7 LONG TITLE
8 General Description:
9 This bill establishes a framework for the ownership of digital assets.
10 Highlighted Provisions:
11 This bill:
12 ▸ defines terms; and
13 ▸ provides a basis for understanding the ownership of digital assets.
14 Money Appropriated in this Bill:
16 Other Special Clauses:
18 Utah Code Sections Affected:
20 13-61-101, Utah Code Annotated 1953
21 13-61-102, Utah Code Annotated 1953
23 Be it enacted by the Legislature of the state of Utah:
24 Section 1. Section 13-61-101 is enacted to read:
27 13-61-101. Definitions.
28 As used in this chapter:
29 (1) "Agent" means a person who is authorized to act on behalf of an owner with respect
30 to a digital asset.
31 (2) "Control" means:
32 (a) an owner or an agent has the exclusive legal authority to conduct a transaction
33 relating to the digital asset, including by means of a private key or the use of a multi-signature
34 arrangement the owner or agent authorizes; or
35 (b) a secured party has created a smart contract which gives the secured party exclusive
36 legal authority to conduct a transaction relating to a digital security.
37 (3) (a) "Digital asset" means a representation of economic, proprietary, or access rights
38 that is stored in a computer readable format.
39 (b) "Digital asset" includes:
40 (i) a digital user asset; or
41 (ii) a digital security.
42 (4) "Digital security" means a digital asset which constitutes a security, as that term is
43 defined in Section 70A-8-101.
44 (5) (a) "Digital user asset" means a digital asset that is used or bought primarily for
45 consumptive, personal, or household purposes.
46 (b) "Digital user asset" includes an open blockchain token.
47 (c) "Digital user asset" does not include a digital security.
48 (6) "Multi-signature arrangement" means a system of access control relating to a digital
49 asset for the purposes of preventing unauthorized transactions relating to the asset, in which
50 two or more private keys are required to conduct a transaction.
51 (7) "Private key" means a unique element of cryptographic data, which is:
52 (a) held by a person;
53 (b) paired with a unique, publicly available element of cryptographic data; and
54 (c) associated with an algorithm that is necessary to carry out an encryption or
55 decryption required to execute a transaction.
56 (8) "Smart contract" means a transaction which is comprised of code, script, or
57 programming language that executes the terms of an agreement, and which may include taking
58 custody of and transferring a digital asset, or issuing executable instructions for these actions,
59 based on the occurrence or nonoccurrence of specified conditions.
60 Section 2. Section 13-61-102 is enacted to read:
61 13-61-102. Ownership of digital assets.
62 (1) Digital securities are intangible personal property and shall be considered securities
63 and investment property for purposes of this chapter, Title 70A, Chapter 8, Uniform
64 Commercial Code - Investment Securities, and Title 70A, Chapter 9a, Uniform Commercial
65 Code - Secured Transactions.
66 (2) An owner of a digital user asset may demonstrate ownership of the digital user asset
67 through control.
68 (3) Nothing in this chapter shall be interpreted to restrict or impair an owner's right to
69 own a digital asset.