A new bill tabled in Rhode Island suggests that specific tokens will be excluded from Securities Law currently enforced in the state. The said bill was introduced in the state legislature on 27 February 2019.
According to the bipartisan bill H5595, various amendments to the Rhode Island Securities Act have been suggested. If certain conditions are met, a seller or developer of a cryptocurrency token will not be considered as the issuer of a security.
However, tokens are allowed to be used only for consumptive purposes such as the receipt of services, content or goods. It may also include rights of access to content, goods or services.
Furthermore, the said bill explains that tokens are not allowed to be used as an investment. Buyers must refrain from reselling the tokens if they are not usable for a “consumptive purpose” during a trade. The entities facilitating the exchange of token from broker-dealer will also be excluded, given that they file a notification with the Secretary of State.
The bill defined blockchain token as a mathematically verified, decentralized and digitally recorded entity which can be traded or transferred without a custodian or intermediary of value.
Following the bill’s introduction, it was referred to the House Finance Committee, noted Legiscan (legislation info portal). However, information regarding further votes has not been reported yet.
Recently, a similar bill (SB023) was passed by the Colorado General Assembly, offering limited extra freedom to cryptocurrencies. However, their governor is yet to sign the bill in order for it to become a law.
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