In order to oversee crypto space and to control all the negative outcomes of cryptocurrencies such as money laundering and terror funding, most regions have imposed rules and regulations for digital space. Sometimes, the crypto firms have to face scrutiny due to that.
To lighten the regulations over the crypto market, the US State of Colorado has considered a new bill to exempt cryptocurrencies from some securities laws. Sponsored by three senators, “Colorado Digital Token Act” was introduced by Colorado’s legislators in the state’s 72nd General Assembly. The act aims to provide limited extra freedoms for cryptocurrencies and traders.
The bill notes, “The bill provides limited exemptions from the securities registration and securities broker-dealer and salesperson licensing requirements for persons dealing in digital tokens.” A summary of the recommendations states, “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.”
The bill says that the current state securities laws make businesses “face regulatory uncertainty.” The bill seems optimistic enough regarding the crypto economy. The bill affirms that the new exemptions will help businesses that use crypto economic systems for their growth and expansion. With that, the lawmakers are hoping that attitude towards both crypto and blockchain are becoming more welcoming. The bill talks about blockchain stating, “Blockchain technology has the potential to create new forms of decentralized ‘Web 3.0’ platforms and applications that have advantages over the current centralized internet platforms and applications.”
It adds, “Colorado has become a hub for companies and entrepreneurs that seek to utilize crypto economic systems to power blockchain technology-based business models.”
However, this is not the first effort of Colorado at crypto regulation. Previously, Colorado lawmakers proposed the “Virtual Currency Exemption Money Transmitters Act.” The bill was struck down after a dramatic voting process.
To draft the bill, Jack Tate, one of the introducers of the bill studied the local blockchain and finance companies for the last six months. He also had conversations with the state legislators regarding the crypto industry. He also worked with politicians from both parties.