(II) denies the application of the 
person to register; or 
(ii) the digital asset broker, digital 
asset dealer, or digital asset trading system 
that filed a notice of intent to register failed 
to register as such with the Commission 
within 180 days after the Commission fi-
nalized the rules of the Commission for the 
registration of digital asset brokers, digital 
asset dealers, and digital asset trading sys-
tems, as appropriate. 
(g) LIABILITY OF THE FILER.—It shall be unlawful 
for any person to provide false information in support of 
a filing under this section if the person knowingly or rea-
sonably should have known that the information was false. 
SEC. 107. COMMODITY EXCHANGE ACT SAVINGS PROVI-
SIONS. 
(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; 
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(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; or 
(2) the activities of any person with respect to 
any such agreement, contract, or transaction. 
(b) PROHIBITIONS ON SPOT DIGITAL COMMODITY EN-
TITIES.—Nothing in this Act authorizes, or shall be inter-
preted to authorize, a digital commodity exchange, digital 
commodity broker, or digital commodity dealer to engage 
in any activities involving any transaction, contract, or 
agreement described in subsection (a)(1), solely by virtue 
of being registered or filing notice of intent to register 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. INTERNATIONAL HARMONIZATION. 
In order to promote effective and consistent global reg-
ulation of digital assets, the Commodity Futures Trading 
Commission and the Securities and Exchange Commission, 
as appropriate— 
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(1) shall consult and coordinate with foreign reg-
ulatory authorities on the establishment of consistent 
international standards with respect to the regulation 
of digital assets, restricted digital assets, and digital 
commodities; and 
(2) may agree to such information-sharing ar-
rangements as may be deemed to be necessary or ap-
propriate in the public interest or for the protection 
of investors, customers, and users of digital assets. 
SEC. 109. IMPLEMENTATION. 
(a) GLOBAL RULEMAKING TIMEFRAME.—Unless other-
wise 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 EFFEC-
TIVE DATES.— 
(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— 
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(A) promulgate rules, regulations, or orders 
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 action 
by the Commodity Futures Trading Commission or 
the Securities and Exchange Commission under para-
graph (1) shall not become effective before the effective 
date otherwise applicable to the action under this Act. 
TITLE II.—DIGITAL ASSET 
EXEMPTIONS 
SEC. 201. EXEMPTED TRANSACTIONS IN DIGITAL ASSETS. 
(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 fol-
lowing: 
‘‘(8) transactions involving the offer or sale of 
units of a digital asset by a digital asset issuer, if— 
‘‘(A) the aggregate amount of units of the 
digital asset sold by the digital asset issuer in re-
liance on the exemption provided under this 
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paragraph, during the 12-month period pre-
ceding the date of such transaction, including the 
amount sold in such transaction, is not more 
than $75,000,000 (as such amount is annually 
adjusted by the Commission to reflect the change 
in the Consumer Price Index for All Urban Con-
sumers published by the Bureau of Labor Statis-
tics of the Department of Labor); 
‘‘(B) with respect to a transaction involving 
the purchase of units of a digital asset by a per-
son who is not an accredited investor, the aggre-
gate amount of all units of digital assets pur-
chased by such person during the 12-month pe-
riod preceding the date of such transaction, in-
cluding the unit of a digital asset purchased in 
such transaction, does not exceed the greater of— 
‘‘(i) 10 percent of the person’s annual 
income or joint income with that person’s 
spouse or spousal equivalent; or 
‘‘(ii) 10 percent of the person’s net 
worth or joint net worth with the person’s 
spouse or spousal equivalent; 
‘‘(C) after the completion of the transaction, 
the purchaser does not own more than 10 percent 
of the total amount of the units of the digital 
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asset sold in reliance on the exemption under 
this paragraph; 
‘‘(D) the transaction does not involve the 
offer or sale of any digital asset not offered as 
part of an investment contract; 
‘‘(E) the transaction does not involve the 
offer or sale of a unit of a digital asset by a dig-
ital asset 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 Com-
pany Act of 1940 (15 U.S.C. 80a–3), or is 
excluded from the definition of investment 
company by section 3(b) or section 3(c) of 
that Act (15 U.S.C. 80a–3(b) or 80a–3(c)); 
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‘‘(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 before 
the filing of the offering statement; or 
‘‘(vi) is disqualified pursuant to sec-
tion 230.262 of title 17, Code of Federal 
Regulations; and 
‘‘(F) the issuer meets the requirements of 
section 4B(a).’’; and 
(2) by inserting after section 4A the following: 
‘‘SEC. 4B. REQUIREMENTS WITH RESPECT TO CERTAIN DIG-
ITAL ASSET TRANSACTIONS. 
‘‘(a) REQUIREMENTS FOR DIGITAL ASSET ISSUERS.— 
‘‘(1) INFORMATION REQUIRED IN STATEMENT.— 
A digital asset issuer offering or selling a unit of dig-
ital asset in reliance on section 4(a)(8) shall file with 
the Commission a statement containing the following 
information: 
‘‘(A) The name, legal status (including the 
jurisdiction in which the issuer is organized and 
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the date of organization), and website of the dig-
ital asset issuer. 
‘‘(B) A certification that the digital asset 
issuer meets the relevant requirements described 
under section 4(a)(8). 
‘‘(C) An overview of the material aspects of 
the offering. 
‘‘(D) A description of the purpose and in-
tended use of the offering proceeds. 
‘‘(E) A description of the plan of distribu-
tion of any unit of a digital asset that is to be 
offered. 
‘‘(F) A description of the material risks sur-
rounding ownership of a unit of a digital asset. 
‘‘(G) A description of exempt offerings con-
ducted within the past three years by the digital 
asset issuer. 
‘‘(H) A description of the digital asset 
issuer and the current number of employees of 
the digital asset issuer. 
‘‘(I) A description of any material trans-
actions or relationships between the digital asset 
issuer and affiliated persons. 
‘‘(J) A description of exempt offerings con-
ducted within the past three years. 
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‘‘(2) 
INFORMATION
REQUIRED
FOR
PUR-
CHASERS.—A digital asset issuer shall disclose the in-
formation described under section 43 of the Securities 
Exchange Act of 1934 on a freely accessible public 
website. 
‘‘(3) ONGOING DISCLOSURE REQUIREMENTS.—A 
digital asset issuer that has filed a statement under 
paragraph (1) to offer and sell a unit of a digital 
asset in reliance on section 4(a)(8) shall file the fol-
lowing with the Commission: 
‘‘(A) ANNUAL REPORTS.—An annual report 
that includes any material changes to the infor-
mation described under paragraph (2) for the 
current fiscal year and for any fiscal year there-
after, unless the issuer is no longer obligated to 
file such annual report pursuant to paragraph 
(4). 
‘‘(B) SEMIANNUAL
REPORTS.—Along with 
each annual report required under subparagraph 
(A), and separately six months thereafter, a re-
port containing— 
‘‘(i) an updated description of the cur-
rent state and timeline for the development 
of the blockchain system to which the digital 
asset relates, showing how and when the 
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blockchain system intends or intended to be 
considered a functional network and a de-
centralized network; 
‘‘(ii) the amount of money raised by 
the digital asset issuer in reliance on sec-
tion 4(a)(8), how much of that money has 
been spent, and the general categories and 
amounts on which that money has been 
spent; and 
‘‘(iii) any material changes to the in-
formation in the most recent annual report. 
‘‘(C) CURRENT REPORTS.—A current report 
shall be filed with the Commission reflecting any 
material changes to the information previously 
reported to the Commission by the digital asset 
issuer. 
‘‘(4) TERMINATION
OF
REPORTING
REQUIRE-
MENTS.— 
‘‘(A) IN GENERAL.—The ongoing reporting 
requirements under paragraph (3) shall not 
apply to a digital asset issuer 180 days after the 
end of the covered fiscal year. 
‘‘(B) COVERED FISCAL YEAR DEFINED.—In 
this paragraph, the term ‘covered fiscal year’ 
means the first fiscal year of an issuer in which 
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the blockchain system to which the digital asset 
relates is a functional network and certified to be 
a decentralized network under section 44 of the 
Securities Exchange Act of 1934. 
‘‘(b) REQUIREMENTS FOR INTERMEDIARIES.— 
‘‘(1) IN GENERAL.—A person acting as an inter-
mediary in a transaction involving the offer or sale 
of a unit of a digital asset in reliance on section 
4(a)(8) shall— 
‘‘(A) register with the Commission as a 
broker under section 15(b) of the Securities Ex-
change Act of 1934 (15 U.S.C. 78o(b)); and 
‘‘(B) be a member of a national securities 
association registered under section 15A of the 
Securities Exchange Act of 1934 (15 U.S.C. 78o– 
3). 
‘‘(2) PURCHASER QUALIFICATION.— 
‘‘(A) IN GENERAL.—Each time, before ac-
cepting any commitment (including any addi-
tional commitment from the same person), an 
intermediary or digital asset issuer shall have a 
reasonable basis for believing that the purchaser 
satisfies the requirements of section 4(a)(8). 
‘‘(B) RELIANCE
ON
PURCHASER’S
REP-
RESENTATIONS.—For purposes of subparagraph 
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(A), an intermediary or digital asset issuer may 
rely on a purchaser’s representations concerning 
the purchaser’s annual income and net worth 
and the amount of the purchaser’s other invest-
ments made, unless the intermediary or digital 
asset issuer has reason to question the reliability 
of the representation. 
‘‘(C) RELIANCE
ON
INTERMEDIARY.—For 
purposes of determining whether a transaction 
meets the requirements described under subpara-
graph (A) through (C) of section 4(a)(8), a dig-
ital asset issuer may rely on the efforts of an 
intermediary. 
‘‘(c) ADDITIONAL PROVISIONS.— 
‘‘(1) 
ACCEPTANCE
OF
WRITTEN
OFFERS; 
SALES.—After an issuer files a statement under para-
graph (1) to offer and sell a digital asset in reliance 
on section 4(a)(8)— 
‘‘(A) written offers of the digital asset may 
be made; and 
‘‘(B) the issuer may sell the digital assets in 
reliance on section 4(a)(8), if such sales meet all 
other requirements. 
‘‘(2) SOLICITATION OF INTEREST.— 
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‘‘(A) IN GENERAL.—At any time before the 
filing of a statement under paragraph (1), a dig-
ital asset issuer may communicate orally or in 
writing to determine whether there is any inter-
est in a contemplated offering. Such communica-
tions are deemed to be an offer of a unit of a 
digital asset for sale for purposes of the anti-
fraud provisions of the Federal securities laws. 
No solicitation or acceptance of money or other 
consideration, nor of any commitment, binding 
or otherwise, from any person is permitted until 
the statement is filed. 
‘‘(B) CONDITIONS.—In any communication 
described under subparagraph (A), the digital 
asset issuer shall— 
‘‘(i) state that no money or other con-
sideration is being solicited, and if sent in 
response, will not be accepted; 
‘‘(ii) state that no offer to buy a unit 
of a digital asset can be accepted and no 
part of the purchase price can be received 
until the statement is filed and then only 
through an intermediary; and 
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‘‘(iii) state that a person’s indication 
of interest involves no obligation or commit-
ment of any kind. 
‘‘(C) 
INDICATIONS
OF
INTEREST.—Any 
written communication described under subpara-
graph (A) may include a means by which a per-
son may indicate to the digital asset issuer that 
such person is interested in a potential offering. 
A digital asset issuer may require a name, ad-
dress, telephone number, or email address in any 
response form included with a communication 
described under subparagraph (A). 
‘‘(3) DISQUALIFICATION PROVISIONS.—The Com-
mission shall issue rules to apply the disqualification 
provisions under section 230.262 of title 17, Code of 
Federal Regulations, to the exemption provided under 
section 4(a)(8). 
‘‘(4) DIGITAL ASSETS DEEMED RESTRICTED DIG-
ITAL ASSET.—A unit of a digital asset acquired di-
rectly or indirectly from the digital asset issuer in re-
liance on the exemption provided under section 
4(a)(8) is deemed a restricted digital asset.’’. 
(b) ADDITIONAL EXEMPTIONS.— 
(1) CERTAIN
REGISTRATION
REQUIREMENTS.— 
Section 12(g)(6) of the Securities Exchange Act of 
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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.—Sec-
tion 18(b)(4) of the Securities Act of 1933 (15 U.S.C. 
77r(b)(4)) is amended— 
(A) in section (B), by striking ‘‘section 
4(4)’’ and inserting ‘‘section 4(a)(4)’’; 
(B) in section (C), by striking ‘‘section 
4(6)’’ and inserting ‘‘section 4(a)(6)’’; 
(C) in subparagraph (F)— 
(i) by striking ‘‘section 4(2)’’ each 
place such term appears and inserting ‘‘sec-
tion 4(a)(2)’’; 
(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).’’. 
SEC. 202. REQUIREMENTS TO TRANSACT IN CERTAIN DIG-
ITAL ASSETS. 
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: 
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‘‘SEC. 42. REQUIREMENTS TO TRANSACT IN CERTAIN DIG-
ITAL ASSETS. 
‘‘(a) TRANSACTIONS IN CERTAIN RESTRICTED DIGITAL 
ASSETS.— 
‘‘(1) IN GENERAL.—Notwithstanding any other 
provision of law, subject to paragraph (2), a re-
stricted digital asset may be offered and sold on an 
alternative trading system by any person other than 
a digital asset issuer if, at the time of such offer or 
sale, any blockchain system to which the restricted 
digital asset relates is a functional network and the 
information described in section 43 has been certified 
and made publicly available for any blockchain sys-
tem to which the restricted digital asset relates. 
‘‘(2) ADDITIONAL RULES FOR RELATED AND AF-
FILIATED PERSONS.—A restricted digital asset owned 
by a related person or an affiliated person may only 
be offered or sold after 12 months after the later of— 
‘‘(A) the date on which such restricted dig-
ital asset was acquired; or 
‘‘(B) the digital asset maturity date. 
‘‘(b) TRANSACTIONS IN CERTAIN DIGITAL COMMOD-
ITIES.— 
‘‘(1) IN GENERAL.—Subject to paragraph (2), a 
digital commodity may be offered and sold by any 
person other than a digital asset issuer. 
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‘‘(2) RULES FOR RELATED AND AFFILIATED PER-
SONS.—A digital commodity may only be offered or 
sold by a related person or an affiliated person if— 
‘‘(A) the holder of the digital commodity 
owned the digital commodity while it was a re-
stricted digital asset for 12 months after the later 
of— 
‘‘(i) the date on which such restricted 
digital asset was acquired; or 
‘‘(ii) the digital asset maturity date; 
‘‘(B) any blockchain system to which the 
digital commodity relates is certified to be a de-
centralized network under section 44; and 
‘‘(C) the digital commodity is offered or sold 
on or subject to the rules of a digital commodity 
exchange registered under section 5i of the Com-
modity Exchange Act. 
‘‘(3) NOT A SECURITY.— 
‘‘(A) IN
GENERAL.—Except as provided 
under subparagraph (B), for purposes of the se-
curities laws, a transaction in a digital com-
modity made in compliance with paragraph (1) 
or (2) shall not be a transaction in a security. 
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‘‘(B) EXCEPTION.—Subparagraph (A) does 
not apply to a transaction in a digital com-
modity if the transaction— 
‘‘(i) is a mixed digital asset trans-
action; or 
‘‘(ii) is made pursuant to an invest-
ment contract or in conjunction with any 
other security. 
‘‘(c) SALES RESTRICTIONS
FOR AFFILIATED PER-
SONS.—A digital asset may be offered or sold by an affili-
ated person under subsection (a) or (b) if— 
‘‘(1) the aggregate amount of such digital assets 
sold in any 3-month period by the affiliated person 
is not greater than one percent of the digital assets 
then outstanding; or 
‘‘(2) the affiliated person promptly, following the 
placement of an order to sell one percent of the digital 
assets then outstanding during any 3-month period, 
reports the sale to— 
‘‘(A) the Commodity Futures Trading Com-
mission, in the case of an order to sell a digital 
commodity on or subject to the rules of a digital 
commodity exchange; or 
‘‘(B) the Securities and Exchange Commis-
sion, in the case of a sell order for a restricted 
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digital asset placed with an alternative trading 
system. 
‘‘(d) TREATMENT OF CERTAIN END USER DISTRIBU-
TIONS UNDER THE SECURITIES LAWS.— 
‘‘(1) IN
GENERAL.—With respect to a digital 
asset, an end user distribution is described under this 
paragraph if— 
‘‘(A) each blockchain system to which such 
digital asset relates is a functional network; and 
‘‘(B) with respect to the digital asset and 
each blockchain system to which such digital 
asset relates, the information described in section 
43 has been certified and made publicly avail-
able. 
‘‘(2) NOT A SECURITY.—For purposes of the se-
curities laws, an end user distribution described 
under paragraph (1) shall not be a transaction in a 
security. 
‘‘(3) EXEMPTION.—Section 5 of the Securities 
Act of 1933 (15 U.S.C. 77e) shall not apply to an end 
user distribution described under paragraph (1) or a 
transaction in a unit of digital asset issued in such 
a distribution.’’. 
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SEC. 203. ENHANCED DISCLOSURE REQUIREMENTS. 
Title I of the Securities Exchange Act of 1934 (15 
U.S.C. 78a et seq.), as amended by section 202, is further 
amended by adding at the end the following: 
‘‘SEC. 43. ENHANCED DISCLOSURE REQUIREMENTS WITH 
RESPECT TO DIGITAL ASSETS. 
‘‘(a) DISCLOSURE INFORMATION.—With respect to a 
digital asset and any blockchain system to which the digital 
asset relates, the information described under this section 
is as follows: 
‘‘(1) SOURCE CODE.—The source code for any 
blockchain system to which the digital asset relates. 
‘‘(2) TRANSACTION HISTORY.—A description of 
the steps necessary to independently access, search, 
and verify the transaction history of any blockchain 
system to which the digital asset relates. 
‘‘(3) DIGITAL ASSET ECONOMICS.—A description 
of the purpose of any blockchain system to which the 
digital asset relates and the operation of any such 
blockchain system, including— 
‘‘(A) 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 assets to be created, the 
release schedule for the digital assets, and the 
total number of digital assets then outstanding; 
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‘‘(B) information on any applicable con-
sensus mechanism or process for validating 
transactions, method of generating or mining 
digital assets, and any process for burning or de-
stroying digital assets on the blockchain system; 
‘‘(C) an explanation of governance mecha-
nisms 
for 
implementing 
changes 
to 
the 
blockchain system or forming consensus among 
holders of such digital assets; and 
‘‘(D) sufficient information for a third 
party to create a tool for verifying the trans-
action history of the digital asset. 
‘‘(4) PLAN OF DEVELOPMENT.—The current state 
and timeline for the development of any blockchain 
system to which the digital asset relates, showing how 
and when the blockchain system intends or intended 
to be considered a functional network and decentral-
ized network. 
‘‘(5) DEVELOPMENT DISCLOSURES.—A list of all 
persons who are related persons or affiliated persons 
who have been issued a unit of a digital asset by a 
digital asset issuer or have a right to a unit of a dig-
ital asset from a digital asset issuer. 
‘‘(6) RISK FACTOR DISCLOSURES.—Where appro-
priate, provide under the caption ‘Risk Factors’ a de-
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scription of the material risks surrounding ownership 
of a unit of a digital asset. This discussion shall be 
organized logically with relevant headings and each 
risk factor shall be set forth under a subcaption that 
adequately describes the risk. 
‘‘(b) CERTIFICATION.—With respect to a digital asset 
and any blockchain system to which the digital asset relates, 
the information required to be made available under this 
section has been certified if the digital asset issuer, an affili-
ated person, a decentralized governance system, or a digital 
commodity exchange certifies on a quarterly basis to the 
Commodity Futures Trading Commission and the Securi-
ties and Exchange Commission that the information is true 
and correct.’’. 
SEC. 204. CERTIFICATION OF CERTAIN DIGITAL ASSETS. 
Title I of the Securities Exchange Act of 1934 (15 
U.S.C. 78a et seq.), as amended by section 203, is further 
amended by adding at the end the following: 
‘‘SEC. 44. CERTIFICATION OF CERTAIN DIGITAL ASSETS. 
‘‘(a) CERTIFICATION.—Any person may certify to the 
Securities and Exchange Commission that the blockchain 
system to which a digital asset relates is a decentralized 
network. 
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‘‘(b) FILING
REQUIREMENTS.—A certification de-
scribed under subsection (a) shall be filed with the Commis-
sion, and include— 
‘‘(1) information regarding the person making 
the certification; 
‘‘(2) a description of the blockchain system and 
the digital asset which relates to such blockchain sys-
tem, including— 
‘‘(A) the operation of the blockchain system; 
‘‘(B) the functionality of the related digital 
asset; 
‘‘(C) any decentralized governance system 
which relates to the blockchain system; and 
‘‘(D) the process to develop consensus or 
agreement within such decentralized governance 
system; 
‘‘(3) a description of the development of the 
blockchain system and the digital asset which relates 
to the blockchain system, including— 
‘‘(A) a history of the development of the 
blockchain system and the digital asset which re-
lates to such blockchain system; 
‘‘(B) a description of the issuance process 
for the digital asset which relates to the 
blockchain system; 
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‘‘(C) information identifying the digital 
asset issuer of the digital asset which relates to 
the blockchain system; and 
‘‘(D) a list of any affiliated person related 
to the digital asset issuer; 
‘‘(4) an analysis of the factors on which such 
person based the certification that the blockchain sys-
tem is a decentralized network, including— 
‘‘(A) an explanation of the protections and 
prohibitions available during the previous 12 
months against any one person being able to— 
‘‘(i) control or materially alter the 
blockchain system; 
‘‘(ii) exclude any other person from 
using or participating on the blockchain 
system; and 
‘‘(iii) exclude any other person from 
participating in a decentralized governance 
system; 
‘‘(B) information regarding the beneficial 
ownership of the digital asset which relates to 
such blockchain system and the distribution of 
voting power in any decentralized governance 
system during the previous 12 months; 
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‘‘(C) information regarding the history of 
upgrades to the source code for such blockchain 
system during the previous 3 months, includ-
ing— 
‘‘(i) a description of any consensus or 
agreement process utilized to process or ap-
prove changes to the source code; 
‘‘(ii) a list of any material changes to 
the source code, the purpose and effect of the 
changes, and the contributor of the changes, 
if known; and 
‘‘(iii) any changes to the source code 
made by the digital asset issuer, a related 
person, or an affiliated person; 
‘‘(D) information regarding any activities 
conducted to market the digital asset which re-
lates to the blockchain system during the pre-
vious 3 months by the digital asset issuer or an 
affiliated person of the digital asset issuer; and 
‘‘(E) information regarding any issuance of 
a unit of the digital asset which relates to such 
blockchain system during the previous 12 
months; and 
‘‘(5) with respect to a blockchain system for 
which a certification has previously been rebutted 
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under this section or withdrawn under section 5i(m) 
of the Commodity Exchange Act, specific information 
relating to the analysis provided in subsection (f)(2) 
in connection with such rebuttal or such section 
5i(m)(1)(C) in connection with such withdrawal. 
‘‘(c) REBUTTABLE PRESUMPTION.—The Commission 
may rebut a certification described under subsection (a) 
with respect to a blockchain system if the Commission, 
within 30 days of receiving such certification, determines 
that the blockchain system is not a decentralized network. 
‘‘(d) CERTIFICATION REVIEW.— 
‘‘(1) IN GENERAL.—Any blockchain system that 
relates to a digital asset for which a certification has 
been made under subsection (a) shall be considered a 
decentralized network 30 days after the date on which 
the Commission receives a certification under sub-
section (a), unless the Commission notifies the person 
who made the certification within such time that the 
Commission is staying the certification due to— 
‘‘(A) an inadequate explanation by the per-
son making the certification; or 
‘‘(B) any novel or complex issues which re-
quire additional time to consider. 
‘‘(2) PUBLIC
NOTICE.—The Commission shall 
make the following available to the public and provide 
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a copy to the Commodity Futures Trading Commis-
sion: 
‘‘(A) Each certification received under sub-
section (a). 
‘‘(B) Each stay of the Commission under 
this section, and the reasons therefore. 
‘‘(C) Any response from a person making a 
certification under subsection (a) to a stay of the 
certification by the Commission. 
‘‘(3) CONSOLIDATION.—The Commission may 
consolidate and treat as one submission multiple cer-
tifications made under subsection (a) for the same 
blockchain system which relates to a digital asset 
which are received during the review period provided 
under this subsection. 
‘‘(e) STAY OF CERTIFICATION.— 
‘‘(1) IN GENERAL.—A notification by the Com-
mission pursuant to subsection (d)(1) shall stay the 
certification once for up to an additional 120 days 
from the date of the notification. 
‘‘(2) PUBLIC COMMENT PERIOD.—Before the end 
of the 30-day period described under subsection 
(d)(1), the Commission may begin a public comment 
period of at least 30 days in conjunction with a stay 
under this section. 
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‘‘(f) DISPOSITION OF CERTIFICATION.— 
‘‘(1) IN GENERAL.—A certification made under 
subsection (a) shall— 
‘‘(A) become effective— 
‘‘(i) upon the publication of a notifica-
tion from the Commission to the person who 
made the certification that the Commission 
does not object to the certification; or 
‘‘(ii) at the expiration of the certifi-
cation review period; and 
‘‘(B) not become effective upon the publica-
tion of a notification from the Commission to the 
person who made the certification that the Com-
mission has rebutted the certification. 
‘‘(2) DETAILED ANALYSIS INCLUDED WITH RE-
BUTTAL.—The Commission shall include, with each 
publication of a notification of rebuttal described 
under paragraph (1)(B), a detailed analysis of the 
factors on which the decision was based. 
‘‘(g) RECERTIFICATION.—With respect to a blockchain 
system for which a certification has been rebutted under this 
section, no person may make a certification under sub-
section (a) with respect to such blockchain system during 
the 90-day period beginning on the date of such rebuttal. 
‘‘(h) APPEAL OF REBUTTAL.— 
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‘‘(1) IN GENERAL.—If a certification is rebutted 
under this section, the person making such certifi-
cation may appeal the decision to the United States 
Court of Appeals for the District of Columbia, not 
later than 60 days after the notice of rebuttal is 
made. 
‘‘(2) REVIEW.—In an appeal under paragraph 
(1), the court shall have de novo review of the deter-
mination to rebut the certification. 
‘‘(i) LIABILITY
FOR PROVIDING FALSE INFORMA-
TION.—It shall be unlawful for any person to provide false 
information in support of a certification under this section 
if such person knew or reasonably should have known such 
information was false.’’. 
SEC. 205. 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 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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TITLE III.—REGISTRATION FOR 
DIGITAL 
ASSET 
INTER-
MEDIARIES AT THE SECURI-
TIES AND EXCHANGE COM-
MISSION 
SEC. 301. TREATMENT OF DIGITAL COMMODITIES AND 
OTHER DIGITAL ASSETS. 
(a) SECURITIES ACT OF 1933.—Section 2(a)(1) of the 
Securities Act of 1933 (15 U.S.C. 77b(a)(1)) is amended 
by adding at the end the following: ‘‘The term does not in-
clude a digital commodity or permitted payment 
stablecoin.’’. 
(b) SECURITIES EXCHANGE ACT OF 1934.—Section 
3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 
78c(a)) is amended— 
(1) in paragraph (1), by adding at the end the 
following: ‘‘The term ‘exchange’ does not include a 
digital asset trading system, blockchain protocol, or 
any person or group of persons solely because of their 
development of a blockchain protocol.’’; 
(2) in paragraph (2), by adding at the end the 
following: ‘‘A digital asset trading system is not a ‘fa-
cility’ of an exchange.’’; 
(3) in paragraph (4)(A), by inserting ‘‘, other 
than restricted digital assets,’’ after ‘‘securities’’; 
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(4) in paragraph (5)(A), by inserting ‘‘restricted 
digital assets or’’ after ‘‘not including’’; 
(5) in paragraph (26) by inserting ‘‘(other than 
a notice-registered digital asset clearing agency)’’ 
after ‘‘or registered clearing agency’’; 
(6) in paragraph (28) by inserting ‘‘(other than 
a notice-registered digital asset clearing agency)’’ 
after ‘‘registered clearing agency’’; 
(7) in paragraph (10), by adding at the end the 
following: ‘‘Subject to subsection (i), the term does not 
include a digital commodity or permitted payment 
stablecoin.’’; 
(8) by redesignating the second paragraph (80) 
(relating to funding portals) as paragraph (81); and 
(9) by adding at the end the following: 
‘‘(81) BANK SECRECY ACT.—The term ‘Bank Se-
crecy 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. 
‘‘(82) DIGITAL ASSET BROKER.—The term ‘dig-
ital asset broker’— 
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‘‘(A) means any person engaged in the busi-
ness of effecting transactions in restricted digital 
assets for the account of others; and 
‘‘(B) does not include a blockchain protocol 
or a person or group of persons solely because of 
their development of a blockchain protocol. 
‘‘(83) DIGITAL ASSET DEALER.—The term ‘dig-
ital asset dealer’— 
‘‘(A) means any person engaged in the busi-
ness of buying and selling digital assets for such 
person’s own account through a broker or other-
wise; and 
‘‘(B) does not include— 
‘‘(i) a person that buys or sells digital 
assets for such person’s own account, either 
individually or in a fiduciary capacity, but 
not as a part of a regular business; or 
‘‘(ii) a blockchain protocol or a person 
or group of persons solely because of their 
development of a blockchain protocol. 
‘‘(84) DIGITAL
ASSET
TRADING
SYSTEM.—The 
term ‘digital asset trading system’— 
‘‘(A) means any organization, association, 
person, or group of persons, whether incor-
porated or unincorporated, that constitutes, 
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maintains, or provides a market place or facili-
ties for bringing together purchasers and sellers 
of restricted digital assets or for otherwise per-
forming with respect to digital assets the func-
tions commonly performed by a stock exchange 
within the meaning of section 240.3b–16 of title 
17, Code of Federal Regulations, as in effect on 
the date of enactment of this paragraph; and 
‘‘(B) does not include a blockchain protocol 
or a person or group of persons solely because of 
their development of a blockchain protocol. 
‘‘(85) MIXED
DIGITAL
ASSET
TRANSACTION.— 
The term ‘mixed digital asset transaction’ means an 
agreement, contract, or transaction involving a re-
stricted digital asset and a digital commodity. 
‘‘(86) 
NOTICE-REGISTERED
DIGITAL
ASSET 
CLEARING AGENCY.—The term ‘notice-registered dig-
ital asset clearing agency’ means a clearing agency 
that has registered with the Commission pursuant to 
section 17A(b)(9). 
‘‘(87) 
ADDITIONAL
DIGITAL
ASSET-RELATED 
TERMS.— 
‘‘(A) SECURITIES ACT OF 1933.—The terms 
‘affiliated person’, ‘blockchain system’, ‘decen-
tralized governance system’, ‘decentralized net-
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work’, ‘digital asset’, ‘digital asset issuer’, ‘dig-
ital asset maturity date’, ‘end user distribution’, 
‘functional network’, ‘mixed digital asset trans-
action’, ‘permitted payment stablecoin’, ‘related 
person’, ‘restricted digital asset’, and ‘source 
code’ have the meaning given those terms, respec-
tively, under section 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’, and ‘digital 
commodity exchange’ have the meaning given 
those terms, respectively, under section 1a of the 
Commodity Exchange Act (7 U.S.C. 1a).’’. 
(c) INVESTMENT ADVISERS ACT OF 1940.—Section 
202(a) of the Investment Advisers Act of 1940 (15 U.S.C. 
80b–2) is amended— 
(1) in paragraph (18), by adding at the end the 
following: ‘‘The term does not include a digital com-
modity or permitted payment stablecoin.’’; 
(2) by redesignating the second paragraph (29) 
(relating to commodity pools) as paragraph (31); 
(3) by adding at the end, the following: 
‘‘(32) DIGITAL
ASSET-RELATED
TERMS.—The 
terms ‘digital commodity’ and ‘permitted payment 
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stablecoin’ have the meaning given those terms, re-
spectively, under section 2(a) of the Securities 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), by adding at the end the 
following: ‘‘The term does not include a digital com-
modity or permitted payment stablecoin.’’; and 
(2) by adding at the end the following: 
‘‘(55) DIGITAL
ASSET-RELATED
TERMS.—The 
terms ‘digital commodity’ and ‘permitted payment 
stablecoin’ have the meaning given those terms, re-
spectively, under section 2(a) of the Securities Act of 
1933 (15 U.S.C. 77b(a)).’’. 
SEC. 302. ANTIFRAUD AUTHORITY OVER PERMITTED PAY-
MENT STABLECOINS. 
Section 10 of the Securities Exchange Act of 1934 (15 
U.S.C. 78j) is amended— 
(1) by moving subsection (c) so as to appear 
after subsection (b); 
(2) by designating the undesignated matter at 
the end of that section as subsection (d); and 
(3) by adding at the end the following: 
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‘‘(e)(1) Rules promulgated under subsection (b) that 
prohibit fraud, manipulation, or insider trading (but not 
rules imposing or specifying reporting or recordkeeping re-
quirements, procedures, or standards as prophylactic meas-
ures against fraud, manipulation, or insider trading), and 
judicial precedents decided under subsection (b) and rules 
promulgated thereunder that prohibit fraud, manipulation, 
or insider trading, shall apply to permitted payment 
stablecoins with respect to those circumstances in which the 
permitted payment stablecoins are brokered, traded, or 
custodied by a broker, dealer, digital asset broker, or digital 
asset dealer or through an alternative trading system or 
digital asset trading platform to the same extent as they 
apply to securities. 
‘‘(2) Judicial precedents decided under section 17(a) 
of the Securities Act of 1933 and sections 9, 15, 16, 20, 
and 21A of this title, and judicial precedents decided under 
applicable rules promulgated under such sections, shall 
apply to permitted payment stablecoins with respect to 
those circumstances in which the permitted payment 
stablecoins are brokered, traded, or custodied by a digital 
asset broker, digital asset dealer, or digital asset trading 
platform to the same extent as they apply to securities. 
‘‘(3) Nothing in this subsection may be construed to 
provide the Commission authority to make any rule, regula-
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tion, requirement, or obligation on a permitted payment 
stablecoin issuer regarding the operations of a permitted 
payment stablecoin issuer or a permitted payment 
stablecoin, including requirements or obligations regard-
ing— 
‘‘(A) design; 
‘‘(B) structure; 
‘‘(C) issuance; 
‘‘(D) redemption; 
‘‘(E) financial resources; 
‘‘(F) collateral; or 
‘‘(G) any other aspect of the operation of a per-
mitted payment stablecoin issuer or permitted pay-
ment stablecoin.’’. 
SEC. 303. REGISTRATION OF DIGITAL ASSET TRADING SYS-
TEMS. 
Section 6 of the Securities Exchange Act of 1934 (15 
U.S.C. 78f) is amended by adding at the end the following: 
‘‘(m) DIGITAL ASSET TRADING SYSTEM.— 
‘‘(1) IN GENERAL.—It shall be unlawful for any 
digital asset trading system to make use of the mails 
or any means or instrumentality of interstate com-
merce within or subject to the jurisdiction of the 
United States to effect any transaction in a digital 
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asset, unless such digital asset trading system is reg-
istered with the Commission. 
‘‘(2) APPLICATION.—A person desiring to reg-
ister as a digital asset trading system shall submit to 
the Commission an application in such form and con-
taining such information as the Commission may re-
quire for the purpose of making the determinations 
required for approval. 
‘‘(3) EXEMPTIONS.—A digital asset trading sys-
tem that offers or seeks to offer at least one digital 
asset shall not be required to register under this sec-
tion (and subparagraph (A) shall not apply to such 
digital asset trading system) if the trading system 
satisfies any of the exemptions set forth in section 
240.3b–16(b) of title 17, Code of Federal Regula-
tions.’’. 
SEC. 304. REQUIREMENTS FOR DIGITAL ASSET TRADING 
SYSTEMS. 
Title I of the Securities Exchange Act of 1934 (15 
U.S.C. 78a et seq.) is amended by inserting after section 
6 the following: 
‘‘SEC. 6A. REQUIREMENTS FOR DIGITAL ASSET TRADING 
SYSTEMS. 
‘‘(a) HOLDING OF CUSTOMER ASSETS.— 
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cies regarding providing fair access to the digital 
asset trading system. 
‘‘(4) CAPACITY, INTEGRITY, AND
SECURITY
OF 
AUTOMATED SYSTEMS.—Policies and procedures rea-
sonably designed to ensure the capacity, integrity, 
and security of the digital asset trading system, tak-
ing into account the particular nature of digital asset 
trading systems. 
‘‘(5) EXAMINATIONS, INSPECTIONS, AND INVES-
TIGATIONS.—The examination and inspection of the 
premises, systems, and records of the digital asset 
trading system by the Commission or by a self-regu-
latory organization of which such digital asset trad-
ing system is a member. 
‘‘(6) RECORDKEEPING.—The making, keeping 
current, and preservation of records related to trading 
activity on the digital asset trading system. 
‘‘(7) REPORTING.—The reporting of transactions 
in digital assets that occur through the digital asset 
trading system. 
‘‘(8) PROCEDURES.—The establishment of ade-
quate written safeguards and written procedures to 
protect confidential trading information. 
‘‘(c) NAME REQUIREMENT.—A digital asset trading 
system may not use the word ‘exchange’ in the name of the 
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digital asset trading system, unless the digital asset trading 
system— 
‘‘(1) is operated by a registered national securi-
ties exchange; and 
‘‘(2) is clearly indicated as being provided out-
side of the system’s capacity as a national securities 
exchange. 
‘‘(d) TREATMENT UNDER THE BANK SECRECY ACT.— 
A digital asset trading system shall be treated as a financial 
institution for purposes of the Bank Secrecy Act.’’. 
SEC. 305. REGISTRATION OF DIGITAL ASSET BROKERS AND 
DIGITAL ASSET DEALERS. 
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. REGISTRATION OF DIGITAL ASSET BROKERS 
AND DIGITAL ASSET DEALERS. 
‘‘(a) REGISTRATION.— 
‘‘(1) IN GENERAL.—It shall be unlawful for any 
digital asset broker or digital asset dealer (other than 
a natural person associated with a digital asset 
broker or digital asset dealer, and other than such a 
digital asset broker or digital asset dealer whose busi-
ness is exclusively intrastate and who does not make 
use of any facility of a digital asset trading platform) 
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to make use of the mails or any means or instrumen-
tality of interstate commerce to effect any trans-
actions in, or to induce or attempt to induce the pur-
chase or sale of, any digital asset unless such digital 
asset broker or digital asset dealer is registered in ac-
cordance with this section. 
‘‘(2) APPLICATION.—A person desiring to reg-
ister as a digital asset broker or digital asset dealer 
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 approval. 
‘‘(b) NATIONAL SECURITIES ASSOCIATION MEMBER-
SHIP.— 
‘‘(1) IN GENERAL.—A digital asset broker or dig-
ital asset dealer may not register or maintain reg-
istration under this section unless such digital asset 
broker or digital asset dealer is a member of a na-
tional securities association registered under section 
15A. 
‘‘(2) EXCEPTION.—A digital asset broker or dig-
ital asset dealer may register under this section with-
out obtaining membership in a national securities as-
sociation until the end of the 360-day period begin-
ning on the date the first national securities associa-
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tion adopts rules to admit digital asset brokers or dig-
ital asset dealers as members. 
‘‘(c) ADDITIONAL REGISTRATIONS WITH THE COM-
MODITY FUTURES TRADING COMMISSION.—A registered 
digital asset broker or digital asset dealer shall be permitted 
to maintain any other registration with the Commodity Fu-
tures Trading Commission relating to the other activities 
of the registered digital asset broker or registered digital 
asset dealer, including as a digital commodity broker or 
digital commodity dealer, to list or trade contracts of sale 
for digital commodities.’’. 
SEC. 306. REQUIREMENTS OF DIGITAL ASSET BROKERS AND 
DIGITAL ASSET DEALERS. 
Section 15H of the Securities Exchange Act of 1934, 
as added by section 205, is amended by adding at the end 
the following: 
‘‘(d) ANTIFRAUD.—No digital asset broker or digital 
asset dealer shall make use of the mails or any means or 
instrumentality of interstate commerce to effect any trans-
action in, or to induce or attempt to induce the purchase 
or sale of, any digital asset that is not a digital commodity 
by means of any manipulative, deceptive, or other fraudu-
lent device or contrivance. 
‘‘(e) HOLDING OF CUSTOMER ASSETS.— 
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‘‘(1) IN GENERAL.—A digital asset broker or dig-
ital asset dealer shall hold customer money, assets, 
and property in a manner to minimize the risk of 
loss to the customer or unreasonable delay in the ac-
cess to the money, assets, and property of the cus-
tomer. 
‘‘(2) RULEMAKING.—Not later than 180 days 
after the date of enactment of this section, the Com-
mission shall issue rules to provide that a registered 
digital asset broker or digital asset dealer will be con-
sidered to satisfy the requirements of paragraph (1), 
with respect to digital assets, so long as the digital 
asset broker or digital asset dealer— 
‘‘(A) holds such digital asset at a bank 
that— 
‘‘(i) is recognized by the appropriate 
Federal banking agency or State bank su-
pervisor (as such terms are defined, respec-
tively, in section 3 of the Federal Deposit 
Insurance Act (12 U.S.C. 1813)) as having 
custody over such assets; 
‘‘(ii) delivers the digital asset to the 
digital asset broker or digital asset dealer 
without requiring the payment of money or 
value; and 
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‘‘(iii) has acknowledged in writing that 
the digital asset in the custody or control of 
the bank is free of charge, lien, or claim of 
any kind in favor of such bank or any per-
son claiming through the bank; 
‘‘(B) establishes, maintains, and enforces 
written policies, procedures, and controls reason-
ably designed to demonstrate that the digital 
asset broker or digital asset dealer— 
‘‘(i) has control over the digital asset 
that the digital asset broker or digital asset 
dealer holds in custody to protect against 
the theft, loss, or unauthorized use of the 
private keys necessary to access and transfer 
such digital asset; 
‘‘(ii) has identified the steps that will 
be taken in the wake of certain events that 
could affect the custody of the digital assets 
by the digital asset broker or digital asset 
dealer; 
‘‘(iii) can comply with a court-ordered 
freeze or seizure; and 
‘‘(iv) has established arrangements to 
allow for the transfer of the digital asset 
held by such digital asset broker or digital 
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asset dealer to another digital asset broker 
or digital asset dealer, a trustee, receiver, 
liquidator, or person performing a similar 
function, or to another appropriate person, 
in the event such digital asset broker or dig-
ital asset dealer can no longer continue as 
a going concern and self-liquidates or is 
subject to a formal bankruptcy, receivership, 
liquidation, or similar proceeding; or 
‘‘(C) complies with such other requirements 
as the Commission may permit. 
‘‘(3) SEGREGATION OF FUNDS.— 
‘‘(A) IN GENERAL.—A digital asset broker 
or digital asset dealer shall treat and deal with 
all money, assets, and property held for a cus-
tomer of the digital asset broker or digital asset 
dealer, or that accrues to a customer as a result 
of trading in digital assets, as belonging to the 
customer. 
‘‘(B) COMMINGLING
PROHIBITED.—Money, 
assets, and property of a customer described in 
subparagraph (A) shall be separately accounted 
for and shall not be commingled with the funds 
of the digital asset broker or digital asset dealer 
or be used to margin, secure, or guarantee any 
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trades of any person other than the customer of 
the digital asset broker or digital asset dealer for 
whom the same are held. 
‘‘(4) EXCEPTIONS.— 
‘‘(A) USE OF FUNDS.— 
‘‘(i) IN
GENERAL.—Notwithstanding 
paragraph (3), money, assets, and property 
of customers of a digital asset broker or dig-
ital asset dealer described in paragraph (3) 
may be maintained and deposited in the 
same account or accounts with any bank, 
trust company, digital asset broker, or dig-
ital asset dealer, if the money, assets, and 
property remain segregated from the money, 
assets, and property of the digital asset 
broker or digital asset dealer. 
‘‘(ii) WITHDRAWAL.—Notwithstanding 
paragraph (3), such share of the money, as-
sets, and property described in paragraph 
(3) as in the normal course of business shall 
be necessary to transfer, adjust, or settle a 
digital asset transaction pursuant to a cus-
tomer’s instruction (standing or otherwise) 
may be withdrawn and applied to such 
purposes, including the withdrawal and 
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payment of commissions, brokerage, inter-
est, taxes, storage, and other charges law-
fully accruing in connection with a digital 
asset transaction. 
‘‘(iii) COMMISSION
ACTION.—In ac-
cordance with such terms and conditions as 
the Commission may prescribe by rule, reg-
ulation, or order, any money, assets, or 
property of a customer of a digital asset 
broker or digital asset dealer described in 
paragraph (3) may be commingled and de-
posited as provided in this section with any 
other money, assets, or property received by 
the digital asset broker or digital asset deal-
er and required by the Commission to be 
separately accounted for and treated and 
dealt with as belonging to the customer of 
the digital asset broker or digital asset deal-
er. 
‘‘(B) PARTICIPATION IN BLOCKCHAIN SERV-
ICES.— 
‘‘(i) IN
GENERAL.—A customer shall 
have the right to waive the restrictions in 
paragraph (3) for any unit of a digital 
asset, by affirmatively electing, in writing 
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to the digital asset broker or digital asset 
dealer, to waive the restrictions. 
‘‘(ii) USE OF FUNDS.—Customer dig-
ital assets removed from segregation under 
clause (i) may be pooled and used by the 
digital asset broker or digital asset dealer or 
its designee to provide a blockchain service 
for a blockchain system to which the unit of 
the digital asset removed from segregation 
under clause (i) relates. 
‘‘(iii) LIMITATIONS.—The Commission 
may, by rule, establish notice and disclosure 
requirements, and any other limitations 
and rules related to the waiving of any re-
strictions under this subparagraph that are 
reasonably necessary to protect customers. 
‘‘(iv) 
BLOCKCHAIN
SERVICE
DE-
FINED.—In this subparagraph, the term 
‘blockchain service’ means any activity re-
lating to validating transactions on a 
blockchain system, providing security for a 
blockchain system, or other similar activity 
required for the ongoing operation of a 
blockchain system. 
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‘‘(5) FURTHER LIMITATIONS.—No person shall 
treat or deal with a digital asset held on behalf of any 
customer pursuant to paragraph (3) by utilizing any 
unit of such digital asset to participate in a 
blockchain 
service 
(as 
defined 
in 
paragraph 
(4)(B)(iv)) or a decentralized governance system asso-
ciated with the digital asset or the blockchain system 
to which the digital asset relates in any manner other 
than that which is expressly directed by the customer 
from which such unit of a digital asset was received. 
‘‘(f) CAPITAL REQUIREMENTS.— 
‘‘(1) IN GENERAL.—Each registered digital asset 
broker and registered digital asset dealer shall meet 
such minimum requirements as the Commission may 
prescribe to ensure that the digital asset broker or dig-
ital asset dealer is able to— 
‘‘(A) conduct an orderly wind-down of the 
activities of the digital asset broker or digital 
asset dealer; and 
‘‘(B) fulfill the customer obligations of the 
digital asset broker or digital asset dealer. 
‘‘(2) CALCULATION.—For purposes of any Com-
mission rule or order adopted under this section or 
any interpretation thereof regulating a digital asset 
broker or digital asset dealer’s financial responsibility 
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obligations and capital requirements, a registered dig-
ital asset broker or digital asset dealer that maintains 
control of customer digital assets in a manner that 
satisfies the rules issued by the Commission under 
subsection (e)(2) shall not be required to include the 
value of such digital assets as assets or liabilities of 
the digital asset broker or digital asset dealer. 
‘‘(3) COORDINATION
OF
CAPITAL
REQUIRE-
MENTS.— 
‘‘(A) COMMISSION RULE.—The Commission 
shall, by rule, provide appropriate offsets to any 
applicable capital requirement for a person with 
multiple registrations, including as a broker, 
dealer, digital asset broker, or digital asset deal-
er. 
‘‘(B) JOINT RULE.—The Commission and 
the Commodity Futures Trading Commission 
shall jointly, by rule, provide appropriate offsets 
to any applicable capital requirement for a per-
son with multiple registrations, including as a 
digital asset broker, digital asset dealer, digital 
asset trading system, digital commodity broker, 
digital commodity dealer, or digital commodity 
exchange. 
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‘‘(g) REPORTING AND RECORDKEEPING.—Each reg-
istered digital asset broker and digital asset 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 asset broker or digital asset dealer; 
‘‘(2) shall keep books and records in such form 
and manner and for such period as may be prescribed 
by the Commission by rule or regulation; and 
‘‘(3) shall keep the books and records open to in-
spection and examination by any representative of 
the Commission. 
‘‘(h) TREATMENT UNDER THE BANK SECRECY ACT.— 
A digital asset broker and a digital asset dealer shall be 
treated as a financial institution for purposes of the Bank 
Secrecy Act.’’. 
SEC. 307. RULES RELATED TO CONFLICTS OF INTEREST. 
The Securities Exchange Act of 1934 (15 U.S.C. 78a 
et seq.) is amended by inserting after section 10D the fol-
lowing: 
‘‘SEC. 10E. CONFLICTS OF INTEREST RELATED TO DIGITAL 
ASSETS. 
‘‘Each registered digital asset trading system, reg-
istered digital asset broker, registered digital asset dealer, 
and notice-registered digital asset clearing agency shall es-
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100 
tablish, maintain, and enforce written policies and proce-
dures reasonably designed, taking into consideration the na-
ture of such person’s business, to mitigate any conflicts of 
interest and transactions or arrangements with affiliates.’’. 
SEC. 308. TREATMENT OF CERTAIN DIGITAL ASSETS IN 
CONNECTION WITH FEDERALLY REGULATED 
INTERMEDIARIES. 
Section 18(b) of the Securities Act of 1933 (15 U.S.C. 
77r(b)) is amended by adding at the end the following: 
‘‘(5) EXEMPTION FOR CERTAIN DIGITAL ASSETS 
IN CONNECTION WITH FEDERALLY REGULATED INTER-
MEDIARIES.—A digital asset is a covered security 
with respect to a transaction that is exempt from reg-
istration under this Act when— 
‘‘(A) it is brokered, traded, custodied, or 
cleared by a digital asset broker or digital asset 
dealer registered under section 15H of the Secu-
rities Exchange Act of 1934; or 
‘‘(B) traded through a digital asset trading 
system (as defined under section 242.301 of title 
17, Code of Federal Regulations).’’. 
SEC. 309. DUAL REGISTRATION. 
Any person that is registered with the Securities and 
Exchange Commission as a digital asset broker, digital 
asset dealer, or digital asset trading system may register 
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101 
with the Commodity Futures Trading Commission, as ap-
propriate, as— 
(1) a digital commodity exchange under section 
5i of the Commodity Exchange Act (7 U.S.C. 1 et 
seq.), as added by this Act, if the person offers or seeks 
to offer a cash or spot market in at least one digital 
commodity; 
(2) a digital commodity broker under section 4u 
of the Commodity Exchange Act, as added by this 
Act, if the person is engaged in soliciting or accepting 
orders in digital commodity cash or spot markets; or 
(3) a digital commodity dealer under section 4u 
of the Commodity Exchange Act, as added by this 
Act, if the person holds themself out as a dealer in 
digital commodity cash or spot markets. 
SEC. 310. EXCLUSION FOR ANCILLARY ACTIVITIES. 
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. EXCLUSION FOR ANCILLARY ACTIVITIES. 
‘‘(a) IN GENERAL.—Notwithstanding any other provi-
sion of this Act, a person shall not be subject to this Act 
and the regulations thereunder solely based on the person 
undertaking any ancillary activities. 
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102 
‘‘(b) EXCEPTIONS.—Subsection (a) shall not be con-
strued to apply to the antimanipulation and antifraud au-
thorities of the Commission. 
‘‘(c) ANCILLARY ACTIVITIES DEFINED.—In this sec-
tion, the term ‘ancillary activities’ means any of the fol-
lowing activities related to the operation of a blockchain 
system: 
‘‘(1) Compiling network transactions, operating 
a pool, relaying, searching, sequencing, validating, or 
acting in a similar capacity with respect to a re-
stricted digital asset. 
‘‘(2) Providing computational work, operating a 
node, or procuring, offering, or utilizing network 
bandwidth, or other similar incidental services with 
respect to a restricted digital asset. 
‘‘(3) Providing a user interface that enables a 
user to read and access data about a blockchain sys-
tem, send messages, or otherwise interact with a 
blockchain system. 
‘‘(4) Developing, publishing, constituting, ad-
ministering, maintaining, or otherwise distributing a 
blockchain system. 
‘‘(5) Developing, publishing, constituting, ad-
ministering, maintaining, or otherwise distributing 
software or systems that create or deploy a hardware 
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103 
or software wallet or other system facilitating an in-
dividual user’s own personal ability to keep, safe-
guard, or custody the user’s restricted digital assets or 
related private keys.’’. 
SEC. 311. REGISTRATION AND REQUIREMENTS FOR NO-
TICE-REGISTERED DIGITAL ASSET CLEARING 
AGENCIES. 
Section 17A(b) of the Securities Exchange Act of 1934 
(15 U.S.C. 78q–1(b)) is amended— 
(1) in subsection (1), by inserting ‘‘(other than 
a notice-registered digital asset clearing agency)’’ 
after ‘‘unlawful for any clearing agency’’; and 
(2) by adding at the end, the following: 
‘‘(9) REGISTRATION
AND
REQUIREMENTS
FOR 
NOTICE-REGISTERED DIGITAL ASSET CLEARING AGEN-
CY.— 
‘‘(A) ELIGIBILITY.—A person may register 
with the Commission as a notice-registered dig-
ital asset clearing agency if the person— 
‘‘(i) is otherwise registered as a digital 
asset broker or digital asset dealer with the 
Commission and is engaging in a business 
involving digital assets that are not digital 
commodities, in compliance with Commis-
sion rules pursuant to section 15H(e); or 
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104 
‘‘(ii) is a bank engaging in a business 
involving digital assets, in compliance with 
applicable banking law and regulation re-
lating to the custody and safekeeping of 
such assets. 
‘‘(B) REGISTRATION.—A person may reg-
ister with the Commission as a notice-registered 
digital asset clearing agency by providing the 
Commission with notice of the activities of the 
person or planned activities in such form as the 
Commission determines appropriate. 
‘‘(C) RULEMAKING.—The Commission may 
adopt rules, which may not take effect until at 
least 360 days following the date of enactment of 
this paragraph, with regard to the activities of 
notice-registered digital asset clearing agencies, 
taking into account the nature of digital assets.’’. 
SEC. 312. TREATMENT OF CUSTODY ACTIVITIES BY BANK-
ING INSTITUTIONS. 
(a) TREATMENT OF CUSTODY ACTIVITIES.—The ap-
propriate Federal banking agency (as defined under section 
3 of the Federal Deposit Insurance Act (12 U.S.C. 1813)), 
the National Credit Union Administration (in the case of 
a credit union), and the Securities and Exchange Commis-
sion may not require a depository institution, national 
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105 
bank, Federal credit union, State credit union, or trust 
company, or any affiliate thereof— 
(1) to include assets held in custody as a liabil-
ity on any financial statement or balance sheet, in-
cluding payment stablecoin custody or safekeeping ac-
tivities; 
(2) to hold additional regulatory capital against 
assets in custody or safekeeping, except as necessary 
to mitigate against operational risks inherent with 
the custody or safekeeping services, as determined 
by— 
(A) the appropriate Federal banking agen-
cy; 
(B) the National Credit Union Administra-
tion (in the case of a credit union); 
(C) a State bank supervisor (as defined 
under section 3 of the Federal Deposit Insurance 
Act (12 U.S.C. 1813)); or 
(D) a State credit union supervisor (as de-
fined under section 6003 of the Anti-Money 
Laundering Act of 2020); or 
(3) to recognize a liability for any obligations re-
lated to activities or services performed for digital as-
sets that the entity does not own if that liability 
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106 
would exceed the expense recognized in the income 
statement as a result of the corresponding obligation. 
(b) DEFINITIONS.—In this section: 
(1) DEPOSITORY INSTITUTION.—The terms ‘‘de-
pository institution’’ has the meaning given that term 
under section 3 of the Federal Deposit Insurance Act. 
(2) CREDIT UNION TERMS.—The terms ‘‘Federal 
credit union’’ and ‘‘State credit union’’ have the 
meaning given those terms, respectively, under section 
101 of the Federal Credit Union Act. 
TITLE IV.—REGISTRATION FOR 
DIGITAL 
ASSET 
INTER-
MEDIARIES 
AT 
THE 
COM-
MODITY FUTURES TRADING 
COMMISSION 
SEC. 401. COMMISSION JURISDICTION OVER DIGITAL COM-
MODITY TRANSACTIONS. 
(a) IN GENERAL.—Section 2(a)(1) of the Commodity 
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 Financial Innovation and 
Technology for the 21st Century Act shall affect 
or apply to, or be interpreted to affect or apply 
to— 
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107 
‘‘(i) any agreement, contract, or trans-
action that is subject to this Act as— 
‘‘(I) a contract of sale of a com-
modity for future delivery or an option 
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 
(C)(i) or (D)(i) of subsection (c)(2) of 
this section; or 
‘‘(VI) a leverage transaction au-
thorized under section 19 of this Act; 
or 
‘‘(ii) the activities of any person with 
respect to any such an agreement, contract, 
or transaction.’’. 
(b) IN GENERAL.—Section 2(c)(1) of the Commodity 
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 
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108 
(3) by adding at the end the following: 
‘‘(H) permitted payment stablecoins.’’. 
(c) IN GENERAL.—Section 2(c)(2) of the Commodity 
Exchange Act (7 U.S.C. 2(c)(2)) is amended— 
(1) in subparagraph (D)(ii)— 
(A) in subclause (III), in the matter that 
precedes item (aa), by inserting ‘‘of a com-
modity, other than a digital commodity,’’ before 
‘‘that’’; and 
(B) by redesignating subclauses (IV) and 
(V) as subclauses (V) and (VI) and inserting 
after subclause (III) the following: 
‘‘(IV) a contract of sale of a dig-
ital commodity that— 
‘‘(aa) results in actual deliv-
ery, as the Commission shall by 
rule determine, within 2 days or 
such other period as the Commis-
sion may determine by rule or 
regulation based upon the typical 
commercial practice in cash or 
spot markets for the digital com-
modity involved; or 
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109 
‘‘(bb) is executed with a reg-
istered digital commodity deal-
er— 
‘‘(AA) directly; 
‘‘(BB) through a reg-
istered 
digital 
commodity 
broker; or 
‘‘(CC) on or subject to 
the rules of a registered dig-
ital commodity exchange;’’; 
and 
(2) by adding at the end the following: 
‘‘(F) COMMISSION JURISDICTION WITH RESPECT TO 
DIGITAL COMMODITY TRANSACTIONS.— 
‘‘(i) IN GENERAL.—Subject to sections 6d and 
12(e), the Commission shall have exclusive jurisdic-
tion with respect to any account, agreement, contract, 
or transaction involving a contract of sale of a digital 
commodity in interstate commerce, including in a 
digital commodity cash or spot market, that is of-
fered, 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 reg-
istered as a registered entity; or 
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110 
‘‘(II) by any other entity registered, or re-
quired to be registered, with the Commission. 
‘‘(ii) LIMITATIONS.—Clause (i) shall not apply 
with respect to custodial or depository activities for a 
digital commodity, or custodial or depository activi-
ties for any promise or right to a future digital com-
modity, of an entity regulated by an appropriate 
Federal banking agency or a State bank supervisor 
(within the meaning of section 3 of the Federal De-
posit Insurance Act). 
‘‘(iii) MIXED DIGITAL ASSET TRANSACTIONS.— 
‘‘(I) IN
GENERAL.—Clause (i) shall not 
apply to a mixed digital asset transaction. 
‘‘(II) OVERSIGHT OF MIXED DIGITAL ASSET 
TRANSACTIONS.—A mixed digital asset trans-
action shall be subject to the exclusive jurisdic-
tion of the Securities and Exchange Commission. 
‘‘(III) REPORTS ON MIXED DIGITAL ASSET 
TRANSACTIONS.—A digital asset issuer, related 
person, affiliated person, or other person reg-
istered with the Securities and Exchange Com-
mission that engages in a mixed digital asset 
transaction, shall, on request, open to inspection 
and examination by the Commodity Futures 
Trading Commission all books and records relat-
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117 
in subparagraph (A), a detailed analysis of the 
factors on which the decision was based. 
‘‘(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 Commission 
makes a disapproval decision under paragraph 
(4), the written certification described in para-
graph (1) shall become effective, pursuant to the 
certification by the eligible entity and notice of 
the certification to the public (in a manner de-
termined 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) 2 business days after the date the 
Commission receives the certification (or 
VerDate Sep 11 2014 
00:52 May 09, 2024
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H4763
rfrederick on LAP8M3WLY3PROD with BILLS