Tag: policy

TDC’s Artificial Intelligence (AI) Policy Principles 

by Mary Grace Cooney

As AI is increasingly integrated into our lives and national infrastructure, The Digital Chamber (TDC) has built policy principles to ensure that these vital systems preserves innovation, resiliency, safety, and a responsible federal-state regulatory harmonization that provides clear direction and protections for relevant stakeholders in the AI ecosystem.  Specifically, the United States must refine regulations to leverage decentralized AI and AI development that supports open and democratic governance – technological remedies to many legacy AI roadblocks and concerns. 

TDC supports the following principles that we intend to use to guide our AI policy engagement: 

1. Mitigating Bias: Bias Audits Should Be Effective, Outcomes-Based, Transparent, and Public 

AI systems should be tested for fair and non-discriminatory outcomes across their full lifecycle, not certified only once at launch.  

TDC supports making bias-audit results available for regulator and public review, with the FTC and state attorneys general able to act where a consistent pattern of failed audits reveals discriminatory outputs. Bias audits should be tied to reasonable mitigation requirements, and at no point should mitigating bias be treated as the introduction thereof. Responsibility for biased outputs should generally rest with the deployer, the entity closest to the person affected, rather than falling equally on every upstream developer. The goal is a standard that measures results, rather than intent, as AI is definitionally incapable of producing ‘intent’ necessary for disparate-treatment claims. 

2. Model Safety: Safety Disclosure Should Scale with Use Case, Not Model Size 

Safety testing should be continuous and include:  

  • pre-deployment evaluation 
  • active monitoring,  
  • an established process for addressing failing systems in real time 

TDC supports disclosure requirements for safety testing results, calibrated to expected use case, user base, and associated risks, rather than model size alone. Systems deployed in healthcare, hiring, housing, or against a vulnerable population should meet a higher bar than a narrow tool with limited exposure, regardless of scale. Risk thresholds should reflect input from the people who bear the consequences of failure, and the workforce that identifies harm(s)deserves protections of its own. 

Further, catastrophic risks have received outsized attention compared to more common violations of user rights and well-being. Both catastrophic and quotidian risks must be addressed. 

3. Liability and Accountability: Accountability Should Follow Supply-Chain Role 

Liability should track function: developers and deployers should each be accountable for harms tied to their specific role, and content-neutral infrastructure providers in a decentralized AI operating system should not be shoehorned into one of these existing categories. 

  • Developers supply capability and are typically liable for defects in the underlying model (e.g., Meta is the developer of the Llama series). A party that modifies an existing model also takes on developer obligations where that modification expands the capability surface, alters the action space, or degrades safeguards; 
  • Deployers refine capability and put it into use. This covers parties that fine-tune a model to narrow it within the intended purposes and documented limitations, and the entity that chooses to place a system into service. Deployers sit closest to the affected person and carry the greatest share of responsibility for outcomes in use. A deployer that narrows a model should publish its intended-use documentation and test for drift within that window; 
  • End Users query or operate an AI system. Where the user and the affected person are the same, accuracy limits are disclosed, and a free and prompt remedy is available, liability should not run upstream for use outside the developer’s/deployer’s stated parameters. This limit does not apply where the affected person is not the operator, as in lending, hiring, housing, healthcare, and criminal justice. 

These categories describe function, not identity, and are not mutually exclusive. A power user self-hosting a model may be developer, deployer, and end user at once. Contractual allocation should not displace the factual distribution of control. 

Obligations also presuppose a party able to discharge them. Where a layer is permissionless and no entity controls access or output, assigning developer or deployer duties there accomplishes nothing or makes recentralization the only compliance path. Accountability should attach to parties exercising control, applied equally to concentrated and distributed infrastructure. 

This chain should also make room for a distinct category of content-neutral infrastructure providers, including decentralized compute, storage, data-availability, and validation networks that do not select or control the models running on them, who should not inherit developer or deployer liability absent knowing participation in a specific harm (see Principle 9). 

Each party should be able to explain the portion of the process it controls, and affected individuals should receive that explanation without requesting it or litigating for it. 

4. Governance and Oversight: Human Oversight Is the Floor; Direct Governance Can Exceed It 

Human oversight of consequential AI decisions – in lending, hiring, healthcare, housing, and criminal justice, among other high-risk domains – remains essential, as is government accountability. 

Where a community (like a blockchain-based AI DAO) holds governance rights, that direct governance can fulfill accountability requirements.  

Worker organizations and unions should be included as participants in setting oversight standards for AI directly impacting workers in a stakeholder model. Agentic AI should inherently carry identification metadata.  

Further, that identification should extend to verifiable tamper-evident action logs, so an autonomous agent’s decisions can be attributed to a responsible party after the fact rather than reconstructed through litigation (see Principle 13). Mechanisms that build oversight directly into execution, such as network-level alignment nodes, illustrate how decentralized systems can make governance a property of the infrastructure rather than an afterthought. 

5. Data Privacy and Sovereignty: Individuals Should Hold a Strong Claim to Their Own Data 

Meaningful, rather than purely symbolic or perfunctory, control over personal and session data is essential.  

Principled data sovereignty requires that people natively own their data. Privacy-preserving infrastructure, like decentralized identity and zero-knowledge methods, can help realize these protections.  

Regulators should treat these privacy-enhancing technologies, including trusted execution environments and confidential computing, secure multi-party computation, and federated approaches, as affirmative compliance pathways deserving of safe-harbor treatment, rather than viewing their use with suspicion. 

Reasonable limits on data brokers and concentrated data control can help enhance privacy where individual-level tools fall short. TDC also supports updated de-identification standards that account for AI-enabled re-identification risk. 

6. Redefining “Democratic AI”: Legitimacy Comes from Governance, Not Governments 

Democratic legitimacy is measured by how directly an AI stack’s power and governance is checked and how widely it is distributed, rather than by which government’s flag sits on a developer’s S1.  

TDC believes AI development should build toward open, auditable, and decentralized AI, governed by meaningful direct input from the people it affects.  Where that level of direct governance isn’t yet possible, legislative direction and generic guardrails can be a reasonable alternative. 

Widespread use of a technology is not the same as widespread control over it. A system available to everyone and governed by one company is not democratic. Democratic AI should embody the following qualities: 

  • Both control and usage are distributed. Many parties can run a system, but that is not the test. What matters is whether any single entity can unilaterally change the model, revoke access, or set the terms everyone else operates under. 
  • The stack is open and forkable. Weights, training data, and code are published under terms that permit modification and redistribution. ‘Open source’ is a necessary but insufficient quality for Democratic AI. 
  • Governance rights are enforceable. People affected by a system can change how it operates. 

Decentralization also carries a resilience and security dividend that policymakers should weigh directly: infrastructure with no single point of control or failure reduces systemic risk and concentrated dependency. Advancing this standard should include interoperability, data and model portability, and open protocols, so that no single incumbent can capture the AI stack through lock-in. 

7. Shared Societal Benefit: Democratizing AI Should Extend to Democratizing Its Gains 

AI-driven labor disruption calls for near-term investment in reskilling and a modernized safety net, tracking impact as it happens rather than after the fact. 

TDC believes that economic gains of AI should be widely distributed through consultation with civil society and affected populations. Workers and communities displaced by AI infrastructure should have a meaningful path to share the benefits of that infrastructure, rather than simply support for the disruption it causes.  

Democratizing AI should extend beyond its oversight to who benefits from the tech, which should itself be decided democratically. Concretely, this can be delivered through verifiable on-chain attribution and micropayments to the people who contribute data, compute, and storage, and through participation in the networks those contributions help run. Such mechanisms distribute gains by design rather than only redistributing them after the fact (see Principle 12). 

8. Verifiable AI: Cryptographic Proof Should Be a Recognized Path to Compliance 

Compliance should be something a regulator can check, rather than something a developer asserts. 

Audits, disclosures, and self-certification all ultimately ask the public to trust the party being regulated. TDC supports recognizing cryptographic verification, meaning proof of what model ran, on what data, and with what result, established through methods such as verifiable inference, provenance attestation, trusted execution environments, and zero-knowledge proofs, as a valid and, where available, preferred means of demonstrating compliance. A standard built on “verify, don’t just trust” lets oversight keep pace with systems too numerous and fast-moving to certify one at a time. 

9. Neutral Infrastructure: Content-Neutral Providers Should Have a Clear Safe Harbor 

Providing the pipes should not mean answering for the water. 

The compute, storage, data-availability, and validation networks that AI runs on are typically content-neutral: they do not choose, train, or control the models they carry. TDC supports a clear safe harbor establishing that operating such infrastructure does not, by itself, make a party a developer or deployer, absent known participation in a specific harm. Without this, the decentralized and distributed infrastructure that makes open AI possible cannot operate at scale in the United States. 

10. Digital Assets: Network-Incentive Tokens Deserve Regulatory Clarity 

Decentralized AI cannot run on infrastructure that has no lawful way to reward its participants. 

Decentralized networks coordinate and compensate their compute providers, storage providers, validators, and other contributors through functional tokens. TDC supports clear federal treatment confirming that tokens used to coordinate infrastructure and reward genuine network participation are not, by default, treated as securities, along with workable clarity for staking and other consensus mechanisms. Resolving this question, now under active debate in digital-asset market-structure legislation, is a precondition for a domestic decentralized-AI industry rather than a matter separate from AI policy. 

11. Open Models: Releasing Open-Weight AI Should Be Presumptively Protected 

Openness is both a safe and competitive strategy. 

Open-weight and open-source models let independent researchers inspect, test, and improve systems that would otherwise be opaque. TDC supports treating the release of open-weight models as presumptively protected, so that a developer is not automatically liable for every downstream use of an openly released model and we are cautious about blanket reporting or restriction regimes aimed at open release. Where safety concerns arise, verifiability (Principle 8) is the better answer than closure: open and verifiable is more accountable than closed and unexamined. 

12. Data Provenance: Contributors Should Be Traceable and Compensable 

If data is the raw material of AI, its providers should be visible in the record and able to share in the value. 

Verifiable data pipelines make it possible to record what data trained a model and to trace contributions back to their source. TDC supports on-chain, privacy-respecting data provenance together with mechanisms for attribution and compensation, including micropayments, to the creators and communities whose data trains AI systems. This advances content authenticity and consent while giving the shared-benefit commitment in Principle 7 a concrete mechanism. 

13. Agentic AI: Autonomous Agents Need Identity, Accountability, and Payment Rails by Design 

As agents begin to act and transact on their own, the accountability layer should be built in up front. 

Autonomous agents increasingly initiate actions and transactions with limited real-time human involvement. TDC supports requiring that agents carry verifiable, portable identity, maintain tamper-evident logs of their actions, and remain attributable to a responsible human or entity, with any agent-to-agent transaction rails designed so that accountability is verifiable rather than reconstructed after harm. Building these guarantees into the infrastructure is the most reliable way to keep an emerging agentic economy answerable to the people it affects. 

If you have any questions, please reach out to policy@digitalchamber.org.  

TDC Submits Response to HFSC Democrats’ Request for Information on AI  

by Mary Grace Cooney

By: Jean-Phillippe Beaudet

On August 14, The Digital Chamber submitted a response to House Financial Services Committee Democrats’ Request for Information on artificial intelligence in financial services and housing. The AI + Quantum Working Group answered more than 30 of the Committee’s questions on explainability, liability, third-party risk, capital markets, housing, data centers, and international development. 

Read our full response HERE. 

TDC’s response makes three arguments: 

First, existing law already covers most of what worries people about AI in finance. The Equal Credit Opportunity Act, the Fair Housing Act, the Fair Credit Reporting Act, and Dodd-Frank’s UDAAP provisions don’t carve out an exception for a decision a model made instead of a person. Congress’s first job is reviving and enforcing the rules already on the books, rather than building a parallel AI-specific regime. 

Second, compliance claims should be provable, rather than asserted by private companies. Tamper-evident action logs, cryptographic attestations, and verifiable model and data provenance records let a regulator or a court confirm which system acted, on what data, and whether the record was altered afterward. None of that replaces governance, testing, or supervision, but it strengthens self-certification with an authoritative audit trail. 

Third, liability should follow function and control, rather than a party’s position in the supply chain. A developer that sets a model’s behavior, and that a deployer can neither inspect nor alter, should answer to the consumer. We also asked Congress for the reverse protection: a safe harbor for content-neutral infrastructure. Compute, storage, and validation networks that carry AI without selecting or training the models running on them shouldn’t be treated as developers or deployers simply for existing, and that protection should apply whether the infrastructure is centralized or distributed. 

Data Centers, Front and Center 

We also weighed in on AI data centers. We asked the Federal Energy Regulatory Commission to assign the transmission and generation costs a large load causes to that load, instead of spreading them across every customer in the region. We asked Congress to give the Energy Information Administration authority to collect mandatory facility-level reporting on power and water use, because fragmentary data reporting obligations leave communities without the information they need to make informed decisions. And we pointed the Committee to decentralized AI architectures, workloads distributed across many smaller machines instead of concentrated in one location, as a way to ease grid pressure and democratize the AI stack. 

Committee Democrats will fold this response into future hearings and legislation on AI in financial services and housing. TDC’s position gives them a path that doesn’t force a choice between protecting consumers and letting the industry keep building: rules that already exist, evidence a regulator can check, and liability that lands on whoever actually controls the outcome. 

Read TDC’s full library of comment letters and reports at www.digitalchamber.org. Questions can be sent to policy@digitalchamber.org.

The Digital Chamber Launches Compute Working Group 

by Mary Grace Cooney

New Digital Power Network initiative will bring industry expertise to federal policy discussions on compute markets and infrastructure. 

WASHINGTON, D.C. — September 24, 2026 — The Digital Chamber (TDC), through its Digital Power Network (DPN), today announced the launch of a ComputeWorking Group to help shape policies affecting the supply, financing, and use of computing capacity. 

The group will bring together companies that build, power, finance, buy, sell, and operate compute capacity, connecting industry expertise directly with federal policy discussions around artificial intelligence, high-performance computing, energy, and data center infrastructure. 

The initiative builds on DPN’s leadership in Bitcoin mining and the deep operational experience its members have developed across energy-intensive digital infrastructure. As demand for compute accelerates, many of the same challenges around power, infrastructure, capital, and market design are increasingly converging. 

“Compute is quickly becoming one of the most valuable resources in the American economy, and the markets that finance and allocate it are still being built,” said Cody Carbone, CEO of The Digital Chamber. “Our members have spent years navigating complex challenges around power, capital, and infrastructure at scale. Our Compute Working Group brings that experience to Washington, so policymakers can get these markets right from the start and keep America at the forefront of the compute economy.” 

The group’s first project will inform TDC’s response to the Commodity Futures Trading Commission’s request for comment on compute derivatives, including computefutures. Participants will help explain how compute markets operate and assess how emerging financial products could support price discovery, manage risk, and facilitateinvestment. 

“Compute policy is already taking shape across financial markets, energy, and infrastructure,” said Zunera Mazhar, VP of Policy and Government Affairs at The Digital Chamber. “We’re focused on bringing the industry’s operational experience to these conversations, starting with derivatives and extending to the energy, infrastructure, procurement, and market standards that will shape how compute markets develop. This work gives policymakers practical insight into how these markets function and what is needed to support investment, innovation, and growth.” 

The working group will also explore:  

  • Compute markets and financial innovation: Policies that support transparent, liquid compute markets, including emerging derivatives, financing tools, and risk management products. 
  • Energy and infrastructure: Power availability, grid interconnection, data center development, and other infrastructure constraints affecting compute growth. 
  • Procurement and market access: Opportunities and barriers for companies seeking to provide compute capacity and services to the federal government. 
  • Standards and market integrity: Frameworks for measuring, verifying, and delivering compute services, including interoperability, performance standards, and emerging distributed compute models.  
  • Through this work, participating companies will help translate operational experience into recommendations for policymakers, bringing the perspectives of infrastructure developers, suppliers, and customers into decisions affecting the compute economy. 

About The Digital Chamber 

The Digital Chamber is a non-profit organization committed to promoting global blockchain adoption. We envision a fair and inclusive digital and financial ecosystem where everyone has the opportunity to participate. Access to digital assets is not merely a technological advancement but a fundamental human right, crucial for economic and social empowerment. Through targeted education, advocacy, and strategic collaborations with government and industry stakeholders, we drive innovation and shape policies that create a favorable environment for the blockchain technology ecosystem. 

The Digital Chamber’s umbrella includes: CryptoUK, Digital Power Network (DPN), TDC’s Digital State Network, and Treasury Council. 

Media Contact: Mary Grace Cooney, Mary_grace@digitalchamber.org; press@digitalchamber.org

From Policy Ask to Policy Win: FinCEN Recognizes Digital Identity for Customer Verification

by Mary Grace Cooney

The Financial Crimes Enforcement Network (FinCEN) and the federal banking agencies have issued new guidance confirming that banks and credit unions may use government-issued verifiable digital credentials—including state-issued mobile driver’s licenses—to verify customers under the Customer Identification Program Rule.

This is an important modernization of federal financial-crime compliance and a direct response to a regulatory clarification The Digital Chamber has repeatedly requested.

Why This Guidance Was Needed

Financial institutions increasingly serve customers through mobile applications and other digital channels, but identity-verification practices often remain rooted in physical documents. Customers may be asked to photograph and upload a driver’s license, transmit sensitive personal information, or rely on authentication methods that are vulnerable to forgery and identity theft.

Mobile driver’s licenses and other verifiable digital credentials offer a more secure alternative. They use cryptographic signatures, device binding, authentication factors, and other safeguards to help institutions determine whether a credential is authentic and belongs to the person presenting it.

Until now, however, regulatory uncertainty limited adoption. Financial institutions needed clear confirmation that these credentials could be used consistently with existing Bank Secrecy Act and Customer Identification Program obligations.

From an Ask to a Win

TDC made that clarification a specific policy priority.

In our comments on Bank Secrecy Act modernization, permitted payment stablecoin issuer requirements, and NIST’s mobile driver’s license implementation guidance, TDC urged regulators to recognize privacy-preserving digital identity and verifiable credentials as legitimate compliance tools.

In May, we publicly called on FinCEN to issue clear guidance explaining how financial institutions could use mobile driver’s licenses and other digital credentials to satisfy BSA and Customer Identification Program requirements. FinCEN has now answered that request.

The new FAQs confirm that an unexpired government-issued verifiable digital credential can qualify as “government-issued identification” under the documentary verification provisions of the Customer Identification Program Rule, provided it contains the required information and the institution has the technology, policies, and procedures necessary to use it.

The guidance also confirms that these credentials may be used when customers open accounts in person, remotely over the internet, or through another digital or virtual channel. In addition, electronic credentials issued by nongovernmental entities may also be used as a non-documentary verification method when the institution ensures an appropriate level of authentication.

Why It Matters

This guidance gives regulated institutions greater confidence to adopt stronger identity technology without waiting for Congress or regulators to rewrite the underlying rule.

Properly implemented, verifiable digital credentials can:

  • Make forged or altered identity documents easier to detect
  • Strengthen remote customer onboarding
  • Reduce dependence on easily copied physical documents
  • Prevent new fraud tactics made widely available by AI
  • Limit unnecessary collection and storage of sensitive information
  • Improve the customer experience while supporting effective compliance

The FAQs do not require institutions to accept digital credentials or create new supervisory expectations. Institutions must still form a reasonable belief that they know a customer’s true identity, address signs of fraud, and incorporate any credential into a compliant risk-based program.

That flexibility is a strength. It allows financial institutions to adopt better tools while preserving responsibility for effective identity verification.

This is how sustained policy engagement produces results: identify a barrier, develop a workable recommendation, place it consistently before the right agencies, and secure clear federal guidance.

TDC thanks FinCEN and the federal banking agencies for recognizing that modern technology can advance compliance, cybersecurity, innovation, and consumer privacy at the same time.

Read the new FinCEN FAQs

Decoding Digital Assets: Empowering Policymakers with Tax Facts 

by Simi Awe

Digital assets are transforming the global economy at lightning speed. Regulators and lawmakers are actively trying to understand these mechanics to establish tax rules of the road, most recently in market structure legislation awaiting the U.S. Senate’s consideration.  

To secure U.S. leadership in digital assets for generations to come, we must address the burdensome nature of the current tax code on companies and consumers, and find a path to tax parity with traditional assets. We must resolve technical ambiguities regarding the timing and sourcing of staking rewards and push back against disproportionate compliance burdens like reward bifurcation.  

Finally, we will ensure that new rules, such as de minimis exceptions, thoughtfully address real-world administrability concerns. By tackling these issues head-on during the upcoming markup and beyond, we will foster domestic capital formation and build a tax code that supports industry growth. 

Advancing Tax Clarity

TDC has worked with the House Ways and Means Committee throughout the current legislative effort to help understand the technology and what kind of tax framework makes sense for consumers and the industry. 

  • In May, we outlined key pillars for a digital asset tax framework in a letter to the committee and reinforced those priorities in a formal statement for the record for June’s hearing. We have also shared technical analysis with legislators on the digital asset taxation legislative package. 
  • Direct Advocacy: Beyond formal submissions, we met directly with the vast majority of Ways and Means offices to advocate for comprehensive, bipartisan solutions conducting over 70 meetings that span more than 50 hours of direct engagement. 
  • Educational Roundtables: We have hosted 7 educational roundtables as part of our ongoing series, providing staffers with the insights needed to navigate this evolving landscape and creating a safe space for deeper questions about the causes and effects of the current U.S. tax structure. 
  • Bicameral Focus: Alongside these House engagements, our advocacy and education efforts in the Senate remain highly active. 

Whether through one-on-one briefings, educational roundtables, or technical documents on high-impact issues like staking, TDC provides lawmakers with an open line to industry experts so they can understand the technology they regulate. Our commitment and engagement ensures that every policy maker can make sound decisions for their constituents and the industry. 

What’s Next  

With the House Ways and Means Committee expected to mark up a digital asset tax package this September, we must maintain engagement to replace ambiguity with statutory certainty to boost tax compliance, protect retail investors, and secure U.S. leadership. 

TDC Forums: The Place to Meet and Learn 

by Neil Humphrey

In a world filled with noise, decision makers’ greatest resource is time. TDC Forums are time well spent for these key leaders, and our next engagements in New York City and Chicago are filling up fast. 
 
Though built for a specific locality, the events are globally focused. With limited seating, the conversations remain small but inclusive in these half-day convenings. TDC Forums are in the works for other key international cities and build on The Digital Chamber’s reputation for sophisticated policy engagement and industry-shaping collaboration between the digital assets industry, global financial leaders, and policymakers. 
 
Rather than simply including another panel, the events are built for engagement. Whether in a group setting or one-on-one, the opportunities at TDC Forums are designed to ensure meaningful connections can grow high-impact ideas. 
 
TDC Members are invited to join the events at no cost. Non-members can join for a nominal fee. Each Forum is also open to the public and meant to diversify voices engaging in key policy issue discussions. TDC Forums are another way TDC is helping the broader industry shape the future of the digital economy across the globe. 

To learn more about the latest cities playing host to a TDC Forum and sponsorship opportunities, click here.

Insider Trading and Prediction Markets; Blockchain Transparency Drives Enforcement  

by Neil Humphrey

Recently, insider trading allegations related to prediction markets have been dominating headlines. One of the recent headline grabbers includes allegations a U.S. military official committed fraud and misuse of classified information. The soldier allegedly used classified intelligence related to U.S. military action in Venezuela to place a series of trades on Polymarket’s offshore platform, generating over $400,000 in personal profit. He has been charged with multiple criminal offenses, and the CFTC has also filed a lawsuit against him for civil damages. 

According to the criminal indictment, to bypass the offshore platform’s restrictions against use by U.S. individuals, it is alleged the individual accessed the platform through foreign accounts and attempted to conceal his activity by moving funds through offshore accounts. However, the activity was quickly discovered despite alleged attempts to conceal because the trades at issue were executed through public and immutable blockchain technologies. The suspicious timing and size of the trades were rapidly spotted by the public and quickly uncovered in media reports, leading to a federal investigation and the resulting criminal and civil charges. Since everyone could see the suspicious trading activity, accountability was as transparent as the blockchain ledger. 

As the call for prediction markets regulation bubbles at the state and federal level, this example illuminates a number of key policy discussion points: 

• Transparency: Blockchain-based technologies and platform monitoring appear to have contributed to identifying unusual trading patterns, which were later investigated by authorities.  

• Existing rules: This case represents one of the first major criminal prosecutions and civil enforcement actions for insider trading involving prediction markets. The case suggests that existing fraud, commodities, and misuse-of-information statutes can be applied to conduct on prediction markets.   

• Jurisdictional complexity: U.S. law prohibits certain event contracts, such as those involving war, which is why the individual allegedly had to use workarounds to trade on offshore markets. This highlights that U.S. regulations prohibiting event contracts on things like war and terrorism are still in full force, but the borderless nature of prediction markets and digital assets complicate who and how bad actors are brought to justice.  

• Regulatory scrutiny of prediction markets: The case and similar recent civil enforcement actions are heating up policy discussions around how prediction markets and insider trading with sensitive information on those markets should be regulated. Even though the trades happened on an offshore platform, U.S. authorities can still enforce the law. If someone in the U.S. tries to bypass restrictions to access those markets, they can be held accountable if they break U.S. law.  

Though existing laws already prohibit the insider trading alleged in this matter, clearly tying those existing rules to emerging technology like prediction markets in cases like this is necessary to ensure law enforcement can fairly police online trading activity. As with so many emerging technology products, there is a clear need for consistent regulatory frameworks that address misuse without stifling innovation. 


If you have any questions, please reach out to policy@digitalchamber.org. 

Arizona Sets the Standard: Digital Asset Reserves Next Act

by Neil Humphrey

By Anastasia Dellaccio, Executive Director, Digital Chamber State Network

 The states that move early and with intention will attract capital, talent, and infrastructure that underpins the next generation of financial systems. 

Arizona has advanced one of the most comprehensive state-level digital asset reserve frameworks in the country. The legislature recently passed SB 1649 and SB 1042, sending them to Governor Katie Hobbs’ desk, but whether they will be signed into law still remains uncertain.  

SB 1649 establishes a Digital Assets Strategic Reserve Fund managed by the State Treasurer, seeded with seized and forfeited digital assets at no new cost to taxpayers. The Treasurer is authorized to hold, invest, and where appropriate, lend those assets to generate returns. The bill proposes this effort be governed by a “cryptocurrency fair value” framework that evaluates assets on measurable criteria like market capitalization, network activity, and ecosystem development.  

SB 1042 would complement the reserve by enabling Arizona to diversify a small portion of public funds beyond traditional assets into high-potential digital assets. 

Why This Matters for Arizona’s Fiscal Future

As state debts and unfunded pension liabilities grow, governments face mounting pressure to protect long-term purchasing power without burdening taxpayers. Traditional portfolios have a mix of bonds, cash, and Treasuries. Digital assets offer states a new diversification opportunity, and Arizona’s framework is designed to capture that upside responsibly.

The digital asset industry has grown from roughly $10 billion in total market capitalization a decade ago to between $2 and $3 trillion today and shown increasing stability alongside sustained growth. Critically, SB 1649’s weighted, metrics-based framework for determining eligible assets means Arizona is not relying on a concentrated position on any single token. It is building a diversified digital asset allocation governed by principled, measurable criteria. That is the same discipline we expect from any well-managed public fund, now applied to an asset class most state treasuries haven’t yet had the tools to access.

Good Policy Built Right

Passing the legislation is step one. Implementation is the bigger challenge, and Arizona has the opportunity to set an example for state governments across the country

Diversify thoughtfully within the framework. SB 1649’s fair value framework was designed to allow Arizona to invest across a diversified mix of assets rather than concentrating exposure in a single token. As the Treasurer’s office operationalizes the fund, it should establish clear, repeatable processes for evaluating asset eligibility, reviewing portfolio composition regularly, and resisting any pressure to treat the fund as a single-asset vehicle. Diversification across digital assets with different use cases, network characteristics, and market dynamics is what transforms this reserve from a novelty into a durable fiscal tool.

Go beyond periodic attestation and build out the full reserve stack. As Arizona moves into the next phase of digital asset innovation, it should anchor its framework in transparency and durability. Across unclaimed assets, strategic reserves, and state stablecoin regulation, Arizona should aim for the ceiling in its digital asset administration. Traditional monthly audits show what was true at a single point in time, while programmatic, on-chain proof of reserves can show what is true continuously, every block, every second. But proof of reserves is only the foundation. Proof of composition provides transparency into the makeup of reserve assets to guard against concentration and tail risk, while proof of solvency can continuously demonstrate that total assets exceed liabilities.

Together, these layers distinguish a durable financial system from a compliance checkbox. This framework is ultimately about more than compliance; it’s about building enduring financial infrastructure and services that strengthen Arizona’s long-term fiscal stability. This also offers assurance to regulators that they can cover their bases by leveraging technology to hedge against risk.

Use the custodial flexibility the bill provides. SB 1649’s amended language recognizes secure custody solutions as qualified custodians, and the bill preserves the Treasurer’s ability to self-custody assets directly using technology providers. This is a wise choice, as it is typically more cost-effective, secure, and less exposed to third-party risk than relying exclusively on institutional custodians.

The Bigger Picture

Arizona’s move is not just about reserves. It is a signal. A signal that states are beginning to treat digital assets as a strategic asset class, a legitimate investment opportunity, and a clear message to innovators that Arizona is open for business.

The Digital Chamber State Network stands ready to help ensure what comes next matches the ambition of what has just been achieved.

Maryland Leads the Way: Turning Digital Asset Policy into Progress 

by Neil Humphrey

By Anastasia Dellaccio, Executive Director, Digital Chamber State Network | Jacqui Cooper, CEO, Maryland Blockchain Association 

At its best, digital asset policy is not only about markets or technology. It is about expanding access, strengthening protections, and creating real opportunities. For Maryland communities, from the unbanked to students, to entrepreneurs and workers across the state, they are seeing the benefits of clarity, coordination, and bipartisan action in their legislature to ensure that opportunities for jobs and innovation can flourish in their state. 

As Governor Wes Moore recently underscored at The Digital Chamber’s DC Blockchain Summit, “Innovative technologies like blockchain must work for everyone, including underbanked communities.” Maryland is not just embracing that vision. It is putting it into action.  

The 2026 legislative session will be remembered in Maryland as the year digital asset policy moved from conversation to commitment. As the 2026 legislative session draws to a close, the state has clearly asserted that Maryland is open for business. Lawmakers advanced a cohesive, bipartisan set of policies designed to move blockchain technology from theory into real-world applications and, on a broader scale, have positioned the state to compete for digital assets jobs by embracing responsible innovation. 

Building the Legal Foundation 

The 2026 legislative session will be remembered in Maryland as the year digital asset policy moved from conversation to commitment. 

At the heart of this session, progress is SB 154, which modernizes Maryland’s commercial code to recognize controllable electronic records. Though not flashy, this foundational move aligns UCC Article 12 and considers adopting provisions for Controllable Electronic Records. Simply stated, Maryland has modernized its commercial law to recognize and protect digital assets with the same rigor as traditional physical property. For consumers and businesses, this means digital assets are just like other asset classes, which can be owned, transferred, financed, and secured with distinct legal clarity. 

Putting Blockchain to Work 

Maryland is equally focused on harnessing blockchain technology for tangible public value. SB 168 / HB 810 is now headed to the Governor’s desk and means the state will actively study evaluating recording real property titles on blockchain-based systems. By piloting blockchain-based title verification, the state is making a concrete investment in modern technology that will reduce fraud, streamline transactions, and shine a light on systems traditionally burdened by inefficiency and opacity.  

Playing the Long Game 

Maryland’s work is smart and likely to be successful because it is built on a foundation of technical expertise. 

SB 376 / HB 470 establishes a Digital Asset and Blockchain Technology Task Force, creating a standing engine for the state to continue to lead in policy development. This task force will offer a low-risk, low-cost, and transparent path to policymaking, while enabling lawmakers to build internal expertise, compare approaches taken by peer states, and assess real-world use cases. By doing this work before committing public resources or adopting specific rules, Maryland is more likely to continue their practical and bipartisan regulatory efforts. 

Meanwhile, SB 662 / HB 1355, the Maryland Stablecoin Act, is advancing a clear, credible framework for payment stablecoins, providing the consumer protections and banking standards necessary for digital dollars to flourish in the state’s economy. Although this legislation needs some improvement, primarily around reserves and a few other standards, it does a good job at adhering closely to the federal law, the GENIUS Act, and creating nimble efforts to adapt to future industry needs. 

Next Opportunities 

Not every blockchain legislative effort in Maryland advanced this session, and that matters too. 

Unfortunately, SB 759 / HB 859, which addressed staking and broader financial innovation, did not advance out of committee. Marylanders deserve access to staking-as-a-service offerings, as described in this legislation. The industry’s coalition has engaged in educating policymakers around this topic, and staking legislation remains a top priority as it signals a long-term commitment to sophisticated financial technology.  

The Maryland Blockchain Association calls these education efforts its “Lighthouse” strategy and will continue to push for clarity that attracts serious players and builds a real, durable digital assets innovation ecosystem. 

The next opportunity is the Maryland BlockchAIn Bootcamp & Workforce Expo, will be held from July 13–17, 2026, at Capitol Technology University. The Expo will gather consumers, students, businesses, state leaders, and the new cohort of The Blockchain Legal Institute’s Business of Blockchain Interns to demonstrate real-world applications for blockchain technology. A Replicable Blueprint 

Groups that share Maryland’s ambition are beginning to take root in other states. Together, The Digital Chamber’s State Network and the Maryland Blockchain Association have partnered to help increase awareness of the facts around blockchain.  

We commend the Maryland lawmakers who drove this progress, including Delegate Boafo, Senator Watson, Delegate Amprey, Senator Hayes, and Senator West. Their leadership reflects exactly the kind of policymaking this moment demands, grounded not just in innovation, but in impact. We look forward to our continued work with them to ensure that Maryland continues to prioritize the values of privacy, freedom, and innovation that Marylanders deserve. 

Five State Blockchain Leaders Awarded First TDC State Network Grants at the DC Blockchain Summit 2026

by Nicole Rankin

Five organizations from across the United States were recognized at the DC Blockchain Summit as the first recipients of The Digital Chamber’s State Network grants. The program supports grassroots leaders advancing digital asset education, non-partisan policy development, and adoption at the state level.

Last week at the DC Blockchain Summit, The Digital Chamber’s State Network announced the first-ever recipients of its competitive grant program. Selected from 41 applicants nationwide, five organizations from Illinois, Maryland, Michigan, Utah, and West Virginia were recognized for their work advancing digital asset education and policy in their states.

Why it matters:
State governments are playing an increasingly important role in shaping the regulatory environment for digital assets. By supporting grassroots leaders who are working directly with policymakers and communities, TDC’s State Network aims to accelerate education, collaboration, policy development, and responsible blockchain adoption across the country.

“TDC’s State Network is about empowering grassroots leaders advocating for smart digital asset policy in their states,” said Anastasia Dellaccio, Executive Director of TDC’s State Network. “These organizations are on the front lines of digital asset policy development, and the work they are doing to develop sensible solutions at the state level is critical to the future of the industry nationwide.”

Each organization received $2,000 in funding to support projects that strengthen engagement between policymakers, industry leaders, and local communities.

Meet the 2026 Grant Recipients

Convergence Tech Policy Institute (C:TPI)
C:TPI is a global think tank in Illinois, focused on the intersection of AI, blockchain, and quantum policy. With support from this grant, the organization will host a reception during the National Conference of State Legislatures (NCSL) Summit in Chicago this July, bringing together policymakers and technology leaders to discuss cybersecurity and emerging technology governance.

Maryland Blockchain Association (MDBA)
The Maryland Blockchain Association is a nonprofit coalition uniting industry, government, and academia to advance Bitcoin, Web3 innovation, and responsible digital asset policy across the state. Led by Jacqueline Cooper, Esq., known in the community as “CryptoMom2,” MDBA is actively engaged in shaping Maryland’s legislative landscape on issues ranging from blockchain real estate applications and cryptocurrency staking to stablecoin legislation and the state’s Digital Asset and Blockchain Technology Task Force. Their grant will support Blockchain Bootcamp, a career-focused conference coming to Maryland this July.

Detroit Blockchain Center (DBC)
The Detroit Blockchain Center is Michigan’s premier 501(c)(3) organization, focused on blockchain, crypto, AI, and emerging technology education. Founded in 2018, the organization helps individuals and institutions better understand decentralized technologies while supporting startups building in the state. The grant will help launch DBC’s policy education track, including legislative roundtables, fireside discussions, and voter education content designed to make digital asset policy more accessible to Michigan stakeholders.

Utah Blockchain Coalition (UBC)
The Utah Blockchain Coalition advances blockchain-focused public policy initiatives and works to educate government officials on the benefits of the technology. With this grant, UBC will convene elected officials, innovators, and policy advocates for a working session on key blockchain trends and how Utah can position itself for responsible digital asset adoption.

West Virginia Blockchain Foundation
The West Virginia Blockchain Foundation connects legislators, universities, and communities across Appalachia to the economic and technological opportunities created by blockchain and emerging technologies. Their grant will support a series of in-person and virtual policy education workshops engaging state legislators, county officials, student leaders, and community stakeholders across West Virginia and the greater Ohio Valley.

What’s Next

These five organizations represent the kind of grassroots leadership driving progress in digital asset policy at the state level. As they begin implementing their projects throughout 2026, The Digital Chamber’s State Network will continue supporting their work through collaboration, resources, and connections across the digital asset ecosystem.

If you missed the announcement at the DC Blockchain Summit, you can watch the full session here.