Delaware Assembly Passes "Historic" Law Legalizing Blockchain-Based Stock Trades

The State of Delaware just took a historic step toward ensuring that US stock exchanges will soon be violently disrupted by blockchain technology - possibly to the extent of being rendered obsolete. CoinDesk reports that lawmakers in the state’s general assembly passed a law that makes explicit the right to trade stocks on a blockchain. Details of the bill are still emerging. One source indicated that the bill passed with near unanimity, with a single vote against. The vote was widely considered to be the final obstacle to state adoption, following the passage of the bill in the Senate earlier this month. The measure, which was added to another bill in the form of an amendment, is expected to be signed in to law by Delaware Gov. John Carney by the end of the month, with the ruling going into effect on Aug. 1.

Developed under the close guidance of blockchain lawyer Marco Santori of Cooley LLP and Caitlin Long of blockchain startup Symbiont, the bill is expected to pave the way for potentially large-scale issuance of stock on a blockchain. By trading stock on a blockchain or similar distributed ledgers, users can cut out middlemen like the exchanges and ATSs that profit by facilitating trades, resulting in significantly faster settlement times. The bill was introduced last year by the previous governor, Jack Markell, following requests made by multiple companies for the legislation – which was already lenient to blockchain stocks – to make explicit the legality of such issuances, according to CoinDesk's sources.

“This is big for Delaware,” Symbiont's Long told CoinDesk, further explaining the potential benefits of the amendments:”

Chair of the corporate law section of the Delaware bar association, Matthew O'Toole, told CoinDesk he expects the state's governor, John Carney, to sign the bill into law by the end of July, with an effective date of 1st August.

In an email to CoinDesk, O'Toole said the vote "keeps Delaware at the forefront of corporate law and in the lead in terms of enabling the use of 'distributed ledger shares'." He added: "We look forward to helping Delaware corporations enjoy the benefits of this innovative new amalgamation of law and technology."

Blockchain-based trading systems are inching closer to becoming a reality. Two years ago, Nasdaq OMX Group said it would use blockchain technology to power trading in shares of privately held companies on its Nasdaq Private Market platform. The company said at the time that private-share trading was particularly ripe for disruption because of the heavy volume of paperwork involved in recording and settling the transactions. Assuming Carney signs the bill, like CoinDesk expects, the measure should pave the way for US companies – many of which are legally based in the state – to begin listing shares on blockchain-based distributed ledgers. One source told CD that the bill "keeps Delaware at the forefront of corporate law and in the lead in terms of enabling the use of 'distributed ledger shares'."


cherry picker Sun, 07/02/2017 - 18:29 Permalink

Why not a 'historic' law that takes government tax collectors and regulators out of the mix.Tired of all those politicians who couldn't hold down a real job regulating and stealing us blind.

aurum4040 5000yl Sun, 07/02/2017 - 19:12 Permalink

Well other than the 4000% run since beginning of the year, I think we figured out why Ether crashed last week - crush the week hands, double up position, and let it fly. For those who said cryptos and specifically Ether is just another fiat with no instrinic value - does your feeble mind understand yet? And trading systems are just the tip of the iceberg .  Guess which crypto is going to benefit most out of this? Well, the one thats backed by JP Morgan, UBS, BNY and 217 other companies of course. Great day for Ether and blockchain enthusiasts. 

In reply to by 5000yl

any_mouse Give us Stirli… Sun, 07/02/2017 - 19:09 Permalink

You do not understand the nature of human systems of self preservation and the sociopaths that run the system.

Only Chaos and Collapse are inevitable in this Universe.

The Governments will not go peacefully. No law would ever be passed that removes Power from the Government and hands Rights and Power back to the People.

USA started with Rights of The People as foremost. The States were lower and had Rights. The Federal government only had a few Duties to The People and The States, no Rights were ascribed to the Federal level.

Complete Reversal of Sovereignty.

Happened slowly at first, then all at once.

In reply to by Give us Stirli…

tmosley any_mouse Sun, 07/02/2017 - 19:33 Permalink

You don't understand. Government is the dinosaur. Blockchain is the meteor. Artificial General Intelligence (AGI) is the second meteor because fuck you that's why.When their money is worth nothing, no-one will bother to work for the government. Jackboots cost money. While they might be able to extract money from some people, the second meteor, AGI makes that money largely moot because an infinite workforce drives the cost of all goods and services to zero. When everyone has everything they could ever want, no-one wants to do their boring government job. Everyone just walks away.

In reply to by any_mouse

DjangoCat tmosley Sun, 07/02/2017 - 19:50 Permalink

On the otherhand, the AI is, or should be, opensource.  Everyone can read and undertand the code.  No secrets, no false flags.  If you don't like one version, you can launch a better one.  All it takes is significant acceptance by the populace.  Keep the powerful forces, banks, corporates, governments, out of the process.  Bitcoin is the pure, clean, first mover on this space.

In reply to by tmosley

Sudden Debt Sun, 07/02/2017 - 18:32 Permalink

That already exists for a long time.... it's like you buy stocks from the blackrock fund.You can buy for 1000 dollars for example and you get 0,8 stocks.This is just a way to let people buy overinflated stocks so they can go even higher...this has nothing to do with crypto's as most idiots here will think ;)

Scrimpy (not verified) grunk Sun, 07/02/2017 - 19:36 Permalink

The DEM dominated GA will pass any law to increase revenue to their slush fund. Delaware is one of the most corrupt states in America, and that is a feat in itself. The main "news"paper is a jew run propaganda outlet called the "News" Urinal. It's a Gannett Propaganda Publication, just like Joo Ess Aye Today.

In reply to by grunk

Sudden Debt aloha_snakbar Sun, 07/02/2017 - 18:35 Permalink

bitcoin has nothing to do with this. maybe a bit... it shows that coindesk is working together with the authorities!!And as EVERY BITCOIN owner didn't report their profits to the taxman... they should be scared shitless.This deal that coindesk has made is a switch. If they would destroy bitcoin in America, they would lose their'll sell out the bitcoin owners and get a new biz in return. 

In reply to by aloha_snakbar

any_mouse Sun, 07/02/2017 - 18:34 Permalink

The law was written with help of a blockchain lawyer and a blockchain startup.

The bill passed by reps who, for the most part, do not understand blockchain.