KRS § 42.747 — KY Code / Title VI / Chapter 42 / Section 42.747
42.747 Blockchain Technology Working Group
Status: in_force

42.747 Blockchain Technology Working Group.

(1) As used in this section, unless the context otherwise requires:

(a) "Blockchain technology" means shared or distributed data structures or digital

ledgers used in peer-to-peer networks that:

1. Store digital transactions;

2. Verify and secure transactions cryptographically; and

3. Allow automated self-execution of smart contracts;

(b) "Peer-to-peer networks" means computer systems that are connected to each

other over the Internet so that each computer system:

1. Is a client and a server simultaneously; and

2. Allows file sharing without use of a central server;

(c) "Smart contract" means a computerized transaction protocol that self-executes

the terms of a contract and that is integrated into the blockchain program

architecture; and

(d) "Contract" means an agreement of the parties in fact, as found in their

language or inferred from other circumstances, including course of

performance, course of dealing, or usage of trade, reached through offer and

mutual acceptance by the parties to be legally bound by the terms of the

agreement which includes valuable consideration for all parties.

(2) There is hereby established a Blockchain Technology Working Group which shall

be attached to the Commonwealth Office of Technology for administrative

purposes.

(3) The working group shall evaluate the feasibility and efficacy of using blockchain

technology to enhance the security of and increase protection for the state's critical

infrastructure, including but not limited to the electric utility grid, natural gas

pipelines, drinking water supply and delivery, wastewater, telecommunications, and

emergency services. The workgroup shall create a priority list of critical

infrastructure that could benefit from the use of blockchain technology and then

determine whether:

(a) Blockchain fits the distributed nature of transactions;

(b) The peer-to-peer network is robust enough to support the use of blockchain

technology;

(c) A cost-benefit analysis of blockchain for each case is warranted to

demonstrate its value, applicability, or efficiency; and

(d) If the parties involved in the blockchain would agree to its usage if deployed.

(4) The workgroup shall consist of nine (9) members, three (3) of which shall be ex

officio, as follows:

(a) The chief information officer for the Commonwealth Office of Technology or

his or her designee who shall serve as chair;

(b) The secretary for the Energy and Environment Cabinet or his or her designee;

(c) The chief information officer for the Finance and Administration Cabinet or

his or her designee;

(d) A representative designated by the executive director of the Kentucky Public

Service Commission, who has knowledge of the spatial characteristics of the

infrastructure used by public utilities;

(e) The executive director of Kentucky Department of Homeland Security or his

or her designee;

(f) One (1) member in academia designated by the chief information officer of

the Commonwealth Office of Technology, who has expertise in blockchain

technology and its applicability to different industry sectors;

(g) One (1) ex officio member representing municipal utilities designated by the

Kentucky League of Cities;

(h) One (1) ex officio member representing the investor-owned electric utilities

designated by the executive director of the Kentucky Public Service

Commission; and

(i) One (1) ex officio member representing Kentucky electric cooperatives

designated by the chairman of the board of the Kentucky Association of

Electric Cooperatives.

(5) The workgroup shall be staffed by the Commonwealth Office of Technology.

(6) The workgroup shall report to the Governor and to the Legislative Research

Commission by December 1 of each year. The report shall include the current

priority list and a discussion of whether blockchain could be deployed, and any

associated cost-benefit analysis.