Colorado Governor exempted several cryptocurrencies from securities laws
Colorado Gov. Jared Polis signed the Digital Tokens Act on March 8th, which excludes certain cryptocurrencies from securities laws and allows fintech companies to operate without the need to comply with a number of registration requirements..
Colorado legislators introduced draft law SB19-023 earlier this year to address regulatory uncertainties that have emerged in the cryptocurrency space. In accordance with the new law, digital tokens that meet certain criteria can be used to transfer value through the blockchain and will not be recognized as securities or in any other way regulated by regulations created to apply to completely different financial instruments.
Cryptocurrencies “whose primary function is consumer” may be offered, traded, and transferred without the restrictions of Colorado Statute 51.
“Colorado has become the epicenter of businesses and entrepreneurs seeking to use the cryptoeconomic system in blockchain-based business models,” the document says. – Companies seeking to use the cryptoeconomic system face regulatory uncertainty and suggest that the issuance, sale and purchase of digital tokens, whose primary function is consumer, could be prohibited by 51 articles. The consumer function of a token means that it is primarily used to obtain goods, services or content “.
In addition, brokers-dealers and other trading platforms that work with such tokens are exempt from the relevant requirements. The law signed this week comes into force on August 2.
Late last year, Colorado regulators suspended a number of unregistered ICO startups in their jurisdiction..