Naves said. “But the success of this initial use case, which is the digitization of the US dollar, is the one that will enable other use cases to follow.”