Wyoming Bill Helps Shield Citizens’ Private Keys From Government Intrusion

Wyoming, a historically friendly state for crypto companies and investors, has passed a bill prohibiting the forced disclosure of private keys. 

The measure, which will take effect in July, allows investors to withhold private keys “unless a public key is unavailable or unable to disclose the requisite information,” the bill read. 

In most legal matters, the court is able to obtain the required information without being given the actual private key, Christopher Allen, founder and executive director of Blockchain Commons, said on Twitter in May when advocating for the bill. 

“A judge can still achieve the desired outcome by compelling the use of private cryptographic keys (such as to turn over assets in a divorce proceeding, or to prove ownership of an asset) without requiring the disclosure of the key itself,” Allen said. 

Wyoming’s private key protection plans have been in the works since 2022 as the issue of forced disclosure started to pick up across the country. 

“There is no perfect analog for a modern cryptographic private key in existing statute or case law; it is unique in its form and function,” Wyoming State Legislature Senate minority leader Chris Rothfuss said in 2022. “As we build a policy framework around digital assets, it is essential that we appropriately recognize and reflect the characteristics of the underlying public / private key and cryptographic technologies.” 

The bill, passed Tuesday and titled “disclosure of private cryptographic keys,” is intended to advance lawful proceedings while also protecting investor privacy when possible, the text said. 

It is not the first time Wyoming has been at the forefront of progressive crypto policy. The state’s tax laws are attractive to businesses and traders looking to avoid personal and corporate income tax. 

Wyoming also legalized DAOs in 2019 and was a pioneer in crypto charter bank licensing, making it possible for crypto firms to both hold customer cash deposits and custody crypto — later able to be traded on exchanges.

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