Colorado senators Stephen Fenberg and Jack Tate have filed a bipartisan bill, titled the “Colorado Digital Token Act,” that would attempt to exempt digital tokens from securities laws.
The bill reads,
The bill provides limited exemptions from the securities registration and securities broker-dealer and salesperson licensing requirements for persons dealing in digital tokens. ‘Digital token’ is defined as a digital unit with specified characteristics, secured through a decentralized ledger or database, exchangeable for goods or services and capable of being traded or transferred between persons without an intermediary or custodian of value.
Saying that Colorado “has become a hub for companies and entrepreneurs that seek to utilize cryptoeconomic systems to power blockchain technology-based business models,” the bill would effectively give tokens with a “primarily consumptive purpose,” i.e. utility tokens, such as Basic Attention Token (BAT), fewer hoops to jump through.
Stipulations exist, including that tokens must be made available within 180 days of the token sale — a potential way to limit the possibility of scams occurring. The bill wants to make it clear that assets which are essentially speculative in nature are not valid for the exemption. Lastly, the issuer must file a notice of intent with Colorado’s securities commissioner.
An Increasing Number of US Policymakers Passing Crypto-Related Legislation
Policymaking with regards to cryptocurrencies and the blockchain industry has been on the rise since early last year. Ohio became the first US state to allow taxes to be paid in cryptocurrency, while the state of Wyoming has approved a bill that permits the integration of banking services with blockchain. Former Congressman Rand Paul Sr. has also spoken in favor of cryptocurrencies.
Despite the pockets of growing positive sentiment, on a larger level, America is largely undecided on how to approach cryptocurrency. The SEC has hinted that a Bitcoin ETF might soon be approved, but there is no definitive idea on how the SEC is going to approach cryptocurrency more generally.
On the positive side, there is a consensus that blockchain technology could bring both economic and social benefits to state populations.