SNEAK PEEK:

• NYUStern adjunct professor Drew Hinkes says SB1887 is stirring blockchain turmoil.
• Drew Hinkes says the bill’s goal is to protect users in Illinois.
• Drew thinks the court may have to defend impossibility claims and appeal fines.

Drew Hinkes, an adjunct professor at NYUStern, tweeted on February 19 that Illinois Senate Bill SB1887 has raised a lot of controversy in the blockchain world. He noted that the bill would drive miners, validators, and operators of blockchain nodes out of the state. 

#Illinois Senate Bill SB1887 would drive out #blockchain #node operators, #miners, and #validators, waste judicial resources, and confuse existing law in a quixotic attempt to protect Illinois consumers. Let’s examine the mess in a #thread:

— Drew Hinkes (@propelforward) February 19, 2023

As a result, it causes uncertainty regarding current laws and wastes precious resources. According to Drew Hinkes, the bill aims to safeguard Illinois consumers. However, it is structured in such a way that it may force node operators, miners, and validators to do impossible things or even create new criminal and civil obligations with the threat of fines.

For instance, the bill would require blockchain node operators, miners, and validators to obtain a license from the state. Unfortunately, this license would come with a hefty fee and a number of burdensome regulations, making it difficult for many to continue operating in Illinois.

Additionally, the Illinois SB1887 asserts that upon a petition by the Attorney General or a state’s attorney, the court shall levy a forfeiture of between $5,000 and $10,000 for each day that the blockchain network disregards the order.

The bill also permits service on a blockchain network by leaving a copy of the pleading, paper, filing, or order with a miner, validator, or node operator who has participated in the blockchain network after the act’s effective date.

In conclusion, the Senate bill has raised concerns among the tech community, as it could lead to legal battles and added enforcement complexities. 

Drew Hinkes thinks that courts may need to argue impossibility claims and face appeals of fines, which could result in miners leaving the state. Other states may also challenge the service law, and constitutional issues may arise during litigation.

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• Source: https://investorbites.com/illinois-senate-bill-sb1887-a-misguided-attempt-to-regulate-crypto/