•HR 3633 EH1S 
grammatic result of validating or staking 
activity for a blockchain system’s con-
sensus mechanism, including the staking of 
a digital commodity and the operation of a 
node or validator for such activity where— 
‘‘(I) the owner of the staked dig-
ital commodity and operator of the 
node or validator for such activity are 
different persons or entities; and 
‘‘(II) the operator of the node or 
validator does not maintain custody or 
control of the staked digital com-
modity. 
‘‘(iii) CUSTODIAL
AND
ANCILLARY 
STAKING SERVICES.—Subject to the rules 
issued pursuant to subparagraph (C), the 
provision of custodial or ancillary staking 
services enabling the owner of a digital 
commodity to participate in validating or 
staking activity for a blockchain system’s 
consensus mechanism that results in the 
programmatic distribution of a unit of a 
digital commodity, provided that such cus-
todial or ancillary services are exclusively 
administrative or ministerial in nature.
•HR 3633 EH1S 
‘‘(C) RULEMAKING TO DEFINE THE CUS-
TODIAL AND ANCILLARY STAKING SERVICES.— 
Not later than 270 days after the date of the 
enactment of this paragraph, the Commission 
shall issue rules defining the custodial and an-
cillary staking services described in subpara-
graph (B)(iii) that are exclusively administra-
tive or ministerial in nature, consistent with 
what is necessary or appropriate for the public 
interest or for the protection of investors. 
‘‘(31) MATURE
BLOCKCHAIN
SYSTEM.—The 
term ‘mature blockchain system’ means a blockchain 
system, together with its related digital commodity, 
that is not controlled by any person or group of per-
sons under common control. 
‘‘(32) PERMITTED
PAYMENT
STABLECOIN.— 
The term ‘permitted payment stablecoin’ means a 
payment stablecoin (as defined in section 2 of the 
GENIUS Act) issued by a permitted payment 
stablecoin issuer. 
‘‘(33) 
PERMITTED
PAYMENT
STABLECOIN 
ISSUER.—The term ‘permitted payment stablecoin 
issuer’ has the meaning given that term in section 
2 of the GENIUS Act.’’.
•HR 3633 EH1S 
SEC. 102. DEFINITIONS UNDER THE SECURITIES EX-
CHANGE ACT OF 1934. 
Section 3(a) of the Securities Exchange Act of 1934 
(15 U.S.C. 78c(a)) is amended— 
(1) by redesignating the second paragraph (80) 
(relating to funding portals) as paragraph (81); and 
(2) by adding at the end the following: 
‘‘(82) BANK SECRECY ACT.—The term ‘Bank 
Secrecy Act’ means— 
‘‘(A) section 21 of the Federal Deposit In-
surance Act (12 U.S.C. 1829b); 
‘‘(B) chapter 2 of title I of Public Law 91– 
508 (12 U.S.C. 1951 et seq.); and 
‘‘(C) subchapter II of chapter 53 of title 
31, United States Code. 
‘‘(83) ADDITIONAL
DIGITAL
COMMODITY-RE-
LATED TERMS.— 
‘‘(A) SECURITIES
ACT
OF
1933.—The 
terms ‘blockchain system’, ‘decentralized gov-
ernance system’, ‘digital asset’, ‘digital com-
modity affiliated person’, ‘digital commodity 
issuer’, ‘digital commodity related person’, ‘end 
user distribution’, ‘mature blockchain system’, 
‘permitted payment stablecoin’, and ‘permitted 
payment stablecoin issuer’ have the meaning 
given those terms, respectively, under section
•HR 3633 EH1S 
2(a) of the Securities Act of 1933 (15 U.S.C. 
77b(a)). 
‘‘(B) COMMODITY
EXCHANGE
ACT.—The 
terms ‘digital commodity’, ‘digital commodity 
broker’, ‘digital commodity dealer’, ‘digital com-
modity exchange’, ‘decentralized finance mes-
saging system’, and ‘decentralized finance trad-
ing protocol’ have the meaning given those 
terms, respectively, under section 1a of the 
Commodity Exchange Act (7 U.S.C. 1a).’’. 
SEC. 103. DEFINITIONS UNDER THE COMMODITY EX-
CHANGE ACT. 
(a) IN GENERAL.—Section 1a of the Commodity Ex-
change Act (7 U.S.C. 1a) is amended— 
(1) in paragraph (10)— 
(A) in subparagraph (A)— 
(i) by redesignating clauses (iii) and 
(iv) as clauses (iv) and (v), respectively; 
and 
(ii) by inserting after clause (ii) the 
following: 
‘‘(iii) digital commodity;’’; and 
(B) by redesignating subparagraph (B) as 
subparagraph (C) and inserting after subpara-
graph (A) the following:
•HR 3633 EH1S 
‘‘(B) EXCLUSION.—For purposes of this 
paragraph, the term ‘trading in commodity in-
terests’ shall not include transacting in digital 
commodities for the purpose of— 
‘‘(i) acting as a digital commodity 
custodian; 
‘‘(ii) establishing, maintaining, or 
managing inventory or payment instru-
ments for commercial purposes; or 
‘‘(iii) maintaining or supporting the 
operation of, or validating transactions on, 
a blockchain system.’’; 
(2) in paragraph (11)— 
(A) in subparagraph (A)(i)— 
(i) by redesignating subclauses (III) 
and (IV) as subclauses (IV) and (V), re-
spectively; and 
(ii) by inserting after subclause (II) 
the following: 
‘‘(III) digital commodity;’’; and 
(B) by redesignating subparagraph (B) as 
subparagraph (C) and inserting after subpara-
graph (A) the following: 
‘‘(B) EXCLUSION.—For purposes of this 
paragraph, the term ‘trading in commodity in-
•HR 3633 EH1S 
terests’ shall not include transacting in digital 
commodities for the purpose of— 
‘‘(i) acting as a digital commodity 
custodian; 
‘‘(ii) establishing, maintaining, or 
managing inventory or payment instru-
ments for commercial purposes; or 
‘‘(iii) maintaining or supporting the 
operation of, or validating transactions on, 
a blockchain system.’’; 
(3) in paragraph (12)(A)(i)— 
(A) in subclause (II), by adding at the end 
a semicolon; 
(B) by redesignating subclauses (III) and 
(IV) as subclauses (IV) and (V), respectively; 
and 
(C) by inserting after subclause (II) the 
following: 
‘‘(III) a digital commodity;’’; 
(4) by redesignating paragraphs (16) through 
(51) as paragraphs (17) through (52), respectively, 
and inserting after paragraph (15) the following: 
‘‘(16) TERMS RELATED TO DIGITAL COMMOD-
ITIES.—
•HR 3633 EH1S 
‘‘(A) ASSOCIATED PERSON OF A DIGITAL 
COMMODITY BROKER.— 
‘‘(i) IN
GENERAL.—Except as pro-
vided in clause (ii), the term ‘associated 
person of a digital commodity broker’ 
means a person who is associated with a 
digital commodity broker as a partner, of-
ficer, employee, or agent (or any person oc-
cupying a similar status or performing 
similar functions) in any capacity that in-
volves— 
‘‘(I) the solicitation or acceptance 
of an order for the purchase or sale of 
a digital commodity; or 
‘‘(II) the supervision of any per-
son engaged in the solicitation or ac-
ceptance of an order for the purchase 
or sale of a digital commodity. 
‘‘(ii) EXCLUSION.—The term ‘associ-
ated person of a digital commodity broker’ 
does not include any person associated 
with a digital commodity broker the func-
tions of which are solely clerical or ministe-
rial.
•HR 3633 EH1S 
‘‘(B) ASSOCIATED PERSON OF A DIGITAL 
COMMODITY DEALER.— 
‘‘(i) IN
GENERAL.—Except as pro-
vided in clause (ii), the term ‘associated 
person of a digital commodity dealer’ 
means a person who is associated with a 
digital commodity dealer as a partner, offi-
cer, employee, or agent (or any person oc-
cupying a similar status or performing 
similar functions) in any capacity that in-
volves— 
‘‘(I) the solicitation or acceptance 
of a contract for the purchase or sale 
of a digital commodity; or 
‘‘(II) the supervision of any per-
son engaged in the solicitation or ac-
ceptance of a contract for the pur-
chase or sale of a digital commodity. 
‘‘(ii) EXCLUSION.—The term ‘associ-
ated person of a digital commodity dealer’ 
does not include any person associated 
with a digital commodity dealer the func-
tions of which are solely clerical or ministe-
rial.
•HR 3633 EH1S 
‘‘(C) BANK
SECRECY
ACT.—The term 
‘Bank Secrecy Act’ means— 
‘‘(i) section 21 of the Federal Deposit 
Insurance Act (12 U.S.C. 1829b); 
‘‘(ii) chapter 2 of title I of Public Law 
91–508 (12 U.S.C. 1951 et seq.); and 
‘‘(iii) subchapter II of chapter 53 of 
title 31, United States Code. 
‘‘(D) 
DECENTRALIZED
FINANCE
MES-
SAGING SYSTEM.— 
‘‘(i) IN GENERAL.—The term ‘decen-
tralized finance messaging system’ means 
a software application that provides a user 
with the ability to create or submit an in-
struction, communication, or message to a 
decentralized finance trading protocol for 
the purpose of executing a transaction by 
the user. 
‘‘(ii) ADDITIONAL
REQUIREMENTS.— 
The term ‘decentralized finance messaging 
system’ does not include any system that 
provides any person other than the user 
with control over— 
‘‘(I) the funds of the user; or
•HR 3633 EH1S 
‘‘(II) the execution of the trans-
action of the user. 
‘‘(E) DECENTRALIZED FINANCE TRADING 
PROTOCOL.— 
‘‘(i) IN GENERAL.—The term ‘decen-
tralized finance trading protocol’ means a 
blockchain system through which multiple 
participants can execute a financial trans-
action— 
‘‘(I) in accordance with an auto-
mated rule or algorithm that is pre-
determined and non-discretionary; and 
‘‘(II) without reliance on any 
other person to maintain control of 
the digital assets of the user during 
any part of the financial transaction. 
‘‘(ii) EXCLUSIONS.— 
‘‘(I) IN
GENERAL.—The term 
‘decentralized finance trading pro-
tocol’ does not include a blockchain 
system if— 
‘‘(aa) a person or group of 
persons under common control or 
acting pursuant to an agreement 
to act in concert has the author-
•HR 3633 EH1S 
ity, directly or indirectly, through 
any contract, arrangement, un-
derstanding, relationship, or oth-
erwise, to control or materially 
alter the functionality, operation, 
or rules of consensus or agree-
ment of the blockchain system; or 
‘‘(bb) the blockchain system 
does not operate, execute, and 
enforce its operations and trans-
actions based solely on pre-estab-
lished, transparent rules encoded 
directly within the source code of 
the blockchain system. 
‘‘(II) SPECIAL RULE.—For pur-
poses of subclause (I), a decentralized 
governance system shall not be consid-
ered to be a person or a group of per-
sons under common control or acting 
pursuant to an agreement to act in 
concert. 
‘‘(F) DIGITAL COMMODITY.— 
‘‘(i) IN GENERAL.—The term ‘digital 
commodity’ means a digital asset that is 
intrinsically linked to a blockchain system,
•HR 3633 EH1S 
and the value of which is derived from or 
is reasonably expected to be derived from 
the use of the blockchain system. 
‘‘(ii) 
RELATIONSHIP
TO
A 
BLOCKCHAIN
SYSTEM.—For purposes of 
this subparagraph, a digital asset is intrin-
sically linked to a blockchain system if the 
digital asset is directly related to the 
functionality or operation of the blockchain 
system or to the activities or services for 
which the blockchain system is created or 
utilized, including where the digital asset 
is— 
‘‘(I) issued or generated by the 
programmatic 
functioning 
of 
the 
blockchain system; 
‘‘(II) used to transfer value be-
tween participants in the blockchain 
system; 
‘‘(III) used to access the activi-
ties or services of the blockchain sys-
tem; 
‘‘(IV) used to participate in the 
decentralized governance system of 
the blockchain system;
•HR 3633 EH1S 
‘‘(V) used or removed from cir-
culation in whole or in part to pay 
fees or otherwise verify or validate 
transactions on the blockchain system; 
‘‘(VI) used as payment or incen-
tive to participants in the blockchain 
system to engage in the activities of 
the blockchain system, provide serv-
ices to other participants in the 
blockchain system, or otherwise par-
ticipate in the functionality of the 
blockchain system; or 
‘‘(VII) used as payment or incen-
tive to participants in the blockchain 
system to validate transactions, secure 
the blockchain system, provide com-
putational services, maintain or dis-
tribute information, or otherwise par-
ticipate in the operations of the 
blockchain system. 
‘‘(iii) EXCLUSION.—The term ‘digital 
commodity’ does not include any of the fol-
lowing: 
‘‘(I) SECURITY.—
•HR 3633 EH1S 
‘‘(aa) Any security, other 
than a note, an investment con-
tract, or a certificate of interest 
or participation in any profit- 
sharing agreement. 
‘‘(bb) A note, an investment 
contract, or a certificate of inter-
est or participation in any profit- 
sharing agreement that— 
‘‘(AA) 
represents 
or 
gives the holder an owner-
ship interest or other inter-
est in the revenues, profits, 
obligations, debts, assets, or 
assets or debts to be ac-
quired of the issuer of the 
digital asset or another per-
son (other than a decentral-
ized governance system); 
‘‘(BB) makes the hold-
er a creditor of the issuer of 
the digital asset or another 
person; or 
‘‘(CC) 
represents 
or 
gives the holder the right to
•HR 3633 EH1S 
receive interest or the return 
of principal from the issuer 
of the digital asset or an-
other person. 
‘‘(II) SECURITY DERIVATIVE.—A 
digital asset that, based on its terms 
and other characteristics, is, rep-
resents, or is functionally equivalent 
to an agreement, contract, or trans-
action that is— 
‘‘(aa) a security future, as 
defined in section 2a of the Secu-
rities Act of 1933; 
‘‘(bb) a security-based swap, 
as defined in section 2a of the 
Securities Act of 1933; 
‘‘(cc) a put, call, straddle, 
option, or privilege on any secu-
rity, certificate of deposit, or 
group or index of securities (in-
cluding any interest therein or 
based on the value thereof), as 
defined in section 2a of the Secu-
rities Act of 1933; or
•HR 3633 EH1S 
‘‘(dd) a put, call, straddle, 
option, or privilege on any secu-
rity, as defined in section 2a of 
the Securities Act of 1933. 
‘‘(III) 
PERMITTED
PAYMENT 
STABLECOIN.—A digital asset that is 
a permitted payment stablecoin. 
‘‘(IV) BANKING DEPOSIT.— 
‘‘(aa) A deposit (as defined 
under section 3 of the Federal 
Deposit 
Insurance 
Act 
(12 
U.S.C. 1813)), regardless of the 
technology used to record the de-
posit. 
‘‘(bb) An account (as de-
fined in section 101 of the Fed-
eral Credit Union Act (12 U.S.C. 
1752)), regardless of the tech-
nology used to record the ac-
count. 
‘‘(V) 
COMMODITY.—A 
digital 
asset that references, represents an 
interest in, or is functionally equiva-
lent to—
•HR 3633 EH1S 
‘‘(aa) an agricultural com-
modity; 
‘‘(bb) 
an 
excluded 
com-
modity, other than a security; or 
‘‘(cc) an exempt commodity, 
other than the digital commodity 
itself, as shall be further defined 
by the Commission. 
‘‘(VI) 
COMMODITY
DERIVA-
TIVE.—A digital asset that, based on 
its terms and other characteristics, is, 
represents, or is functionally equiva-
lent to an agreement, contract, or 
transaction that is— 
‘‘(aa) a contract of sale of a 
commodity for future delivery or 
an option thereon; 
‘‘(bb) a security futures 
product; 
‘‘(cc) a swap; 
‘‘(dd) an agreement, con-
tract, or transaction described in 
section 2(c)(2)(C)(i) or section 
2(c)(2)(D)(i);
•HR 3633 EH1S 
‘‘(ee) a commodity option 
authorized under section 4c; or 
‘‘(ff) a leverage transaction 
authorized under section 19. 
‘‘(VII) POOLED INVESTMENT VE-
HICLE.— 
‘‘(aa) IN GENERAL.—A dig-
ital asset not described by sub-
clause (I) that, based on its 
terms and other characteristics, 
is, represents, or is functionally 
equivalent to an interest in— 
‘‘(AA) 
a 
commodity 
pool, as defined in this Act; 
or 
‘‘(BB) a pooled invest-
ment vehicle. 
‘‘(bb) POOLED INVESTMENT 
VEHICLE DEFINED.—In this sub-
clause, the term ‘pooled invest-
ment vehicle’ means— 
‘‘(AA) any investment 
company as defined in sec-
tion 3(a) of the Investment
•HR 3633 EH1S 
Company Act of 1940 (15 
U.S.C. 80a–3(a)); 
‘‘(BB) any company (as 
defined in section 2 of such 
Act (15 U.S.C. 80a–2)) that 
would 
be 
an 
investment 
company under section 3(a) 
of such Act but for the ex-
clusions provided from that 
definition by section 3(c) of 
such Act, if for purposes of 
this subclause the company 
were assumed to be an 
issuer (as defined in section 
2 of such Act); or 
‘‘(CC) any entity or 
person that is not an invest-
ment company but holds or 
will hold assets other than 
securities. 
‘‘(VIII) 
GOOD, 
COLLECTIBLE, 
AND
OTHER
NON-COMMODITY 
ASSET.—A digital asset that has 
value, utility, or significance beyond 
its mere existence as a digital asset,
•HR 3633 EH1S 
including the digital equivalent of a 
tangible or intangible good, such as— 
‘‘(aa) a work of art, a musi-
cal composition, a literary work, 
or other intellectual property; 
‘‘(bb) collectibles, merchan-
dise, virtual land, and video game 
assets; 
‘‘(cc) affinity, rewards, or 
loyalty points, including airline 
miles or credit card points, that 
are not primarily speculative in 
nature; or 
‘‘(dd) rights, licenses, and 
tickets. 
‘‘(iv) RULE OF CONSTRUCTION.—No 
presumption shall exist that a digital asset 
is a security, nor shall a digital asset be 
excluded from being a digital commodity 
pursuant to clause (iii)(I), solely due to— 
‘‘(I) the digital asset providing 
voting or economic rights with respect 
to the blockchain system to which the 
digital asset relates or the decentral-
ized 
governance 
system 
of 
the
•HR 3633 EH1S 
blockchain system to which the digital 
asset relates; 
‘‘(II) the value of the digital 
asset having the potential to appre-
ciate or depreciate in response to the 
efforts, operations, or financial per-
formance of the blockchain system to 
which the digital asset relates or the 
decentralized governance system of 
the blockchain system to which the 
digital asset relates; or 
‘‘(III) the value of the digital 
asset appreciating or depreciating due 
to the use of the blockchain system to 
which the digital asset relates or the 
decentralized governance system of 
the blockchain system to which the 
digital asset relates. 
‘‘(G) DIGITAL COMMODITY BROKER.— 
‘‘(i) IN GENERAL.—The term ‘digital 
commodity broker’ means any person who, 
as a regular business— 
‘‘(I) is engaged in— 
‘‘(aa) soliciting or accepting 
an order from a customer for—
•HR 3633 EH1S 
‘‘(AA) the purchase or 
sale of a digital commodity; 
or 
‘‘(BB) an agreement, 
contract, or transaction de-
scribed 
in 
section 
2(c)(2)(D)(iv); and 
‘‘(bb) in conjunction with 
the activities in item (aa), ac-
cepts or maintains control over— 
‘‘(AA) the funds of any 
customer; or 
‘‘(BB) the execution of 
any transaction of a cus-
tomer; 
‘‘(II) is engaged in soliciting or 
accepting orders from a customer for 
the purchase or sale of a unit of a 
digital commodity on or subject to the 
rules of a registered entity; or 
‘‘(III) is registered with the Com-
mission 
as 
a 
digital 
commodity 
broker.
•HR 3633 EH1S 
‘‘(ii) EXCEPTIONS.—The term ‘digital 
commodity broker’ does not include a per-
son solely because the person— 
‘‘(I) solicits or accepts an order 
described in clause (i)(I)(aa)(AA) 
from a customer who is an eligible 
contract participant; 
‘‘(II) enters into 1 or more dig-
ital commodity transactions that are 
attributable or solely incidental to 
making, sending, receiving, or facili-
tating payments, whether involving a 
payment service provider or on a peer- 
to-peer basis; or 
‘‘(III) is a bank (as defined 
under section 3(a) of the Securities 
Exchange Act of 1934) engaging in 
certain banking activities with respect 
to a digital commodity in the same or 
a similar manner as a bank is ex-
cluded from the definition of a broker 
under such section, as determined by 
the Commission. 
‘‘(iii) 
FURTHER
DEFINITION.—The 
Commission, by rule or regulation, may ex-
•HR 3633 EH1S 
clude from the term ‘digital commodity 
broker’ any person or class of persons if 
the Commission determines that the rule 
or regulation will effectuate the purposes 
of this Act. 
‘‘(H) DIGITAL COMMODITY DEALER.— 
‘‘(i) IN GENERAL.—The term ‘digital 
commodity dealer’ means any person who, 
as a regular business— 
‘‘(I) is, or offers to be a 
counterparty to a person for the pur-
chase or sale of a digital commodity 
as a regular business, and in conjunc-
tion with the activities, accepts or 
maintains control over the funds of 
any counterparty; or 
‘‘(II) is registered with the Com-
mission as a digital commodity dealer. 
‘‘(ii) EXCEPTION.—The term ‘digital 
commodity dealer’ does not include a per-
son solely because the person— 
‘‘(I) 
is 
or 
offers 
to 
be 
a 
counterparty to a person who is an el-
igible contract participant;
•HR 3633 EH1S 
‘‘(II) enters into a digital com-
modity transaction with an eligible 
contract participant; 
‘‘(III) enters into a digital com-
modity transaction on or through a 
registered 
digital 
commodity 
ex-
change, with a registered digital com-
modity broker, or through a decentral-
ized finance trading protocol; 
‘‘(IV) enters into a digital com-
modity transaction for the person’s 
own account, either individually or in 
a fiduciary capacity, but not as a part 
of a regular business; 
‘‘(V) enters into 1 or more digital 
commodity transactions that are at-
tributable or solely incidental to mak-
ing, sending, receiving, or facilitating 
payments, whether involving a pay-
ment service provider or on a peer-to- 
peer basis; or 
‘‘(VI) is a bank (as defined under 
section 3(a) of the Securities Ex-
change Act of 1934) engaging in cer-
tain banking activities with respect to
•HR 3633 EH1S 
a digital commodity in the same or a 
similar manner as a bank is excluded 
from the definition of a dealer under 
section 3(a)(5) of such Act, as deter-
mined by the Commission. 
‘‘(iii) 
FURTHER
DEFINITION.—The 
Commission, by rule or regulation, may ex-
clude from the term ‘digital commodity 
dealer’ any person or class of persons if 
the Commission determines that the rule 
or regulation will effectuate the purposes 
of this Act. 
‘‘(I) DIGITAL
COMMODITY
EXCHANGE.— 
The term ‘digital commodity exchange’ means a 
trading facility that offers or seeks to offer a 
cash or spot market in at least 1 digital com-
modity. 
‘‘(J) 
MIXED
DIGITAL
ASSET
TRANS-
ACTION.—The term ‘mixed digital asset trans-
action’ means a transaction in which a digital 
commodity is traded for a security. 
‘‘(K) TERMS DEFINED UNDER THE SECU-
RITIES ACT OF 1933.—The terms ‘blockchain 
system’, ‘decentralized governance system’, ‘dig-
ital asset’, ‘digital commodity issuer’, ‘digital
•HR 3633 EH1S 
commodity affiliated person’, ‘digital commodity 
related person’, ‘end user distribution’, ‘mature 
blockchain 
system’, 
‘permitted 
payment 
stablecoin’, and ‘permitted payment stablecoin 
issuer’ have the meaning given those terms, re-
spectively, under section 2(a) of the Securities 
Act of 1933 (15 U.S.C. 77b(a)).’’; and 
(5) in paragraph (41) (as so redesignated by 
paragraph (4) of this subsection)— 
(A) by striking ‘‘and’’ at the end of sub-
paragraph (E); 
(B) by striking the period at the end of 
subparagraph (F) and inserting ‘‘; and’’; and 
(C) by adding at the end the following: 
‘‘(G) a digital commodity exchange reg-
istered under section 5i.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Each of the following provisions of law is 
amended 
by 
striking 
‘‘1a(18)’’ 
and 
inserting 
‘‘1a(19)’’: 
(A) Section 4s(h)(5)(A)(i) of the Com-
modity Exchange Act (7 U.S.C. 6s(h)(5)(A)(i)). 
(B) Section 5(e) of the Securities Act of 
1933 (15 U.S.C. 77e(e)).
•HR 3633 EH1S 
(C) Section 6(g)(5)(B) of the Securities 
Exchange 
Act 
of 
1934 
(15 
U.S.C. 
78f(g)(5)(B)). 
(D) Section 15F(h)(5)(A)(i) of the Securi-
ties Exchange Act of 1934 (15 U.S.C. 78o– 
10(h)(5)(A)(i)). 
(2) Section 752 of the Wall Street Trans-
parency and Accountability Act of 2010 (15 U.S.C. 
8325) is amended by striking ‘‘1a(39)’’ and insert-
ing ‘‘1a(40)’’. 
(3) Section 4s(f)(1)(D) of the Commodity Ex-
change Act (7 U.S.C. 6s(f)(1)(D)) is amended by 
striking ‘‘1a(47)(A)’’ and inserting ‘‘1a(48)(A)’’. 
(4) Each of the following provisions of the 
Commodity Exchange Act is amended by striking 
‘‘1a(47)(A)(v)’’ and inserting ‘‘1a(48)(A)(v)’’: 
(A) 
Section 
4t(b)(1)(C) 
(7 
U.S.C. 
6t(b)(1)(C)). 
(B) Section 5(d)(23) (7 U.S.C. 7(d)(23)). 
(C) Section 5b(k)(3) (7 U.S.C. 7a– 
1(k)(3)). 
(D) Section 5h(f)(10)(A)(iii) (7 U.S.C. 7b– 
3(f)(10)(A)(iii)).
•HR 3633 EH1S 
(5) Section 21(f)(4)(C) of the Commodity Ex-
change Act (7 U.S.C. 24a(f)(4)(C)) is amended by 
striking ‘‘1a(48)’’ and inserting ‘‘1a(49)’’. 
(6) Section 403 of the Legal Certainty for 
Bank Products Act of 2000 (7 U.S.C. 27a) is 
amended— 
(A) in subsection (a)(2), by striking 
‘‘1a(47)(A)(v)’’ and inserting ‘‘1a(48)(A)(v)’’; 
and 
(B) in each of subsections (b)(1) and 
(c)(2), by striking ‘‘1a(47)’’ and inserting 
‘‘1a(48)’’. 
(7) Section 712 of the Wall Street Trans-
parency and Accountability Act of 2010 (15 U.S.C. 
8302) is amended— 
(A) in subsection (a)(8), by striking 
‘‘1a(47)(D)’’ each place it appears and insert-
ing ‘‘1a(48)(D)’’; and 
(B) in subsection (d)(1), by striking 
‘‘1a(47)(A)(v)’’ each place it appears and in-
serting ‘‘1a(48)(A)(v)’’. 
SEC. 104. DEFINITIONS UNDER THIS ACT. 
In this Act: 
(1) DEFINITIONS UNDER THE COMMODITY EX-
CHANGE
ACT.—The terms ‘‘decentralized finance
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shall jointly issue rules to further define the following 
terms: 
(1) The terms— 
(A) ‘‘blockchain’’, ‘‘blockchain applica-
tion’’, ‘‘blockchain system’’, ‘‘blockchain pro-
tocol’’, 
‘‘decentralized 
governance 
system’’, 
‘‘digital commodity affiliated person’’, ‘‘digital 
commodity issuer’’, ‘‘digital commodity related 
person’’, ‘‘end user distribution’’, and ‘‘mature 
blockchain system’’, as defined under section 
2(a) of the Securities Act of 1933; 
(B) ‘‘unilateral authority’’, as such term is 
used in section 42 of the Securities Exchange 
Act of 1934 and section 1a of the Commodity 
Exchange Act; and 
(C) ‘‘programmatic functioning’’, as such 
term is used in sections 4C of the Securities 
Act of 1933, section 42 of the Securities Ex-
change Act of 1934, and section 1a of the Com-
modity Exchange Act. 
(2) The terms ‘‘digital commodity’’, ‘‘decentral-
ized finance messaging system’’, and ‘‘decentralized 
finance trading protocol’’, as defined under section 
1a of the Commodity Exchange Act.
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(b) JOINT RULEMAKING FOR MIXED DIGITAL ASSET 
TRANSACTIONS.—The Securities and Exchange Commis-
sion and the Commodity Futures Trading Commission 
shall jointly issue rules applicable to mixed digital asset 
transactions under this Act and the amendments made by 
this Act, including by further defining such term. 
(c) PROTECTION OF SELF-CUSTODY.— 
(1) IN GENERAL.—A United States individual 
shall retain the right to— 
(A) maintain a hardware wallet or software 
wallet for the purpose of facilitating the individ-
ual’s own lawful custody of digital assets; and 
(B) engage in direct, peer-to-peer trans-
actions in digital assets with another individual 
or entity for the individual’s own lawful pur-
poses using a hardware wallet or software wal-
let, if— 
(i) such other individual or entity is 
not a financial institution (as defined in 
section 5312 of title 31, United States 
Code); and 
(ii) the transactions do not involve 
any property or interests in property that 
are blocked pursuant to, or are otherwise 
prohibited by, United States sanctions.
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(2) APPLICATION.—This subsection— 
(A) applies solely to personal use by indi-
viduals; and 
(B) does not apply to individuals acting in 
a custodial or fiduciary capacity for others. 
(3) RULE OF CONSTRUCTION.—Nothing in this 
subsection shall be construed to limit the authority 
of the Secretary of the Treasury, the Securities and 
Exchange Commission, the Commodity Futures 
Trading Commission, the Board of Governors of the 
Federal Reserve System, the Comptroller of the Cur-
rency, the Federal Deposit Insurance Corporation, 
or the National Credit Union Administration to 
carry out any enforcement action or special measure 
authorized under applicable law, including— 
(A) the Bank Secrecy Act, section 9714 of 
the Combating Russian Money Laundering Act 
(31 U.S.C. 5318A note), and section 7213A of 
the Fentanyl Sanctions Act (21 U.S.C. 2313a); 
or 
(B) any other law relating to illicit finance, 
money laundering, terrorism financing, or 
United States sanctions. 
(d) JOINT RULEMAKING, PROCEDURES, OR GUID-
ANCE FOR DELISTING.—Not later than 180 days after the
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date of the enactment of this Act, the Commodity Futures 
Trading Commission and the Securities and Exchange 
Commission shall jointly issue rules, procedures, or guid-
ance (as determined appropriate by the Commissions) re-
garding the process to delist an asset for trading under 
section 106 if the Commissions determine that the listing 
is inconsistent with the Commodity Exchange Act, the se-
curities laws (including regulations under those laws), or 
this Act. 
(e) JOINT RULES FOR PORTFOLIO MARGINING DE-
TERMINATIONS.— 
(1) IN
GENERAL.—Not later than 360 days 
after the date of the enactment of this Act, the 
Commodity Futures Trading Commission and the 
Securities and Exchange Commission shall jointly 
issue rules describing the process for persons reg-
istered with either such Commission to seek a joint 
order or determination with respect to margin, cus-
tomer protection, segregation, or other requirements 
as necessary to facilitate portfolio margining of secu-
rities (including related extensions of credit), secu-
rity-based swaps, contracts for future delivery, op-
tions on a contract for future delivery, swaps, and 
digital commodities, or any subset thereof, in—
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(A) a securities account carried by a reg-
istered broker or dealer or a security-based 
swap account carried by a registered security- 
based swap dealer; 
(B) a futures or cleared swap account car-
ried by a registered futures commission mer-
chant; 
(C) a swap account carried by a swap deal-
er; or 
(D) a digital commodity account carried by 
a registered digital commodity broker or digital 
commodity dealer that is also registered in such 
other capacity as is necessary to also carry the 
other customer or counterparty positions being 
held in the account. 
(2) PROCESS.—With respect to a joint order or 
determination described in paragraph (1), the rules 
required to be issued pursuant to paragraph (1) 
shall require— 
(A) the joint order or determination to be 
issued only if the order or determination is in 
the public interest and provides for the appro-
priate protection of customers; 
(B) applicants to file a standard applica-
tion, in a form and manner determined by the
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Federal Reserve System, the Comptroller of the Currency, 
and the Federal Deposit Insurance Corporation shall de-
velop risk-based and leverage capital requirements for in-
sured depository institutions, depository institution hold-
ing companies, and nonbank financial companies super-
vised by the Board of Governors that address netting 
agreements that provide for termination and close-out net-
ting across multiple types of financial transactions, con-
sistent with subsection (e), in the event of a counterparty’s 
default. 
SEC. 106. EXPEDITED REGISTRATION FOR DIGITAL COM-
MODITY EXCHANGES, BROKERS, AND DEAL-
ERS; PROVISIONAL STATUS. 
(a) REGISTRATION.— 
(1) IN GENERAL.—Unless exempted from reg-
istration, a person shall not act as a digital com-
modity broker, digital commodity dealer, or digital 
commodity exchange after the end of the 90-day pe-
riod beginning on the date the process described in 
paragraph (2) is adopted by the Commodity Futures 
Trading Commission, unless, as the case may be, the 
person is registered as a— 
(A) digital commodity broker pursuant to 
section 4u of the Commodity Exchange Act;
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(B) digital commodity dealer pursuant to 
section 4u of the Commodity Exchange Act; or 
(C) digital commodity exchange pursuant 
to section 5i of the Commodity Exchange Act. 
(2) EXPEDITED
PROCESS.—Within 180 days 
after the date of the enactment of this Act, the 
Commodity Futures Trading Commission shall 
adopt, by rule, regulation, or order, a process for ex-
pedited registration of persons required to be reg-
istered pursuant to paragraph (1). 
(b) PROVISIONAL STATUS.— 
(1) IN GENERAL.—A person who is registered 
in accordance with subsection (a) of this section 
shall be in provisional status until— 
(A) in the case of a digital commodity 
broker or dealer, 270 days after the final effec-
tive date of the rulemakings required under sec-
tion 4u of the Commodity Exchange Act; or 
(B) in the case of a digital commodity ex-
change, 270 days after the final effective date 
of the rulemakings required under section 5i of 
such Act. 
(2) PAYMENT
OF
FEES.—A person in provi-
sional status shall pay all fees and penalties required 
under section 410.
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(c) OPERATIONS PRIOR TO REGULATIONS.— 
(1) REQUIREMENTS.—A person in provisional 
status shall be subject to the requirements of this 
section and the Commodity Exchange Act and any 
rules or regulations promulgated under this section 
or the Commodity Exchange Act, as applicable. 
(2) LISTINGS.— 
(A) IN GENERAL.—Except as provided in 
subparagraph (B), a person in provisional sta-
tus may continue to offer, solicit, trade, facili-
tate, execute, clear, report, or otherwise deal in 
any digital asset offered on or through the fa-
cilities of the person before the date of registra-
tion under this section, until such time as the 
joint rulemaking on definitions required under 
section 105(a) is effective. 
(B) DELISTING.—Before the effective date 
of the joint rulemaking on definitions under 
section 105(a), a person in provisional status 
shall cease offering, soliciting, trading, facili-
tating, executing, clearing, reporting, or other-
wise dealing in any digital asset required to be 
delisted pursuant to a joint delisting process es-
tablished under section 105(d).
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(3) EXEMPTIVE AUTHORITY.—In order to pro-
mote responsible innovation and fair competition, or 
protect customers, the Commodity Futures Trading 
Commission may exempt any persons or class of per-
sons registered pursuant to subsection (a) and in 
provisional status pursuant to subsection (b) from 
any requirements of this section or the Commodity 
Exchange Act or any rules or regulations promul-
gated under this section or the Commodity Ex-
change Act, as applicable. 
(d) CUSTOMER DISCLOSURE BEFORE REGISTRA-
TION.— 
(1) IN GENERAL.—Beginning 30 days after the 
date of the enactment of this Act, any person acting 
as a digital commodity exchange, digital commodity 
broker, or digital commodity dealer shall disclose to 
the customers of the person so acting, in the disclo-
sure documents, offering documents, and pro-
motional material of the person so acting, in a 
prominent manner, that the person is not registered 
with or regulated by the Commodity Futures Trad-
ing Commission. 
(2) EXPIRATION.—Paragraph (1) of this sub-
section shall not apply to any person who registers 
pursuant to subsection (a).
•HR 3633 EH1S 
SEC. 107. COMMODITY EXCHANGE ACT AND SECURITIES 
LAWS SAVINGS PROVISIONS. 
(a) IN GENERAL.—Nothing in this Act shall affect 
or apply to, or be interpreted to affect or apply to— 
(1) any agreement, contract, or transaction that 
is subject to the Commodity Exchange Act as— 
(A) a contract of sale of a commodity for 
future delivery or an option on such a contract; 
(B) a swap; 
(C) a security futures product; 
(D) an option authorized under section 4c 
of such Act; 
(E) an agreement, contract, or transaction 
described in section 2(c)(2)(C)(i) of such Act; 
or 
(F) a leverage transaction authorized 
under section 19 of such Act; 
(2) any agreement, contract, or transaction that 
is subject to the securities laws as— 
(A) a security-based swap; 
(B) a security futures product; or 
(C) an option on or based on the value of 
a security; or 
(3) the activities of any person with respect to 
any such agreement, contract, or transaction.
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(b) PROHIBITIONS ON SPOT DIGITAL COMMODITY 
ENTITIES.—Nothing in this Act authorizes, or shall be in-
terpreted to authorize, a digital commodity exchange, dig-
ital commodity broker, or digital commodity dealer to en-
gage in any activities involving any transaction, contract, 
or agreement described in subsection (a)(1), solely by vir-
tue of being registered as a digital commodity exchange, 
digital commodity broker, or digital commodity dealer. 
(c) DEFINITIONS.—In this section, each term shall 
have the meaning provided in the Commodity Exchange 
Act or the regulations prescribed under such Act. 
SEC. 108. ADMINISTRATIVE REQUIREMENTS. 
Section 4c(a) of the Commodity Exchange Act (7 
U.S.C. 6c(a)) is amended— 
(1) in paragraph (3)— 
(A) in subparagraph (B), by striking ‘‘or’’ 
at the end; 
(B) in subparagraph (C), by striking the 
period and inserting ‘‘; or’’; and 
(C) by adding at the end the following: 
‘‘(D) a contract of sale of a digital com-
modity.’’; 
(2) in paragraph (4)— 
(A) in subparagraph (A)—
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(i) in clause (ii), by striking ‘‘or’’ at 
the end; 
(ii) in clause (iii), by striking the pe-
riod and inserting ‘‘; or’’; and 
(iii) by adding at the end the fol-
lowing: 
‘‘(iv) a contract of sale of a digital 
commodity.’’; 
(B) in subparagraph (B)— 
(i) in clause (ii), by striking ‘‘or’’ at 
the end; 
(ii) in clause (iii), by striking the pe-
riod and inserting ‘‘; or’’; and 
(iii) by adding at the end the fol-
lowing: 
‘‘(iv) a contract of sale of a digital 
commodity.’’; and 
(C) in subparagraph (C)— 
(i) in clause (ii), by striking ‘‘or’’ at 
the end; 
(ii) by striking ‘‘(iii) a swap, provided 
however,’’ and inserting the following: 
‘‘(iii) a swap; or 
‘‘(iv) a contract of sale of a digital 
commodity,
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provided, however,’’; and 
(iii) by striking ‘‘clauses (i), (ii), or 
(iii)’’ and insert ‘‘any of clauses (i) 
through (iv)’’. 
SEC. 109. TREATMENT OF CERTAIN NON-CONTROLLING 
BLOCKCHAIN DEVELOPERS. 
(a) IN GENERAL.—Notwithstanding applicable law, a 
non-controlling blockchain developer or provider of a 
blockchain service shall not be treated as a money trans-
mitter or as engaged in ‘‘money transmitting’’ or, fol-
lowing the date of enactment of this Act, be otherwise sub-
ject to any new registration requirement that is substan-
tially similar to the requirement that currently applies to 
money transmitters, solely on the basis of— 
(1) creating or publishing software to facilitate 
the creation of, or provision of maintenance services 
to, a blockchain or blockchain service; 
(2) providing hardware or software to facilitate 
a customer’s own custody or safekeeping of the cus-
tomer’s digital assets; or 
(3) providing infrastructure support to main-
tain a blockchain service. 
(b) RULE OF CONSTRUCTION.—Nothing in this sec-
tion shall be construed to affect whether a blockchain de-
veloper or provider of a blockchain service is otherwise
•HR 3633 EH1S 
subject to classification or treatment as a money trans-
mitter, or as engaged in ‘‘money transmitting’’, under ap-
plicable State or Federal law, including laws relating to 
anti-money laundering or countering the financing of ter-
rorism, based on conduct outside the scope of subsection 
(a). Nothing in this section shall be construed to affect 
whether a blockchain developer or provider of a blockchain 
service is otherwise subject to classification or treatment 
as a financial institution under the Bank Secrecy Act, this 
Act, or any Act enacted after the date of enactment of 
this Act. 
(c) EFFECT ON OTHER LAWS.— 
(1) INTELLECTUAL PROPERTY LAW.—Nothing 
in this section shall be construed to limit or expand 
any law pertaining to intellectual property. 
(2) STATE LAW.—Nothing in this section shall 
be construed to prevent any State from enforcing 
any State law that is consistent with this section. No 
cause of action may be brought and no liability may 
be imposed under any State or local law that is in-
consistent with this section. 
(d) DEFINITIONS.—In this section: 
(1) 
BLOCKCHAIN
DEVELOPER.—The 
term 
‘‘blockchain developer’’ means any person or busi-
ness that creates or publishes software to facilitate
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the creation of, or provide maintenance to, a 
blockchain or a blockchain service. 
(2) 
BLOCKCHAIN
SERVICE.—The 
term 
‘‘blockchain service’’ means any information, trans-
action, or computing service or system that provides 
or enables access to a blockchain network by mul-
tiple users, including specifically a service or system 
that enables users to send, receive, exchange, or 
store digital assets described by blockchain net-
works. 
(3) NON-CONTROLLING
BLOCKCHAIN
DEVEL-
OPER OR PROVIDER OF A BLOCKCHAIN SERVICE.— 
The term ‘‘non-controlling blockchain developer or 
provider of a blockchain service’’ means a blockchain 
developer or provider of a blockchain service that in 
the regular course of operations, does not have the 
legal right or the unilateral and independent ability 
to control, initiate upon demand, or effectuate trans-
actions involving digital assets that users are enti-
tled to, without the approval, consent, or direction of 
any other third party. 
SEC. 110. APPLICATION OF THE BANK SECRECY ACT. 
(a) IN GENERAL.—Section 5312(c)(1)(A) of title 31, 
United States Code, is amended—
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(1) by inserting ‘‘digital commodity broker, dig-
ital commodity dealer,’’ after ‘‘futures commission 
merchant,’’; and 
(2) by inserting before the period the following: 
‘‘and any digital commodity exchange registered, or 
required to register, under the Commodity Exchange 
Act which permits direct customer access’’. 
(b) BANK SECRECY ACT REQUIREMENTS.— 
(1) REGULATIONS.—The Secretary of the 
Treasury, acting through the Director of the Finan-
cial Crimes Enforcement Network, and in consulta-
tion with Commodity Futures Trading Commission, 
shall issue requirements consistent with the require-
ments of futures commission merchants to apply the 
Bank Secrecy Act to digital commodity brokers, dig-
ital commodity dealers, and digital commodity ex-
changes that are tailored to the size and complexity 
of such entities, including by requiring each such en-
tity to— 
(A) establish and maintain an anti-money 
laundering and countering the financing of ter-
rorism program, which shall include— 
(i) an appropriate risk assessment; 
(ii) the development of internal poli-
cies, procedures, and controls;
•HR 3633 EH1S 
(iii) the designation of a compliance 
officer; 
(iv) an ongoing employee training pro-
gram; and 
(v) an independent audit function to 
test such program; 
(B) retain appropriate records of trans-
actions; 
(C) monitor and report suspicious activity, 
which may include use of appropriate distrib-
uted ledger analytics; and 
(D) maintain an effective customer identi-
fication program to identify and verify account 
holders and carry out appropriate customer due 
diligence. 
(2) COMPLIANCE WITH SANCTIONS.—A digital 
commodity broker, digital commodity dealer, or dig-
ital commodity exchange shall comply with all laws 
and regulations related to United States sanctions 
administered by the Office of Foreign Assets Con-
trol. 
SEC. 111. RULE OF CONSTRUCTION. 
Nothing in this Act, or the amendments made by this 
Act, shall be construed to limit or prevent the continued 
application of applicable ethics statutes and regulations
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administered by the Office of Government Ethics, or the 
ethics rules of the Senate and the House of Representa-
tives, including section 208 of title 18, United States 
Code, and sections 2635.702 and 2635.802 of title 5, Code 
of Federal Regulations. For the avoidance of doubt, exist-
ing Office of Government Ethics laws and the ethics rules 
of the Senate and the House of Representatives prohibit 
any member of Congress or senior executive branch official 
from issuing a digital commodity during their time in pub-
lic service. For the purposes of this section, an employee 
described in section 202 of title 18, United States Code, 
shall be deemed an executive branch employee for pur-
poses of complying with section 208 of that title. 
SEC. 112. IMPLEMENTATION. 
(a) GLOBAL RULEMAKING TIMEFRAME.—Unless oth-
erwise provided in this Act or an amendment made by this 
Act, the Commodity Futures Trading Commission and the 
Securities and Exchange Commission, or both, shall indi-
vidually, and jointly where required, promulgate rules and 
regulations required of each Commission under this Act 
or an amendment made by this Act not later than 360 
days after the date of enactment of this Act. 
(b) RULES AND REGISTRATION BEFORE FINAL EF-
FECTIVE DATES.—
•HR 3633 EH1S 
(1) IN GENERAL.—In order to prepare for the 
implementation of this Act, the Commodity Futures 
Trading Commission and the Securities and Ex-
change Commission may, before any effective date 
provided in this Act— 
(A) promulgate rules, regulations, or or-
ders permitted or required by this Act; 
(B) conduct studies and prepare reports 
and recommendations required by this Act; 
(C) register persons under this Act; and 
(D) exempt persons, agreements, contracts, 
or transactions from provisions of this Act, 
under the terms contained in this Act. 
(2) LIMITATION ON EFFECTIVENESS.—An ac-
tion by the Commodity Futures Trading Commission 
or the Securities and Exchange Commission under 
paragraph (1) shall not become effective before the 
effective date otherwise applicable to the action 
under this Act. 
TITLE II—OFFERS AND SALES OF 
DIGITAL COMMODITIES 
SEC. 201. TREATMENT OF INVESTMENT CONTRACT ASSETS. 
(a) SECURITIES ACT OF 1933.—Section 2(a) of the 
Securities Act of 1933 (15 U.S.C. 77b(a)), as amended 
by section 101, is further amended—
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(1) in paragraph (1), by adding at the end the 
following: ‘‘The term ‘investment contract’ does not 
include an investment contract asset.’’; and 
(2) by adding at the end the following: 
‘‘(36) The term ‘investment contract asset’ 
means a digital commodity— 
‘‘(A) that can be exclusively possessed and 
transferred, person to person, without necessary 
reliance on an intermediary, and is recorded on 
a blockchain; and 
‘‘(B) sold or otherwise transferred, or in-
tended to be sold or otherwise transferred, pur-
suant to an investment contract.’’. 
(b) INVESTMENT ADVISERS ACT OF 1940.—Section 
202(a)(18) of the Investment Advisers Act of 1940 (15 
U.S.C. 80b–2(a)(18)) is amended by adding at the end 
the following: ‘‘The term ‘investment contract’ does not 
include an investment contract asset (as such term is de-
fined under section 2(a) of the Securities Act of 1933).’’. 
(c) INVESTMENT COMPANY ACT OF 1940.—Section 
2(a)(36) of the Investment Company Act of 1940 (15 
U.S.C. 80a–2(a)(36)) is amended by adding at the end 
the following: ‘‘The term ‘investment contract’ does not 
include an investment contract asset (as such term is de-
fined under section 2(a) of the Securities Act of 1933).’’.
•HR 3633 EH1S 
(d) SECURITIES EXCHANGE ACT OF 1934.—Section 
3(a)(10) of the Securities Exchange Act of 1934 (15 
U.S.C. 78c(a)(10)) is amended by adding at the end the 
following: ‘‘The term ‘investment contract’ does not in-
clude an investment contract asset (as such term is de-
fined under section 2(a) of the Securities Act of 1933).’’. 
(e) SECURITIES INVESTOR PROTECTION ACT
OF 
1970.—Section 16(14) of the Securities Investor Protec-
tion Act of 1970 (15 U.S.C. 78lll(14)) is amended by add-
ing at the end the following: ‘‘The term ‘investment con-
tract’ does not include an investment contract asset (as 
such term is defined under section 2(a) of the Securities 
Act of 1933).’’. 
SEC. 202. EXEMPTED PRIMARY TRANSACTIONS IN DIGITAL 
COMMODITIES. 
(a) IN GENERAL.—The Securities Act of 1933 (15 
U.S.C. 77a et seq.) is amended— 
(1) in section 4(a), by adding at the end the 
following: 
‘‘(8) the offer or sale of an investment contract 
involving units of a digital commodity by its digital 
commodity issuer (including all entities controlled by 
or under common control with the issuer), if— 
‘‘(A) the blockchain system to which the 
digital commodity relates, together with the dig-
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ital commodity, is certified as a mature 
blockchain system under section 42 of the Secu-
rities Exchange Act of 1934 or the issuer in-
tends for the blockchain system to which the 
digital commodity relates to be a mature 
blockchain system by the later of— 
‘‘(i) the date that is four years after 
the first sale of the investment contract in-
volving a unit of such digital commodity in 
reliance on the exemption provided under 
this paragraph, subject to any extensions 
as may be granted by the Commission; or 
‘‘(ii) the date that is four years after 
the effective date of this paragraph; 
‘‘(B) the sum of all cash and other consid-
eration to be received by the digital commodity 
issuer in reliance on the exemption provided 
under this paragraph, during the 12-month pe-
riod preceding the date of such offering, includ-
ing the amount received in such offering, is not 
more than $50,000,000 (as such amount is an-
nually adjusted by the Commission to reflect 
the change in the Consumer Price Index for All 
Urban Consumers published by the Bureau of 
Labor Statistics of the Department of Labor);
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‘‘(C) after the completion of the trans-
action, a purchaser does not own more than 10 
percent of the total amount of the outstanding 
units of the digital commodity; 
‘‘(D) the transaction does not involve the 
offer or sale of an investment contract involving 
units of a digital commodity by its digital com-
modity issuer that— 
‘‘(i) is not organized under the laws of 
a State, a territory of the United States, 
or the District of Columbia; 
‘‘(ii) is a development stage company 
that either— 
‘‘(I) has no specific business plan 
or purpose; or 
‘‘(II) has indicated that the busi-
ness plan of the company is to merge 
with or acquire an unidentified com-
pany; 
‘‘(iii) is an investment company, as 
defined in section 3 of the Investment 
Company Act of 1940 (15 U.S.C. 80a–3), 
or is excluded from the definition of invest-
ment company by section 3(c) of that Act 
(15 U.S.C. 80a–3(b) or 80a–3(c));
•HR 3633 EH1S 
‘‘(iv) is issuing fractional undivided 
interests in oil or gas rights, or a similar 
interest in other mineral rights; 
‘‘(v) is, or has been, subject to any 
order of the Commission entered pursuant 
to section 12(j) of the Securities Exchange 
Act of 1934 during the 5-year period be-
fore the filing of the offering statement; or 
‘‘(vi) is disqualified pursuant to sec-
tion 230.262 of title 17, Code of Federal 
Regulations; and 
‘‘(E) the issuer meets the requirements of 
section 4B(b).’’; and 
(2) by inserting after section 4A the following: 
‘‘SEC. 4B. REQUIREMENTS WITH RESPECT TO CERTAIN DIG-
ITAL COMMODITY TRANSACTIONS. 
‘‘(a) COMMISSION JURISDICTION.—For the purposes 
of this section: 
‘‘(1) The Commission shall have jurisdiction 
and enforcement authority with respect to disclo-
sures described in this section. 
‘‘(2) Section 17 shall apply to a statement 
made in an offering statement, disclosure, or report 
filed under this section to the same extent as such 
section 17 applies to a statement made in any other
•HR 3633 EH1S 
offering statement, disclosure, or report filed under 
this Act. 
‘‘(b) REQUIREMENTS
FOR
DIGITAL
COMMODITY 
ISSUERS.— 
‘‘(1) TERMS AND CONDITIONS.—A digital com-
modity issuer offering or selling an investment con-
tract involving units of a digital commodity in reli-
ance on section 4(a)(8) shall file with the Commis-
sion an offering statement and any related docu-
ments, in such form and with such content as pre-
scribed by the Commission, including financial infor-
mation, a description of the issuer and the oper-
ations of the issuer, the financial condition of the 
issuer, a description of the plan of distribution of 
any unit of a digital commodity that is to be offered 
as well as the intended use of the offering proceeds, 
and a description of the development plan for the 
blockchain system, and the related digital com-
modity, to become a mature blockchain system, if 
such blockchain system is not already certified as a 
mature blockchain system pursuant to section 42 of 
the Securities Exchange Act of 1934 (15 U.S.C. 78a 
et seq.). 
‘‘(2) 
INFORMATION
REQUIRED
FOR
PUR-
CHASERS.—A digital commodity issuer that has filed
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a statement under paragraph (1) to offer and sell an 
investment contract involving a unit of a digital 
commodity in reliance on section 4(a)(8) shall in-
clude in such statement the following information: 
‘‘(A) MATURITY
STATUS.—Whether the 
blockchain system to which the digital com-
modity relates has been certified as a mature 
blockchain system pursuant to section 42 of the 
Securities Exchange Act of 1934 (15 U.S.C. 
78a et seq.) and, where such blockchain system 
is not so certified, a statement of the digital 
commodity issuer’s intent for the blockchain 
system to which the digital commodity relates 
to be a mature blockchain system within the 
time period described in section 4(a)(8)(A). 
‘‘(B) SOURCE CODE.—The source code, or 
a publicly accessible webpage displaying such 
source code, for any blockchain system to which 
the digital commodity relates, and whether the 
source code was sourced from an external third 
party, whether there are any existing external 
dependencies, and whether the code underwent 
a third-party security audit, along with material 
results of any such audit.
•HR 3633 EH1S 
‘‘(C) TRANSACTION HISTORY.—A descrip-
tion of the steps necessary to independently ac-
cess, search, and verify the transaction history 
of any blockchain system to which the digital 
commodity relates, to the extent any such inde-
pendent access, search, and verification activi-
ties are technically feasible with respect to such 
blockchain system. 
‘‘(D) DIGITAL COMMODITY ECONOMICS.— 
A description of the purpose of any blockchain 
system to which the digital commodity relates 
and the operation of any such blockchain sys-
tem, including— 
‘‘(i) information explaining the launch 
and supply process, including the number 
of units of the digital commodity to be 
issued in an initial allocation, the total 
number of units of the digital commodity 
to be created, the release schedule for the 
units of the digital commodity, and the 
total number of units of the digital com-
modity outstanding; 
‘‘(ii) information explaining the tech-
nical requirements for holding, accessing, 
and transferring the digital commodity;
•HR 3633 EH1S 
‘‘(iii) information on any applicable 
consensus mechanism or process for vali-
dating transactions, method of generating 
or mining digital commodities, and any 
process for burning or destroying units of 
the digital commodity on the blockchain 
system; 
‘‘(iv) an explanation of any mecha-
nism for driving value to the digital com-
modity of such blockchain system; and 
‘‘(v) an explanation of governance 
mechanisms for implementing changes to 
the blockchain system or forming con-
sensus among holders of units of such dig-
ital commodity. 
‘‘(E) PLAN OF DEVELOPMENT.—The cur-
rent state and timeline for the development of 
any blockchain system to which the digital com-
modity relates, detailing how and when the 
blockchain system is intended to be a mature 
blockchain system, if the blockchain system is 
not yet certified as a mature blockchain system, 
and the various roles that exist or are intended 
to exist in connection with the blockchain sys-
tem, such as users, service providers, devel-
•HR 3633 EH1S 
opers, transaction validators, and governance 
participants, including a discussion of any 
mechanisms by which control or authority are 
exerted with respect to the blockchain system or 
its related digital commodity, and any critical 
operational dependencies of the blockchain sys-
tem or its related digital commodity. 
‘‘(F) OWNERSHIP DISCLOSURES.— 
‘‘(i) IN GENERAL.—A list of all per-
sons who are digital commodity related 
persons or digital commodity affiliated per-
sons who have been issued a unit of the 
digital commodity by the digital commodity 
issuer or have a right to a unit of the dig-
ital commodity from the digital commodity 
issuer. 
‘‘(ii) CONFIDENTIALITY.—The Com-
mission shall keep each list described 
under clause (i) confidential, consistent 
with what is necessary or appropriate in 
the public interest or for the protection of 
investors. 
‘‘(G) RISK FACTOR DISCLOSURES.—A de-
scription of the material risks surrounding own-
ership of a unit of a digital commodity.
•HR 3633 EH1S 
‘‘(3) ONGOING
DISCLOSURE
REQUIREMENTS 
FOR MATURING BLOCKCHAIN SYSTEMS.—Subject to 
paragraph (5), the issuer of a digital commodity re-
lated to a blockchain system that is not yet certified 
as a mature blockchain system under section 42 of 
the Securities Exchange Act of 1934 that has filed 
a statement under paragraph (1) to offer and sell an 
investment contract involving a unit of a digital 
commodity in reliance on section 4(a)(8) shall file 
the following with the Commission: 
‘‘(A) SEMIANNUAL
REPORTS.—Every 6 
months, a report containing— 
‘‘(i) an updated description of the cur-
rent state and timeline for the development 
of the blockchain system to which the dig-
ital commodity relates, showing how and 
when the blockchain is intended to be a 
mature blockchain system; 
‘‘(ii) a description of the efforts of the 
issuer and digital commodity related per-
sons in developing the blockchain system to 
which the digital commodity relates; 
‘‘(iii) the amount of money raised by 
the digital commodity issuer in reliance on 
section 4(a)(8), how much of that money
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has been spent, and the general categories 
of activities for which that money has been 
spent and amounts spent per category; and 
‘‘(iv) financial statements, where ap-
plicable. 
‘‘(B) CURRENT REPORTS.—A current re-
port reflecting any material changes relevant to 
the information previously reported to the Com-
mission by the digital commodity issuer, which 
shall be filed as soon as practicable after the 
material change occurred, in accordance with 
such rules as the Commission may prescribe as 
necessary or appropriate in the public interest 
or for the protection of investors. 
‘‘(4) RULEMAKING.—Not later than 360 days 
after the date of the enactment of this section, the 
Commission shall prescribe rules on requirements 
applicable to issuers of digital commodities in reli-
ance on section 4(a)(8). 
‘‘(5) TERMINATION
OF
CERTAIN
REPORTING 
REQUIREMENTS; POST-MATURITY
REPORTING
RE-
QUIREMENTS.— 
‘‘(A) IN GENERAL.—The ongoing reporting 
requirements under paragraph (3) shall not 
apply to a digital commodity issuer 180 days
•HR 3633 EH1S 
after the end of the covered fiscal year, if the 
information with respect to the digital com-
modity and the blockchain system to which it 
relates described in subparagraphs (A) through 
(C) of paragraph (2) is made publicly available 
and the disclosure requirements under subpara-
graph (C) of this paragraph are satisfied. 
‘‘(B) COVERED FISCAL YEAR DEFINED.— 
In this paragraph, the term ‘covered fiscal year’ 
means, with respect to a digital commodity, the 
first fiscal year of a digital commodity issuer in 
which the blockchain system to which such dig-
ital commodity relates is certified as a mature 
blockchain system under section 42 of the Secu-
rities Exchange Act of 1934. 
‘‘(C) 
POST-MATURITY
REPORTING
RE-
QUIREMENTS.—After the blockchain system to 
which a digital commodity relates is certified as 
a mature blockchain system under section 42 of 
the Securities Exchange Act of 1934, any dig-
ital commodity issuer that has filed a statement 
under paragraph (1) to offer and sell an invest-
ment contract involving a unit of a digital com-
modity in reliance on section 4(a)(8) and is en-
gaged in material ongoing efforts related to the
•HR 3633 EH1S 
mature blockchain system shall disclose, in a 
manner reasonably calculated to inform the 
public, and at such frequency as the Commis-
sion may prescribe, by rule, a description of 
such efforts, including— 
‘‘(i) any participation in a decentral-
ized governance system of such blockchain 
system; 
‘‘(ii) any participation in alterations 
or proposed alterations to the functionality 
or operation of such blockchain system; 
‘‘(iii) the use or planned use of any 
funds raised in reliance on section 4(a)(8) 
or any rulemaking pursuant to section 
202(c) of the CLARITY Act of 2025 in 
such efforts; 
‘‘(iv) the amount of units of the dig-
ital commodity, or rights thereto, owned 
and controlled by such issuer and any use, 
sale, trading, or other disposition thereof; 
and 
‘‘(v) any affiliations of such issuer 
material to the efforts of such issuer. 
‘‘(D) TERMINATION
OF
AND
EXEMPTION 
FROM
POST-MATURITY
REPORTING
REQUIRE-
•HR 3633 EH1S 
MENTS.—Not later than 270 days after the 
date of the enactment of this section, the Com-
mission shall issue rules— 
‘‘(i) for terminating the disclosure re-
quirements described in subparagraph (C) 
during the first fiscal year in which the 
digital commodity issuer does not engage 
in material ongoing efforts related to the 
mature blockchain system; and 
‘‘(ii) to, as is necessary or appropriate 
in the public interest or for the protection 
of investors, exempt a digital commodity 
issuer from the requirements described in 
subparagraph (C) where only a de minimis 
amount of market activity involving the 
digital commodity of such digital com-
modity issuer is taking place. 
‘‘(E) RULE OF CONSTRUCTION.—Nothing 
in subparagraph (C) may be construed to make 
any digital commodity described in such sub-
paragraph a security. 
‘‘(c) REQUIREMENTS FOR INTERMEDIARIES.—A per-
son acting as an intermediary in connection with the offer 
or sale of an investment contract involving units of a dig-
ital commodity in reliance on section 4(a)(8) shall—
•HR 3633 EH1S 
‘‘(1) register with the Commission as a broker 
or dealer; and 
‘‘(2) be a member of a national securities asso-
ciation registered under section 15A of the Securi-
ties Exchange Act of 1934 (15 U.S.C. 78o–3). 
‘‘(d) DISQUALIFICATION PROVISIONS.—The Commis-
sion shall issue rules to apply the disqualification provi-
sions under section 230.262 of title 17, Code of Federal 
Regulations, to the exemption provided under section 
4(a)(8). 
‘‘(e) FAILURE TO MATURE.— 
‘‘(1) IN GENERAL.—Not later than 270 days 
after the date of the enactment of this section, the 
Commission shall issue rules applying such addi-
tional obligations and disclosures for the digital com-
modity issuers, digital commodity related persons, 
and digital commodity affiliated persons of a 
blockchain system described under subsection (b)(1) 
that does not become a mature blockchain system 
within 
the 
time 
period 
described 
in 
section 
4(a)(8)(A) as are necessary or appropriate in the 
public interest or for the protection of investors. 
Such obligations and disclosures shall include the 
following:
•HR 3633 EH1S 
‘‘(A) DISCLOSURES.—Disclosures regard-
ing the following: 
‘‘(i) FAILURE
TO
MATURE.—A de-
tailed explanation of the reason that the 
blockchain system has not become a ma-
ture blockchain system within the time pe-
riod described in section 4(a)(8)(A). 
‘‘(ii) DEVELOPMENT PLANS.—The fu-
ture 
plans 
of 
development 
of 
the 
blockchain system, including information 
required under subsection (b)(3). 
‘‘(iii) RISK
FACTOR
DISCLOSURES.— 
The material risks surrounding ownership 
of a unit of a digital commodity that re-
lates to a blockchain system described 
under subsection (b)(1) that has not be-
come a mature blockchain system within 
the time period described in section 
4(a)(8)(A). 
‘‘(B) OBLIGATIONS.—Transaction report-
ing and beneficial ownership disclosure obliga-
tions applicable to digital commodity related 
persons and digital commodity affiliated per-
sons of such blockchain system.
•HR 3633 EH1S 
‘‘(2) QUALIFICATION
REQUIRED.—The Com-
mission may not permit any additional reliance on 
an exempt offering for the offer or sale of an invest-
ment contract involving a unit of a digital com-
modity by the issuer of the digital commodity related 
to a blockchain system described under subsection 
(a)(1) that has not become a mature blockchain sys-
tem within the time period described in section 
4(a)(8)(A) unless the Commission has qualified any 
offering statement related to such exempt offering.’’. 
(b) ADDITIONAL EXEMPTIONS.— 
(1) CERTAIN REGISTRATION REQUIREMENTS.— 
Section 12(g)(6) of the Securities Exchange Act of 
1934 (15 U.S.C. 78l(g)(6)) is amended by striking 
‘‘under section 4(6)’’ and inserting ‘‘under section 
4(a)(6) or 4(a)(8)’’. 
(2) EXEMPTION FROM STATE REGULATION.— 
Section 18(b)(4) of the Securities Act of 1933 (15 
U.S.C. 77r(b)(4)) is amended— 
(A) in subparagraph (B), by striking ‘‘sec-
tion 4(4)’’ and inserting ‘‘section 4(a)(4)’’; 
(B) in subparagraph (C), by striking ‘‘sec-
tion 4(6)’’ and inserting ‘‘section 4(a)(6)’’; 
(C) in subparagraph (F)—
•HR 3633 EH1S 
(i) by striking ‘‘section 4(2)’’ each 
place such term appears and inserting 
‘‘section 4(a)(2)’’; and 
(ii) by striking ‘‘or’’ at the end; 
(D) in subparagraph (G), by striking the 
period and inserting ‘‘; or’’; and 
(E) by adding at the end the following: 
‘‘(H) section 4(a)(8).’’. 
(c) USE OF OTHER EXEMPTIONS.— 
(1) RULE OF CONSTRUCTION.—Except as pro-
vided in this subsection, nothing in this section or 
the amendments made by this section may be con-
strued as prohibiting the offer or sale of an invest-
ment contract involving units of a digital commodity 
in reliance on an exemption from registration under 
the Securities Act of 1933, including as provided 
under section 3, 4(a), or 19 of the Securities Act of 
1933, other than that provided under section 4(a)(8) 
of the Securities Act of 1933. 
(2) RULEMAKINGS.— 
(A) The Securities and Exchange Commis-
sion may issue rules— 
(i) to permit the issuer of a digital 
commodity related to a blockchain system 
described under section 4B(b)(1) of the
•HR 3633 EH1S 
commodity in reliance on an exemption 
from registration under the Securities Act 
of 1933, including as provided under sec-
tion 3, 4(a), or 19 of the Securities Act of 
1933, other than that provided under sec-
tion 4(a)(8) of the Securities Act of 1933, 
on or after the date of enactment of this 
Act, to file a comparable set of disclosures 
to those described under section 4B of the 
Securities Act of 1933 as the Commission 
determines appropriate based on the ex-
emption, the maturity of the blockchain 
system to which such digital commodity re-
lates, and any material ongoing efforts of 
such digital commodity issuer, prior to the 
date of any secondary market sale of such 
digital commodity made in reliance on sec-
tion 203. 
(iii) With respect to a digital com-
modity where the digital commodity issuer 
is required to file disclosures under clause 
(i) or (ii) and where the blockchain system 
to which the digital commodity relates is 
not certified as a mature blockchain sys-
tem pursuant to section 42 of the Securi-
•HR 3633 EH1S 
ties Exchange Act of 1934 after the 4-year 
period beginning on the date that the first 
such disclosure is filed— 
(I) a rule prohibiting the offer or 
sale of an investment contract involv-
ing units of the digital commodity un-
less the Commission has qualified any 
offering statement related to such 
offer or sale, where such offer or sale 
is permitted pursuant to subpara-
graph (A)(i); and 
(II) a rule requiring the digital 
commodity issuer to make disclosures 
comparable to those described in 
4B(e)(1)(A) of the Securities Act of 
1933. 
(iv) A rule permitting a successor to 
a digital commodity issuer, or such other 
appropriate person as designated by the 
Commission, to make the disclosures re-
quired under clause (i), where such issuer 
does not make the required disclosures.
•HR 3633 EH1S 
SEC. 203. TREATMENT OF SECONDARY TRANSACTIONS IN 
DIGITAL COMMODITIES THAT ORIGINALLY 
INVOLVED INVESTMENT CONTRACTS. 
(a) SECONDARY MARKET TREATMENT.—Notwith-
standing any other provision of law, the offer or sale of 
a digital commodity that originally involved an investment 
contract by a person other than the issuer of such digital 
commodity, or an agent or underwriter thereof, shall be 
deemed not to be an offer or sale of such investment con-
tract between the issuer of the investment contract involv-
ing the digital commodity, or an agent or underwriter 
thereof, and the purchaser of such digital commodity 
under— 
(1) the Securities Act of 1933 (15 U.S.C. 77a 
et seq.); 
(2) the Investment Advisers Act of 1940 (15 
U.S.C. 80b–1 et seq.); 
(3) the Investment Company Act of 1940 (15 
U.S.C. 80a–1 et seq.); 
(4) the Securities Exchange Act of 1934 (15 
U.S.C. 78a et seq.); 
(5) the Securities Investor Protection Act of 
1970 (15 U.S.C. 78aaa et seq.); and 
(6) any applicable provisions of State law.
•HR 3633 EH1S 
(b) END USER DISTRIBUTIONS NOT AN OFFER OR 
SALE OF A SECURITY.—An end user distribution does not 
involve the offer or sale of a security. 
(c) AGENT DEFINED.—In this section and with re-
spect to a digital commodity issuer, the term ‘‘agent’’ 
means any person directly or indirectly controlled by the 
issuer or under direct or indirect common control with the 
issuer. 
SEC. 204. REQUIREMENTS FOR OFFERS AND SALES OF DIG-
ITAL COMMODITIES BY DIGITAL COMMODITY 
RELATED 
PERSONS 
AND 
DIGITAL 
COM-
MODITY AFFILIATED PERSONS. 
The Securities Act of 1933 (15 U.S.C. 77a et seq.), 
as amended by section 202, is further amended by insert-
ing after section 4B the following: 
‘‘SEC. 4C. REQUIREMENTS FOR OFFERS AND SALES OF DIG-
ITAL COMMODITIES BY DIGITAL COMMODITY 
RELATED 
PERSONS 
AND 
DIGITAL 
COM-
MODITY AFFILIATED PERSONS. 
‘‘(a) IN GENERAL.—It shall be a violation of this Act 
for a digital commodity affiliated person or a digital com-
modity related person to offer or sell a digital commodity 
acquired directly from its issuer, or an agent or under-
writer thereof, pursuant to an investment contract in reli-
•HR 3633 EH1S 
ance on section 4(a)(8) or another exemption under this 
Act, other than as provided in this section. 
‘‘(b) COMMISSION JURISDICTION.— 
‘‘(1) Where a digital commodity affiliated per-
son or a digital commodity related person offers or 
sells a digital commodity acquired directly from its 
issuer, or an agent or underwriter thereof, pursuant 
to an investment contract in reliance on section 
4(a)(8), or another exemption under this Act, other 
than as provided in this section, such digital com-
modity affiliated person or digital commodity related 
person shall be considered an issuer of such invest-
ment contract. 
‘‘(2) For the purposes of this section, the Com-
mission shall have jurisdiction and enforcement au-
thority with respect to an offer or sale of a digital 
commodity described in subsection (a). 
‘‘(c) RESTRICTIONS ON DIGITAL COMMODITY RE-
LATED PERSONS AND DIGITAL COMMODITY AFFILIATED 
PERSONS.— 
‘‘(1) PRIOR TO BEING A MATURE BLOCKCHAIN 
SYSTEM.—Prior to the blockchain system to which a 
digital commodity relates being certified as a mature 
blockchain system under section 42 of the Securities 
Exchange Act of 1934, units of the digital com-
•HR 3633 EH1S 
modity acquired by a digital commodity related per-
son or digital commodity affiliated person directly 
from its issuer (or an agent or underwriter thereof) 
pursuant to an investment contract in reliance on 
section 4(a)(8), or another exemption under this 
Act, may be offered or sold by such digital com-
modity related person or digital commodity affiliated 
person if— 
‘‘(A) reports with respect to such digital 
commodity, 
where 
required 
under 
section 
4B(b)(3) (or, with respect to a digital com-
modity not issued in reliance on section 4(a)(8), 
a comparable set of reports where required by 
the Commission) have been filed with the Com-
mission; 
‘‘(B) the digital commodity related person 
or digital commodity affiliated person has held 
the units for not less than 12 months; and 
‘‘(C) the aggregate amount of the units of 
the digital commodity offered or sold by the 
digital commodity related person or digital com-
modity affiliated person is— 
‘‘(i) in any 12-month period, or short-
er period as the Commission may pre-
scribe, not less than 5 percent or greater
•HR 3633 EH1S 
than 20 percent of the total units of the 
digital commodity acquired directly from 
its issuer (or an agent or underwriter 
thereof) by the digital commodity related 
person or digital commodity affiliated per-
son, as determined by the Commission pur-
suant to paragraph (3); and 
‘‘(ii) an amount, as determined by the 
Commission pursuant to paragraph (3), 
not less than 30 percent or greater than 
50 percent of the total units of the digital 
commodity acquired directly from its issuer 
(or an agent or underwriter thereof) by the 
digital commodity related person or digital 
commodity affiliated person. 
‘‘(2) AFTER BECOMING A MATURE BLOCKCHAIN 
SYSTEM.—After the blockchain system to which a 
digital commodity relates is certified as a mature 
blockchain system under section 42 of the Securities 
Exchange Act of 1934, units of the digital com-
modity acquired by a digital commodity related per-
son or digital commodity affiliated person directly 
from its issuer (or an agent or underwriter thereof) 
pursuant to an investment contract in reliance on
•HR 3633 EH1S 
section 4(a)(8) or another exemption under this Act, 
may be— 
‘‘(A) offered or sold by a digital commodity 
related person; or 
‘‘(B) offered or sold by a digital com-
modity affiliated person if— 
‘‘(i) information described in section 
4B(b)(5)(C), where required (or, with re-
spect to a digital commodity not issued in 
reliance on section 4(a)(8), a comparable 
set of information, where required) is pub-
licly available; 
‘‘(ii) the digital commodity affiliated 
person has held the units for not less than 
the earlier of— 
‘‘(I) 12 months; or 
‘‘(II) 3 months following the date 
on which the blockchain system is cer-
tified as a mature blockchain system 
under section 42 of the Securities Ex-
change Act of 1934; and 
‘‘(iii) the aggregate amount of the 
units of the digital commodity offered or 
sold by the digital commodity affiliated 
person in any 12-month period is an
•HR 3633 EH1S 
amount, as determined by the Commission 
pursuant to paragraph (3), not less than 5 
percent or greater than 10 percent of the 
total outstanding amount of the digital 
commodity. 
‘‘(3) RULEMAKINGS REQUIRED.—Not later than 
270 days after the date of the enactment of this sec-
tion, consistent with protecting investors, maintain-
ing fair, orderly, and efficient markets, and facili-
tating capital formation, and to foster the develop-
ment of mature blockchain systems, the Commission, 
by rule, after notice and comment— 
‘‘(A) shall set the percentage amounts de-
scribed in paragraphs (1)(C)(i), (1)(C)(ii), and 
(2)(B)(iii); and 
‘‘(B) may provide an exemption from the 
limitation described in paragraph (1)(C)(ii), if 
the Commission requires any offer or sale pur-
suant to such exemption of a digital commodity 
related to a blockchain system that has failed to 
become a mature blockchain system under this 
Act or any rule promulgated hereunder to be 
accompanied by the disclosures required under, 
as applicable, section 4B(e)(1)(A) or section
•HR 3633 EH1S 
202(c)(2)(B)(iii)(II) of the CLARITY Act of 
2025. 
‘‘(d) RULES OF CONSTRUCTION.—For purposes of 
this section, the use of a digital commodity in the pro-
grammatic functioning of the blockchain system to which 
it relates is not an offer or sale of a digital commodity. 
‘‘(e) MANIPULATIVE AND DECEPTIVE DEVICES; RE-
PORTING.— 
‘‘(1) IN GENERAL.—It shall be unlawful for any 
digital commodity issuer, digital commodity related 
person, or digital commodity affiliated person, di-
rectly or indirectly, by the use of any means or in-
strumentality of interstate commerce or of the mails, 
to use or employ, in connection with the purchase or 
sale of any digital commodity, any manipulative or 
deceptive device or contrivance in contravention of 
such rules and regulations as the Commission may 
prescribe as necessary or appropriate in the public 
interest or for the protection of investors. 
‘‘(2) AFFIRMATIVE DEFENSE.—Not later than 
270 days after the date of the enactment of this sec-
tion, the Commission shall issue rules to implement 
paragraph (1), including by providing any affirma-
tive defenses to an enforcement action thereunder as 
the Commission may prescribe as necessary or ap-
•HR 3633 EH1S 
propriate in the public interest or for the protection 
of investors. 
‘‘(3) REPORTING.—Not later than 270 days 
after the date of the enactment of this section, the 
Commission shall issue rules to prescribe such trans-
action reporting and beneficial ownership disclosure 
obligations applicable to digital commodity related 
persons and digital commodity affiliated persons, as 
necessary or appropriate in the public interest or for 
the protection of investors. 
‘‘(4) DIFFERENTIATION BETWEEN PERSONS.— 
In issuing rules required under paragraphs (2) and 
(3), the Commission shall differentiate between dig-
ital commodity related persons and digital com-
modity affiliated persons, as necessary or appro-
priate in the public interest or for the protection of 
investors. 
‘‘(f) CERTAIN UNITS RECEIVED PRIOR TO ENACT-
MENT.—A unit of a digital commodity received from the 
digital commodity issuer prior to the date of the enact-
ment of this section through an offer or sale of an invest-
ment contract involving units of a digital commodity in 
reliance on an exemption from registration under this Act, 
including as provided under section 3, 4(a), or 19, may
•HR 3633 EH1S 
be offered or sold by a digital commodity related person 
or digital commodity affiliated person, if— 
‘‘(1) the digital commodity issuer is no longer 
engaged in material ongoing efforts related to the 
blockchain system to which the digital commodity re-
lates and the blockchain system to which the digital 
commodity 
relates 
is 
certified 
as 
a 
mature 
blockchain system under section 42 of the Securities 
Exchange Act of 1934; or 
‘‘(2) the appropriate disclosures required under 
section 202(c)(2)(B) of the CLARITY Act of 2025 
have been made with the Commission. 
‘‘(g) RULEMAKING ON FURTHER USAGE OF DIGITAL 
COMMODITIES.— The Commission, consistent with pro-
tecting investors, maintaining fair, orderly, and efficient 
markets, and facilitating capital formation, as well as fos-
tering the development of mature blockchain systems, 
may, by rule, exempt unconditionally or on stated terms 
or conditions, a digital commodity related person or a dig-
ital commodity affiliated person, or any class thereof, from 
the requirements of this section for the offer or sale of 
a digital commodity, including for the purposes of pro-
moting market liquidity.’’.
•HR 3633 EH1S 
SEC. 205. MATURE BLOCKCHAIN SYSTEM REQUIREMENTS. 
Title I of the Securities Exchange Act of 1934 (15 
U.S.C. 78a et seq.) is amended by adding at the end the 
following: 
‘‘SEC. 42. MATURE BLOCKCHAIN SYSTEMS. 
‘‘(a) CERTIFICATION OF BLOCKCHAIN SYSTEMS.— 
‘‘(1) CERTIFICATION.—A digital commodity 
issuer, digital commodity related person, digital com-
modity affiliated person, decentralized governance 
system of the blockchain system, or a registered dig-
ital commodity exchange, or any other appropriate 
person as designated by the Commission, may certify 
to the Commission that the blockchain system to 
which a digital commodity relates is a mature 
blockchain system. 
‘‘(2) FILING
REQUIREMENTS.—A certification 
described under paragraph (1) shall be filed with the 
Commission, and include such information that is 
reasonably necessary to establish that the blockchain 
system is not controlled by any person or group of 
persons under common control, which may include 
information regarding— 
‘‘(A) the operation of the blockchain sys-
tem; 
‘‘(B) the functionality of the related digital 
commodity;
•HR 3633 EH1S 
‘‘(C) how the market value of the digital 
commodity is substantially derived from the 
programmatic functioning of such blockchain 
system; 
‘‘(D) any decentralized governance system 
which relates to the blockchain system; and 
‘‘(E) the current roles, if any, of the digital 
commodity issuer, digital commodity affiliated 
persons, and digital commodity related persons 
where such roles are material to the develop-
ment or operation of such blockchain system or 
the decentralized governance system of such 
blockchain system. 
‘‘(3) REBUTTABLE PRESUMPTION.—The Com-
mission may rebut a certification described under 
paragraph (1) with respect to a blockchain system if 
the Commission, within 60 days of receiving such 
certification, determines that the blockchain system 
is not a mature blockchain system. 
‘‘(4) CERTIFICATION REVIEW.— 
‘‘(A) IN
GENERAL.—Any blockchain sys-
tem that relates to a digital commodity for 
which a certification has been made under para-
graph (1) shall be considered a mature 
blockchain system 60 days after the date on
•HR 3633 EH1S 
which the Commission receives a certification 
under paragraph (1), unless the Commission 
notifies the person who made the certification 
within such time that the Commission is stay-
ing the certification due to— 
‘‘(i) an inadequate explanation by the 
person making the certification; or 
‘‘(ii) any novel or complex issues 
which require additional time to consider. 
‘‘(B) PUBLIC
NOTICE.—The Commission 
shall make the following available to the public 
and provide a copy to the Commodity Futures 
Trading Commission: 
‘‘(i) Each certification received under 
paragraph (1). 
‘‘(ii) Each stay of the Commission 
under this subsection, and the reasons 
therefor. 
‘‘(iii) Any response from a person 
making a certification under paragraph (1) 
to a stay of the certification by the Com-
mission. 
‘‘(C) CONSOLIDATION.—The Commission 
may consolidate and treat as one submission 
multiple certifications made under paragraph
•HR 3633 EH1S 
(1) for the same blockchain system which re-
lates to a digital commodity which are received 
during the review period provided under this 
paragraph. 
‘‘(5) STAY OF CERTIFICATION.— 
‘‘(A) IN GENERAL.—A notification by the 
Commission pursuant to paragraph (4)(A) shall 
stay the certification once for up to an addi-
tional 120 days from the date of the notifica-
tion. 
‘‘(B) PUBLIC COMMENT PERIOD.—Before 
the end of the 60-day period described under 
paragraph (4)(A), the Commission may begin a 
public comment period of at least 30 days in 
conjunction with a stay under this subsection. 
‘‘(6) DISPOSITION OF CERTIFICATION.—A cer-
tification made under paragraph (1) shall— 
‘‘(A) become effective— 
‘‘(i) upon the publication of a notifica-
tion from the Commission to the person 
who made the certification that the Com-
mission does not object to the certification; 
or 
‘‘(ii) at the expiration of the certifi-
cation review period; and
•HR 3633 EH1S 
‘‘(B) not become effective upon the publi-
cation of a notification from the Commission to 
the person who made the certification that the 
Commission has rebutted the certification. 
‘‘(7) RECERTIFICATION.—With respect to a 
blockchain system for which a certification has been 
rebutted under this subsection, no person may make 
a certification under paragraph (1) with respect to 
such blockchain system during the 90-day period be-
ginning on the date of such rebuttal. 
‘‘(8) APPEAL OF REBUTTAL.— 
‘‘(A) IN GENERAL.—If a certification is re-
butted under this section, the person making 
such certification may appeal the decision to 
the United States Court of Appeals for the Dis-
trict of Columbia, not later than 60 days after 
the notice of rebuttal is made. 
‘‘(B) REVIEW.—In an appeal under sub-
paragraph (A), the court shall have de novo re-
view of the determination to rebut the certifi-
cation. 
‘‘(b) MATURITY CRITERIA.— 
‘‘(1) SENSE OF CONGRESS.—It is the sense of 
the Congress that protecting investors, maintaining 
fair, orderly, and efficient markets, and facilitating
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•HR 3633 EH1S 
capital formation necessitates establishing clear cri-
teria for blockchain systems to be deemed mature, 
as well as enabling the Commission to develop, with-
out prejudice to any such criteria codified in statute, 
alternative criteria by which blockchain systems may 
be considered not to be controlled by any person or 
group of persons under common control in order to 
accommodate changes in markets and technology. 
‘‘(2) IN GENERAL.—The Commission may issue 
rules identifying conditions by which a blockchain 
system, together with its related digital commodity, 
shall be considered a mature blockchain system, con-
sistent with the protection of investors, maintenance 
of fair, orderly, and efficient markets, and the facili-
tation of capital formation. 
‘‘(3) RULES OF CONSTRUCTION.— 
‘‘(A) Nothing in this subsection may be 
construed to permit the Commission to impose 
additional criteria to the criteria in subsection 
(c) for certifying that a blockchain system is a 
mature blockchain system pursuant to sub-
section (c). 
‘‘(B) Nothing in this subsection or sub-
section (c) may be construed to limit the Com-
mission’s ability to identify alternative condi-
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•HR 3633 EH1S 
tions and criteria by which a blockchain system 
may be considered a mature blockchain system. 
‘‘(c) DEEMED MATURE.— 
‘‘(1) IN GENERAL.—Notwithstanding subsection 
(b), for the purposes of subsection (a), a digital com-
modity issuer, digital commodity related person, dig-
ital commodity affiliated person, or decentralized 
governance system of the blockchain system may es-
tablish that a blockchain system, together with its 
related digital commodity, is not controlled by any 
person or group of persons under common control, 
if the blockchain system, together with its related 
digital asset, meets the requirements described in 
paragraph (2) or (3). 
‘‘(2) CRITERIA
FOR
ANY
BLOCKCHAIN
SYS-
TEM.—The requirements described in this paragraph 
are the following: 
‘‘(A) SYSTEM VALUE.— 
‘‘(i) MARKET
VALUE.—The digital 
commodity has a value that is substantially 
derived from the use and functioning of 
the blockchain system. 
‘‘(ii) DEVELOPMENT OF VALUE MECH-
ANISM
SUBSTANTIALLY
COMPLETED.— 
Where the digital commodity issuer has
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•HR 3633 EH1S 
made public a development plan describing 
how the digital commodity’s value is rea-
sonably expected to be derived from the 
programmatic 
functioning 
of 
the 
blockchain system, the development of such 
mechanisms has been substantially com-
pleted. 
‘‘(B) 
FUNCTIONAL
SYSTEM.—The 
blockchain system allows network participants 
to engage in the activities the blockchain system 
is intended to provide, including— 
‘‘(i) using, transmitting, or storing 
value, or otherwise executing transactions, 
on the blockchain system; 
‘‘(ii) deploying, executing, or accessing 
software or services, or otherwise offering 
or participating in services, deployed on or 
integrated with the blockchain system; 
‘‘(iii) participating in the consensus 
mechanism, transaction validation process, 
or decentralized governance system of the 
blockchain system; or 
‘‘(iv) operating any client, node, 
validator, or other form of computational
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•HR 3633 EH1S 
infrastructure 
with 
respect 
to 
the 
blockchain system. 
‘‘(C) OPEN
AND
INTEROPERABLE
SYS-
TEM.—The blockchain system— 
‘‘(i) is composed of source code that is 
open source; and 
‘‘(ii) does not restrict or prohibit 
based on the exercise of unilateral author-
ity any person, other than a digital com-
modity issuer, digital commodity related 
person, or digital commodity affiliated per-
son from engaging in the activities the 
blockchain system is intended to provide, 
including the activities described in sub-
paragraph (B). 
‘‘(D) 
PROGRAMMATIC
SYSTEM.—The 
blockchain system operates, executes, and en-
forces its operations and transactions based 
solely on pre-established, transparent rules en-
coded directly within the source code of the 
blockchain system. 
‘‘(E) SYSTEM
GOVERNANCE.—No person 
or group of persons under common control— 
‘‘(i) has the unilateral authority, di-
rectly or indirectly, through any contract,
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•HR 3633 EH1S 
arrangement, understanding, relationship, 
or otherwise, to control or materially alter 
the functionality, operation, or rules of 
consensus or agreement of the blockchain 
system or its related digital commodity; or 
‘‘(ii) has the unilateral authority to di-
rect the voting, in the aggregate, of 20 
percent or more of the outstanding voting 
power of such blockchain system by means 
of a related digital commodity, nodes or 
validators, a decentralized governance sys-
tem, or otherwise, in a blockchain system 
which can be altered by a voting system. 
‘‘(F) IMPARTIAL SYSTEM.—No person or 
group of persons under common control pos-
sesses a unique permission or privilege with re-
spect to functionality, operation, or rules of 
consensus or agreement of the blockchain sys-
tem or its related digital commodity, unless 
such alteration— 
‘‘(i) addresses errors, regular mainte-
nance, or cybersecurity risks of the 
blockchain system that affect the pro-
grammatic functioning of the blockchain 
system; and
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•HR 3633 EH1S 
‘‘(ii) is adopted through the consensus 
or agreement of a decentralized governance 
system. 
‘‘(G) DISTRIBUTED OWNERSHIP.—No dig-
ital commodity issuer, digital commodity related 
person, or digital commodity affiliated person 
beneficially owns, in the aggregate, 20 percent 
or more of the total amount of units of the dig-
ital commodity. 
‘‘(3) OPTIONAL
CRITERIA
FOR
PREEXISTING 
BLOCKCHAIN SYSTEMS.—The requirements described 
in this paragraph are that the blockchain system— 
‘‘(A) was created prior to the date of en-
actment of this section; 
‘‘(B) met the requirements of subpara-
graphs (A) through (F) of paragraph (2) prior 
to the date of enactment of this section; and 
‘‘(C) at least 50 percent of the units of the 
digital commodity related to the blockchain sys-
tem are held by persons other than the digital 
commodity issuer, a digital commodity related 
person, or a digital commodity affiliated person. 
‘‘(d) DECENTRALIZED GOVERNANCE SYSTEM.—
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•HR 3633 EH1S 
‘‘(1) For the purposes of this section, a decen-
tralized governance system is not a ‘person’ or a 
‘group of persons under common control’. 
‘‘(2) A blockchain system, together with its dig-
ital commodity, shall not be precluded from being 
considered a mature blockchain system solely based 
on a functional, administrative, clerical, or ministe-
rial action of a decentralized governance system, in-
cluding any such action taken by a person acting on 
behalf of and at the direction of the decentralized 
governance system, as determined by the Commis-
sion and consistent with the protection of investors, 
maintenance of fair, orderly, and efficient markets, 
and the facilitation of capital formation. 
‘‘(e) RULEMAKING.—Not more than 270 days after 
the date of enactment of this section, the Commission 
shall issue rules to carry out this section.’’. 
SEC. 206. EFFECTIVE DATE. 
Unless otherwise provided in this title, this title and 
the amendments made by this title shall take effect 360 
days after the date of enactment of this Act, except that, 
to the extent a provision of this title requires a rule-
making, the provision shall take effect on the later of— 
(1) 360 days after the date of enactment of this 
Act; or
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•HR 3633 EH1S 
(2) 60 days after the publication in the Federal 
Register of the final rule implementing the provision. 
TITLE III—REGISTRATION FOR 
INTERMEDIARIES AT THE SE-
CURITIES 
AND 
EXCHANGE 
COMMISSION 
SEC. 301. TREATMENT OF DIGITAL COMMODITIES AND PER-
MITTED PAYMENT STABLECOINS. 
(a) SECURITIES ACT OF 1933.—Section 2(a)(1) of 
the Securities Act of 1933 (15 U.S.C. 77b(a)(1)), as 
amended by the GENIUS Act, is amended by striking the 
final sentence and inserting the following: ‘‘The term does 
not include a digital commodity or permitted payment 
stablecoin.’’. 
(b) SECURITIES EXCHANGE ACT OF 1934.—Section 
3(a)(10) of the Securities Exchange Act of 1934 (15 
U.S.C. 78c(a)), as amended by the GENIUS Act, is 
amended by striking the final sentence and inserting the 
following: ‘‘The term does not include a digital commodity 
or permitted payment stablecoin.’’. 
(c) INVESTMENT ADVISERS ACT OF 1940.—Section 
202(a) of the Investment Advisers Act of 1940 (15 U.S.C. 
80b–2(a)) is amended— 
(1) in paragraph (18), as amended by the GE-
NIUS Act, by striking the final sentence and insert-
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•HR 3633 EH1S 
ing the following: ‘‘The term does not include a dig-
ital commodity or permitted payment stablecoin.’’; 
(2) by redesignating the second paragraph (29) 
(relating to commodity pools) as paragraph (31); 
and 
(3) by adding at the end, the following: 
‘‘(32) DIGITAL COMMODITY-RELATED TERMS.— 
The terms ‘digital commodity’ and ‘permitted pay-
ment stablecoin’ have the meaning given those 
terms, respectively, under section 2(a) of the Securi-
ties Act of 1933 (15 U.S.C. 77b(a)).’’. 
(d) INVESTMENT COMPANY ACT OF 1940.—Section 
2(a) of the Investment Company Act of 1940 (15 U.S.C. 
80a–2) is amended— 
(1) in paragraph (36), as amended by the GE-
NIUS Act, by striking the final sentence and insert-
ing the following: ‘‘The term does not include a dig-
ital commodity or permitted payment stablecoin.’’; 
and 
(2) by adding at the end, the following: 
‘‘(55) DIGITAL COMMODITY-RELATED TERMS.— 
The terms ‘digital commodity’ and ‘permitted pay-
ment stablecoin’ have the meaning given those 
terms, respectively, under section 2(a) of the Securi-
ties Act of 1933 (15 U.S.C. 77b(a)).’’.
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•HR 3633 EH1S 
(e) SECURITIES INVESTOR PROTECTION ACT
OF 
1970.—Section 16 of the Securities Investor Protection 
Act of 1970 (15 U.S.C. 78lll) is amended— 
(1) in paragraph (14), as amended by the GE-
NIUS Act, by striking the final sentence and insert-
ing the following: ‘‘The term does not include a dig-
ital commodity or permitted payment stablecoin, as 
such terms are defined, respectively, under section 
2(a) of the Securities Act of 1933 (15 U.S.C. 
77b(a))’’; and 
(2) by adding at the end the following: 
‘‘(15) TREATMENT
OF
PERMITTED
PAYMENT 
STABLECOINS.—A permitted payment stablecoin, as 
defined in section 2(a) of the Securities Act of 1933, 
shall not qualify as ‘cash’ and a claim for a per-
mitted payment stablecoin shall not qualify as a 
‘claim for cash’.’’. 
SEC. 302. ANTI-FRAUD AUTHORITY OVER PERMITTED PAY-
MENT STABLECOINS AND CERTAIN DIGITAL 
COMMODITY TRANSACTIONS. 
(a) IN GENERAL.—Section 10 of the Securities Ex-
change Act of 1934 (15 U.S.C. 78j) is amended— 
(1) by moving subsection (c) so as to appear 
after subsection (b);
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•HR 3633 EH1S 
(2) by inserting after subsection (c) the fol-
lowing: 
‘‘(d) To use or employ, in connection with the pur-
chase or sale of any permitted payment stablecoin or dig-
ital commodity, by or through, as applicable, a broker, 
dealer, national securities exchange, or an alternative 
trading system, any manipulative or deceptive device or 
contrivance in contravention of such rules and regulations 
as the Commission may prescribe as necessary or appro-
priate in the public interest or for the protection of inves-
tors.’’; and 
(3) by adding at the end the following: ‘‘Rules 
promulgated under subsection (b) that prohibit 
fraud, manipulation, or insider trading (but not 
rules imposing or specifying reporting or record-
keeping requirements, procedures, or standards as 
prophylactic measures against fraud, manipulation, 
or insider trading), and judicial precedents decided 
under subsection (b) and rules promulgated there-
under that prohibit fraud, manipulation, or insider 
trading, shall apply with respect to permitted pay-
ment stablecoin and digital commodity transactions 
engaged in by or through a broker or dealer or 
through an alternative trading system or, as applica-
ble, a national securities exchange to the same ex-
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•HR 3633 EH1S 
‘‘(1) IN GENERAL.—The Commission may not 
preclude a trading platform from operating pursuant 
to a covered exemption to exchange registration 
under section 6 of this title on the basis that the as-
sets traded or to be traded on such platform in-
clude— 
‘‘(A) digital commodities or permitted pay-
ment stablecoins; and 
‘‘(B) securities. 
‘‘(2) COVERED
EXEMPTION.—In this sub-
section, the term ‘covered exemption’ means an ex-
emption— 
‘‘(A) described in subsection (a)(2); or 
‘‘(B) with respect to any other rule of the 
Commission relating to the definition of ‘ex-
change’.’’. 
(b) SECURITIES EXCHANGE ACT OF 1934.—Section 
3(a)(2) of the Securities Exchange Act of 1934 (15 U.S.C. 
78c(a)(2)) is amended by adding at the end the following: 
‘‘Neither an alternative trading system predominantly fa-
cilitating the trading of digital commodities, permitted 
payment stablecoins, or both, relative to its securities trad-
ed, nor a digital commodity exchange, is a ‘facility’ of an 
exchange.’’.
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•HR 3633 EH1S 
(c) RULE OF CONSTRUCTION.—Nothing in this sec-
tion, the amendments made by this section, or section 304 
may be construed to— 
(1) prohibit a national securities exchange from 
owning or operating any other type of alternative 
trading system; or 
(2) create a presumption that any other type of 
alternative trading system owned or operated by a 
national securities exchange is a facility of that ex-
change. 
SEC. 304. RULEMAKING FOR DUAL-REGISTERED ENTITIES. 
(a) CONFLICT OF INTEREST POLICIES AND PROCE-
DURES.—Each person or entity dual-registered with the 
Commodity Futures Trading Commission as permitted 
under section 15(p) of the Securities Exchange Act of 
1934 shall establish, maintain, and, as applicable, enforce 
and comply with written policies and procedures reason-
ably designed to mitigate any conflicts of interest, includ-
ing with respect to transactions or arrangements with af-
filiates registered with the Securities and Exchange Com-
mission, taking into consideration the nature of the busi-
ness of such person or entity. 
(b) EXEMPTION FROM DUPLICATIVE, CONFLICTING, 
OR UNDULY BURDENSOME PROVISIONS.—The Securities 
and Exchange Commission shall prescribe rules for a per-
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•HR 3633 EH1S 
son or entity with multiple registrations, where at least 
one such registration includes any dual registration per-
mitted under section 15(p) of the Securities Exchange Act 
of 1934, to exempt the person or entity from duplicative, 
conflicting, or unduly burdensome provisions of the Secu-
rities Exchange Act of 1934 and rules thereunder, to the 
extent such an exemption would protect investors, main-
tain fair, orderly, and efficient markets, and facilitate cap-
ital formation. 
(c) IMPLEMENTING ORGANIZATIONS.—The Securities 
and Exchange Commission shall require any registered na-
tional securities association that has as a member a reg-
istered broker or registered dealer that is registered with 
the Commodity Futures Trading Commission as a digital 
commodity broker or digital commodity dealer as per-
mitted under section 15(p)(1) of the Securities Exchange 
Act of 1934 or otherwise transacts in permitted payment 
stablecoins to revise such rules as may be necessary to 
further the purposes of and compliance with this section. 
(d) MEMORANDUM OF UNDERSTANDING.—The Secu-
rities and Exchange Commission shall enter into a memo-
randum of understanding with the Commodity Futures 
Trading Commission to ensure— 
(1) non-duplicative supervision and enforcement 
with respect to registrants of the Securities and Ex-
116 
•HR 3633 EH1S 
change Commission dual-registered with the Com-
modity Futures Trading Commission as permitted 
under section 15(p) of the Securities Exchange Act 
of 1934; and 
(2) appropriate information sharing between 
the Commissions to further the purposes of and 
compliance with this section, the Securities Ex-
change Act of 1934, and the Commodity Exchange 
Act. 
(e) RULE OF CONSTRUCTION.—Nothing in this sec-
tion shall be construed to limit the anti-fraud, anti-manip-
ulation, or false reporting enforcement authorities of the 
Commodity Futures Trading Commission with respect to 
a contract of sale of a commodity and persons effecting 
such contracts. 
SEC. 305. MODERNIZATION OF RECORDKEEPING REQUIRE-
MENTS. 
(a) IN
GENERAL.—For purposes of books and 
records requirements for brokers, dealers, transfer agents, 
national securities exchanges under the Securities and Ex-
change Act of 1934 (15 U.S.C. 78a et seq.), investment 
advisers under the Investment Advisers Act of 1940 (15 
U.S.C. 80b–1 et seq.), and investment companies under 
the Investment Company Act of 1940 (15 U.S.C. 80a– 
1 et seq.), a person may, consistent with any rules promul-
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•HR 3633 EH1S 
gated under subsection (b), utilize records from a 
blockchain system. 
(b) REVISION OF RULES.—Not later than 180 days 
after the date of enactment of this Act, the Securities and 
Exchange Commission shall issue and revise such rules as 
may be necessary to implement this section. 
SEC. 306. EXEMPTIVE AUTHORITY. 
Section 28 of the Securities Act of 1933 (15 U.S.C. 
77z–3) is amended by striking ‘‘by rule or regulation’’ and 
inserting ‘‘by rule, regulation, or order’’. 
SEC. 307. ADDITIONAL REGISTRATIONS WITH THE COM-
MODITY FUTURES TRADING COMMISSION. 
Section 15 of the Securities Exchange Act of 1934 
(15 U.S.C. 78o) is amended by adding at the end the fol-
lowing: 
‘‘(p) ADDITIONAL REGISTRATIONS WITH THE COM-
MODITY FUTURES TRADING COMMISSION.— 
‘‘(1) REGISTERED BROKERS AND DEALERS.—A 
registered broker or registered dealer shall be per-
mitted to maintain a registration with the Com-
modity Futures Trading Commission as a digital 
commodity broker or digital commodity dealer. 
‘‘(2) NATIONAL
SECURITIES
EXCHANGES.—A 
national securities exchange or affiliate thereof shall 
be permitted to maintain a registration with the
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•HR 3633 EH1S 
Commodity Futures Trading Commission as a dig-
ital commodity exchange. 
‘‘(3) ALTERNATIVE TRADING SYSTEMS.—An al-
ternative trading system, and the operator thereof, 
shall be permitted to maintain a registration with 
the Commodity Futures Trading Commission as a 
digital commodity exchange. 
‘‘(4) NOTICE OF APPLICATION.—Any person or 
entity described in paragraph (1) through (3) shall 
provide to the Securities and Exchange Commission, 
at such time and in such form and manner as the 
Securities and Exchange Commission shall prescribe, 
notice of any application to register with the Com-
modity Futures Trading Commission as a digital 
commodity broker, digital commodity dealer, or dig-
ital commodity exchange.’’. 
SEC. 308. EXEMPTING DIGITAL COMMODITIES FROM STATE 
SECURITIES LAWS. 
(a) COVERED SECURITY.—Section 18(b) of the Secu-
rities Act of 1933 (15 U.S.C. 77r(b)) is amended by add-
ing at the end the following: 
‘‘(5) EXEMPTION IN CONNECTION WITH DIG-
ITAL COMMODITIES.—A digital commodity shall be 
treated as a covered security.’’.
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•HR 3633 EH1S 
(b) RULE OF CONSTRUCTION.—Nothing in this sec-
tion, section 202, or the amendments made by such sec-
tions may be construed to limit the existing authority de-
scribed in section 18(c)(1) of the Securities Act of 1933 
(15 U.S.C. 77r(c)(1)) of a securities commission (or any 
agency or office performing like functions) of any State 
with respect to a covered security or any security. 
SEC. 309. EXCLUSION FOR DECENTRALIZED FINANCE AC-
TIVITIES. 
The Securities Exchange Act of 1934 (15 U.S.C. 78a 
et seq.) is amended by inserting after section 15G the fol-
lowing: 
‘‘SEC. 15H. DECENTRALIZED FINANCE ACTIVITIES NOT SUB-
JECT TO THIS ACT. 
‘‘(a) IN GENERAL.—Notwithstanding any other pro-
vision of this Act, a person shall not be subject to this 
Act and the regulations promulgated under this Act based 
on the person directly or indirectly engaging in any of the 
following activities, whether singly or in combination, in 
relation to the operation of a blockchain system or in rela-
tion to a decentralized finance trading protocol: 
‘‘(1) Compiling network transactions or relay-
ing, searching, sequencing, validating, or acting in a 
similar capacity.
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•HR 3633 EH1S 
‘‘(2) Providing computational work, operating a 
node or oracle service, or procuring, offering, or uti-
lizing network bandwidth, or providing other similar 
incidental services. 
‘‘(3) Providing a user-interface that enables a 
user to read and access data about a blockchain sys-
tem. 
‘‘(4) Developing, publishing, constituting, ad-
ministering, maintaining, or otherwise distributing a 
blockchain system or a decentralized finance trading 
protocol. 
‘‘(5) Developing, publishing, constituting, ad-
ministering, maintaining, or otherwise distributing a 
decentralized finance messaging system, or operating 
or participating in a liquidity pool, for the purpose 
of executing a spot contract for the purchase or sale 
of a digital commodity in relation to a decentralized 
finance trading protocol. 
‘‘(6) Developing, publishing, constituting, ad-
ministering, maintaining, or otherwise distributing 
software or systems that create or deploy hardware 
or software, including wallets or other systems, fa-
cilitating an individual user’s own personal ability to 
keep, safeguard, or custody the user’s digital assets 
or related private keys.
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•HR 3633 EH1S 
‘‘(b) EXCEPTIONS.—Subsection (a) shall not apply to 
the anti-fraud and anti-manipulation authorities of the 
Commission.’’. 
SEC. 310. TREATMENT OF CUSTODY ACTIVITIES BY BANK-
ING INSTITUTIONS. 
(a) TREATMENT OF CUSTODY ACTIVITIES.—The ap-
propriate Federal banking agency, the National Credit 
Union Administration (in the case of a credit union), and 
the Securities and Exchange Commission may not require 
a depository institution, national bank, Federal credit 
union, State credit union, trust company, broker, or deal-
er, or any affiliate thereof (the ‘‘entity’’)— 
(1) to include assets held in custody that are 
not accounted for as assets of the entity as a liabil-
ity on the financial statement or balance sheet of the 
entity, including digital commodity or permitted pay-
ment stablecoin custody or safekeeping services; and 
(2) to hold regulatory capital against assets, in-
cluding reserves backing such assets, in custody or 
safekeeping, except as necessary to mitigate against 
operational risks inherent with the custody or safe-
keeping services, as determined by— 
(A) the appropriate Federal banking agen-
cy;
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•HR 3633 EH1S 
(B) the National Credit Union Administra-
tion (in the case of a credit union); 
(C) a State bank supervisor; 
(D) a State credit union supervisor (as de-
fined in section 6003 of the Anti-Money Laun-
dering Act of 2020 (31 U.S.C. 5311 note)); or 
(E) the Securities and Exchange Commis-
sion (in the case of a broker or dealer). 
(b) DEFINITIONS.—In this section: 
(1) BANKING TERMS.—The terms ‘‘appropriate 
Federal banking agency’’, ‘‘depository institution’’, 
‘‘national bank’’, and ‘‘State bank supervisor’’ have 
the meaning given those terms, respectively, under 
section 3 of the Federal Deposit Insurance Act (12 
U.S.C. 1813). 
(2) CREDIT UNION TERMS.—The terms ‘‘Fed-
eral credit union’’ and ‘‘State credit union’’ have the 
meaning given those terms, respectively, under sec-
tion 101 of the Federal Credit Union Act (12 U.S.C. 
1752). 
SEC. 311. BROKER AND DEALER DISCLOSURES REGARDING 
THE TREATMENT OF ASSETS. 
(a) IN GENERAL.—Not later than 270 days after the 
date of the enactment of this Act, the Securities and Ex-
change Commission shall issue rules requiring written dis-
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•HR 3633 EH1S 
closures regarding the treatment of customer assets in the 
event of an insolvency, resolution, or liquidation pro-
ceeding to be provided by a registered broker or dealer 
to an investor before a digital commodity, a permitted pay-
ment stablecoin, or an investment contract involving a unit 
of a digital commodity is received, acquired, or held by 
the broker or dealer for the account of the investor, which 
shall include, as necessary or appropriate for the protec-
tion of investors— 
(1) a description of the manner in which any 
digital commodity, permitted payment stablecoin, or 
investment contact involving a unit of a digital com-
modity received, acquired, or held by the broker or 
dealer for the account of such investor would be 
treated in an insolvency, resolution, or liquidation 
proceeding with respect to the broker or dealer 
under— 
(A) title II of the Dodd-Frank Wall Street 
Reform and Consumer Protection Act (12 
U.S.C. 5381 et seq.); 
(B) the Securities Investor Protection Act 
of 1970 (15 U.S.C. 78aaa et seq.); or 
(C) as applicable, chapter 7 or chapter 11 
of title 11, United States Code; and
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•HR 3633 EH1S 
(2) how the treatment described in paragraph 
(1) differs from the treatment of securities and cash 
received, acquired, or held by the broker or dealer 
for the account of such investor in the event of an 
insolvency, resolution, or liquidation proceeding with 
respect to the broker or dealer under each law de-
scribed under subparagraph (A) through (C) of 
paragraph (1). 
SEC. 312. DIGITAL COMMODITY ACTIVITIES THAT ARE FI-
NANCIAL IN NATURE. 
(a) DIGITAL COMMODITY ACTIVITIES THAT ARE FI-
NANCIAL IN NATURE.—Section 4(k)(4) of the Bank Hold-
ing Company Act of 1956 (12 U.S.C. 1843(k)(4)) is 
amended— 
(1) in subparagraph (A), by striking ‘‘or securi-
ties’’ and inserting ‘‘, securities, or digital commod-
ities’’; and 
(2) in subparagraph (E), by inserting ‘‘or dig-
ital commodities’’ before the period at the end. 
(b) NATIONAL BANK ACTIVITY.— 
(1) IN GENERAL.—A national bank may use a 
digital asset or blockchain system to perform, pro-
vide, or deliver any activity, function, product, or 
service that the national bank is otherwise author-
ized by law to perform, provide, or deliver.
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•HR 3633 EH1S 
(2) RULE OF CONSTRUCTION.—Nothing in this 
subsection may be construed to exempt a national 
bank’s performance, provision, or delivery of an ac-
tivity, function, product, or service from a require-
ment that would apply if the activity were not per-
formed, provided, or delivered using a digital asset 
or blockchain system. 
(c) INSURED STATE BANKS AND SUBSIDIARIES OF 
INSURED STATE BANKS.—For purposes of sections 24(a) 
and 24(d) of the Federal Deposit Insurance Act (12 
U.S.C. 1831a(a) and (d)), all of the activities authorized 
for a national bank under subsection (b) that are principal 
activities shall be permissible for an insured State bank 
and subsidiary of an insured State bank. 
SEC. 313. EFFECTIVE DATE; ADMINISTRATION. 
Except as otherwise provided under this title, this 
title and the amendments made by this title shall take ef-
fect 360 days after the date of enactment of this Act, ex-
cept that, to the extent a provision of this title requires 
a rulemaking, the provision shall take effect on the later 
of— 
(1) 360 days after the date of enactment of this 
Act; or 
(2) 60 days after the publication in the Federal 
Register of the final rule implementing the provision.
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•HR 3633 EH1S 
SEC. 314. EDUCATIONAL MATERIAL REQUIREMENTS. 
The Securities and Exchange Commission, in con-
sultation with the Commodity Futures Trading Commis-
sion, shall require any registered entity that facilitates the 
trading of digital commodities or investment contracts in-
volving units of a digital commodity to provide clear and 
accessible educational materials to the public, including— 
(1) an overview of how blockchain technology 
functions; 
(2) a description of common risks associated 
with digital commodities; 
(3) a description of the differences between dig-
ital commodity markets and traditional financial 
markets; 
(4) information on reporting requirements re-
lated to digital commodity transactions or invest-
ment contracts involving units of a digital com-
modity; and 
(5) guidance on recognizing fraudulent schemes 
and instructions for reporting suspected fraud. 
SEC. 315. DISCRETIONARY SURPLUS FUND. 
(a) IN
GENERAL.—The dollar amount specified 
under section 7(a)(3)(A) of the Federal Reserve Act (12 
U.S.C. 289(a)(3)(A)) is reduced by $15,000,000. 
(b) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall take effect on September 30, 2035.
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•HR 3633 EH1S 
TITLE IV—REGISTRATION FOR 
DIGITAL COMMODITY INTER-
MEDIARIES 
AT 
THE 
COM-
MODITY FUTURES TRADING 
COMMISSION 
SEC. 401. COMMISSION JURISDICTION OVER DIGITAL COM-
MODITY TRANSACTIONS. 
(a) SAVINGS CLAUSE.—Section 2(a)(1) of the Com-
modity Exchange Act (7 U.S.C. 2(a)(1)) is amended by 
adding at the end the following: 
‘‘(J) Except as expressly provided in this 
Act, nothing in the CLARITY Act of 2025 shall 
affect or apply to, or be interpreted to affect or 
apply to— 
‘‘(i) any agreement, contract, or 
transaction that is subject to this Act as— 
‘‘(I) a contract of sale of a com-
modity for future delivery or an op-
tion on such a contract; 
‘‘(II) a swap; 
‘‘(III) a security futures product; 
‘‘(IV) an option authorized under 
section 4c of this Act; 
‘‘(V) an agreement, contract, or 
transaction described in subparagraph
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•HR 3633 EH1S 
(C)(i) or (D)(i) of subsection (c)(2) of 
this section; or 
‘‘(VI) a leverage transaction au-
thorized under section 19; or 
‘‘(ii) the activities of any person with 
respect to any such an agreement, con-
tract, or transaction.’’. 
(b) LIMITATION ON AUTHORITY OVER PERMITTED 
PAYMENT STABLECOINS.—Section 2(c)(1) of the Com-
modity Exchange Act (7 U.S.C. 2(c)(1)) is amended— 
(1) in subparagraph (F), by striking ‘‘or’’ at 
the end; 
(2) in subparagraph (G), by striking the period 
and inserting ‘‘; or’’; and 
(3) by adding at the end the following: 
‘‘(H) permitted payment stablecoins.’’. 
(c) COMMISSION JURISDICTION OVER FINANCING 
AGREEMENTS.—Section 2(c)(2)(D) of the Commodity Ex-
change Act (7 U.S.C. 2(c)(2)(D)) is amended— 
(1) in clause (ii)(I), by inserting after ‘‘para-
graph (1)’’ the following: ‘‘(other than an agree-
ment, contract, or transaction in a permitted pay-
ment stablecoin)’’; and 
(2) by redesignating clause (iv) as clause (v) 
and inserting after clause (iii) the following:
129 
•HR 3633 EH1S 
‘‘(iv) AGREEMENTS FOR MARGIN FI-
NANCING.—Notwithstanding clause (iii), a 
digital commodity broker may, subject to 
the requirements of section 4u(c)(2), offer 
to or enter into an agreement for margin 
financing with a customer for the purchase 
or sale of a digital commodity, provided 
any purchase or sale made pursuant to the 
agreement shall result in the delivery of 
the digital commodity into or from an ac-
count carried for the customer by the dig-
ital commodity broker, as determined by 
the Commission by rule or regulation, 
based on commercial spot market prac-
tices.’’. 
(d) COMMISSION AUTHORITY OVER CERTAIN DIG-
ITAL
COMMODITY
AND
STABLECOIN
SPOT
TRANS-
ACTIONS.—Section 2(c)(2) of the Commodity Exchange 
Act (7 U.S.C. 2(c)(2)) is amended by adding at the end 
the following: 
‘‘(F) COMMISSION JURISDICTION WITH RE-
SPECT
TO
DIGITAL
COMMODITY
TRANS-
ACTIONS.— 
‘‘(i) IN
GENERAL.—Subject to sec-
tions 6d and 12(e), the Commission shall
130 
•HR 3633 EH1S 
have exclusive jurisdiction with respect to 
any account, agreement, contract, or trans-
action involving a contract of sale of a dig-
ital commodity or tradable asset (as de-
fined in section 4x) in interstate commerce, 
including in a digital commodity or 
tradable asset (as so defined) cash or spot 
market, that is offered, solicited, traded, 
facilitated, executed, cleared, reported, or 
otherwise dealt in— 
‘‘(I) on or subject to the rules of 
a registered entity or an entity that is 
required to be registered as a reg-
istered entity; or 
‘‘(II) by any other entity reg-
istered, or required to be registered, 
with the Commission. 
‘‘(ii) LIMITATIONS.—Clause (i) shall 
not apply with respect to— 
‘‘(I) custodial or depository ac-
tivities for a digital commodity of an 
entity regulated by an appropriate 
Federal banking agency or a State 
bank supervisor (within the meaning
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•HR 3633 EH1S 
of section 3 of the Federal Deposit In-
surance Act); or 
‘‘(II) an offer or sale of an in-
vestment contract involving a digital 
commodity or of a securities offer or 
sale involving a digital commodity. 
‘‘(iii) MIXED DIGITAL ASSET TRANS-
ACTIONS.— 
‘‘(I) IN
GENERAL.—Clause (i) 
shall not apply to a mixed digital 
asset transaction. 
‘‘(II) REPORTS
ON
MIXED
DIG-
ITAL
ASSET
TRANSACTIONS.—A dig-
ital commodity issuer, digital com-
modity related person, digital com-
modity affiliated person, or other per-
son registered with the Securities and 
Exchange Commission that engages in 
a mixed digital asset transaction, 
shall, on request of the Commission, 
open to inspection and examination by 
the Commission all books and records 
relating to the mixed digital asset 
transaction, subject to the confiden-
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•HR 3633 EH1S 
tiality and disclosure requirements of 
section 8. 
‘‘(G) 
AGREEMENTS, 
CONTRACTS, 
AND 
TRANSACTIONS IN STABLECOINS.— 
‘‘(i) TREATMENT OF PERMITTED PAY-
MENT STABLECOINS ON COMMISSION-REG-
ISTERED ENTITIES.—Subject to clauses (ii) 
and (iii), the Commission shall have juris-
diction over a cash or spot agreement, con-
tract, or transaction in a permitted pay-
ment stablecoin that is offered, offered to 
enter into, entered into, executed, solicited, 
or accepted, or for which the execution of 
is confirmed— 
‘‘(I) on or subject to the rules of 
a registered entity; or 
‘‘(II) by any other entity reg-
istered with the Commission. 
‘‘(ii) 
PERMITTED
PAYMENT 
STABLECOIN
TRANSACTION
RULES.—This 
Act shall apply to a transaction described 
in clause (i) only for the purpose of regu-
lating the offer, execution, solicitation, or 
acceptance of a cash or spot permitted 
payment stablecoin transaction on a reg-
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•HR 3633 EH1S 
istered entity or by any other entity reg-
istered with the Commission, as if the per-
mitted payment stablecoin were a digital 
commodity. 
‘‘(iii) NO
AUTHORITY
OVER
PER-
MITTED
PAYMENT
STABLECOINS.—Not-
withstanding clauses (i) and (ii), the Com-
mission shall not make a rule or regula-
tion, impose a requirement or obligation on 
a registered entity or other entity reg-
istered with the Commission, or impose a 
requirement or obligation on a permitted 
payment stablecoin issuer, regarding the 
operation 
of 
a 
permitted 
payment 
stablecoin issuer or a permitted payment 
stablecoin.’’. 
(e) CONFORMING AMENDMENTS.—The Commodity 
Exchange Act is amended— 
(1) in section 1a(9) (7 U.S.C. 1a(9)), as 
amended by the GENIUS Act, by striking the sec-
ond sentence; and 
(2) in section 2(a)(1)(A) (7 U.S.C. 2(a)(1)(A)), 
in the 1st sentence, by inserting ‘‘subparagraphs (F) 
and (G) of subsection (c)(2) of this section or’’ be-
fore ‘‘section 19’’.
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•HR 3633 EH1S 
SEC. 402. REQUIRING FUTURES COMMISSION MERCHANTS 
TO 
USE 
QUALIFIED 
DIGITAL 
ASSET 
CUSTODIANS. 
Section 4d of the Commodity Exchange Act (7 U.S.C. 
6d) is amended— 
(1) in subsection (a)(2)— 
(A) in the 1st proviso, by striking ‘‘any 
bank or trust company’’ and inserting ‘‘any 
bank, trust company, or qualified digital asset 
custodian, as applicable,’’; and 
(B) by inserting ‘‘: Provided further, That 
any such property that is a digital asset shall 
be held in a qualified digital asset custodian’’ 
before the period at the end; and 
(2) in subsection (f)(3)(A)(i), by striking ‘‘any 
bank or trust company’’ and inserting ‘‘any bank, 
trust company, or qualified digital asset custodian’’. 
SEC. 403. TRADING CERTIFICATION AND APPROVAL FOR 
DIGITAL COMMODITIES. 
Section 5c of the Commodity Exchange Act (7 U.S.C. 
7a–2) is amended— 
(1) in subsection (a), by striking ‘‘5(d) and 
5b(c)(2)’’ and inserting ‘‘5(d), 5b(c)(2), and 5i(c)’’; 
(2) in subsection (b)—
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•HR 3633 EH1S 
(A) in each of paragraphs (1) and (2), by 
inserting ‘‘digital commodity exchange,’’ before 
‘‘derivatives’’; and 
(B) in paragraph (3), by inserting ‘‘digital 
commodity exchange,’’ before ‘‘derivatives’’ each 
place it appears; 
(3) in subsection (c)— 
(A) in paragraph (2), by inserting ‘‘or par-
ticipants’’ before ‘‘(in a’’; 
(B) in paragraph (4)(B), by striking 
‘‘1a(10)’’ and inserting ‘‘1a(9)’’; and 
(C) in paragraph (5), by adding at the end 
the following: 
‘‘(D) SPECIAL RULES FOR DIGITAL COM-
MODITY
CONTRACTS.—In certifying any new 
rule or rule amendment, or listing any new con-
tract or instrument, in connection with a con-
tract of sale of a commodity for future delivery, 
option, swap, or other agreement, contract, or 
transaction, that is based on or references a 
digital commodity, a registered entity shall 
make or rely on a certification under subsection 
(d) for the digital commodity.’’; and 
(4) by inserting after subsection (c) the fol-
lowing:
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•HR 3633 EH1S 
‘‘(d) CERTIFICATIONS
FOR DIGITAL COMMODITY 
TRADING.— 
‘‘(1) IN GENERAL.—Notwithstanding subsection 
(c), for the purposes of listing or offering a digital 
commodity for trading in a digital commodity cash 
or spot market, an eligible entity shall submit a 
written certification to the Commission that the dig-
ital commodity meets the requirements of this Act 
(including the regulations prescribed under this 
Act). 
‘‘(2) CONTENTS OF THE CERTIFICATION.— 
‘‘(A) IN GENERAL.—In making a written 
certification under this paragraph, the eligible 
entity shall furnish to the Commission an anal-
ysis of how the digital commodity meets the re-
quirements of section 5i(c)(3). 
‘‘(B) 
RELIANCE
ON
PRIOR
DISCLO-
SURES.—In making a certification under this 
subsection, an eligible entity may rely on the 
records and disclosures of any relevant person 
registered with the Securities and Exchange 
Commission or other State or Federal agency. 
‘‘(3) MODIFICATIONS.—
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•HR 3633 EH1S 
‘‘(A) IN GENERAL.—An eligible entity shall 
modify a certification made under paragraph 
(1) to— 
‘‘(i) account for significant changes in 
any information provided to the Commis-
sion under paragraph (2)(A)(ii); or 
‘‘(ii) permit or restrict trading in 
units of a digital commodity held by a dig-
ital commodity related person or a digital 
commodity affiliated person. 
‘‘(B) 
RECERTIFICATION.—Modifications 
required by this subsection shall be subject to 
the same disapproval and review process as a 
new certification under paragraphs (4) and (5). 
‘‘(4) DISAPPROVAL.— 
‘‘(A) IN
GENERAL.—The written certifi-
cation described in paragraph (1) shall become 
effective unless the Commission finds that the 
listing of the digital commodity is inconsistent 
with the requirements of this Act or the rules 
and regulations prescribed under this Act. 
‘‘(B) ANALYSIS REQUIRED.—The Commis-
sion shall include, with any findings referred to 
in subparagraph (A), a detailed analysis of the 
factors on which the decision was based.
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•HR 3633 EH1S 
‘‘(C) PUBLIC FINDINGS.—The Commission 
shall make public any disapproval decision, and 
any related findings and analysis, made under 
this paragraph. 
‘‘(5) REVIEW.— 
‘‘(A) IN GENERAL.—Unless the Commis-
sion makes a disapproval decision under para-
graph (4), the written certification described in 
paragraph (1) shall become effective, pursuant 
to the certification by the eligible entity and no-
tice of the certification to the public (in a man-
ner determined by the Commission) on the date 
that is— 
‘‘(i) 20 business days after the date 
the Commission receives the certification 
(or such shorter period as determined by 
the Commission by rule or regulation), in 
the case of a digital commodity that has 
not been certified under this section or for 
which a certification is being modified 
under paragraph (3); or 
‘‘(ii) 1 business day after the date the 
Commission receives the certification (or 
such shorter period as determined by the 
Commission by rule or regulation) for any
139 
•HR 3633 EH1S 
digital commodity that has been certified 
under this section. 
‘‘(B) EXTENSIONS.—The time for consid-
eration under subparagraph (A) may be ex-
tended through notice to the eligible entity that 
there are novel or complex issues that require 
additional time to analyze, that the explanation 
by the submitting eligible entity is inadequate, 
or of a potential inconsistency with this Act— 
‘‘(i) once, for 30 business days, 
through written notice to the eligible entity 
by the Commission; and 
‘‘(ii) once, for an additional 30 busi-
ness days, through written notice to the el-
igible entity from the Commission that in-
cludes a description of any deficiencies 
with the certification, 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.
140 
•HR 3633 EH1S 
‘‘(6) PRIOR
APPROVAL
BEFORE
REGISTRA-
TION.— 
‘‘(A) IN GENERAL.—A person applying for 
registration with the Commission for the pur-
poses of listing or offering a digital commodity 
for trading in a digital commodity cash or spot 
market may request that the Commission grant 
prior approval for the person to list or offer the 
digital commodity on being registered with the 
Commission. 
‘‘(B) REQUEST FOR PRIOR APPROVAL.—A 
person seeking prior approval under subpara-
graph (A) shall furnish the Commission with a 
written certification that the digital commodity 
meets the requirements of this Act (including 
the regulations prescribed under this Act) and 
the information described in paragraph (2). 
‘‘(C) DEADLINE.—The Commission shall 
take final action on a request for prior approval 
not later than 90 business days after submis-
sion of the request, unless the person submit-
ting the request agrees to an extension of the 
time limitation established under this subpara-
graph. 
‘‘(D) DISAPPROVAL.—
141 
•HR 3633 EH1S 
‘‘(i) IN GENERAL.—The Commission 
shall approve the listing of the digital com-
modity unless the Commission finds that 
the listing is inconsistent with this Act (in-
cluding any regulation prescribed under 
this Act). 
‘‘(ii) 
ANALYSIS
REQUIRED.—The 
Commission shall include, with any find-
ings made under clause (i), a detailed anal-
ysis of the factors on which the decision is 
based. 
‘‘(iii) PUBLIC FINDINGS.—The Com-
mission shall make public any disapproval 
decision, and any related findings and 
analysis, made under this paragraph. 
‘‘(7) ELIGIBLE ENTITY DEFINED.—In this sub-
section, the term ‘eligible entity’ means a registered 
entity or group of registered entities acting jointly.’’. 
SEC. 404. REGISTRATION OF DIGITAL COMMODITY EX-
CHANGES. 
The Commodity Exchange Act (7 U.S.C. 1 et seq.) 
is amended by inserting after section 5h the following: 
‘‘SEC. 5i. REGISTRATION OF DIGITAL COMMODITY EX-
CHANGES. 
‘‘(a) IN GENERAL.—
142 
•HR 3633 EH1S 
‘‘(1) REGISTRATION.— 
‘‘(A) IN GENERAL.—A trading facility that 
offers or seeks to offer a cash or spot market 
in at least 1 digital commodity shall register 
with the Commission as a digital commodity ex-
change. 
‘‘(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. 
‘‘(C) EXEMPTIONS.—A trading facility 
that offers or seeks to offer a cash or spot mar-
ket in at least 1 digital commodity shall not be 
required to register under this section if the 
trading facility— 
‘‘(i) permits no more than a de mini-
mis amount of trading activity, as the 
Commission may determine by rule or reg-
ulation, in a digital commodity; or 
‘‘(ii) serves only customers in a single 
State, territory, or possession of the 
United States.
143 
•HR 3633 EH1S 
‘‘(2) ADDITIONAL REGISTRATIONS.— 
‘‘(A) WITH THE COMMISSION.—In order to 
foster the development of fair and orderly mar-
kets, protect customers, and promote respon-
sible innovation, the Commission— 
‘‘(i) shall prescribe rules to exempt an 
entity registered with the Commission 
under more than 1 section of this Act from 
duplicative, conflicting, or unduly burden-
some provisions of this Act and the rules 
under this Act; 
‘‘(ii) shall prescribe rules to address 
conflicts of interests and activities of the 
entity; and 
‘‘(iii) may, after an analysis of the 
risks and benefits, prescribe rules to pro-
vide for portfolio margining. 
‘‘(B) WITH A REGISTERED FUTURES ASSO-
CIATION.— 
‘‘(i) IN GENERAL.—A registered dig-
ital commodity exchange shall become and 
remain a member of a registered futures 
association and comply with rules related 
to such activity, if the registered digital 
commodity exchange accepts customer
144 
•HR 3633 EH1S 
funds required to be segregated under sub-
section (d). 
‘‘(ii) RULEMAKING
REQUIRED.—The 
Commission shall require any registered 
futures association with a digital com-
modity exchange as a member to provide 
such rules as may be necessary to further 
compliance with subsection (d), protect 
customers, and promote the public interest. 
‘‘(C) REGISTRATION REQUIRED.—A person 
required to be registered as a digital commodity 
exchange under this section shall register with 
the Commission as such regardless of whether 
the person is registered with another State or 
Federal regulator. 
‘‘(b) TRADING.— 
‘‘(1) PROHIBITION ON CERTAIN TRADING PRAC-
TICES.— 
‘‘(A) Section 4b shall apply to any agree-
ment, contract, or transaction in a digital com-
modity as if the agreement, contract, or trans-
action were a contract of sale of a commodity 
for future delivery. 
‘‘(B) Section 4c shall apply to any agree-
ment, contract, or transaction in a digital com-
145 
•HR 3633 EH1S 
modity as if the agreement, contract, or trans-
action were a transaction involving the purchase 
or sale of a commodity for future delivery. 
‘‘(C) Section 4b–1 shall apply to any 
agreement, contract, or transaction in a digital 
commodity as if the agreement, contract, or 
transaction were a contract of sale of a com-
modity for future delivery. 
‘‘(2) 
PROHIBITION
ON
ACTING
AS
A 
COUNTERPARTY.— 
‘‘(A) IN GENERAL.—A digital commodity 
exchange or any affiliate of such an exchange 
shall not trade on or subject to the rules of the 
digital commodity exchange for its own account. 
‘‘(B) EXCEPTIONS.—Subject to any condi-
tions, requirements, or limitations imposed by 
the Commission pursuant to subparagraph (C), 
a digital commodity exchange may engage in 
trading on the exchange so long as the trading 
is not solely for the purpose of the profit of the 
exchange, including the following: 
‘‘(i) CUSTOMER DIRECTION.—A trans-
action for, or entered into at the direction 
of, or for the benefit of, an unaffiliated 
customer.
146 
•HR 3633 EH1S 
‘‘(ii) RISK
MANAGEMENT.—A trans-
action to manage the credit, market, and 
liquidity risks associated with the digital 
commodity business of the exchange. 
‘‘(iii) 
OPERATIONAL
NEEDS.—A 
transaction related to the operational 
needs of the business of the digital com-
modity exchange or its affiliate. 
‘‘(iv) FUNCTIONAL
USE.—A trans-
action related to the functional operation 
of a blockchain system. 
‘‘(C) 
RULEMAKING.—The 
Commission 
may, by rule, establish conditions, requirements, 
or other limitations on the activities of a digital 
commodity exchange and its affiliate permitted 
pursuant to subparagraph (B) that are nec-
essary for the protection of customers, the pro-
motion of innovation, or the maintenance of 
fair, orderly, and efficient markets. 
‘‘(D) NOTICE
REQUIREMENT.—In order 
for a digital commodity exchange or any affil-
iate of a digital commodity exchange to engage 
in trading on the affiliated exchange pursuant 
to subsection (B), notice must be given to the 
Commission that shall enumerate how any pro-
147 
•HR 3633 EH1S 
posed activity is consistent with the exceptions 
in subsection (B) and the purposes of this Act. 
‘‘(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 
exchange, a 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—
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•HR 3633 EH1S 
‘‘(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 
‘‘(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) LISTING STANDARDS FOR DIGITAL COM-
MODITIES.—
149 
•HR 3633 EH1S 
‘‘(A) IN GENERAL.—A digital commodity 
exchange shall establish policies and procedures 
to permit trading in a digital commodity only 
if— 
‘‘(i) reports with respect to the digital 
commodity required under, as applicable, 
section 4B(b)(3) or 4B(b)(5)(C) of the Se-
curities Act of 1933 (or, with respect to a 
digital commodity not issued in reliance on 
section 4(a)(8) of the Securities Act of 
1933, a comparable set of reports, where 
required by the Securities and Exchange 
Commission) have been filed with the Se-
curities and Exchange Commission; or 
‘‘(ii) such other similar information as 
the Commission may, by rule or regulation 
require, that is related to the ongoing de-
velopment plan of the blockchain system 
and is able to be publicly ascertained, has 
been provided to the public. 
‘‘(B) 
PUBLIC
INFORMATION
REQUIRE-
MENTS.— 
‘‘(i) IN
GENERAL.—A digital com-
modity exchange shall—
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•HR 3633 EH1S 
‘‘(I) permit trading in a digital 
commodity only if the digital com-
modity exchange reasonably deter-
mines that the information required 
by clause (ii) is correct, current, and 
available to the public; and 
‘‘(II) establish policies and proce-
dures to determine that the informa-
tion provided pursuant to clause (ii) is 
correct, current, and available to the 
public. 
‘‘(ii) REQUIRED INFORMATION.—With 
respect to a digital commodity and each 
blockchain system to which the digital 
commodity relates for which the digital 
commodity exchange will make the digital 
commodity available to the customers of 
the digital commodity exchange, the fol-
lowing information: 
‘‘(I) SOURCE CODE.—The source 
code for any blockchain system to 
which the digital commodity relates. 
‘‘(II) TRANSACTION HISTORY.—A 
description of the steps necessary to 
independently access, search, and
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•HR 3633 EH1S 
verify the transaction history of any 
blockchain system to which the digital 
commodity relates, to the extent any 
such independent access, search, and 
verification activities are technically 
feasible with respect to the blockchain 
system. 
‘‘(III) DIGITAL COMMODITY ECO-
NOMICS.—A narrative description of 
the purpose of any blockchain system 
to which the digital commodity relates 
and the operation of any such 
blockchain system, including— 
‘‘(aa) information explaining 
the launch and supply process, 
including the number of digital 
assets to be issued in an initial 
allocation, the total number of 
digital commodities to be created, 
the release schedule for the dig-
ital commodities, and the total 
number of digital commodities 
then outstanding; 
‘‘(bb) information detailing 
any applicable consensus mecha-
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•HR 3633 EH1S 
nism or process for validating 
transactions, method of gener-
ating or mining digital commod-
ities, and any process for burning 
or destroying digital commodities 
on the blockchain system; 
‘‘(cc) an explanation of gov-
ernance mechanisms for imple-
menting 
changes 
to 
the 
blockchain system or forming 
consensus among holders of the 
digital commodities; and 
‘‘(dd) sufficient information 
for a third party to create a tool 
for verifying the transaction his-
tory of the digital asset. 
‘‘(IV) TRADING
VOLUME
AND 
VOLATILITY.—The 
trading 
volume 
and volatility of the digital commodity 
on the exchange. 
‘‘(V) 
ADDITIONAL
INFORMA-
TION.—Such additional information 
as the Commission may determine by 
rule to be necessary for a customer to 
understand the financial and oper-
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•HR 3633 EH1S 
ational risks of a digital commodity, 
and to be practically feasible to pro-
vide. 
‘‘(iii) 
FORMAT.—The 
Commission 
shall prescribe rules and regulations for 
the standardization and simplification of 
disclosures under clause (ii), including re-
quiring that disclosures— 
‘‘(I) be conspicuous; 
‘‘(II) use plain language com-
prehensible to customers; 
‘‘(III) are not drafted in a way 
that presumes the customer already 
has a base knowledge, familiarity, or 
understanding of the basic termi-
nology, operation, and function of 
blockchain systems; and 
‘‘(IV) succinctly explain the in-
formation that is required to be com-
municated to the customer. 
‘‘(iv) RELIANCE
ON
PREVIOUS
DIS-
CLOSURES.—In complying with this sub-
paragraph, a digital commodity exchange 
may rely on and make available to the pub-
lic relevant information publicly disclosed
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•HR 3633 EH1S 
to the Commission, the Securities and Ex-
change Commission, or an appropriate 
Federal banking agency. 
‘‘(C) DIGITAL COMMODITIES HELD BY RE-
LATED AND DIGITAL COMMODITY AFFILIATED 
PERSONS.—A digital commodity exchange shall 
establish policies and procedures designed to 
permit the trading of a unit of a digital com-
modity acquired from the issuer and held by a 
digital commodity affiliated person or a digital 
commodity related person, only in accordance 
with the requirements of section 4C of the Se-
curities Act of 1933. 
‘‘(4) TREATMENT
OF
CUSTOMER
ASSETS.—A 
digital commodity exchange shall establish policies 
and procedures that are designed to protect and en-
sure the safety of customer money, assets, and prop-
erty. 
‘‘(5) MONITORING
OF
TRADING
AND
TRADE 
PROCESSING.— 
‘‘(A) IN GENERAL.—A 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.
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•HR 3633 EH1S 
‘‘(B) PROTECTION OF MARKETS AND MAR-
KET PARTICIPANTS.—A 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) TRADING
PROCEDURES.—A digital 
commodity exchange shall— 
‘‘(i) establish and enforce rules or 
terms and conditions defining, or specifica-
tions detailing— 
‘‘(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
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•HR 3633 EH1S 
distortion, and disruptions, through sur-
veillance, 
compliance, 
and 
disciplinary 
practices and procedures, including meth-
ods for conducting real-time monitoring of 
trading and comprehensive and accurate 
trade reconstructions. 
‘‘(6) ABILITY
TO
OBTAIN
INFORMATION.—A 
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 
‘‘(C) have the capacity to carry out such 
international information-sharing agreements as 
the Commission may require. 
‘‘(7) EMERGENCY AUTHORITY.—A digital com-
modity exchange shall adopt rules to provide for the 
exercise of emergency authority, in consultation or 
cooperation with the Commission or a registered en-
tity, 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.
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•HR 3633 EH1S 
‘‘(8) TIMELY PUBLICATION OF TRADING INFOR-
MATION.— 
‘‘(A) IN GENERAL.—A digital commodity 
exchange shall make public timely information 
on price, trading volume, and other trading 
data on digital commodities to the extent pre-
scribed by the Commission. 
‘‘(B) CAPACITY
OF
DIGITAL
COMMODITY 
EXCHANGE.—A digital commodity exchange 
shall 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 relating to the 
business of the exchange, including a com-
plete audit trail, in a form and manner ac-
ceptable 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
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•HR 3633 EH1S 
duties of the Commission under this Act; 
and 
‘‘(iii) keep any such records of digital 
commodities which relate to a security 
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—
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•HR 3633 EH1S 
‘‘(I) foreign financial supervisors 
(including foreign futures authorities); 
‘‘(II) foreign central banks; and 
‘‘(III) foreign ministries. 
‘‘(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 the entity stating that the entity 
shall abide by the confidentiality requirements 
described in section 8 relating to the informa-
tion on digital commodities that is provided. 
‘‘(D) PROVIDING INFORMATION.—A digital 
commodity exchange shall provide to the Com-
mission (including any designee of the Commis-
sion) 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, a digital commodity exchange shall not— 
‘‘(A) adopt any rules or take any actions 
that result in any unreasonable restraint of 
trade; or
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•HR 3633 EH1S 
‘‘(B) impose any material anticompetitive 
burden on trading. 
‘‘(11) CONFLICTS OF INTEREST.—The digital 
commodity exchange shall establish and enforce 
rules— 
‘‘(A) to minimize conflicts of interest in 
the decision making processes of the contract 
market; and 
‘‘(B) to establish a process for resolving 
conflicts of interest referred to in subparagraph 
(A). 
‘‘(12) FINANCIAL RESOURCES.— 
‘‘(A) IN GENERAL.—A digital commodity 
exchange shall have adequate financial, oper-
ational, 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.—A digital commodity exchange shall 
possess financial resources that, at a minimum, 
exceed the sum of— 
‘‘(i) the total amount that would en-
able the digital commodity exchange to 
cover the operating costs of the digital
161 
•HR 3633 EH1S 
commodity exchange for a 1-year period, 
as calculated on a rolling basis; and 
‘‘(ii) the total amount necessary to 
meet the financial obligations of the digital 
commodity exchange to all customers of 
the digital commodity exchange. 
‘‘(13) DISCIPLINARY
PROCEDURES.—A digital 
commodity exchange shall establish and enforce dis-
ciplinary procedures that authorize the digital com-
modity exchange to discipline, suspend, or expel 
members or market participants that violate the 
rules of the digital commodity exchange, or similar 
methods for performing the same functions, includ-
ing delegation of the functions to third parties. 
‘‘(14) GOVERNANCE FITNESS STANDARDS.— 
‘‘(A) GOVERNANCE
ARRANGEMENTS.—A 
digital commodity exchange shall establish gov-
ernance arrangements that are transparent and 
designed to permit consideration of the views of 
market participants. 
‘‘(B) FITNESS
STANDARDS.—A digital 
commodity exchange shall establish and enforce 
appropriate fitness standards for— 
‘‘(i) officers and directors; and
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•HR 3633 EH1S 
‘‘(ii) any individual or entity with di-
rect access to, or control of, customer as-
sets. 
‘‘(15) SYSTEM
SAFEGUARDS.—A 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, 
through the development of appropriate controls 
and procedures, and automated systems in ac-
cordance with industry standards, that— 
‘‘(i) are reliable and secure; and 
‘‘(ii) have adequate scalable capacity; 
‘‘(B) establish and maintain emergency 
procedures, backup resources, and a plan for 
disaster 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—
163 
•HR 3633 EH1S 
‘‘(i) 
order 
processing 
and 
trade 
matching; 
‘‘(ii) price reporting; 
‘‘(iii) market surveillance; and 
‘‘(iv) maintenance of a comprehensive 
and accurate audit trail. 
‘‘(d) HOLDING OF CUSTOMER ASSETS.— 
‘‘(1) IN
GENERAL.—A digital commodity ex-
change shall hold customer money, assets, and prop-
erty in a manner to minimize the risk of loss to the 
customer or unreasonable delay in customer access 
to the money, assets, and property of the customer. 
‘‘(2) SEGREGATION OF FUNDS.— 
‘‘(A) IN GENERAL.—A digital commodity 
exchange shall treat and deal with all money, 
assets, and property that is received by the dig-
ital commodity exchange, or accrues to a cus-
tomer as the result of trading in digital com-
modities, as belonging to the customer. 
‘‘(B) COMMINGLING PROHIBITED.—Money, 
assets, and property described in subparagraph 
(A) shall be separately accounted for and shall 
not be commingled with the funds of the digital 
commodity exchange or be used to margin, se-
cure, or guarantee any trades or accounts of
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•HR 3633 EH1S 
any customer or person other than the person 
for whom the same are held. 
‘‘(C) EXCEPTIONS.— 
‘‘(i) USE OF FUNDS.— 
‘‘(I) 
IN
GENERAL.—Notwith-
standing subparagraph (A), money, 
assets, and property described in sub-
paragraph (A) may, for convenience, 
be commingled and deposited in the 
same account or accounts with any 
bank, 
trust 
company, 
derivatives 
clearing organization, or qualified dig-
ital asset custodian. 
‘‘(II) 
WITHDRAWAL.—Notwith-
standing 
subparagraph 
(A), 
such 
share of the money, assets, and prop-
erty described in subparagraph (A) as 
in the normal course of business shall 
be necessary to margin, guarantee, se-
cure, transfer, adjust, or settle a con-
tract of sale of a digital commodity 
with a registered entity may be with-
drawn and applied to such purposes, 
including the payment of commis-
sions, brokerage, interest, taxes, stor-
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•HR 3633 EH1S 
made in accordance with such rules and regulations 
and subject to such conditions as the Commission 
may prescribe. 
‘‘(4) CUSTOMER
PROTECTION
DURING
BANK-
RUPTCY.— 
‘‘(A) CUSTOMER
PROPERTY.—All assets 
held on behalf of a customer by a digital com-
modity exchange, and all money, assets, and 
property of any customer received by a digital 
commodity exchange for trading or custody, or 
to facilitate, margin, guarantee, or secure con-
tracts of sale of a digital commodity (including 
money, assets, or property accruing to the cus-
tomer as the result of the transactions), shall 
be considered customer property for purposes of 
section 761 of title 11, United States Code. 
‘‘(B) TRANSACTIONS.—A transaction in-
volving the sale of a unit of a digital commodity 
occurring on or subject to the rules of a digital 
commodity exchange shall be considered a con-
tract 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 pur-
poses of the definition of ‘commodity contract’ 
in section 761 of title 11, United States Code.
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•HR 3633 EH1S 
‘‘(C) EXCHANGES.—A digital commodity 
exchange shall be considered a futures commis-
sion merchant for purposes of section 761 of 
title 11, United States Code. 
‘‘(D) 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. 
‘‘(5) MISUSE OF CUSTOMER PROPERTY.— 
‘‘(A) IN GENERAL.—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 any person other 
than a customer of the digital commodity 
exchange; or 
‘‘(ii) for any other person, including 
any depository, other digital commodity ex-
change, or digital asset custodian that has 
received any customer money, assets, or 
property for deposit, to hold, dispose of, or
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•HR 3633 EH1S 
use any such money, assets, or property, or 
property, as belonging to the depositing 
digital commodity exchange or any person 
other than the customers of the digital 
commodity exchange. 
‘‘(B) USE FURTHER DEFINED.—For pur-
poses of this section, ‘use’ of a digital com-
modity includes utilizing any unit of a digital 
asset to participate in a blockchain service de-
fined in paragraph (6) or a decentralized gov-
ernance system associated with the digital com-
modity or the blockchain system to which the 
digital commodity relates in any manner other 
than that expressly directed by the customer 
from whom the unit of a digital commodity was 
received. 
‘‘(6) PARTICIPATION
IN
BLOCKCHAIN
SERV-
ICES.— 
‘‘(A) USE
OF
FUNDS.—A digital com-
modity exchange (or a designee of a digital 
commodity exchange) may use a unit of a dig-
ital commodity belonging to a customer to pro-
vide a blockchain service for a blockchain sys-
tem to which the unit of the digital commodity 
relates if—
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•HR 3633 EH1S 
‘‘(i) the customer expressly permits 
the use, in writing to the digital commodity 
exchange; and 
‘‘(ii) the digital commodity exchange 
complies with subparagraph (B). 
‘‘(B) LIMITATIONS.— 
‘‘(i) IN GENERAL.—The Commission 
shall, by rule, establish notice and disclo-
sure requirements, and may, by rule, es-
tablish any other limitations and rules re-
lated to a permission provided under sub-
paragraph (A) that are reasonably nec-
essary to protect customers, including eligi-
ble contract participants, non-eligible con-
tract participants, or any other class of 
customers. 
‘‘(ii) CUSTOMER
CHOICE.—A digital 
commodity exchange may not require a 
customer to provide the permission re-
ferred to in subparagraph (A) as a condi-
tion of doing business on the exchange. 
‘‘(C) REQUIREMENTS.—The Commission 
may, by rule, waive or modify the requirements 
of paragraph (2) or subsection (h), to facilitate 
the use of a unit of a digital commodity belong-
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•HR 3633 EH1S 
ing to a customer to provide a blockchain serv-
ice. 
‘‘(D) BLOCKCHAIN SERVICE DEFINED.—In 
this paragraph, the term ‘blockchain service’ 
means any activity relating to validating trans-
actions on a blockchain system, providing secu-
rity for a blockchain system, or other similar 
activity, including protocol consensus participa-
tion activities described in section 2(a)(30)(B) 
of the Securities Act of 1933, required for the 
ongoing operation of a blockchain system. 
‘‘(e) MARKET ACCESS REQUIREMENTS.—The Com-
mission may, by rule, impose any additional requirements 
related to the operations and activities of the digital com-
modity exchange and an affiliated digital commodity 
broker necessary to protect market participants, promote 
fair and equitable trading on the digital commodity ex-
change, and promote responsible innovation. 
‘‘(f) DESIGNATION
OF CHIEF COMPLIANCE OFFI-
CER.— 
‘‘(1) IN
GENERAL.—A digital commodity ex-
change shall designate an individual to serve as a 
chief compliance officer. 
‘‘(2) DUTIES.—The chief compliance officer 
shall—
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•HR 3633 EH1S 
‘‘(A) report directly to the board or to the 
senior officer of the exchange; 
‘‘(B) review compliance with the core prin-
ciples in this subsection; 
‘‘(C) in consultation with the board of the 
exchange, a body performing a function similar 
to that of a board, or the senior officer of the 
exchange, resolve any conflicts of interest that 
may arise; 
‘‘(D) establish and administer the policies 
and procedures required to be established pur-
suant to this section; 
‘‘(E) ensure compliance with this Act and 
the rules and regulations issued under this Act, 
including rules prescribed by the Commission 
pursuant to this section; and 
‘‘(F) establish procedures for the remedi-
ation of noncompliance issues found during 
compliance office reviews, look backs, internal 
or external audit findings, self-reported errors, 
or through validated complaints. 
‘‘(3) REQUIREMENTS
FOR
PROCEDURES.—In 
establishing procedures under paragraph (2)(F), the 
chief compliance officer shall design the procedures 
to establish the handling, management response, re-
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•HR 3633 EH1S 
mediation, retesting, and closing of noncompliance 
issues. 
‘‘(4) ANNUAL REPORTS.— 
‘‘(A) IN
GENERAL.—In accordance with 
rules prescribed by the Commission, the chief 
compliance officer shall annually prepare and 
sign a report that contains a description of— 
‘‘(i) the compliance of the digital com-
modity exchange with this Act; and 
‘‘(ii) the policies and procedures, in-
cluding the code of ethics and conflicts of 
interest policies, of the digital commodity 
exchange. 
‘‘(B) REQUIREMENTS.—The chief compli-
ance officer shall— 
‘‘(i) submit each report described in 
subparagraph (A) with the appropriate fi-
nancial report of the digital commodity ex-
change that is required to be submitted to 
the Commission pursuant to this section; 
and 
‘‘(ii) include in the report a certifi-
cation that, under penalty of law, the re-
port is accurate and complete. 
‘‘(g) APPOINTMENT OF TRUSTEE.—
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•HR 3633 EH1S 
‘‘(1) IN GENERAL.—If a proceeding under sec-
tion 5e results in the suspension or revocation of the 
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.
174 
•HR 3633 EH1S 
‘‘(h) QUALIFIED DIGITAL ASSET CUSTODIAN.—A 
digital commodity exchange shall hold in a qualified digital 
asset custodian each unit of a digital asset 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 (c)(12) of this 
section; or 
‘‘(3) otherwise so required by the Commission 
to reasonably protect customers. 
‘‘(i) EXEMPTIONS.— 
‘‘(1) IN
GENERAL.—In order to promote re-
sponsible innovation and fair competition, or protect 
customers, the Commission may (on its own initia-
tive or on application of the digital commodity ex-
change) exempt, either unconditionally or on stated 
terms or conditions or for stated periods and either 
retroactively or prospectively, or both, a digital com-
modity exchange from the requirements of this Act, 
if the Commission determines that— 
‘‘(A) the exemption would be consistent 
with the public interest and the purposes of this 
Act; and 
‘‘(B) the exemption will not have a mate-
rial adverse effect on the ability of the Commis-
175 
•HR 3633 EH1S 
sion or the digital commodity exchange to dis-
charge regulatory or self-regulatory duties 
under this Act. 
‘‘(2) FOREIGN EXCHANGES.—The Commission 
may exempt, conditionally or unconditionally, a dig-
ital commodity exchange from registration under 
this section if the Commission finds that the digital 
commodity exchange is subject to comparable, com-
prehensive supervision and regulation on a consoli-
dated basis by the appropriate governmental au-
thorities in the home country of the facility. 
‘‘(j) 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 
any other person. 
‘‘(k) FEDERAL PREEMPTION.—Notwithstanding any 
other provision of law, the Commission shall have exclusive 
jurisdiction over any digital commodity exchange reg-
istered under this section with respect to activities and 
transactions subject to this Act.’’.
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•HR 3633 EH1S 
SEC. 405. QUALIFIED DIGITAL ASSET CUSTODIANS. 
The Commodity Exchange Act (7 U.S.C. 1 et seq.), 
as amended by the preceding provisions of this Act, is 
amended by inserting after section 5i the following: 
‘‘SEC. 5j. QUALIFIED DIGITAL ASSET CUSTODIANS. 
‘‘(a) IN GENERAL.—A person is a qualified digital 
asset custodian for purposes of this Act if the person— 
‘‘(1) holds digital assets on behalf of a person 
registered under this Act or a customer of a person 
registered under this Act; and 
‘‘(2) is in compliance with subsections (b) and 
(c). 
‘‘(b) SUPERVISION REQUIREMENT.—A person is in 
compliance with this subsection if the person is subject 
to— 
‘‘(1) supervision and examination for custody 
and safekeeping of digital assets by an appropriate 
Federal banking agency, the National Credit Union 
Administration, the Commission, or the Securities 
and Exchange Commission; or 
‘‘(2) adequate supervision and appropriate reg-
ulation for custody and safekeeping of digital assets 
by— 
‘‘(A) a State bank supervisor (within the 
meaning of section 3 of the Federal Deposit In-
surance Act);
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•HR 3633 EH1S 
‘‘(B) a State officer, agency, or other enti-
ty which has primary regulatory authority over 
nondepository State trust companies; 
‘‘(C) a State credit union supervisor, as 
defined under section 6003 of the Anti-Money 
Laundering Act of 2020; or 
‘‘(D) an appropriate foreign governmental 
authority in the home country of such person. 
‘‘(c) OTHER REQUIREMENTS.—A person shall be in 
compliance with this subsection if: 
‘‘(1) NOT OTHERWISE PROHIBITED.—The per-
son has not been prohibited by its supervisor from 
engaging in an activity with respect to the custody 
and safekeeping of digital assets. 
‘‘(2) INFORMATION SHARING.— 
‘‘(A) IN GENERAL.—The person shares in-
formation with the Commission on request and 
complies with such requirements for periodic 
sharing of information regarding customer ac-
counts that the person holds on behalf of an en-
tity registered with the Commission as the 
Commission determines by rule are reasonably 
necessary to effectuate any of the provisions, or 
to accomplish any of the purposes, of this Act.
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•HR 3633 EH1S 
‘‘(B) PROVISION OF INFORMATION.—If the 
person is subject to regulation and examination 
by an appropriate Federal banking agency, the 
person may satisfy any information request de-
scribed in subparagraph (A) by providing the 
Commission with a detailed listing, in writing, 
of the digital assets of a customer in the cus-
tody of, or use by, the person. 
‘‘(3) RULEMAKING FOR CFTC ENTITIES.— 
‘‘(A) IN GENERAL.—The Commission shall 
prescribe rules to permit a person registered 
with the Commission to be a qualified digital 
asset custodian in compliance with this section. 
‘‘(B) CONTENT.—In prescribing the rules 
under subparagraph (A), the Commission shall 
require a person registered with the Commis-
sion to— 
‘‘(i) implement requirement consistent 
with the requirements in subsection (d)(1); 
‘‘(ii) establish sufficient system safe-
guards; 
‘‘(iii) prevent or mitigate conflicts of 
interest, as appropriate; and
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•HR 3633 EH1S 
‘‘(iv) establish separate governance ar-
rangements for the custodial function of 
the entity. 
‘‘(d) ADEQUATE SUPERVISION
AND APPROPRIATE 
REGULATION.— 
‘‘(1) IN GENERAL.—For purposes of subsection 
(b), the terms ‘adequate supervision’ and ‘appro-
priate regulation’ mean such minimum standards for 
supervision and regulation as are reasonably nec-
essary to protect the digital assets held by a person 
registered under this Act, including standards relat-
ing to the licensing, examination, and supervisory 
processes that require the person to, at a min-
imum— 
‘‘(A) receive a review and evaluation of 
ownership, character and fitness, conflicts of in-
terest, business model, financial statements, 
funding resources, and policies and procedures 
of the person; 
‘‘(B) hold capital sufficient for the finan-
cial integrity of the person; 
‘‘(C) protect customer assets; 
‘‘(D) establish and maintain books and 
records regarding the business of the person;
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•HR 3633 EH1S 
‘‘(E) submit financial statements and au-
dited financial statements to the applicable su-
pervisor described in subsection (b); 
‘‘(F) provide disclosures to the applicable 
supervisor described in subsection (b) regarding 
actions, proceedings, and other items as deter-
mined by the supervisor; 
‘‘(G) maintain and enforce policies and 
procedures for compliance with applicable State 
and Federal laws, including those related to 
anti-money laundering and cybersecurity; 
‘‘(H) establish a business continuity plan 
to ensure functionality in cases of disruption; 
and 
‘‘(I) establish policies and procedures to re-
solve complaints. 
‘‘(2) RULEMAKING WITH RESPECT TO DEFINI-
TIONS.— 
‘‘(A) IN GENERAL.—For purposes of this 
section, the Commission may, by rule, further 
define the terms ‘adequate supervision’ and ‘ap-
propriate regulation’ as necessary and appro-
priate for the protection of customers, and con-
sistent with the purposes of this Act.
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‘‘(B) 
EXISTING
DIGITAL
ASSET 
CUSTODIANS.—A trust company operating as a 
digital asset custodian before the effective date 
of a rulemaking under subparagraph (A) is 
deemed subject to adequate supervision and ap-
propriate regulation if— 
‘‘(i) the trust company is expressly 
permitted by a State bank supervisor to 
engage in the custody and safekeeping of 
digital assets; 
‘‘(ii) the State bank supervisor has es-
tablished licensing, examination, and su-
pervisory processes that require the trust 
company to, at a minimum, meet the con-
ditions described in subparagraphs (A) 
through (I) of paragraph (1); and 
‘‘(iii) the trust company is in good 
standing with its State bank supervisor. 
‘‘(C) TRANSITION
PERIOD
FOR
CERTAIN 
CUSTODIANS.—In implementing the rulemaking 
under subparagraph (A), the Commission shall 
provide a transition period of not less than 2 
years for any trust company that is deemed 
subject to adequate supervision and appropriate
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•HR 3633 EH1S 
regulation under subparagraph (B) on the ef-
fective date of the rulemaking. 
‘‘(e) AUTHORITY TO TEMPORARILY SUSPEND STAND-
ARDS.—The Commission may, by rule or order, tempo-
rarily suspend, in whole or in part, any requirement im-
posed under, or any standard referred to in, this section, 
or any requirement to utilize a qualified digital asset cus-
todian, if the Commission determines that the suspension 
would be consistent with the public interest and the pur-
poses of this Act.’’. 
SEC. 406. REGISTRATION AND REGULATION OF DIGITAL 
COMMODITY BROKERS AND DEALERS. 
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 DIGITAL 
COMMODITY BROKERS AND DEALERS. 
‘‘(a) REGISTRATION.— 
‘‘(1) REQUIREMENT.—It shall be unlawful for 
any person to act as a digital commodity broker or 
digital commodity dealer unless the person is reg-
istered as such with the Commission. 
‘‘(2) ADDITIONAL REGISTRATION.— 
‘‘(A) RULES.—In order to foster the devel-
opment of fair and orderly markets, protect
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•HR 3633 EH1S 
customers, and promote responsible innovation, 
the Commission— 
‘‘(i) shall prescribe rules to exempt an 
entity registered with the Commission 
under more than 1 section of this Act from 
duplicative, conflicting, or unduly burden-
some provisions of this Act and the rules 
under this Act; 
‘‘(ii) shall prescribe rules to address 
conflicts of interests and the activities of 
the entity; and 
‘‘(iii) may after an analysis of the 
risks and benefits, prescribe rules to pro-
vide for portfolio margining. 
‘‘(B) WITH
MEMBERSHIP
IN
A
REG-
ISTERED FUTURES ASSOCIATION.—Any person 
required to be registered as a digital commodity 
broker or digital commodity dealer under this 
section shall become and remain a member of 
a registered futures association. 
‘‘(b) REQUIREMENTS.— 
‘‘(1) IN GENERAL.—A person shall register as 
a digital commodity broker or digital commodity 
dealer by filing a registration application with the 
Commission.
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•HR 3633 EH1S 
‘‘(2) CONTENTS.— 
‘‘(A) IN GENERAL.—The application shall 
be made in such form and manner as is pre-
scribed by the Commission, and shall contain 
such information as the Commission considers 
necessary concerning the business in which the 
applicant is or will be engaged. 
‘‘(B) CONTINUAL REPORTING.—A person 
that is registered as a digital commodity broker 
or digital commodity dealer shall continue to 
submit to the Commission reports that contain 
such information pertaining to the business of 
the person as the Commission may require. 
‘‘(3) STATUTORY
DISQUALIFICATION.—Except 
to the extent otherwise specifically provided by rule, 
regulation, or order, it shall be unlawful for a digital 
commodity broker or digital commodity dealer to 
permit any person who is associated with a digital 
commodity broker or a digital commodity dealer and 
who is subject to a statutory disqualification to ef-
fect or be involved in effecting a contract of sale of 
a digital commodity on behalf of the digital com-
modity broker or the digital commodity dealer, re-
spectively, if the digital commodity broker or digital 
commodity dealer, respectively, knew, or in the exer-
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•HR 3633 EH1S 
cise of reasonable care should have known, of the 
statutory disqualification. 
‘‘(c) RULEMAKING.— 
‘‘(1) IN GENERAL.—The Commission shall pre-
scribe such rules applicable to registered digital com-
modity brokers and registered digital commodity 
dealers as are appropriate to carry out this section, 
including rules in the public interest that limit the 
activities of digital commodity brokers and digital 
commodity dealers. 
‘‘(2) FINANCING AGREEMENTS.— 
‘‘(A) IN GENERAL.—The Commission shall 
prescribe rules and regulations applicable to 
digital commodity brokers or digital commodity 
dealers which shall set forth minimum require-
ments related to disclosure, recordkeeping, mar-
gin financing arrangements, rehypothecation, 
capital, reporting, business conduct, documenta-
tion, and supervision of employees and agents, 
in connection with— 
‘‘(i) an agreement described in section 
2(c)(2)(D)(iv); or 
‘‘(ii) any other margined, leveraged, 
or financing arrangement for the purchase
186 
•HR 3633 EH1S 
or sale of a digital commodity with an eli-
gible contract participant. 
‘‘(B) SPECIFIC
AUTHORITY.—Except as 
prohibited in section 2(c)(2)(G)(iii), the Com-
mission may also make, promulgate, and en-
force such rules and regulations as, in the judg-
ment of the Commission, are reasonably nec-
essary to effectuate any of the provisions of, or 
to accomplish any of the purposes of, this Act 
in connection with an agreement referred to in 
subparagraph (A) of this paragraph. 
‘‘(d) CAPITAL REQUIREMENTS.— 
‘‘(1) IN
GENERAL.—Each digital commodity 
broker and digital commodity dealer shall meet such 
minimum capital requirements as the Commission 
may prescribe to address the risks associated with 
digital commodity trading and to ensure that the 
digital commodity broker or digital commodity deal-
er, respectively, is able, at all times, to— 
‘‘(A) meet, and continue to meet the obli-
gations of such a registrant; and 
‘‘(B) fulfill obligations to customers or 
counterparties for any margined, leveraged, or 
financed transactions.
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•HR 3633 EH1S 
‘‘(2) FUTURES COMMISSION MERCHANTS AND 
OTHER
DEALERS.—Each futures commission mer-
chant, introducing broker, digital commodity broker, 
digital commodity dealer, broker, and dealer shall 
maintain sufficient capital to comply with the strict-
er of any applicable capital requirements to which 
the 
futures 
commission 
merchant, 
introducing 
broker, digital commodity broker, digital commodity 
dealer, broker, or dealer, respectively, is subject 
under this Act or the Securities Exchange Act of 
1934 (15 U.S.C. 78a et seq.). 
‘‘(e) REPORTING AND RECORDKEEPING.—Each dig-
ital commodity broker and digital commodity dealer— 
‘‘(1) shall make such reports as are required by 
the Commission by rule or regulation regarding the 
transactions, positions, and financial condition of the 
digital commodity broker or digital commodity deal-
er, respectively; 
‘‘(2) shall keep books and records in such form 
and manner and for such period as may be pre-
scribed by the Commission by rule or regulation; and 
‘‘(3) shall keep the books and records open to 
inspection and examination by any representative of 
the Commission. 
‘‘(f) DAILY TRADING RECORDS.—
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•HR 3633 EH1S 
‘‘(1) IN
GENERAL.—Each digital commodity 
broker and digital commodity dealer shall maintain 
daily trading records of the transactions of the dig-
ital commodity broker or digital commodity dealer, 
respectively, and all related records (including re-
lated forward or derivatives transactions) and re-
corded communications, including electronic mail, in-
stant messages, and recordings of telephone calls, 
for such period as the Commission may require by 
rule or regulation. 
‘‘(2) INFORMATION REQUIREMENTS.—The daily 
trading records shall include such information as the 
Commission shall require by rule or regulation. 
‘‘(3) COUNTERPARTY RECORDS.—Each digital 
commodity broker and digital commodity dealer shall 
maintain daily trading records for each customer or 
counterparty in a manner and form that is identifi-
able with each digital commodity transaction. 
‘‘(4) AUDIT
TRAIL.—Each digital commodity 
broker and digital commodity dealer shall maintain 
a complete audit trail for conducting comprehensive 
and accurate trade reconstructions. 
‘‘(g) BUSINESS CONDUCT STANDARDS.— 
‘‘(1) IN
GENERAL.—Each digital commodity 
broker and digital commodity dealer shall conform
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•HR 3633 EH1S 
with such business conduct standards as the Com-
mission, by rule or regulation, prescribes related 
to— 
‘‘(A) fraud, manipulation, and other abu-
sive practices involving spot or margined, lever-
aged, or financed digital commodity trans-
actions (including transactions that are offered 
but not entered into); 
‘‘(B) diligent supervision of the business of 
the registered digital commodity broker or dig-
ital commodity dealer, respectively; and 
‘‘(C) such other matters as the Commis-
sion deems appropriate. 
‘‘(2) BUSINESS
CONDUCT
REQUIREMENTS.— 
The Commission shall, by rule, prescribe business 
conduct requirements which— 
‘‘(A) require disclosure by a registered dig-
ital commodity broker and registered digital 
commodity dealer to any counterparty to the 
transaction (other than an eligible contract par-
ticipant) of— 
‘‘(i) information about the material 
risks and characteristics of the digital com-
modity; and
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•HR 3633 EH1S 
‘‘(ii) information about the material 
risks and characteristics of the transaction; 
‘‘(B) establish a duty for such a digital 
commodity broker and such a digital commodity 
dealer to communicate in a fair and balanced 
manner based on principles of fair dealing and 
good faith; 
‘‘(C) establish standards governing digital 
commodity broker and digital commodity dealer 
marketing 
and 
advertising, 
including 
testimonials and endorsements; and 
‘‘(D) establish such other standards and 
requirements as the Commission may determine 
are appropriate for the protection of customers. 
‘‘(3) PROHIBITION
ON
FRAUDULENT
PRAC-
TICES.—It shall be unlawful for a digital commodity 
broker or digital commodity dealer to— 
‘‘(A) employ any device, scheme, or artifice 
to defraud any customer or counterparty; 
‘‘(B) engage in any transaction, practice, 
or course of business that operates as a fraud 
or deceit on any customer or counterparty; or 
‘‘(C) engage in any act, practice, or course 
of business that is fraudulent, deceptive, or ma-
nipulative.
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•HR 3633 EH1S 
‘‘(h) DUTIES.— 
‘‘(1) RISK MANAGEMENT PROCEDURES.—Each 
digital commodity broker and digital commodity 
dealer shall establish robust and professional risk 
management systems adequate for managing the 
day-to-day business of the digital commodity broker 
or digital commodity dealer, respectively. 
‘‘(2) DISCLOSURE
OF
GENERAL
INFORMA-
TION.—Each digital commodity broker and digital 
commodity dealer shall disclose to the Commission 
information concerning— 
‘‘(A) the terms and conditions of the trans-
actions of the digital commodity broker or dig-
ital commodity dealer, respectively; 
‘‘(B) the trading operations, mechanisms, 
and practices of the digital commodity broker 
or digital commodity dealer, respectively; 
‘‘(C) financial integrity protections relating 
to the activities of the digital commodity broker 
or digital commodity dealer, respectively; and 
‘‘(D) other information relevant to trading 
in digital commodities by the digital commodity 
broker or digital commodity dealer, respectively.
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•HR 3633 EH1S 
‘‘(3) ABILITY TO OBTAIN INFORMATION.—Each 
digital commodity broker and digital commodity 
dealer 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, on request. 
‘‘(4) CONFLICTS OF INTEREST.—Each digital 
commodity broker and digital commodity dealer shall 
establish, maintain, and enforce written policies and 
procedures reasonably designed, taking into consid-
eration the nature of the business of the person, to 
mitigate any conflicts of interest in transactions or 
arrangements with affiliates. 
‘‘(5) 
ANTITRUST
CONSIDERATIONS.—Unless 
necessary or appropriate to achieve the purposes of 
this Act, a digital commodity broker or digital com-
modity dealer shall not— 
‘‘(A) adopt any process or take any action 
that results in any unreasonable restraint of 
trade; or 
‘‘(B) impose any material anticompetitive 
burden on trading or clearing.
193 
•HR 3633 EH1S 
‘‘(i) DESIGNATION
OF CHIEF COMPLIANCE OFFI-
CER.— 
‘‘(1) IN
GENERAL.—Each digital commodity 
broker and digital commodity dealer shall designate 
an individual to serve as a chief compliance officer. 
‘‘(2) DUTIES.—The chief compliance officer 
shall— 
‘‘(A) report directly to the board or to the 
senior officer of the registered digital com-
modity broker or registered digital commodity 
dealer; 
‘‘(B) review the compliance of the reg-
istered digital commodity broker or registered 
digital commodity dealer with respect to the 
registered digital commodity broker and reg-
istered digital commodity dealer requirements 
described in this section; 
‘‘(C) in consultation with the board of di-
rectors, a body performing a function similar to 
the board, or the senior officer of the organiza-
tion, resolve any conflicts of interest that may 
arise; 
‘‘(D) be responsible for administering each 
policy and procedure that is required to be es-
tablished pursuant to this section;
194 
•HR 3633 EH1S 
‘‘(E) ensure compliance with this Act (in-
cluding regulations), including each rule pre-
scribed by the Commission under this section; 
‘‘(F) establish procedures for the remedi-
ation of noncompliance issues identified by the 
chief compliance officer through any— 
‘‘(i) compliance office review; 
‘‘(ii) look-back; 
‘‘(iii) internal or external audit find-
ing; 
‘‘(iv) self-reported error; or 
‘‘(v) validated complaint; and 
‘‘(G) establish and follow appropriate pro-
cedures for the handling, management response, 
remediation, retesting, and closing of non-
compliance issues. 
‘‘(3) ANNUAL REPORTS.— 
‘‘(A) IN
GENERAL.—In accordance with 
rules prescribed by the Commission, the chief 
compliance officer shall annually prepare and 
sign a report that contains a description of— 
‘‘(i) the compliance of the registered 
digital commodity broker or registered dig-
ital commodity dealer with this Act (in-
cluding regulations); and
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•HR 3633 EH1S 
‘‘(ii) each policy and procedure of the 
registered digital commodity broker or reg-
istered digital commodity dealer followed 
by the chief compliance officer (including 
the code of ethics and conflict of interest 
policies). 
‘‘(B) REQUIREMENTS.—The chief compli-
ance officer shall ensure that a compliance re-
port under subparagraph (A)— 
‘‘(i) accompanies each appropriate fi-
nancial report of the registered digital 
commodity broker or registered digital 
commodity dealer that is required to be 
furnished to the Commission pursuant to 
this section; and 
‘‘(ii) includes a certification that, 
under penalty of law, the compliance re-
port is accurate and complete. 
‘‘(j) SEGREGATION OF DIGITAL COMMODITIES.— 
‘‘(1) HOLDING OF CUSTOMER ASSETS.— 
‘‘(A) IN
GENERAL.—Each digital com-
modity broker and digital commodity dealer 
shall hold customer money, assets, and property 
in a manner to minimize the risk of loss to the 
customer or unreasonable delay in customer ac-
196 
•HR 3633 EH1S 
cess to the money, assets, and property of the 
customer. 
‘‘(B) QUALIFIED
DIGITAL
ASSET
CUSTO-
DIAN.—Each digital commodity broker and dig-
ital commodity dealer shall hold in a qualified 
digital asset custodian each unit of a digital 
asset that is— 
‘‘(i) the property of a customer or 
counterparty of the digital commodity 
broker or digital commodity dealer, respec-
tively; 
‘‘(ii) required to be held by the digital 
commodity broker or digital commodity 
dealer under subsection (e); or 
‘‘(iii) otherwise so required by the 
Commission to reasonably protect cus-
tomers or promote the public interest. 
‘‘(2) SEGREGATION OF FUNDS.— 
‘‘(A) IN
GENERAL.—Each digital com-
modity broker and digital commodity dealer 
shall treat and deal with all money, assets, and 
property that is received by the digital com-
modity broker or digital commodity dealer, or 
accrues to a customer as the result of trading
197 
•HR 3633 EH1S 
in digital commodities, as belonging to the cus-
tomer. 
‘‘(B) COMMINGLING PROHIBITED.— 
‘‘(i) IN
GENERAL.—Except as pro-
vided in clause (ii), each digital commodity 
broker and digital commodity dealer shall 
separately account for money, assets, and 
property of a digital commodity customer, 
and shall not commingle any such money, 
assets, or property with the funds of the 
digital commodity broker or digital com-
modity dealer, respectively, or use any such 
money, assets, or property to margin, se-
cure, or guarantee any trades or accounts 
of any customer or person other than the 
person for whom the money, assets, or 
property are held. 
‘‘(ii) EXCEPTIONS.— 
‘‘(I) USE OF FUNDS.— 
‘‘(aa) IN GENERAL.—A dig-
ital commodity broker or digital 
commodity dealer may, for con-
venience, commingle and deposit 
in the same account or accounts 
with any bank, trust company,
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•HR 3633 EH1S 
derivatives clearing organization, 
or qualified digital asset custo-
dian money, assets, and property 
of customers. 
‘‘(bb) 
WITHDRAWAL.—The 
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 contract of sale 
of a digital commodity with a 
registered entity may be with-
drawn and applied to such pur-
poses, including the payment of 
commissions, brokerage, interest, 
taxes, storage, and other charges, 
lawfully accruing in connection 
with the contract. 
‘‘(II) COMMISSION
ACTION.—In 
accordance with such terms and con-
ditions as the Commission may pre-
scribe by rule, regulation, or order, 
any money, assets, or property of the 
customers of a digital commodity
199 
•HR 3633 EH1S 
broker or digital commodity dealer 
may be commingled and deposited in 
customer accounts with any other 
money, assets, or property received by 
the digital commodity broker or dig-
ital commodity dealer, respectively, 
and required by the Commission to be 
separately accounted for and treated 
and dealt with as belonging to the 
customer of the digital commodity 
broker or digital commodity dealer, 
respectively. 
‘‘(3) 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, 
in obligations fully guaranteed as to principal and 
interest by the United States, or in any other invest-
ment that the Commission may by rule or regulation 
allow. 
‘‘(4) CUSTOMER
PROTECTION
DURING
BANK-
RUPTCY.— 
‘‘(A) CUSTOMER
PROPERTY.—All money, 
assets, or property described in paragraph (2) 
shall be considered customer property for pur-
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•HR 3633 EH1S 
poses of section 761 of title 11, United States 
Code. 
‘‘(B) TRANSACTIONS.—A transaction in-
volving a unit of a digital commodity occurring 
with a digital commodity broker or digital com-
modity dealer shall be considered a contract for 
the purchase or sale of a commodity for future 
delivery, on or subject to the rules of, a con-
tract market or board of trade for purposes of 
the definition of a ‘commodity contract’ in sec-
tion 761 of title 11, United States Code. 
‘‘(C) BROKERS AND DEALERS.—A digital 
commodity broker and a digital commodity 
dealer shall be considered a futures commission 
merchant for purposes of section 761 of title 
11, United States Code. 
‘‘(D) 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. 
‘‘(5) MISUSE OF CUSTOMER PROPERTY.— 
‘‘(A) IN GENERAL.—It shall be unlawful—
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•HR 3633 EH1S 
‘‘(i) for any digital commodity broker 
or digital commodity dealer that has re-
ceived any customer money, assets, or 
property for custody to dispose of, or use 
any such money, assets, or property as be-
longing to the digital commodity broker or 
digital commodity dealer, respectively, or 
any person other than a customer of the 
digital commodity broker or digital com-
modity dealer, respectively; or 
‘‘(ii) for any other person, including 
any depository, digital commodity ex-
change, other digital commodity broker, 
other digital commodity dealer, or digital 
commodity custodian that has received any 
customer money, assets, or property for 
deposit, to hold, dispose of, or use any 
such money, assets, or property, as belong-
ing to the depositing digital commodity 
broker or digital commodity dealer or any 
person other than the customers of the 
digital commodity broker or digital com-
modity dealer, respectively. 
‘‘(B) USE FURTHER DEFINED.—For pur-
poses of this section, ‘use’ of a digital com-
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•HR 3633 EH1S 
modity includes utilizing any unit of a digital 
asset to participate in a blockchain service de-
fined in paragraph (6) or a decentralized gov-
ernance system associated with the digital com-
modity or the blockchain system to which the 
digital commodity relates in any manner other 
than that expressly directed by the customer 
from whom the unit of a digital commodity was 
received. 
‘‘(6) PARTICIPATION
IN
BLOCKCHAIN
SERV-
ICES.— 
‘‘(A) USE
OF
FUNDS.—A digital com-
modity broker or digital commodity dealer (or a 
designee of a digital commodity broker or a dig-
ital commodity dealer) may use a unit of a dig-
ital commodity belonging to a customer to pro-
vide a blockchain service for a blockchain sys-
tem to which the unit of the digital commodity 
relates if— 
‘‘(i) the customer expressly permits 
the use, in writing to the digital commodity 
broker or digital commodity dealer, as the 
case may be; and
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•HR 3633 EH1S 
‘‘(ii) the digital commodity broker or 
the digital commodity dealer, as the case 
may be, complies with subparagraph (B). 
‘‘(B) LIMITATIONS.— 
‘‘(i) IN GENERAL.—The Commission 
shall, by rule, establish notice and disclo-
sure requirements, and may, by rule, es-
tablish any other limitations and rules re-
lated to a permission provided under sub-
paragraph (A) that are reasonably nec-
essary to protect customers, including eligi-
ble contract participants, non-eligible con-
tract participants, or any other class of 
customers. 
‘‘(ii) CUSTOMER
CHOICE.—A digital 
commodity broker or digital commodity 
dealer may not require a customer to pro-
vide the permission referred to in subpara-
graph (A) as a condition of doing business 
with the broker or dealer. 
‘‘(C) REQUIREMENTS.—The Commission 
may, by rule, waive or modify the requirements 
of paragraph (2) or subsection (h), to facilitate 
the use of a unit of a digital commodity belong-
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•HR 3633 EH1S 
ing to a customer to provide a blockchain serv-
ice. 
‘‘(D) BLOCKCHAIN SERVICE DEFINED.—In 
this paragraph, the term ‘blockchain service’ 
means any activity relating to validating trans-
actions on a blockchain system, providing secu-
rity for a blockchain system, or other similar 
activity, including protocol consensus participa-
tion activities described in section 2(a)(30)(B) 
of the Securities Act of 1933, required for the 
ongoing operation of a blockchain system. 
‘‘(k) FEDERAL PREEMPTION.—Notwithstanding any 
other provision of law, the Commission shall have exclusive 
jurisdiction over any digital commodity broker or digital 
commodity dealer registered under this section with re-
spect to activities subject to this Act. 
‘‘(l) EXEMPTIONS.—In order to promote responsible 
innovation and fair competition, or protect customers, the 
Commission may (on its own initiative or on application 
of the digital commodity broker or digital commodity deal-
er) exempt, unconditionally or on stated terms or condi-
tions, or for stated periods, and retroactively or prospec-
tively, or both, a digital commodity broker or digital com-
modity dealer from the requirements of this Act, if the 
Commission determines that—
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•HR 3633 EH1S 
‘‘(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 to dis-
charge regulatory duties under this Act; or 
‘‘(2) the digital commodity broker or digital 
commodity dealer is subject to comparable, com-
prehensive supervision and regulation by the appro-
priate government authorities in the home country 
of the digital commodity broker or digital commodity 
dealer, respectively.’’. 
SEC. 407. REGISTRATION OF ASSOCIATED PERSONS. 
(a) IN GENERAL.—Section 4k of the Commodity Ex-
change Act (7 U.S.C. 6k) is amended— 
(1) by redesignating subsections (4) through 
(6) as subsections (5) through (7), respectively; 
(2) by inserting after subsection (3) the fol-
lowing: 
‘‘(4) It shall be unlawful for any person to act as an 
associated person of a digital commodity broker or an as-
sociated person of a digital commodity dealer unless the 
person is registered with the Commission under this Act 
and such registration shall not have expired, been sus-
pended (and the period of suspension has not expired), 
or been revoked. It shall be unlawful for a digital com-
206 
•HR 3633 EH1S 
modity broker or a digital commodity dealer to permit 
such a person to become or remain associated with the 
digital commodity broker or digital commodity dealer if 
the digital commodity broker or digital commodity dealer 
knew or should have known that the person was not so 
registered or that the registration had expired, been sus-
pended (and the period of suspension has not expired), 
or been revoked.’’; and 
(3) in subsection (5) (as so redesignated), by 
striking ‘‘or of a commodity trading advisor’’ and in-
serting ‘‘of a commodity trading advisor, of a digital 
commodity broker, or of a digital commodity deal-
er’’. 
(b) CONFORMING AMENDMENTS.—The Commodity 
Exchange Act (7 U.S.C. 1a et seq.) is amended by striking 
‘‘section 4k(6)’’ each place it appears and inserting ‘‘sec-
tion 4k(7)’’. 
SEC. 408. REGISTRATION OF COMMODITY POOL OPERA-
TORS AND COMMODITY TRADING ADVISORS. 
(a) IN GENERAL.—Section 4m(3) of the Commodity 
Exchange Act (7 U.S.C. 6m(3)) is amended— 
(1) in subparagraph (A)— 
(A) by striking ‘‘any commodity trading 
advisor’’ and inserting ‘‘a commodity pool oper-
ator or commodity trading advisor’’; and
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•HR 3633 EH1S 
(B) by striking ‘‘acting as a commodity 
trading advisor’’ and inserting ‘‘acting as a 
commodity pool operator or commodity trading 
advisor’’; and 
(2) in subparagraph (C), by inserting ‘‘digital 
commodities,’’ after ‘‘physical commodities,’’. 
(b) EXEMPTIVE AUTHORITY.—Section 4m of such 
Act (7 U.S.C. 6m) is amended by adding at the end the 
following: 
‘‘(4) EXEMPTIVE
AUTHORITY.—The Commission 
shall promulgate rules to provide appropriate exemptions 
for commodity pool operators and commodity trading advi-
sors, to provide relief from duplicative, conflicting, or un-
duly burdensome requirements or to promote responsible 
innovation, to the extent the exemptions foster the devel-
opment of fair and orderly cash or spot digital commodity 
markets, are necessary or appropriate in the public inter-
est, and are consistent with the protection of customers.’’. 
SEC. 409. EXCLUSION FOR DECENTRALIZED FINANCE AC-
TIVITIES. 
The Commodity Exchange Act (7 U.S.C. 1 et seq.), 
as amended by the preceding provisions of this Act, is 
amended by inserting after section 4u the following:
208 
•HR 3633 EH1S 
‘‘SEC. 4v. DECENTRALIZED FINANCE ACTIVITIES NOT SUB-
JECT TO THIS ACT. 
‘‘(a) IN GENERAL.—Notwithstanding any other pro-
vision of this Act, a person shall not be subject to this 
Act and the regulations promulgated under this Act based 
on the person directly or indirectly engaging in any of the 
following activities, whether singly or in combination, in 
relation to the operation of a blockchain system or in rela-
tion to decentralized finance trading protocol: 
‘‘(1) Compiling network transactions or relay-
ing, searching, sequencing, validating, or acting in a 
similar capacity. 
‘‘(2) Providing computational work, operating a 
node or oracle service, or procuring, offering, or uti-
lizing network bandwidth, or other similar incidental 
services. 
‘‘(3) Providing a user-interface that enables a 
user to read, and access data about a blockchain 
system. 
‘‘(4) Developing, publishing, or otherwise dis-
tributing a blockchain system or a decentralized fi-
nance messaging system. 
‘‘(5) Constituting, administering, or maintain-
ing a decentralized finance messaging system or de-
centralized finance trading protocol, or operating or 
participating in a liquidity pool with respect thereto,