I 

118TH CONGRESS 

2D SESSION H. R. 10544 

To specify the treatment of covered non-fungible tokens under the securities 

laws, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

DECEMBER 20, 2024 

Mr. TIMMONS (for himself and Mr. TORRES of New York) introduced the 

following bill; which was referred to the Committee on Financial Services 

A BILL 

To specify the treatment of covered non-fungible tokens 

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 ‘‘New Frontiers in 

5 Technology Act’’. 

6 SEC. 2. TREATMENT OF COVERED NON-FUNGIBLE TOKENS 

7 UNDER THE SECURITIES LAWS. 

8 (a) IN GENERAL.—For purposes of the securities 

9 laws— 


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1 (1) a covered non-fungible token is not an in2 vestment contract; and 

3 (2) an offer or sale of a covered non-fungible 

4 token is not a transaction in a security. 

5 (b) DEFINITIONS.—In this section and section 3: 

6 (1) COVERED NON-FUNGIBLE TOKEN.— 

7 (A) IN GENERAL.—The term ‘‘covered 

8 non-fungible token’’ means any non-fungible 

9 token which was developed primarily for per10 sonal, family, or household consumption, includ11 ing— 

12 (i) a work of art, musical composition, 

13 literary work, or other intellectual prop14 erty; 

15 (ii) a collectible, merchandise, virtual 

16 land, or video game asset; 

17 (iii) a digital identifier or other certifi18 cate or credential; 

19 (iv) an affinity, reward, or loyalty 

20 point; or 

21 (v) a right, license, membership, or 

22 ticket. 

23 (B) EXCLUSION.— The term ‘‘covered 

24 non-fungible token’’ does not include a non-funVerDate Sep 11 2014 02:26 Jan 28, 2025 Jkt 059200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H10544.IH H10544

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1 gible token that is marketed by an issuer or 

2 promoter— 

3 (i) primarily as an investment oppor4 tunity; or 

5 (ii) that promises future actions or a 

6 series of actions designed explicitly and for 

7 the purpose of increasing the value of the 

8 covered non-fungible token. 

9 (2) NON-FUNGIBLE TOKEN.— 

10 (A) IN GENERAL.—The term ‘‘non-fungible 

11 token’’ means any asset— 

12 (i) which is of such uniqueness or lim13 ited production that it can be independ14 ently assessed or identified; 

15 (ii) which is represented by a unique 

16 digital identifier; 

17 (iii) the record of ownership of which 

18 is recorded on a cryptographically secured 

19 public distributed ledger; 

20 (iv) which— 

21 (I) is a digital equivalent of a 

22 tangible or intangible good; or 

23 (II) has some other inherent 

24 function beyond the fact that the 

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1 corded on a cryptographically secure 

2 public distributed ledger; and 

3 (v) the record of which can be exclu4 sively possessed and transferred, person to 

5 person, without necessary reliance on an 

6 intermediary. 

7 (B) EXCLUSIONS.—The term ‘‘non-fun8 gible token’’ does not include— 

9 (i) any note, stock, treasury stock, se10 curity future, security-based swap, bond, 

11 debenture, evidence of indebtedness, cer12 tificate of interest or participation in any 

13 profit-sharing agreement, collateral-trust 

14 certificate, preorganization certificate or 

15 subscription, transferable share, put, call, 

16 straddle, option, privilege on any security, 

17 certificate of deposit, or group or index of 

18 securities (including any interest therein or 

19 based on the value thereof); or 

20 (ii) any asset which, based on its 

21 terms and other characteristics, is, rep22 resents, or is functionally equivalent to an 

23 agreement, contract, or transaction that 

24 is— 


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1 (I) a contract of sale of a com2 modity (as defined under section 1a of 

3 the Commodity Exchange Act) for fu4 ture delivery or an option thereon; 

5 (II) a security futures product; 

6 (III) a swap; 

7 (IV) an agreement, contract, or 

8 transaction described in section 

9 2(c)(2)(C)(i) or 2(c)(2)(D)(i) of the 

10 Commodity Exchange Act; 

11 (V) a commodity option author12 ized under section 4c of the Com13 modity Exchange Act; or 

14 (VI) a leverage transaction au15 thorized under section 19 of the Com16 modity Exchange Act. 

17 (C) RULE OF CONSTRUCTION.—Nothing in 

18 this subsection may be construed to create a 

19 presumption that a non-fungible token is a rep20 resentation of any type of security not excluded 

21 from the definition under subparagraph (B). 

22 (3) SECURITIES LAWS.—The term ‘‘securities 

23 laws’’ has the meaning given that term in section 

24 3(a) of the Securities Exchange Act of 1934. 


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1 SEC. 3. STUDY ON NON-FUNGIBLE TOKENS. 

2 (a) IN GENERAL.—The Comptroller General of the 

3 United States shall carry out a study of non-fungible to4 kens that analyzes— 

5 (1) the nature, size, role, purpose, and use of 

6 non-fungible tokens; 

7 (2) the similarities and differences between non8 fungible tokens and other digital assets, including 

9 payment stablecoins, and how the markets for those 

10 digital assets intersect with each other; 

11 (3) how non-fungible tokens are minted by 

12 issuers and subsequently administered to purchasers; 

13 (4) how non-fungible tokens are stored after 

14 being purchased by a consumer; 

15 (5) the interoperability of non-fungible tokens 

16 between different blockchain systems; 

17 (6) the scalability of different non-fungible 

18 token marketplaces; 

19 (7) the benefits of non-fungible tokens, includ20 ing verifiable digital ownership; 

21 (8) the risks of non-fungible tokens, including— 

22 (A) intellectual property rights; 

23 (B) cybersecurity risks; and 

24 (C) market risks; 

25 (9) whether and how non-fungible tokens have 

26 integrated with traditional marketplaces, including 


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1 those for music, real estate, gaming, events, and 

2 travel; 

3 (10) whether non-fungible tokens can be used 

4 to facilitate commerce or other activities through the 

5 representation of documents, identification, con6 tracts, licenses, and other commercial, government, 

7 or personal records; 

8 (11) any potential risks to traditional markets 

9 from such integration; and 

10 (12) the levels and types of illicit activity in 

11 non-fungible token markets. 

12 (b) REPORT.—Not later than 1 year after the date 

13 of the enactment of this Act, the Comptroller General shall 

14 make publicly available a report that includes the results 

15 of the study required by subsection (a). 

Æ 


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