A house panel is approving a bill that Gov. Kristi Noem vetoed last year.
The bill updates state laws covering digital currency and electronic transactions. The new version directly addresses the governor’s concerns and her office now supports the legislation.
Republican Gov. Noem vetoed the previous legislation citing concerns about its effects on cryptocurrency.
House lawmakers failed to override the veto last year, sharing concerns about federalized digital currency.
Proponents say updates to the uniform commercial code are necessary for modern transactions—many of which are electronic—whether money transfers or paperwork.
Karl Adam, president of the South Dakota Bankers Association, said the updates help keep the state competitive.
“So that we’re not disadvantaged when it comes to interstate commerce, which is very important” Adam said. “The legal framework when we transact businesses for services or goods - I think the pause button was, obviously, necessary last year. But we think that we’re in a good spot this year to advance this measure.”
The fight over the uniform commercial code is not over. Some lawmakers support a measure that repeals certain provisions. Supporters of the commercial code oppose the move, saying uniformity is necessary for commerce across state lines.
The house panel also supports a bill that prohibits businesses from only accepting federally backed digital currencies. The bill prohibits the state from accepting digital currencies created by a central bank.
“In God we trust, but all others pay cash," said Nathan Sanderson, president of South Dakota Retailers. He said the bill reinforces the state’s opposition to central bank digital currencies.
“The idea behind it is to make sure that there’s no exclusivity with one singular kind of digital currency, whether created in the United States or elsewhere.”
If and when the federal government issues a central bank digital currency, the state would be required to recognize the money.
