I 
117TH CONGRESS 
2D SESSION 
H. R. 7614 
To provide for orderly and secure digital commodity exchange markets, and 
for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
APRIL 28, 2022 
Mr. THOMPSON of Pennsylvania (for himself, Mr. KHANNA, Mr. SOTO, and 
Mr. EMMER) introduced the following bill; which was referred to the 
Committee on Agriculture 
A BILL 
To provide for orderly and secure digital commodity exchange 
markets, and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Digital Commodity Ex-
change Act of 2022’’. 
SEC. 2. AMENDMENTS TO THE COMMODITY EXCHANGE 
ACT. 
(a) DEFINITIONS.—Section 1a of the Commodity Ex-
change Act (7 U.S.C. 1a) is amended— 
(1) in paragraph (28)(A)(i)— 
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(A) in subclause (I)— 
(i) in item (aa)— 
(I) by striking ‘‘or’’ at the end of 
subitem (EE); and 
(II) by adding at the end the fol-
lowing: 
‘‘(GG) the purchase or 
sale of a unit of a digital 
commodity that is traded on 
or subject to the rules of a 
registered entity;’’; 
(ii) in item (bb), by striking ‘‘and’’ 
and inserting ‘‘or’’; and 
(iii) by adding at the end the fol-
lowing: 
‘‘(cc) 
acting 
as 
a 
counterparty to any cash or spot 
agreement, contract, or trans-
action involving a digital com-
modity with a person who is not 
an eligible contract participant, 
unless the activity is— 
‘‘(AA) 
conducted 
in 
compliance with the laws of 
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the State in which the activ-
ity occurs; 
‘‘(BB) subject to regu-
lation by another Federal 
authority; or 
‘‘(CC) separately regu-
lated under this Act; and’’; 
and 
(B) in subclause (II), by striking ‘‘(aa) or 
(bb)’’ and inserting ‘‘(aa), (bb), or (cc)’’; 
(2) in paragraph (40)— 
(A) in subparagraph (E), by striking 
‘‘and’’ at the end; and 
(B) by redesignating subparagraph (F) as 
subparagraph (G) and inserting after subpara-
graph (E) the following: 
‘‘(F) a digital commodity exchange reg-
istered under section 5i; and’’; and 
(3) by adding at the end the following: 
‘‘(52) DIGITAL COMMODITY.— 
‘‘(A) IN GENERAL.—The term ‘digital com-
modity’ means any form of fungible intangible 
personal property that can be exclusively pos-
sessed and transferred person to person without 
necessary reliance on an intermediary. 
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‘‘(B) EXCLUSIONS.—The term ‘digital 
commodity’ does not include any asset that con-
veys— 
‘‘(i) an equity or debt interest in a 
company, partnership, or fund; 
‘‘(ii) a profit or revenue share derived 
solely from the managerial efforts of oth-
ers; or 
‘‘(iii) an entitlement to any interest or 
dividend payment. 
‘‘(C) FURTHER EXCLUSIONS.—The Com-
mission, by rule or regulation, may exclude 
from the term ‘digital commodity’ any intan-
gible personal property that can be exclusively 
possessed and transferred person to person 
without necessary reliance on an intermediary 
that is not of the nature of a digital asset, if 
the Commission determines that the rule or reg-
ulation will effectuate the purposes of this Act. 
‘‘(53) DIGITAL COMMODITY CUSTODIAN.—The 
term ‘digital commodity custodian’ means an entity 
that holds, maintains, or safeguards digital commod-
ities and other assets on behalf of digital commodity 
market participants. 
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‘‘(54) DIGITAL
COMMODITY
EXCHANGE.—The 
term ‘digital commodity exchange’ means a trading 
facility that lists for trading at least one digital com-
modity. 
‘‘(55) DIGITAL
COMMODITY
PRESALE.—The 
term ‘digital commodity presale’ means the delivery 
of a unit of a digital commodity, or any promise or 
right to a future unit of a digital commodity, before 
the listing of the digital commodity for trading on 
a registered digital commodity exchange, to— 
‘‘(A) a participant in a securities offering 
that is— 
‘‘(i) intended to finance the develop-
ment of the digital commodity; and 
‘‘(ii) conducted in compliance with the 
Securities Act of 1933; 
‘‘(B) a founder, promoter, developer, man-
ager, affiliated organization, or other person di-
rectly associated with the development of the 
digital commodity; or 
‘‘(C) any other person the Commission de-
termines has personal knowledge of the activi-
ties of individuals directly associated with the 
development of the digital commodity.’’. 
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(b) COMMISSION JURISDICTION OVER RETAIL DIG-
ITAL COMMODITY TRANSACTIONS.— 
(1) IN GENERAL.—Section 2(c)(2) of such Act 
(7 U.S.C. 2(c)(2)) is amended— 
(A) in subparagraph (D)(ii)— 
(i) in subclause (III), in the matter 
that precedes item (aa), by inserting ‘‘of a 
commodity, other than a digital com-
modity,’’ before ‘‘that’’; and 
(ii) by redesignating subclauses (IV) 
and (V) as subclauses (V) and (VI) and in-
serting after subclause (III) the following: 
‘‘(IV) a contract of sale of a dig-
ital commodity that— 
‘‘(aa) results in actual deliv-
ery within 2 days or such other 
period as the Commission may 
determine by rule or regulation 
based upon the typical commer-
cial practice in cash or spot mar-
kets for the digital commodity in-
volved; or 
‘‘(bb) is executed on or sub-
ject to the rules of a registered 
digital commodity exchange or 
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with a registered futures commis-
sion merchant;’’; and 
(B) by adding at the end the following: 
‘‘(F) COMMISSION JURISDICTION OVER DIGITAL 
COMMODITY TRANSACTIONS.— 
‘‘(i) IN GENERAL.—Subject to sections 6d and 
12(e), the Commission shall have exclusive jurisdic-
tion over any agreement, contract, or transaction in-
volving a contract of sale of a digital commodity in 
interstate commerce. 
‘‘(ii) WITHHOLDING OF RULEMAKING AUTHOR-
ITY
OVER
CERTAIN
TRANSACTIONS.—Notwith-
standing clause (i), this subparagraph shall not be 
interpreted to permit the Commission to issue any 
rule or regulation regarding any agreement, con-
tract, or transaction that is not offered, solicited, 
traded, facilitated, executed, cleared, reported, or 
otherwise dealt in— 
‘‘(I) on or subject to the rules of a reg-
istered entity; 
‘‘(II) by any other entity registered by the 
Commission; or 
‘‘(III) for the purpose of transferring a 
digital commodity, or any promise or right to a 
future unit of a digital commodity, obtained 
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through a digital commodity presale and subject 
to section 4c(h). 
‘‘(iii) LIMITATIONS.—Clause (i) shall not apply 
with respect to— 
‘‘(I) custodial or depository activities for a 
digital commodity, or custodial or depository ac-
tivities for any promise or right to a future dig-
ital commodity, of an entity regulated by a 
State or other Federal regulatory agency; or 
‘‘(II) a securities offering or transaction 
associated with— 
‘‘(aa) a digital commodity presale; or 
‘‘(bb) a sale described in section 
4c(h)(3)(A).’’. 
(2) 
CONFORMING
AMENDMENT.—Section 
2(a)(1)(A) of such Act (7 U.S.C. 2(a)(1)(A)) is 
amended in the 1st sentence by inserting ‘‘sub-
section (c)(2)(F) of this section or’’ before ‘‘section 
19’’. 
(c) PROHIBITED TRANSACTIONS.—Section 4c of such 
Act (7 U.S.C. 6c) is amended by adding at the end the 
following: 
‘‘(h) PROHIBITED
DIGITAL
COMMODITY
TRANS-
ACTIONS.— 
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‘‘(1) IN GENERAL.—It shall be a violation of 
this Act for any person who owns or controls a unit 
of a digital commodity, or any promise or right to 
a future unit of a digital commodity, obtained 
through a digital commodity presale and subject to 
the restrictions in this subsection, to offer to enter 
into, to enter into, or to execute a contract for the 
purchase or sale of the unit, promise, or right, ex-
cept as provided in paragraph (3). 
‘‘(2) UNLAWFUL FACILITATION OF PROHIBITED 
TRANSACTIONS.—It shall be a violation of this Act 
for any person willfully to execute, confirm the exe-
cution of, or conduct any office or business for the 
purpose of soliciting, accepting any order for, or oth-
erwise dealing in, any transaction in, or in connec-
tion with, a contract for the purchase or sale of a 
unit of a digital commodity, or any promise or right 
to a future unit of a digital commodity, which such 
person has reason to believe is obtained through a 
digital commodity presale and subject to the restric-
tions in this subsection, except as provided in para-
graph (3). 
‘‘(3) EXCEPTIONS.— 
‘‘(A) OFF-EXCHANGE TRANSACTIONS.— 
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‘‘(i) SALE OF A PROMISE OR RIGHT.— 
A promise or right to a future unit of a 
digital commodity obtained through a dig-
ital commodity presale may be sold pursu-
ant to a securities transaction conducted in 
compliance with the Securities Act of 
1933. 
‘‘(ii) SALE
OF
A
DIGITAL
COM-
MODITY.—A unit of a digital commodity 
obtained through a digital commodity 
presale may be sold— 
‘‘(I) pursuant to a securities 
transaction conducted in compliance 
with the Securities Act of 1933; or 
‘‘(II) to an accredited investor 
(as defined in section 2(a)(15) of such 
Act). 
‘‘(iii) TREATMENT.—For purposes of 
this subsection, a unit of a digital com-
modity or any promise or right to a future 
unit of a digital commodity obtained 
through a transaction utilizing this excep-
tion shall continue to be considered to be 
obtained through a digital commodity 
presale. 
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‘‘(B) ON-EXCHANGE TRANSACTIONS.— 
‘‘(i) IN GENERAL.—A unit of a digital 
commodity that is obtained through a dig-
ital commodity presale or a transaction de-
scribed in subparagraph (A) may be of-
fered for sale or exchange on a registered 
digital commodity exchange, subject to any 
limitations imposed by the exchange. 
‘‘(ii) TREATMENT.—For purposes of 
this subsection, a unit of a digital com-
modity obtained through a transaction uti-
lizing this exception shall not be considered 
to be obtained though a digital commodity 
presale. 
‘‘(C) UTILIZATION
OF
PRESOLD
DIGITAL 
COMMODITIES.— 
‘‘(i) IN GENERAL.—A unit of a digital 
commodity that is obtained through a dig-
ital commodity presale may be— 
‘‘(I) utilized for the purposes of 
receiving the non-financial rights or 
services associated with the digital 
commodity; or 
‘‘(II) exchanged or sold in such 
limited quantities as the Commission 
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determines support the public use and 
functioning of services and rights as-
sociated with the digital commodity. 
‘‘(ii) TREATMENT.—For purposes of 
this subsection, a unit of a digital com-
modity obtained through a transaction uti-
lizing this exception shall not be considered 
to be obtained though a digital commodity 
presale. 
‘‘(D) PRIOR
DIGITAL
COMMODITIES.—A 
unit of a digital commodity shall not be subject 
to this subsection if, before the date of the en-
actment of this subsection, the digital com-
modity was publicly available for trading on a 
trading facility licensed as a money services 
business with the Department of the Treasury. 
‘‘(4) TRANSITION RULES.— 
‘‘(A) IN GENERAL.—For the purpose of a 
transaction described in paragraph (3)(B), the 
Commission shall consider a trading facility to 
be a registered digital commodity exchange if— 
‘‘(i) the trading facility— 
‘‘(I) has been continuously li-
censed as a money services business 
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with the Department of the Treasury 
since August 1, 2019; 
‘‘(II) is a registered designated 
contract market; or 
‘‘(III) is a registered swap execu-
tion facility; 
‘‘(ii) the trading facility submits a no-
tice to the Commission containing— 
‘‘(I) 
documentation 
dem-
onstrating its licensing referred to in 
clause (i)(I); and 
‘‘(II) an assessment of the digital 
commodity and all units of the digital 
commodity to be permitted to trade, 
in accordance with section 5i(c)(3); 
and 
‘‘(iii) the Commission has not issued a 
notice of disapproval. 
‘‘(B) DISAPPROVAL PROCESS.—In making 
a disapproval under subparagraph (A), the 
Commission shall— 
‘‘(i) issue any disapproval within 20 
business days after receipt of a completed 
notice; and 
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‘‘(ii) identify the specific deficiencies 
with the notice that necessitated the dis-
approval. 
‘‘(C) EXTENSIONS.—The Commission may 
extend the time for consideration under sub-
paragraph (B)— 
‘‘(i) once, for 20 business days, 
through written notice to the digital com-
modity exchange; and 
‘‘(ii) once, for an additional 90 busi-
ness days, through notice to the digital 
commodity exchange which includes a de-
scription of any deficiencies with the listing 
notice, including any— 
‘‘(I) novel or complex issues 
which require additional time to ana-
lyze; 
‘‘(II) missing information or in-
adequate explanations; or 
‘‘(III) potential inconsistencies 
with this Act. 
‘‘(D) EXPIRATION.—The authority pro-
vided by this subparagraph shall expire 1 year 
after the date of the final promulgation of the 
digital commodity exchange registration re-
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quirements, or on the first registration of a dig-
ital commodity exchange, whichever occurs ear-
lier.’’. 
(d) SEGREGATION OF DIGITAL COMMODITIES.—Sec-
tion 4d of such Act (7 U.S.C. 6d) is amended by adding 
at the end the following: 
‘‘(i) SEGREGATION OF DIGITAL COMMODITIES.— 
‘‘(1) HOLDING OF CUSTOMER ASSETS.— 
‘‘(A) IN GENERAL.—Each futures commis-
sion merchant shall hold customer money, as-
sets, and property in a manner to minimize the 
customer’s risk of loss or unreasonable delay in 
the access to the money, assets, and property of 
the customer. 
‘‘(B) QUALIFIED
DIGITAL
COMMODITY 
CUSTODIAN.—A futures commission merchant 
shall hold in a qualified digital commodity cus-
todian each unit of a digital commodity that 
is— 
‘‘(i) the property of a customer of the 
futures commission merchant; or 
‘‘(ii) otherwise so required by the 
Commission to reasonably protect cus-
tomers or promote the public interest. 
‘‘(2) SEGREGATION OF FUNDS.— 
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‘‘(A) IN GENERAL.—A futures commission 
merchant shall treat and deal with all money, 
assets, and property of any digital commodity 
customer received as belonging to the customer. 
‘‘(B) COMMINGLING PROHIBITED.—Money, 
assets, and property of a customer described in 
subparagraph (A) shall be separately accounted 
for, and shall not be commingled with the funds 
of the futures commission merchant or be used 
to margin, secure, or guarantee any trades or 
accounts of any customer or person other than 
the person for whom the same are held. 
‘‘(C) DIGITAL COMMODITY CUSTOMER DE-
FINED.—For the purposes of this paragraph, 
the term ‘digital commodity customer’ means a 
customer involved in a cash or spot, leveraged, 
margined, or financed digital commodity trans-
action in which the futures commission mer-
chant is acting as the counterparty. 
‘‘(3) EXCEPTIONS.— 
‘‘(A) USE OF FUNDS.— 
‘‘(i) IN
GENERAL.—Notwithstanding 
paragraph (2), money, assets, and property 
of customers of a futures commission mer-
chant described in paragraph (2) may, for 
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convenience, be commingled and deposited 
in the same account or accounts with any 
bank, trust company, derivatives clearing 
organization, or qualified digital com-
modity custodian. 
‘‘(ii) WITHDRAWAL.—Notwithstanding 
paragraph (2), the share of the money, as-
sets, and property described in clause (i) 
as in the normal course of business shall 
be necessary to margin, guarantee, secure, 
transfer, adjust, or settle a digital com-
modity transaction with a registered entity 
may be withdrawn and applied to such 
purposes, including the payment of com-
missions, brokerage, interest, taxes, stor-
age, and other charges, lawfully accruing 
in connection with the digital commodity 
transaction. 
‘‘(B) 
COMMISSION
ACTION.—Notwith-
standing paragraph (2), in accordance with 
such terms and conditions as the Commission 
may prescribe by rule, regulation, or order, any 
money, assets, or property of the customers of 
a futures commission merchant described in 
paragraph (2) may be commingled and depos-
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ited in customer accounts with any other 
money, assets, or property received by the fu-
tures commission merchant and required by the 
Commission to be separately accounted for and 
treated and dealt with as belonging to the cus-
tomer of the futures commission merchant. 
‘‘(4) PERMITTED
INVESTMENTS.—Money de-
scribed in paragraph (2) may be invested in obliga-
tions of the United States, in general obligations of 
any State or of any political subdivision of a State, 
and in obligations fully guaranteed as to principal 
and interest by the United States, or in any other 
investment that the Commission may by rule or reg-
ulation prescribe, and the investments shall be made 
in accordance with such rules and regulations and 
subject to such conditions as the Commission may 
prescribe. 
‘‘(5) PROHIBITION.—It shall be unlawful for 
any person, including any derivatives clearing orga-
nization or depository institution that has received 
any money, securities, or property for deposit in a 
separate account or accounts as provided in para-
graph (2) to hold, dispose of, or use any of the 
money, assets, or property that belongs to the depos-
iting futures commission merchant or any person 
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other than the digital commodity customer of the fu-
tures commission merchant. 
‘‘(6) CUSTOMER RIGHT TO OPT OUT.— 
‘‘(A) IN GENERAL.—A customer shall have 
the right to waive the restrictions in this sub-
section, by affirmatively electing, in writing to 
the futures commission merchant, to waive the 
restrictions. 
‘‘(B) 
LIMITATIONS.—The 
Commission 
may, by rule, establish notice and disclosure re-
quirements, segregation requirements, invest-
ment limitations, and other rules related to the 
waiving of any restrictions under this sub-
section that are reasonably necessary to protect 
customers, including eligible contract partici-
pants, non-eligible contract participants, or any 
other class of customers. 
‘‘(7) CUSTOMER
PROTECTION
DURING
BANK-
RUPTCY.— 
‘‘(A) CUSTOMER
PROPERTY.—All money, 
assets, or property described in paragraph (2) 
shall be considered customer property for pur-
poses of section 761 of title 11, United States 
Code. 
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‘‘(B) TRANSACTIONS.—A cash or spot, le-
veraged, margined, or financed digital com-
modity transaction in which the futures com-
mission merchant is acting as the counterparty 
shall be considered a ‘contract for the purchase 
or sale of a commodity for future delivery on, 
or subject to the rules of, a contract market or 
board of trade’ for purposes of the definition of 
‘commodity contract’ in section 761 of title 11, 
United States Code. 
‘‘(C) ASSETS
REMOVED
FROM
SEGREGA-
TION.—Assets removed from segregation due to 
a customer election under paragraph (6) shall 
not be considered customer property for pur-
poses of section 761 of title 11, United States 
Code.’’. 
(e) LIMITATION
ON FUTURES COMMISSION MER-
CHANT ACTING AS A COUNTERPARTY IN DIGITAL COM-
MODITY TRANSACTIONS.—Section 4d of such Act (7 
U.S.C. 6d) is further amended by adding at the end the 
following: 
‘‘(j) LIMITATION ON FUTURES COMMISSION MER-
CHANT ACTING AS A COUNTERPARTY IN DIGITAL COM-
MODITY TRANSACTIONS.—A registered futures commis-
sion merchant shall not act as a counterparty in any 
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‘‘(i) IN GENERAL.—In the case of list-
ing a digital commodity for trading which 
has not yet been listed for trading on an-
other registered entity, paragraphs (2) and 
(3) shall apply as if the listing were a rule, 
and paragraph (2) shall be applied by sub-
stituting ‘20 business days’ for ‘10 busi-
ness days’. 
‘‘(ii) TRANSITIONAL
EXTENSION.— 
For 1 year after the registration of the 
first digital commodity exchange, the Com-
mission shall have an additional 20 busi-
ness days to review any certification under 
clause (i). 
‘‘(iii) 
DIGITAL
COMMODITY 
PRESALES.— 
‘‘(I) IN
GENERAL.—In conjunc-
tion with listing a digital commodity 
in which any unit of the digital com-
modity was obtained through a digital 
commodity presale, a registered entity 
shall prohibit any transaction with 
any unit of the digital commodity ob-
tained in violation of section 4c(h). 
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‘‘(II) RELIANCE ON DISCLOSURE 
BY
REGISTERED
DEVELOPER.—In 
complying with subclause (I), a reg-
istered entity may rely on the records 
and disclosures of a registered digital 
commodity developer submitted to the 
Commission or its designee under sec-
tion 4v in determining whether a unit 
of a digital commodity was obtained 
in violation of section 4c(h). 
‘‘(iv) 
CONSIDERATION
OF
COM-
MENTS.—In conducting a review under 
clause (i), the Commission shall consider 
any comments provided by the Securities 
and Exchange Commission regarding any 
inconsistencies with this Act posed by the 
potential listing of an asset that is not a 
digital commodity.’’. 
(g) REGISTRATION
OF DIGITAL COMMODITY EX-
CHANGES; 
QUALIFIED
DIGITAL
COMMODITY 
CUSTODIANS.— 
(1) IN GENERAL.—The Commodity Exchange 
Act (7 U.S.C. 1 et seq.) is amended by inserting 
after section 5h the following: 
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‘‘SEC. 5i. REGISTRATION OF DIGITAL COMMODITY EX-
CHANGES. 
‘‘(a) IN GENERAL.— 
‘‘(1) REGISTRATION.— 
‘‘(A) IN
GENERAL.—Any trading facility 
that offers or seeks to offer a market in digital 
commodities may register with the Commission 
as a digital commodity exchange. 
‘‘(B) APPLICATION.—A person desiring to 
register as a digital commodity exchange shall 
submit to the Commission an application in 
such form and containing such information as 
the Commission may require for the purpose of 
making the determinations required for ap-
proval under subsections (c) and (e). 
‘‘(2) DEEMED
REGISTRATION.—A registered 
designated contract market or registered swap exe-
cution facility which fulfills the requirements of this 
section may elect to be considered a registered dig-
ital commodity exchange, in such form and manner 
as the Commission shall prescribe. 
‘‘(3) ADDITIONAL
REGISTRATIONS.—A reg-
istered digital commodity exchange shall be— 
‘‘(A) a member of a registered futures as-
sociation; and 
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‘‘(B) registered with the Secretary of the 
Treasury as a Money Services Business. 
‘‘(b) TRADING.— 
‘‘(1) IN
GENERAL.—A digital commodity ex-
change that is registered under subsection (a) may 
make available for trading any digital commodity 
that is not readily susceptible to manipulation, sub-
ject to this subsection. 
‘‘(2) RULES GOVERNING MARGINED OR LEVER-
AGED TRADING.—The Commission may make, pro-
mulgate, and enforce such additional rules governing 
margined, leveraged, or financed transactions as are 
reasonably necessary to protect market participants 
and promote the orderly settlement of transactions 
with respect to— 
‘‘(A) disclosure; 
‘‘(B) recordkeeping; 
‘‘(C) capital, margin, and other financial 
resources; 
‘‘(D) reporting; 
‘‘(E) business conduct; 
‘‘(F) documentation; and 
‘‘(G) such other matters as the Commis-
sion demonstrates to be necessary. 
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‘‘(3) PROHIBITION ON CERTAIN TRADING PRAC-
TICES.—Sections 4b, 4c, and 6(c) shall apply to any 
agreement, contract, or transaction in a digital com-
modity as if the agreement, contract, or transaction 
were a contract of sale of a commodity for future de-
livery. 
‘‘(4) PROHIBITION ON TRADING DERIVATIVES 
PRODUCTS.—Registration as a digital commodity ex-
change shall not permit a trading facility to offer 
any contract of sale of a commodity for future deliv-
ery, option, or swap for trading without also being 
registered as a designated contract market or swap 
execution facility. 
‘‘(5) 
RULES
FOR
DIGITAL
COMMODITY 
PRESALES.—The digital commodity exchange shall 
have in place such rules as may be necessary to rea-
sonably ensure the orderly sale of any unit of a dig-
ital commodity obtained through a digital commodity 
presale. 
‘‘(c) CORE PRINCIPLES FOR DIGITAL COMMODITY 
EXCHANGES.— 
‘‘(1) COMPLIANCE WITH CORE PRINCIPLES.— 
‘‘(A) IN GENERAL.—To be registered, and 
maintain registration, as a digital commodity 
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exchange, the digital commodity exchange shall 
comply with— 
‘‘(i) the core principles described in 
this subsection; and 
‘‘(ii) any requirement that the Com-
mission may impose by rule or regulation 
pursuant to section 8a(5). 
‘‘(B) REASONABLE DISCRETION OF A DIG-
ITAL
COMMODITY
EXCHANGE.—Unless other-
wise determined by the Commission by rule or 
regulation, a digital commodity exchange de-
scribed in subparagraph (A) shall have reason-
able discretion in establishing the manner in 
which the digital commodity exchange complies 
with the core principles described in this sub-
section. 
‘‘(2) COMPLIANCE
WITH
RULES.—A digital 
commodity exchange shall— 
‘‘(A) establish and enforce compliance with 
any rule of the digital commodity exchange, in-
cluding— 
‘‘(i) the terms and conditions of the 
trades traded or processed on or through 
the digital commodity exchange; and 
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‘‘(ii) any limitation on access to the 
digital commodity exchange; 
‘‘(B) establish and enforce trading, trade 
processing, and participation rules that will 
deter abuses and have the capacity to detect, 
investigate, and enforce those rules, including 
means— 
‘‘(i) to provide market participants 
with impartial access to the market; and 
‘‘(ii) to capture information that may 
be used in establishing whether rule viola-
tions have occurred; and 
‘‘(C) establish rules governing the oper-
ation of the exchange, including rules specifying 
trading procedures to be used in entering and 
executing orders traded or posted on the facil-
ity. 
‘‘(3) DIGITAL COMMODITIES NOT READILY SUS-
CEPTIBLE TO MANIPULATION.— 
‘‘(A) IN GENERAL.—The digital commodity 
exchange shall permit trading in only digital 
commodities that are not readily susceptible to 
manipulation. 
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‘‘(B) LISTING
RESTRICTIONS.—A digital 
commodity exchange shall not permit trading 
in— 
‘‘(i) a unit of a digital commodity, if 
it is reasonably likely that the transaction 
history of the digital commodity can be 
fraudulently altered by any person or 
group of persons acting collectively; or 
‘‘(ii) a unit of a digital commodity 
subject to the restrictions in section 4c(h), 
if 
it 
is 
reasonably 
likely 
that 
the 
functionality or operation of the digital 
commodity can be materially altered by 
any person or group of persons under com-
mon control. 
‘‘(C) CONSIDERATIONS.—In assessing a 
digital commodity under this paragraph, the ex-
change shall consider, with respect to the digital 
commodity— 
‘‘(i) its purpose and use; 
‘‘(ii) its unit creation or release proc-
ess; 
‘‘(iii) its consensus mechanism; 
‘‘(iv) its governance structure; 
‘‘(v) its participation and distribution; 
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‘‘(vi) 
its 
current 
and 
proposed 
functionality; and 
‘‘(vii) any other factor required by the 
Commission. 
‘‘(D) RULES
FOR
FIXED-VALUE
DIGITAL 
COMMODITIES.—A 
fixed-value 
digital 
com-
modity shall be determined to be not readily 
susceptible to manipulation under this section if 
the issuer of the fixed-value digital commodity 
is registered as a fixed-value digital commodity 
operator or subject to comparable, comprehen-
sive supervision and regulation by another Fed-
eral regulator or an appropriate government au-
thority in the home country of the fixed-value 
digital commodity operator. 
‘‘(4) TREATMENT OF CUSTOMER ASSETS.— 
‘‘(A) REQUIRED STANDARDS AND PROCE-
DURES.—Each digital commodity exchange 
shall establish standards and procedures that 
are designed to protect and ensure the safety of 
customer money, assets, and property. 
‘‘(B) HOLDING OF CUSTOMER ASSETS.— 
‘‘(i) IN GENERAL.—Each digital com-
modity exchange shall hold customer 
money, assets, and property in a manner 
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to minimize the customer’s risk of loss or 
unreasonable delay in the access to the 
money, assets, and property of the cus-
tomer. 
‘‘(ii) SEGREGATION OF FUNDS.— 
‘‘(I) IN
GENERAL.—A digital 
commodity exchange shall treat and 
deal with all money, assets, and prop-
erty of any customer received as be-
longing to the customer. 
‘‘(II) 
COMMINGLING
PROHIB-
ITED.—Money, assets, and property of 
a customer described in subclause (I) 
shall be separately accounted for and 
shall not be commingled with the 
funds of the digital commodity ex-
change or be used to margin, secure, 
or guarantee any trades or accounts 
of any customer or person other than 
the person for whom the same are 
held. 
‘‘(iii) EXCEPTIONS.— 
‘‘(I) USE OF FUNDS.— 
‘‘(aa) IN
GENERAL.—Not-
withstanding clause (ii), money, 
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assets, and property of customers 
of a digital commodity exchange 
described in clause (ii) may, for 
convenience, be commingled and 
deposited in the same account or 
accounts with any bank, trust 
company, 
or 
qualified 
digital 
commodity custodian. 
‘‘(bb) WITHDRAWAL.—Not-
withstanding clause (ii), such 
share of the money, assets, and 
property described in item (aa) 
as in the normal course of busi-
ness shall be necessary to mar-
gin, guarantee, secure, transfer, 
adjust, or settle a digital com-
modity transaction with a reg-
istered entity may be withdrawn 
and applied to such purposes, in-
cluding the payment of commis-
sions, brokerage, interest, taxes, 
storage, and other charges, law-
fully accruing in connection with 
the 
digital 
commodity 
trans-
action. 
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‘‘(II) 
COMMISSION
ACTION.— 
Notwithstanding clause (ii), in accord-
ance with such terms and conditions 
as the Commission may prescribe by 
rule, regulation, or order, any money, 
assets, or property of the customers of 
a digital commodity exchange de-
scribed in clause (ii) may be commin-
gled and deposited in customer ac-
counts with any other money, assets, 
or property received by the digital 
commodity exchange and required by 
the Commission to be separately ac-
counted for and treated and dealt 
with as belonging to the customer of 
the digital commodity exchange. 
‘‘(C) PERMITTED
INVESTMENTS.—Money 
described in clause (ii) may be invested in obli-
gations of the United States, in general obliga-
tions of any State or of any political subdivision 
of a State, and in obligations fully guaranteed 
as to principal and interest by the United 
States, or in any other investment that the 
Commission may by rule or regulation pre-
scribe, and such investments shall be made in 
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accordance with such rules and regulations and 
subject to such conditions as the Commission 
may prescribe. 
‘‘(D) CUSTOMER
PROTECTION
DURING 
BANKRUPTCY.— 
‘‘(i) CUSTOMER
PROPERTY.—All as-
sets held on behalf of a customer by a dig-
ital commodity exchange registered under 
section 5i of this Act, and all money, as-
sets, and property of any customer re-
ceived by a digital commodity exchange 
registered under section 5i of this Act for 
trading or custody, or to facilitate, margin, 
guarantee, or secure digital commodity 
transactions (including money, assets, or 
property accruing to the customer as the 
result of the transactions), shall be consid-
ered customer property for purposes of sec-
tion 761 of title 11, United States Code. 
‘‘(ii) TRANSACTIONS.—A transaction 
involving a unit of a digital commodity oc-
curring on or subject to the rules of a dig-
ital commodity exchange registered under 
section 5i of this Act shall be considered a 
‘contract for the purchase or sale of a com-
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modity for future delivery, on or subject to 
the rules of, a contract market or board of 
trade’ for the purposes of the definition of 
a ‘commodity contract’ in section 761 of 
title 11, United States Code. 
‘‘(iii) EXCHANGES.—A digital com-
modity exchange registered under section 
5i of this Act shall be considered a futures 
commission merchant for purposes of sec-
tion 761 of title 11, United States Code. 
‘‘(iv) ASSETS
REMOVED
FROM
SEG-
REGATION.—Notwithstanding clause (i), 
assets that have been removed from seg-
regation due to a customer election under 
subparagraph (F) shall not be considered 
customer property for purposes of section 
761 of title 11, United States Code. 
‘‘(E) MISUSE OF CUSTOMER PROPERTY.— 
It shall be unlawful— 
‘‘(i) for any digital commodity ex-
change that has received any customer 
money, assets, or property for custody to 
dispose of, or use any such money, assets, 
or property as belonging to the digital 
commodity exchange; or 
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‘‘(ii) for any other person, including 
any depository, other digital commodity ex-
change, or digital commodity custodian 
that has received any customer money, as-
sets, or property for deposit, to hold, dis-
pose of, or use any such money, assets, or 
property as belonging to the depositing 
digital commodity exchange or any person 
other than the customers of the digital 
commodity exchange. 
‘‘(F) CUSTOMER RIGHT TO OPT OUT.— 
‘‘(i) IN GENERAL.—A customer shall 
have the right to waive the restrictions in 
subparagraph (B), by affirmatively elect-
ing, in writing to the digital commodity ex-
change, to waive the restrictions. 
‘‘(ii) LIMITATIONS.—The Commission 
may, by rule, establish notice and disclo-
sure requirements, segregation require-
ments, investment limitations, and other 
rules related to the waiving of any restric-
tions under this paragraph that are rea-
sonably necessary to protect customers, in-
cluding eligible contract participants, non- 
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eligible contract participants, or any other 
class of customers. 
‘‘(5) MONITORING
OF
TRADING
AND
TRADE 
PROCESSING.— 
‘‘(A) IN GENERAL.—The digital commodity 
exchange shall provide a competitive, open, and 
efficient market and mechanism for executing 
transactions that protects the price discovery 
process of trading on the exchange. 
‘‘(B) PROTECTION OF MARKETS AND MAR-
KET PARTICIPANTS.—The digital commodity ex-
change shall establish and enforce rules— 
‘‘(i) to protect markets and market 
participants from abusive practices com-
mitted by any party, including abusive 
practices committed by a party acting as 
an agent for a participant; and 
‘‘(ii) to promote fair and equitable 
trading on the exchange. 
‘‘(C) The digital commodity exchange 
shall— 
‘‘(i) establish and enforce rules or 
terms and conditions defining, or specifica-
tions detailing— 
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‘‘(I) trading procedures to be 
used in entering and executing orders 
traded on or through the facilities of 
the digital commodity exchange; and 
‘‘(II) procedures for trade proc-
essing of digital commodities on or 
through the facilities of the digital 
commodity exchange; and 
‘‘(ii) monitor trading in digital com-
modities to prevent manipulation, price 
distortion, and disruptions of the delivery 
or cash settlement process through surveil-
lance, compliance, and disciplinary prac-
tices and procedures, including methods 
for conducting real-time monitoring of 
trading and comprehensive and accurate 
trade reconstructions. 
‘‘(6) ABILITY TO OBTAIN INFORMATION.—The 
digital commodity exchange shall— 
‘‘(A) establish and enforce rules that will 
allow the facility to obtain any necessary infor-
mation to perform any of the functions de-
scribed in this section; 
‘‘(B) provide the information to the Com-
mission on request; and 
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‘‘(C) have the capacity to carry out such 
international information-sharing agreements as 
the Commission may require. 
‘‘(7) EMERGENCY
AUTHORITY.—The digital 
commodity exchange shall adopt rules to provide for 
the exercise of emergency authority, in consultation 
or cooperation with the Commission or a registered 
entity, as is necessary and appropriate, including the 
authority to facilitate the liquidation or transfer of 
open positions in any digital commodity or to sus-
pend or curtail trading in a digital commodity. 
‘‘(8) REPORTING REQUIREMENTS.— 
‘‘(A) DUTY OF DIGITAL COMMODITY EX-
CHANGE.—Each digital commodity exchange 
shall provide to the Commission all information 
that is determined by the Commission to be 
necessary to perform each responsibility of the 
Commission under this Act. 
‘‘(B) TIMELY
PUBLICATION
OF
TRADING 
INFORMATION.— 
‘‘(i) IN GENERAL.—The digital com-
modity exchange shall make public timely 
information on price, trading volume, and 
other trading data on digital commodities 
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to the extent prescribed by the Commis-
sion. 
‘‘(ii) CAPACITY
OF
DIGITAL
COM-
MODITY
EXCHANGE.—The digital com-
modity exchange shall be required to have 
the capacity to electronically capture and 
transmit trade information with respect to 
transactions executed on the exchange. 
‘‘(9) RECORDKEEPING AND REPORTING.— 
‘‘(A) IN GENERAL.—A digital commodity 
exchange shall— 
‘‘(i) maintain records of all activities 
relating to the business of the facility, in-
cluding a complete audit trail, in a form 
and manner acceptable to the Commission 
for a period of 5 years; 
‘‘(ii) report to the Commission, in a 
form and manner acceptable to the Com-
mission, such information as the Commis-
sion determines to be necessary or appro-
priate for the Commission to perform the 
duties of the Commission under this Act; 
and 
‘‘(iii) keep any such records of digital 
commodities which relate to a security 
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open to inspection and examination by the 
Securities and Exchange Commission. 
‘‘(B) INFORMATION-SHARING.—Subject to 
section 8, and on request, the Commission shall 
share information collected under subparagraph 
(A) with— 
‘‘(i) the Board; 
‘‘(ii) the Securities and Exchange 
Commission; 
‘‘(iii) each appropriate Federal bank-
ing agency; 
‘‘(iv) each appropriate State bank su-
pervisor (within the meaning of section 3 
of the Federal Deposit Insurance Act); 
‘‘(v) the Financial Stability Oversight 
Council; 
‘‘(vi) the Department of Justice; and 
‘‘(vii) any other person that the Com-
mission determines to be appropriate, in-
cluding— 
‘‘(I) foreign financial supervisors 
(including foreign futures authorities); 
‘‘(II) foreign central banks; and 
‘‘(III) foreign ministries. 
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‘‘(C) CONFIDENTIALITY AGREEMENT.—Be-
fore the Commission may share information 
with any entity described in subparagraph (B), 
the Commission shall receive a written agree-
ment from each entity stating that the entity 
shall abide by the confidentiality requirements 
described in section 8 relating to the informa-
tion on digital commodity transactions that is 
provided. 
‘‘(D) 
PROVIDING
INFORMATION.—Each 
digital commodity exchange shall provide to the 
Commission (including any designee of the 
Commission) information under subparagraph 
(A) in such form and at such frequency as is 
required by the Commission. 
‘‘(10) ANTITRUST
CONSIDERATIONS.—Unless 
necessary or appropriate to achieve the purposes of 
this Act, the digital commodity exchange shall not— 
‘‘(A) adopt any rules or take any actions 
that result in any unreasonable restraint of 
trade; or 
‘‘(B) impose any material anticompetitive 
burden on trading. 
‘‘(11) CONFLICTS OF INTEREST.—The digital 
commodity exchange shall— 
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‘‘(A) establish and enforce rules to mini-
mize conflicts of interest in its decision-making 
process; and 
‘‘(B) establish a process for resolving the 
conflicts of interest. 
‘‘(12) FINANCIAL RESOURCES.— 
‘‘(A) IN
GENERAL.—Each digital com-
modity exchange shall have adequate financial, 
operational, and managerial resources, as deter-
mined by the Commission, to discharge each re-
sponsibility of the digital commodity exchange. 
‘‘(B) MINIMUM AMOUNT OF FINANCIAL RE-
SOURCES.—Each digital commodity exchange 
shall possess financial resources that, at a min-
imum, exceed the total amount that would en-
able the digital commodity exchange to conduct 
an orderly wind-down of its activities. 
‘‘(C) ADDITIONAL FINANCIAL RESOURCES 
FOR
LEVERAGE
TRADING.—The Commission 
may require such additional financial resources 
as are necessary to enable a digital commodity 
exchange which offers margined, leveraged, or 
financed transactions to fulfill its customer obli-
gations. 
‘‘(13) GOVERNANCE FITNESS STANDARDS.— 
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‘‘(A) 
GOVERNANCE
ARRANGEMENTS.— 
Each digital commodity exchange shall establish 
governance arrangements that are transparent 
to fulfill public interest requirements. 
‘‘(B) FITNESS STANDARDS.—Each digital 
commodity exchange shall establish and enforce 
appropriate fitness standards for— 
‘‘(i) directors; 
‘‘(ii) any individual or entity with di-
rect access to the settlement activities of 
the digital commodity exchange; 
‘‘(iii) any individual or entity with di-
rect access to any affiliated digital com-
modity custodian; 
‘‘(iv) any entity offering affiliated 
services for the digital commodity ex-
change; and 
‘‘(v) any party affiliated with any in-
dividual or entity described in this clause. 
‘‘(14) SYSTEM SAFEGUARDS.—The digital com-
modity exchange shall— 
‘‘(A) establish and maintain a program of 
risk analysis and oversight to identify and mini-
mize sources of operational and security risks, 
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through the development of appropriate controls 
and procedures, and automated systems, that— 
‘‘(i) are reliable and secure; and 
‘‘(ii) have adequate scalable capacity; 
‘‘(B) establish and maintain emergency 
procedures, backup facilities, and a plan for dis-
aster recovery that allow for— 
‘‘(i) the timely recovery and resump-
tion of operations; and 
‘‘(ii) the fulfillment of the responsibil-
ities and obligations of the digital com-
modity exchange; and 
‘‘(C) periodically conduct tests to verify 
that the backup resources of the digital com-
modity exchange are sufficient to ensure contin-
ued— 
‘‘(i) 
order 
processing 
and 
trade 
matching; 
‘‘(ii) price reporting; 
‘‘(iii) market surveillance; and 
‘‘(iv) maintenance of a comprehensive 
and accurate audit trail. 
‘‘(d) APPOINTMENT OF TRUSTEE.— 
‘‘(1) IN GENERAL.—If a proceeding under sec-
tion 5e results in the suspension or revocation of the 
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registration of a digital commodity exchange, or if a 
digital commodity exchange withdraws from registra-
tion, the Commission, on notice to the digital com-
modity exchange, may apply to the appropriate 
United States district court where the digital com-
modity exchange is located for the appointment of a 
trustee. 
‘‘(2) ASSUMPTION
OF
JURISDICTION.—If the 
Commission applies for appointment of a trustee 
under paragraph (1)— 
‘‘(A) the court may take exclusive jurisdic-
tion over the digital commodity exchange and 
the records and assets of the digital commodity 
exchange, wherever located; and 
‘‘(B) if the court takes jurisdiction under 
subparagraph (A), the court shall appoint the 
Commission, or a person designated by the 
Commission, as trustee with power to take pos-
session and continue to operate or terminate 
the operations of the digital commodity ex-
change in an orderly manner for the protection 
of customers subject to such terms and condi-
tions as the court may prescribe. 
‘‘(e) QUALIFIED
DIGITAL
COMMODITY
CUSTO-
DIAN.—A digital commodity exchange shall hold in a 
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