State of Delaware Governor John C. Carney Jr. has officially signed the bill that was introduced and passed last May 4, 2017. The bill turned into law would officially legalize and recognize Blockchain transactions for accounting and other business records for companies registered in the state.
Blockchain ledgers and records recognized
A portion of the law explains:
“Any records administered by or on behalf of the corporation in the regular course of its business, including its stock ledger, books of account and minute books, may be kept on, or by means of, or be in the form of, any information storage device, method, or one or more electronic networks or databases (including one or more distributed electronic networks or databases), provided that the records so kept can be converted into clearly legible paper form within a reasonable time.”
In spite of the vague wording in the bill, this fairly means that corporate entities, many of which are registered in Delaware, can store financial records in any electronic means regardless of the traditional technical requirements on how it’s done, which includes Blockchain records.
As long as these records can be printed on paper “within a reasonable time” the State of Delaware would accept these records as authentic and verifiable.
Blockchain transactions as verifiable data
After a swift passage this effectively amends Delaware’s General Corporation Law, Blockchain advocates sought to label the passage as a”historic” milestone, given the State of Delaware now recognizes electronic transactions recorded in Blockchains as verifiable data.
Therefore, it defines with certainty that all transactions are done using cryptocurrencies and can now be recorded in accounting ledgers without question of its validity. This could potentially help prevent future taxation-related problems and more centralized records of the corporations.
Jack Markell, former Delaware governor, has also launched an initiative to promote Blockchain efficiencies in government with this law being one of the baby steps.