California governor signs bill to bring bitcoin and other currency into fold

LOS ANGELES Sat Jun 28, 2014 10:41pm EDT

California Governor Jerry Brown announces emergency drought legislation at the CalO ES State Operations Center in Mather, California, February 19, 2014. REUTERS/Max Whittaker

California Governor Jerry Brown announces emergency drought legislation at the CalO ES State Operations Center in Mather, California, February 19, 2014.

Credit: Reuters/Max Whittaker

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LOS ANGELES (Reuters) - California Governor Jerry Brown on Saturday signed into law a bill that clears away possible state-level obstacles to alternative currencies such as bitcoin.

The legislation repeals what backers said was an outdated California law prohibiting commerce using anything but U.S. currency.

Democratic Assemblyman Roger Dickinson, the bill's author, said earlier this week the bill reflects the popularity of forms of payment already in use in California like bitcoin and that even rewards points from businesses, such as Starbucks Stars, could technically be considered illegal without an update to currency law in the nation's most populous state.

California lawmakers approved the measure on Monday, just days after the failed Tokyo-based bitcoin exchange Mt. Gox received court approval to begin bankruptcy proceedings in the United States as it awaits approval of a settlement with U.S. customers and a sale of its business.

Mt. Gox was once the world's leading exchange for trading the digital currency, but shut its website earlier this year after saying that in a hacking attack it lost some 850,000 bitcoins, worth more than $500 million at current prices. The firm later said it found 200,000 bitcoins.

Brown, a Democrat, in his office's written announcement did not comment on the currency bill he had signed into law along with other legislation.

An analysis of the bill prepared for lawmakers mentions "community currencies", which are created by members of a local area along with participating merchants and are sometimes designed as a protest of U.S. monetary policies, among the forms of alternative payment methods now in use in certain parts of the United States.

The U.S. Marshals Service on Friday auctioned off about 30,000 bitcoins seized during a raid on Silk Road, an Internet black-market bazaar where authorities say illegal drugs and other goods could be bought.

(Reporting by Alex Dobuzinskis; Editing by Jeremy Laurence)

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Comments (4)
Kahnie wrote:
He IS “Governor Moonbeam.” Can take the Governor away from the moon, but the moonbeam is still in the governor. That and allowing restaurant workers who serve food in the kitchen not wear gloves are two laws signed that tell us California is still the land of fruit and nuts. (All apologies to the late Arte Samish).

Jun 28, 2014 10:59pm EDT  --  Report as abuse
xyz2055 wrote:
This ought to be fun! Any bets that someone tries to pay their taxes in Monopoly money next year?

Jun 29, 2014 8:10am EDT  --  Report as abuse
And in other news today, Governor Brown announced that the state of California was reviving Enron Corporation to fix delivery problems and resource allocations of the California energy market…

Jun 29, 2014 12:09am EDT  --  Report as abuse
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