qualified digital commodity custodian each unit of a digital 
commodity that is— 
‘‘(1) the property of a customer of the digital 
commodity exchange; 
‘‘(2) required to be held by the digital com-
modity exchange under subsection (b)(2) or (c)(12) 
of this section; or 
‘‘(3) otherwise so required by the Commission 
to reasonably protect customers or promote the pub-
lic interest. 
‘‘(f) EXEMPTIONS.—In order to promote responsible 
economic or financial innovation and fair competition, or 
protect customers, the Commission may (on its own initia-
tive or on application of the registered digital commodity 
exchange) exempt, either unconditionally or on stated 
terms or conditions or for stated periods and either retro-
actively or prospectively, or both, a registered digital com-
modity exchange from the requirements of this section, if 
the Commission determines that— 
‘‘(1)(A) the exemption would be consistent with 
the public interest and the purposes of this Act; and 
‘‘(B) the exemption will not have a material ad-
verse effect on the ability of the Commission or the 
digital commodity exchange to discharge regulatory 
or self-regulatory duties under this Act; or 
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‘‘(2) the digital commodity exchange is subject 
to comparable, comprehensive supervision and regu-
lation by the appropriate government authorities in 
the home country of the organization. 
‘‘(g) CUSTOMER DEFINED.—In this section, the term 
‘customer’ means any person that maintains an account 
for the trading of digital commodities directly with a dig-
ital commodity exchange (other than a person that is 
owned or controlled, directly or indirectly, by the digital 
commodity exchange) for its own behalf or on behalf of 
other any person. 
‘‘(h) FEDERAL PREEMPTION.—Notwithstanding any 
other provision of law, the Commission shall have exclusive 
jurisdiction over any digital commodity exchange reg-
istered under this section. 
‘‘SEC. 5j. QUALIFIED DIGITAL COMMODITY CUSTODIANS. 
‘‘(a) IN GENERAL.—The Commission shall designate 
a digital commodity custodian as a qualified digital com-
modity custodian, if— 
‘‘(1) the Commission finds the digital com-
modity custodian is subject to adequate supervision 
and appropriate regulation by the Commission, the 
Securities and Exchange Commission, an appro-
priate Federal banking agency, a State bank super-
visor (within the meaning of section 3 of the Federal 
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Deposit Insurance Act), or an appropriate foreign 
governmental authority in the home country of the 
digital commodity custodian; and 
‘‘(2) the digital commodity custodian agrees to 
such regular and periodic sharing of information as 
the Commission determines by rule shall be reason-
ably necessary to effectuate any of the provisions, or 
to accomplish any of the purposes, of this Act. 
‘‘(b) RULEMAKING AUTHORITY.—For purposes of 
subsection (a), the Commission, by rule or order, shall de-
fine ‘adequate supervision’ and ‘appropriate regulation’ as 
any regulatory regime which meets such minimum stand-
ards for supervision and regulation as the Commission de-
termines are reasonably necessary to protect the property 
of customers of a registered digital commodity exchange, 
including minimum standards relating to— 
‘‘(1) accessibility of customer assets; 
‘‘(2) financial resources; 
‘‘(3) risk management requirements; 
‘‘(4) governance arrangements; 
‘‘(5) fitness standards; 
‘‘(6) recordkeeping; 
‘‘(7) information-sharing; and 
‘‘(8) conflicts of interest. 
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‘‘(c) 
AUTHORITY
TO
TEMPORARILY
SUSPEND 
STANDARDS.—The Commission may, by rule or order, 
temporarily suspend, in whole or in part, any requirement 
imposed under, or any standard referred to in, this section 
if the Commission determines that the suspension would 
be consistent with the public interest and the purposes of 
this Act.’’. 
(2) CERTAIN DIGITAL COMMODITY EXCHANGE 
FUNCTIONS NOT SUFFICIENT TO TRIGGER REQUIRE-
MENT TO REGISTER AS FUTURES COMMISSION MER-
CHANT.—Section 4f(c) of the Commodity Exchange 
Act (7 U.S.C. 6f(c)) is amended by adding at the 
end the following: 
‘‘(12) CLARIFICATION OF SCOPE OF REGISTRA-
TION
REQUIREMENT.—A registered digital com-
modity exchange shall not be required to register as 
a futures commission merchant for any activity for 
which the exchange is regulated under section 5i.’’. 
(h) REGISTRATION
AND REGULATION
OF FIXED- 
VALUE DIGITAL COMMODITY OPERATORS.— 
(1) DEFINITIONS.—Section 1a of the Com-
modity Exchange Act (7 U.S.C. 1a) is further 
amended by adding at the end the following: 
‘‘(56) FIXED-VALUE DIGITAL COMMODITY.— 
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‘‘(A) IN GENERAL.—The term ‘fixed-value 
digital commodity’ means a digital commodity 
which is redeemable for a fixed amount of fiat 
currency or another commodity, or the value 
thereof. 
‘‘(B) FURTHER
DEFINITION.—The Com-
mission, by rule or regulation, may include 
within, or exclude from, the term ‘fixed-value 
digital commodity’ any digital commodity if the 
Commission determines that the rule or regula-
tion will effectuate the purposes of this Act. 
‘‘(57) FIXED-VALUE DIGITAL COMMODITY OP-
ERATOR.— 
‘‘(A) IN GENERAL.—The term ‘fixed-value 
digital commodity operator’ means any per-
son— 
‘‘(i) engaged in a business that solic-
its, accepts, or receives funds, property, or 
other assets from others for the purpose of 
issuing units of a fixed-value digital com-
modity; or 
‘‘(ii) who is registered with the Com-
mission as a fixed-value digital commodity 
operator. 
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‘‘(B) FURTHER
DEFINITION.—The Com-
mission, by rule or regulation, may include 
within, or exclude from, the term ‘fixed-value 
digital commodity operator’ any person engaged 
in a business of issuing fixed-value digital com-
modities, if the Commission determines that the 
rule or regulation will effectuate the purposes of 
this Act.’’. 
(2) REGISTRATION
AND
REGULATION.—The 
Commodity Exchange Act (7 U.S.C. 1 et seq.) is 
amended by inserting after section 4t the following: 
‘‘SEC. 4u. REGISTRATION AND REGULATION OF FIXED- 
VALUE DIGITAL COMMODITY OPERATORS. 
‘‘(a) REGISTRATION.— 
‘‘(1) IN GENERAL.—A person may register with 
the Commission as a fixed-value digital commodity 
operator. 
‘‘(2) FILING REQUIREMENT.—A person desiring 
to register with the Commission as a fixed-value dig-
ital commodity operator shall file with the Commis-
sion a registration application, in such form and 
manner as is prescribed by the Commission. 
‘‘(3) APPLICATION CONTENTS.—The application 
shall include— 
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permit any person who is associated with the oper-
ator and is subject to a statutory disqualification, to 
take any action in relation to the fixed-value digital 
commodity on behalf of the operator, if the operator 
knew, or in the exercise of reasonable care should 
have known, of the statutory disqualification. 
‘‘(2) REVOCATION.— 
‘‘(A) IN GENERAL.—The failure of a reg-
istered fixed-value digital commodity operator 
to comply with any provision of this Act or any 
regulation or order of the Commission under 
this Act shall be cause for the suspension for a 
period not to exceed 180 days, or revocation, of 
the registration of the operator as a fixed-value 
digital commodity operator, in accordance with 
the procedures and subject to the judicial re-
view provided in section 6(b). 
‘‘(B) TRUSTEE.—If a proceeding under 
subparagraph (A) results in the suspension or 
revocation of the registration of a fixed-value 
digital commodity operator, or if such an oper-
ator withdraws from registration, the Commis-
sion, on notice to the operator, may apply to 
the appropriate United States district court for 
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the judicial district in which the operator is lo-
cated for the appointment of a trustee. 
‘‘(C) ASSUMPTION
OF
JURISDICTION.—If 
the Commission applies for appointment of a 
trustee under subparagraph (B)— 
‘‘(i) the court may take exclusive ju-
risdiction over the fixed-value digital com-
modity operator and the records and assets 
of the operator, wherever located; and 
‘‘(ii) if the court takes jurisdiction 
under clause (i), the court shall appoint 
the Commission, or a person designated by 
the Commission, as trustee with power to 
take possession and continue to operate or 
terminate the operations of the fixed-value 
digital commodity operator in an orderly 
manner for the protection of participants, 
subject to such terms and conditions as the 
court may prescribe. 
‘‘(c) DUTIES OF A REGISTERED FIXED-VALUE DIG-
ITAL COMMODITY OPERATOR.—A registered fixed-value 
digital commodity operator shall comply, in such manner 
as the Commission shall by rule or order determine, with 
the following requirements: 
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‘‘(1) DISCLOSURE
OF
GENERAL
INFORMA-
TION.—For each fixed-value digital commodity it op-
erates, such an operator shall— 
‘‘(A) disclose to the Commission informa-
tion concerning— 
‘‘(i) the terms and conditions of the 
fixed-value digital commodity transactions; 
‘‘(ii) the fixed-value digital commodity 
operations, mechanisms, and practices; 
‘‘(iii) the process for the issuance and 
redemption of units of the fixed-value dig-
ital commodity; 
‘‘(iv) the financial integrity protec-
tions relating to the fixed-value digital 
commodity; and 
‘‘(v) other information relevant to 
transacting in the fixed-value digital com-
modity; and 
‘‘(B) continue to submit to the Commission 
reports that contain such information per-
taining to the business of the operator as the 
Commission may require. 
‘‘(2) PUBLICLY
AVAILABLE
INFORMATION.— 
For each fixed-value digital commodity it operates, 
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such an operator shall make available to the public, 
information concerning— 
‘‘(A) the fixed-value digital commodity op-
erations, mechanisms, and practices; 
‘‘(B) the process for the issuance and re-
demption of the units of the fixed-value digital 
commodity; 
‘‘(C) information about the material risks 
and characteristics of the fixed-value digital 
commodity; 
‘‘(D) the total value of the outstanding 
units of the fixed-value digital commodity; 
‘‘(E) the total value of funds and other 
property held by the operator for redemption; 
‘‘(F) any material incentives or conflicts of 
interest that the operator may have in connec-
tion with the fixed-value digital commodity; and 
‘‘(G) any other information the Commis-
sion determines is relevant to the public’s un-
derstanding of the operation of the fixed-value 
digital commodity. 
‘‘(3) RECORD OF ASSETS AND LIABILITIES.— 
For each fixed-value digital commodity it operates, 
such an operator shall maintain daily redemption 
fund records reflecting the total amount of funds or 
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property held by the operator for redemption and 
the total value of outstanding redeemable units of 
the fixed-value digital commodity. 
‘‘(4) ABILITY TO OBTAIN INFORMATION.—Such 
an operator shall— 
‘‘(A) establish and enforce internal systems 
and procedures to obtain any necessary infor-
mation to perform any of the functions de-
scribed in this section; and 
‘‘(B) provide the information to the Com-
mission, as applicable, on request. 
‘‘(5) CONFLICTS OF INTEREST.—Such an oper-
ator shall implement conflict-of-interest systems and 
procedures that address such issues as the Commis-
sion determines to be appropriate. 
‘‘(6) RISK MANAGEMENT PROCEDURES.—Such 
an operator shall establish robust and professional 
risk management systems adequate for managing 
the day-to-day business of the operator. 
‘‘(7) REPORTING AND RECORDKEEPING.—Such 
an operator shall— 
‘‘(A) make such reports as are required by 
the Commission by rule or regulation regarding 
the issuance and redemption transactions, and 
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positions and financial condition of the reg-
istered fixed-value digital commodity operator; 
‘‘(B) keep books and records in such form 
and manner and for such period as may be pre-
scribed by the Commission by rule or regula-
tion; and 
‘‘(C) keep the books and records referred 
to in subparagraph (B) open to inspection and 
examination by any representative of the Com-
mission. 
‘‘(8) BUSINESS
CONDUCT
STANDARDS.—Such 
an operator shall conform with such business con-
duct standards as the Commission may prescribe, re-
lated to— 
‘‘(A) fraud, manipulation, and other abu-
sive practices involving the issuance and re-
demption of any unit of the fixed-value digital 
commodity; 
‘‘(B) diligent supervision of the business of 
the operator; 
‘‘(C) communicating with the public in a 
fair and balanced manner based on principles of 
fair dealing and good faith; and 
‘‘(D) such other standards and require-
ments as the Commission may determine are 
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appropriate in the public interest, for the pro-
tection of participants in the fixed-value digital 
commodity, or otherwise in furtherance of the 
purposes of this section. 
‘‘(9) REQUIREMENTS FOR ISSUANCE AND RE-
DEMPTION TRANSACTION RECORDS.— 
‘‘(A) IN GENERAL.—For each fixed-value 
digital commodity it operates, such an operator 
shall maintain daily transaction records of the 
units of the fixed-value digital commodity 
issued or redeemed by the operator for such pe-
riod as may be required by the Commission by 
rule or regulation. 
‘‘(B) COUNTERPARTY RECORDS.—For each 
fixed-value digital commodity it operates, such 
an operator shall maintain daily transaction 
records for each counterparty to an issuance or 
redemption transaction in a manner and form 
that is identifiable with each fixed-value digital 
commodity transaction. 
‘‘(C) AUDIT TRAIL.—For each fixed-value 
digital commodity it operates, such an operator 
shall maintain a complete audit trail for con-
ducting comprehensive and accurate issuance 
and redemption transaction reconstructions. 
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from the assets and other interests of the 
operator. 
‘‘(B) APPLICABILITY.—Subparagraph (A) 
shall not preclude any commercial arrangement 
regarding the investment of segregated funds or 
other property that may only be invested in 
such investments as the Commission may per-
mit by rule or regulation. 
‘‘(C) CUSTODIANS.—The segregated ac-
count referred to in subparagraph (A) shall be 
carried by a qualified digital commodity custo-
dian for any digital commodity held for redemp-
tion. 
‘‘(e) FINANCIAL RESOURCES.— 
‘‘(1) IN
GENERAL.—A registered fixed-value 
digital commodity operator shall meet such min-
imum capital requirements as the Commission shall 
by rule or regulation prescribe, pursuant to the 
standards in paragraph (2). 
‘‘(2) STANDARDS
FOR
CAPITAL
REQUIRE-
MENTS.— 
‘‘(A) The requirements imposed under 
paragraph (1) shall— 
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‘‘(i) help ensure the safety and sound-
ness of the fixed-value digital commodity 
operator; 
‘‘(ii) be appropriate for the risk asso-
ciated with the funds for redemption held 
by such an operator; and 
‘‘(iii) be sufficient for the operator to 
comply with its plan for an orderly wind- 
down of its activities. 
‘‘(B) ADJUSTMENTS.—In setting capital 
requirements for a registered fixed-value digital 
commodity operator, the Commission shall take 
into account— 
‘‘(i) the risks associated with other ac-
tivities conducted by the operator or affili-
ated entity for activities not subject to reg-
ulations providing for a minimum capital 
standard; and 
‘‘(ii) any other capital requirement 
imposed on the operator or affiliated entity 
for activities subject to regulations pro-
viding for a minimum capital standard. 
‘‘(f) EXEMPTIONS.—In order to promote responsible 
economic or financial innovation and fair competition, or 
protect customers, the Commission may (on its own initia-
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tive or on application of the registered fixed-value digital 
commodity operator) exempt, either unconditionally or on 
stated terms or conditions or for stated periods and either 
retroactively or prospectively, or both, a registered fixed- 
value digital commodity operator from the requirements 
of this section, if the Commission determines that— 
‘‘(1) the exemption would be consistent with the 
public interest and the purposes of this Act; and 
‘‘(2) the exemption will not have a material ad-
verse effect on the ability of the Commission or the 
operator to discharge any duty of the Commission or 
the operator, respectively, under this Act. 
‘‘(g) RULEMAKING.— 
‘‘(1) IN
GENERAL.—The Commission shall 
adopt rules for registered fixed-value digital com-
modity operators and to effectuate the requirements 
of this section. 
‘‘(2) PROHIBITION
ON
THE
COLLECTION
OF 
CERTAIN INFORMATION.—This section shall not be 
construed to— 
‘‘(A) require a registered fixed-value digital 
commodity operator to solicit, collect, maintain, 
report, or otherwise make available to the Com-
mission, any other State or Federal agency, or 
any foreign authority, any record or informa-
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tion relating to any person, counterparty, 
amount, or account utilizing a unit of the fixed- 
value digital commodity in a transaction which 
does not involve the issuance or redemption of 
a unit of the fixed-value digital commodity, or 
to cause any other person to do the same; or 
‘‘(B) permit the Commission to require 
such an operator to solicit, collect, maintain, re-
port, or otherwise make available to the Com-
mission, any other State or Federal agency, or 
any foreign authority, any record or informa-
tion relating to any person, counterparty, 
amount, or account utilizing a unit of the fixed- 
value digital commodity in a transaction which 
does not involve the issuance or redemption of 
a unit of the fixed-value digital commodity, or 
to cause any other person to do the same.’’. 
(i) VOLUNTARY REGISTRATION AND DISCLOSURES 
BY DIGITAL COMMODITY DEVELOPERS.— 
(1) DEFINITION.—Section 1a of the Commodity 
Exchange Act (7 U.S.C. 1a) is further amended by 
adding at the end the following: 
‘‘(58) DIGITAL COMMODITY DEVELOPER.—The 
term ‘digital commodity developer’ means a person 
who creates or develops a digital commodity.’’. 
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(2) REGISTRATION
AND
DISCLOSURES.—The 
Commodity Exchange Act (7 U.S.C. 1 et seq.), as 
amended by subsection (f)(2) of this section, is fur-
ther amended by inserting after section 4t the fol-
lowing: 
‘‘SEC. 4v. REGISTRATION AND DISCLOSURES BY DIGITAL 
COMMODITY DEVELOPERS. 
‘‘(a) REGISTRATION.—Any person may register with 
the Commission as a digital commodity developer by filing 
a registration application with the Commission. 
‘‘(b) REQUIREMENTS.— 
‘‘(1) IN
GENERAL.—The application shall be 
made in such form and manner as prescribed by the 
Commission, and shall contain such information, as 
the Commission determines by rule is necessary to 
effectuate the purposes of this Act. 
‘‘(2) MEMBERSHIP.—Any person registered as 
a digital commodity developer shall be a member of 
a registered futures association for the duration of 
the registration. 
‘‘(3) EXPIRATION.—Each registration under 
this section shall expire— 
‘‘(A) when the applicant withdraws from 
registration; 
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‘‘(B) when the applicant fails to comply 
with the requirements of this section; or 
‘‘(C) at such other time as the Commission 
may prescribe by rule or regulation. 
‘‘(c) DISCLOSURES.—For each digital commodity, a 
registered digital commodity developer shall submit to the 
Commission or its designee, and maintain on a publicly 
available website, in such form and manner as prescribed 
by the Commission, the following: 
‘‘(1) INITIAL DISCLOSURES.— 
‘‘(A) PROJECT DISCLOSURES.—A general 
description of the digital commodity, includ-
ing— 
‘‘(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; 
‘‘(vi) 
its 
current 
and 
proposed 
functionality; and 
‘‘(vii) any other such information the 
Commission determines will effectuate the 
purposes of this Act. 
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