State of Wyoming Introduces First State-Backed Digital Cryptocurrency
Wyoming, a leader in blockchain, cryptocurrency, and digital asset regulation since 2016, has made history by launching its own stablecoin, the Frontier Stable Token (FRNT). The Wyoming Stable Token Commission announced the launch of FRNT on Tuesday, marking a significant step in the state's ambition to become a crypto hub.
FRNT is unique in being the first U.S. state-issued stablecoin with a distinctive regulatory backing, designed to serve the public interest rather than private profit. The stablecoin is fully backed by U.S. dollars and short-duration Treasury bills, with a legally mandated 102% overcollateralization to ensure stability, held in trust for token holders under state law.
Key distinctive features and benefits of FRNT include:
- State-Issued and Regulated: Issued by the Wyoming Stable Token Commission, a sovereign public entity, FRNT benefits from a unique regulatory framework separate from federally regulated stablecoins under laws like the GENIUS Act. This status affords Wyoming more flexibility in managing the token, and the state asserts constitutional protections against seizure or freezing of funds that differ from corporate issuers.
- Public Benefit Model: Unlike private stablecoins where reserve interest profits go to companies, benefits from FRNT's reserve interest are directed to Wyoming’s School Foundation Fund quarterly to support public education, emphasizing a social good rather than a for-profit motive.
- Multi-Chain Interoperability: FRNT is launched on seven blockchains, including Ethereum, Solana, Avalanche, Arbitrum, Polygon, Optimism, and Base, using the LayerZero interoperability protocol. This enhances its accessibility and transactional flexibility across multiple blockchain networks.
- Partnerships with Industry Leaders: The token integrates with platforms like Wyoming-based Kraken exchange and Visa through Rain’s card platform, enabling real-world usage and broader adoption.
- Transparency and Consumer Protection: FRNT’s issuance and operations align with Wyoming’s comprehensive blockchain legislation (over 45 laws since 2016), prioritizing transparency, efficiency, and consumer protection in digital finance.
FRNT will be usable anywhere Visa is accepted, including Apple Pay, Google Pay, and physical cards. It will initially be available on Solana via Wyoming-domiciled digital asset exchange Kraken, and will also be available through Rain's Visa-integrated card platform on Avalanche. Interest generated by the reserves of FRNT will be sent to Wyoming's School Foundation Fund.
The launch of FRNT coincides with the Wyoming Blockchain Symposium conference in Jackson Hole, a testament to Wyoming's commitment to blockchain technology. Nebraska is also looking to get into the stablecoin game, along with other states. However, it remains to be seen how these state-issued stablecoins will interact with the federal regulations introduced by the Genius Act, which recently was signed into law by President Donald Trump, but does not cover government-issued tokens like FRNT.
[1] Wyoming Stable Token Commission Press Release, (2021). Retrieved from https://www.wystabletoken.com/press-release
[2] LayerZero Blog, (2021). Retrieved from https://blog.layerzero.xyz/post/frnt-launch-announcement
[3] Kraken Blog, (2021). Retrieved from https://kraken.com/blog/post/frnt-launch-announcement
[4] Wyoming Business Council, (2021). Retrieved from https://www.wyomingbusiness.org/
[5] Rain Financial, (2021). Retrieved from https://rainfinancial.com/
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