Two Senators from Colorado, USA have introduced a bill to exempt digital currencies and certain digital tokens from securities laws.
Senators Mr. Jack Tate (Republican) and Stephen Fenberg (Democrat) jointly filed a bill named the ‘Colorado Digital Token Act,’ recommending that digital tokens with a “primarily consumptive” purpose should be exempted from securities laws given they are not marketed for “speculative or investment” purposes.
The move is intended to remove “regulatory uncertainty” that could hold back firms offering marketplaces for tokens and others trying to fundraise using crypto assets.
Creating the Colorado Digital Token Act will allow Colorado businesses that utilizes crypto-economic systems to achieve growth to help grow and expand their business, thereby promoting the formation and growth of local firms and the accompanying job creation and helping make Colorado a hub for companies that are developing new forms of decentralized “Web 3.0″ platforms and applications,” the proposed bill states.
As per the document, the consumptive purpose of digital tokens is defined as “to provide or obtain goods, services, or content, including access to goods, services, or content.”
To qualify for an exemption, the consumptive purpose for a token must be available within 180 days of its sale or transfer, and the initial buyer can’t resell or transfer the token until the consumptive purpose is available.
Moreover, the bill specifies:
‘The initial buyer provides a knowing and clear acknowledgment that the initial buyer is buying the digital token with the primary aim to accept the digital token for a consumptive purpose and not for a speculative or investment purpose.”
The bill adds, for an exemption, an issuer must file a notice of intent with the state’s securities commissioner.