Blockchain Testimony on LB691 at the Nebraska Legislature
Recently, Kyle Tut testified in front of the Nebraska Legislature's Judiciary Committee on LB691. That testimony presented in front of the committee is provided below.
Chairwoman Ebke, members of the Judiciary Committee, for the record my name is Kyle Tautenhan (K-Y-L-E T-A-U-T-E-N-H-A-N). I am the founder of BlockEra, a company that provides blockchain consultation in the financial and agricultural sectors. I am here today in opposition to LB 691.
I have traveled nationally and internationally to compete in blockchain hackathon competitions and attend blockchain conferences to understand this technology at a deeper level.
My experience around blockchain technology in Nebraska includes consulting for large financial companies in Omaha and partnering with a farmers in Gothenburg to build a virtual currency and smart contract system to facilitate crop production contracts between farmer and buyer.
I oppose this bill speaking from a technical perspective because we are too early in blockchain technology’s lifecycle to be creating laws and defining technical terms as Senator Blood has in this bill.
We are currently in 1994 of the internet for blockchain technology. We don’t know where blockchain will go and proposing any bill today would be similar to proposing bills in 1994 defining that all internet communications would only be in the form of email.
This bill attempts to do just that by defining distributed ledger technology. This bill fails to consider that not all distributed ledger technology is created equal. Unlike public blockchains, private blockchains can be centrally maintained and controlled by a single party to unilaterally alter data.
The bill goes on to say that virtual currency means a medium of exchange in electronic or digital format, including distributed ledger technology, which is not a coin or currency of the United States or another country.
It also says that all persons engaged in a trade or business who receive more than ten thousand dollars in virtual currency must complete and file with the Department of Revenue.
Unfortunately, these definitions fail to consider that virtual currency or, more specifically, tokens can represent ANYTHING. This can mean traditional tangible assets like currency and corn. Or, very abstract forms of value like intellectual property or attention. Tokens can even represent NO VALUE at all. Additionally, there will be token concepts and applications we haven't thought of or discovered yet. Put simply, defining virtual currency today is trying to accurately predict the future.
Thank you for allowing me to testify today. I would be happy to answer any questions you might have.