U.S State Of Rhode Island Excludes Blockchain Tokens From Securities Laws

The state of Rhode Island in the United States decided to exclude ‘’blockchain tokens’’ from the securities laws of the state legislature according to a bill introduced on February 27, previously reported in our crypto news.

The bill H5595 proposes multiple amendments to the Rhode Island Securities Act such as ‘’ a developer or seller of an open blockchain token shall not be deemed the issuer of a security.’’

Also, according to the bill amendments, the token must be used for a consumptive purpose or for ‘’the receipt of, goods, services or content, including rights of access to goods, services or content.’’

If the tokens cannot be used for a consumptive purpose, the tokens cannot be considered as an investment. Buyers must be stopped from reselling them. The H5595 bill also excludes entities that use the exchanging of tokens from broker-dealer status if they file a notification with the Secretary of State. The bill continues:

 “(2) Recorded in a digital ledger or database which is chronological, consensus-based, decentralized and mathematically verified in nature, especially relating to the supply of units and their distribution; and (3) Capable of being traded or transferred between persons without an intermediary or custodian of value.”

A law similar to this was recently passed in the Colorado General Assembly named ‘’Colorado Digital Token Act’’ was passed which offers limited freedoms for cryptocurrencies and for crypto traders. The bill provides ‘’limited exemptions from the securities registration and securities broker-dealer and salesperson licensing requirements for persons dealing in digital tokens.’’