Colorado bill seeks limited exemptions for cryptocurrencies from securities laws

U.S. lawmakers have introduced a new bill to offer cryptocurrencies “limited exemptions” from securities laws in the state of Colorado.

The “Colorado Digital Token Act” is being sponsored at the Senate level by Republican Jack Tate and Democrat Steve Fenberg, Cointelegraph reported.

“The bill provides limited exemptions from the securities registration and securities broker-dealer and salesperson licensing requirements for persons dealing in digital tokens,” according to the bill summary.

“‘Digital token’ is defined as a digital unit with specified characteristics, secured through a decentralized ledger or database, exchangeable for goods or services, and capable of being traded or transferred between persons without an intermediary or custodian of value.”

If passed, the bill will allow Colorado-based businesses to use cryptoeconomic systems to obtain growth capital to help grow and expand their businesses.

The objective is to promote “the formation and growth of local companies” and boosting job creation and “helping make Colorado a hub for companies that are building new forms of decentralized "Web 3.0" platforms and applications.”

Importantly, the bill noted the potential of blockchain technology to create new forms of decentralized "web 3.0" platforms and applications that have advantages over the current centralized internet platforms and applications.

Last month, Reps. Warren Davidson and Darren Soto also introduced a bill, called “Token Taxonomy Act,” which that seeks to exclude cryptocurrencies and certain other digital assets from the definition of a security.