I 

116TH CONGRESS 

1ST SESSION H. R. 5197 

To add establish the treatment of managed stablecoins under the securities 

laws, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

NOVEMBER 20, 2019 

Ms. GARCIA of Texas (for herself and Mr. GOODEN) introduced the following 

bill; which was referred to the Committee on Financial Services 

A BILL 

To add establish the treatment of managed stablecoins under 

the securities laws, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Managed Stablecoins 

5 are Securities Act of 2019’’. 

6 SEC. 2. SENSE OF CONGRESS. 

7 It is the sense of Congress that— 

8 (1) digital assets, known as managed stable9 coins, are investment contracts and therefore are seVerDate Sep 11 2014 23:09 Nov 29, 2019 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H5197.IH H5197

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1 curities within the meaning given the term in section 

2 2(a) of the Securities Act of 1933; and 

3 (2) because issuers of managed stablecoins nev4 ertheless maintain that managed stablecoins are not 

5 securities, it is appropriate for Congress to provide 

6 clarity by amending statutory definitions of the term 

7 security to include managed stablecoins. 

8 SEC. 3. MANAGED STABLECOINS. 

9 (a) DEFINITIONS UNDER THE SECURITIES ACT OF

10 1933.—Section 2(a) of the Securities Act of 1933 (15 

11 U.S.C. 77b(a)) is amended— 

12 (1) in paragraph (1)— 

13 (A) by inserting ‘‘, regardless of form’’ 

14 after ‘‘any of the foregoing’’; and 

15 (B) by inserting ‘‘, managed stablecoin,’’ 

16 after ‘‘national securities exchange relating to 

17 foreign currency’’; and 

18 (2) by adding at the end the following: 

19 ‘‘(20) The term ‘managed stablecoin’ means a 

20 digital asset that— 

21 ‘‘(A) is not a security registered under sec22 tion 8(a) of the Investment Company Act of 

23 1940; and 

24 ‘‘(B) satisfies one or more of the following: 


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1 ‘‘(i) The market value of such digital 

2 asset is determined, in whole or in signifi3 cant part, directly or indirectly, by ref4 erence to the value of a pool or basket of 

5 assets, including digital assets, held, des6 ignated, or managed by one or more per7 sons. 

8 ‘‘(ii) One or more holders of such dig9 ital asset, directly or indirectly, are entitled 

10 to obtain consideration or other assets, in11 cluding other digital assets and any sov12 ereign currency of a foreign government or 

13 the United States, in exchange for the dig14 ital asset, the amount of which payment is 

15 determined, in whole or in significant part, 

16 directly or indirectly, on the basis of the 

17 value of a pool or basket of assets, includ18 ing digital assets, held, designated, or 

19 managed by one or more persons. 

20 ‘‘(21) The term ‘digital asset’ means any asset, 

21 contract, agreement or transaction, including a rep22 resentation of an economic, proprietary, or access 

23 right, that is stored in a computer-readable form 

24 and has or will have a transaction history that is re25 corded in a distributed ledger, digital ledger or other 


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1 digital data structure. A digital asset may be a man2 aged stablecoin and a security.’’. 

3 (b) DEFINITIONS UNDER THE SECURITIES EX4 CHANGE ACT OF 1934.—Section 3(a) of the Securities Ex5 change Act of 1934 (15 U.S.C. 78c) is amended— 

6 (1) in paragraph (10)— 

7 (A) by inserting ‘‘, regardless of form’’ 

8 after ‘‘any of the foregoing’’; 

9 (B) by inserting ‘‘, managed stablecoin’’ 

10 after ‘‘national securities exchange relating to 

11 foreign currency’’; and 

12 (C) by inserting ‘‘sovereign’’ after ‘‘but 

13 shall not include’’; and 

14 (2) by adding at the end the following: 

15 ‘‘(81) The term ‘managed stablecoin’ has the 

16 meaning given the term in section 2(a) of the Secu17 rities Act of 1933. 

18 ‘‘(82) The term ‘digital asset’ has the meaning 

19 given the term in section 2(a) of the Securities Act 

20 of 1933.’’. 

21 (c) DEFINITIONS UNDER THE INVESTMENT COM22 PANY ACT OF 1940.—Section 2(a) of the Investment 

23 Company Act of 1940 (15 U.S.C. 80a–1 et seq.) is amend24 ed— 

25 (1) in paragraph (36)— 


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1 (A) by inserting ‘‘, regardless of form’’ 

2 after ‘‘any of the foregoing’’; and 

3 (B) by inserting ‘‘, managed stablecoin’’ 

4 after ‘‘national securities exchange relating to 

5 foreign currency’’; and 

6 (2) by adding at the end the following: 

7 ‘‘(55) The term ‘managed stablecoin’ has the 

8 meaning given the term in section 2(a) of the Secu9 rities Act of 1933. 

10 ‘‘(56) The term ‘digital asset’ has the meaning 

11 given the term in section 2(a) of the Securities Act 

12 of 1933.’’. 

13 (d) DEFINITIONS UNDER THE INVESTMENT ADVIS14 ERS ACT OF 1940.—Section 202(a) of the Investment Ad15 visers Act of 1940 (15 U.S.C. 80b–1 et seq.) is amended— 

16 (1) in paragraph (18)— 

17 (A) by inserting ‘‘, regardless of form’’ 

18 after ‘‘any of the foregoing’’; and 

19 (B) by inserting ‘‘, managed stablecoin’’ 

20 after ‘‘national securities exchange relating to 

21 foreign currency’’; and 

22 (2) by adding at the end the following: 

23 ‘‘(31) The term ‘managed stablecoin’ has the 

24 meaning given the term in section 2(a) of the Secu25 rities Act of 1933. 


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1 ‘‘(32) The term ‘digital asset’ has the meaning 

2 given the term in section 2(a) of the Securities Act 

3 of 1933.’’. 

4 (e) SEC RULEMAKING.—The Securities and Ex5 change Commission may issue rules and regulations to 

6 further define the terms ‘‘managed stablecoin’’ and ‘‘dig7 ital asset’’ as such terms are defined in section 2(a) of 

8 the Securities Act of 1933. 

Æ 


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