Wyoming bullishly courts crypto, even after collapse of FTX

CHEYENNE, Wyo. (AP) — Software engineer Jae Yang got a lot of questions from friends when he moved from Silicon Valley with plans to launch his cryptocurrency exchange not in the up-and-coming urban crypto hubs of Miami or Austin, Texas, but the windswept plains of southeastern Wyoming.

While the collapse of the massive FTX exchange and recent arrest of its founder, Sam Bankman-Fried, have compounded concerns about crypto, Wyoming remains full-steam ahead in wooing the industry. It has enacted a suite of new laws — with possibly more to come — seeking to make the industry more regulated and reputable to attract businesses like Yang's.

“FTX would not have happened if it was a Wyoming company,” said Steven Lupien, director of the 2-year-old Center for Blockchain and Digital Innovation at the University of Wyoming. “Wyoming got it right. We knew five years ago when we started down this path that appropriate regulation was the way to go.”

While Lupien contends the state's agencies would have picked up on the “shenanigans” going on with the exchange, others aren’t so sure.

“There wouldn’t be anybody in Wyoming who’s sophisticated enough to audit something on the scale of FTX,” said Cheyenne attorney Larry Wolfe. “If you’re a true believer, of course you’ll say it could never happen here. But of course it could happen here.”

Cheyenne, Wyoming's capital city of 65,000 people, is home to a U.S. Air Force nuclear missile base, an historic Union Pacific rail yard, abundant old diners and country bars, and sprawling cattle ranches in every direction.

So far, there's little sign of the crypto industry that Wyoming has courted for the past five years. But Yang says fledgling exchanges like the one he's hoping will open for business in 2023 could be the start of an influx in the...