Senator Kirk A. Cullimore proposes the following substitute bill:




Chief Sponsor: Kirk A. Cullimore

House Sponsor: Jordan D. Teuscher


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:
15          None
16     Other Special Clauses:
17          None
18     Utah Code Sections Affected:
19     ENACTS:
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:

Part 1. General Provisions

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) A "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.