Jurisdictional Nodes

RegTrax Legislative & Regulatory Repository

Working to make blockchain law and regulation accessible via comprehensive curation worldwide.

We envision the RegTrax legislative and regulatory repository acting as a focal point for the general public, builders, academics, and policymakers to gain a better understanding of the regulatory framework governing the space.  We’ll be building out nodes for key jurisdictions, allowing for easy access the relevant laws and proposed legislation, and creating spaces for reference, commentary, and discussion.

We welcome collaboration and contributions from those who would like to build this global latticework of policy nodes.

Jurisdictions

Contributions

The RegTrax repository is currently in the first stage of its build-out, having selected a few key jurisdictions. We will be adding summaries and links to existing and proposed laws and regulations in these jurisdictions.  As our community grows, we’ll expand the scope of jurisdictions, seeking to cover emerging developments worldwide.

We’re starting with a focus on the United States, and a number of key states, as well as the EU, Finland, Australia, the Philippines, Hong Kong and Singapore. To contribute, please send any information, thoughts, or papers, and it will be integrated into our larger overview.

Contribute

RegTrax Regulation Database

The RegTrax database is updated regularly and is still in a beta (i.e., non-comprehensive) stage. This is an open source platform and a resource for global blockchain regulations. This is not legal advice and should be considered to be under construction.

usa

Jurisdictional Highlight: USA

Curator: Carla Reyes – Michigan State University

In the absence of any federal legislative framework specifically regulating blockchain technologies, administrative and agency level activity has been focused on applying existing law to emerging cases and controversies.  There has been significant engagement by the Securities and Exchange Commission (the “SEC”), the Commodities and Futures Trading Commission (the “CFTC”), the Federal Trade Commission (the “FTC”) and the Department of the Treasury, through both the Internal Revenue Service (the “IRS”) and the Financial Crimes Enforcement Network (“FinCEN”).  However, there has been a noticeable lack of significant federal rule making, even as the potential implications of enforcement actions have grown. Several state governments have proposed and/or passed laws addressing cryptocurrencies and blockchain technology, and more activity at the sub-national level is anticipated in the absence of federal policy action.

In an effort to address regulatory uncertainty with this technology and to help educate the public, the SEC launched its Strategic Hub for Innovation and Financial Technology (FinHub), which offers information on blockchain/distributed ledger regulation, ICOs, and offers opportunities for the public to give input.

SEC FinHub

Key Jurisdictions

Hong Kong

Curator: Syren Johnstone - The University of Hong Kong

In November 2019, Hong Kong's Securities and Futures Commission (SFC) has offered guidance to cryptocurrency exchanges ("virtual asset trading platforms"). Despite cryptocurrency exchanges being viewed as entities which "typically provide trading in non-security tokens", the SFC hoped to "[introduce] a regulatory framework which seeks to bring [any] virtual asset trading platforms which are interested in being licensed into its regulatory net." This framework required the expected KYC and AML compliance, suggesting that the operator ought to "take all reasonable steps to establish the true and full identity of each of its clients", as well as to verify their " financial situation, investment experience and investment objectives". The licensing also requires that the applicant be denied unless it can be shown that they are "fit and proper". This assessment considers factors such as how the exchange deals with non-security tokens, how the platform "conducts its entire virtual asset trading business", and, " in particular, whether it follows (or is willing and able to follow) the expected regulatory standards."
Additionally, the SFC looks at which tokens are available to be exchanged on a given platform, requiring an ongoing "reasonable due diligence" on each virtual asset that is offered. The non-inclusive list of potentially applicable factors includes, among others, "the level of adoption across the ecosystem", "the level of activity within the development community", and "the background of the management or development team of the issuer of a virtual asset."
SFC Exchange Paper

European Union

Curator: Thibault Schrepel - Utrecht University School of Law

The European Blockchain Partnership, created in April 2018, joins at a political level all EU Member States and members of the European Economic Area (Norway and Liechtenstein). The signatories of this declaration will work together towards realizing the potential of blockchain-based services for the benefit of citizens, society and economy. As part of this commitment, the Partnership is building a European Blockchain Services Infrastructure (EBSI) which will deliver EU-wide cross-border public services using blockchain technology. In 2019, the European Commission started an open market consultation in preparation of the European Blockchain Pre-Commercial Procurement that is looking for novel, improved blockchain solutions for the future evolution of the European Blockchain Service Infrastructure. Interested market parties are invited to participate in the open market consultation activities. The Fifth Anti-Money Laundering Directive is a piece of legislation that brings fiat-to-crypto exchanges and custodial wallets across the European Union under this first-of-its-kind regulatory framework. 5AMLD’s main impact on the crypto industry is that all EU member states must implement AML regulations. These exchanges will now be required to follow Know Your Customer (KYC) rules for monitoring customer transactions and file suspicious activity reports. The European Commission currently sees two areas related to blockchain which could benefit from improved legal certainty: Smart contracts: The European Commission will study whether the current legal framework is sufficiently clear to ensure the enforceability of smart contracts and clarify jurisdiction in case of legal disputes. Tokenization: The European Commission will study whether the current legal framework is appropriate for issuing and trading tokens (i.e.: crypto assets), when they are not considered as financial instruments. Interoperable blockchains are needed for global deployment. The European Commission is thus supporting and is engaged in work on international standardization, for DLT and blockchain in particular through a a liaison with ISO TC 307 on Blockchain and Distributed Ledger Technologies.
EU-EBP

U.S. States

California

California has not yet passed comprehensive legislation addressing the space. The few statutes on the books ban things like paying for a raffle ticket with cryptocurrency or engaging in unlicensed 'virtual currency' business activities. However, AB 2658 created a multi-stakeholder Blockchain Working Group, which is currently exploring the risks, benefits, and legal implications of blockchain use in the state. This bill also set out a temporary definitions of blockchain technology: "a mathematically secured, chronological, and decentralized ledger or database".

Vermont

Curator: Oliver Goodenough - Vermont Law School

Vermont enacted legislation in June, 2019 relating to education finance which defines a "marketplace facilitator" as a person or business who provides "a virtual currency that purchasers are allowed or required to use to purchase products from sellers." H.B. 536, 2019-20 Leg., Reg. Sess. (Vt. 2019). The same provision has been introduced in a bill related to Vermont's sales and use tax and a bill related to raising revenue to improve access to affordable, high quality child care and early learning. H.B. 117, 2019-20 Leg., Reg. Sess. (Vt. 2019); H.B. 349, 2019-20 Leg., Reg. Sess. (Vt. 2019).

Connecticut

House Bill 7141, passed in 2017, covering cryptocurrencies, requires a license for anyone engaged in financial services. Additionally, HB 5490 offers a definition of "Virtual currency" as: "any type of digital unit that is used as a medium of exchange or a form of digitally stored value or that is incorporated into payment system technology. Virtual currency shall be construed to include digital units of exchange that (A) have a centralized repository or administrator; (B) are decentralized and have no centralized repository or administrator; or (C) may be created or obtained by computing or manufacturing effort. Virtual currency shall not be construed to include digital units that are used (i) solely within online gaming platforms with no market or application outside such gaming platforms, or (ii) exclusively as part of a consumer affinity or rewards program, and can be applied solely as payment for purchases with the issuer or other designated merchants, but cannot be converted into or redeemed for fiat currency. Connecticut also established a working group in 2018 in order to " develop a master plan for fostering the expansion of the blockchain industry in the state and recommend policies and state investments to make Connecticut a leader in blockchain technology. Such master plan shall: (1) Identify the economic growth and development opportunities presented by blockchain technology; (2) assess the existing blockchain industry in the state; (3) review workforce needs and academic programs required to build blockchain expertise across all relevant industries; and (4) make legislative recommendations that will help promote innovation and economic growth by reducing barriers to and expediting the expansion of the state's blockchain industry." Connecticut also provides tangential blockchain regulation, including an act prohibiting the use of noncompete agreements in the blockchain industry (SB 1033) and an act "to authorize the use of smart contracts in commerce in the state." (HB 7310). The state also plans to study blockchain for use in elections (HB 5417), and incorporate blockchain into the administration of state functions (SB 1032).

Wyoming

Curator: Chris Land - Wyoming Division of Banking

Wyoming has staked its claim as the most blockchain-friendly jurisdiction in the United States. Since 2018, Wyoming has passed 18 pieces of blockchain legislation, covering everything from a safe haven for utility tokens to a tax exemption for crypto-to-crypto transactions.
Some notable legislation includes the "Utility Token Bill" (HB 70), which exempts statutorily-determined utility tokens from Wyoming securities laws, and was intended to capture tokens sold primarily for a "consumptive purpose" rather than as a financial investment. Further safe harbors include an amendment to the Wyoming Money Transmitter Act to exempt virtual currencies, a virtual currency exemption from Wyoming state taxes, and a "Financial Technology Sandbox Act" (HB 57), which allows 2-3 years for testing products before needing to file with the state, as well as "limited waivers of specified statutes and rules under certain conditions".
Wyoming has also been comparatively willing to facilitate corporate use of blockchain technology, passing HB 101 (authorizing corporations to keep records on a blockchain), HB 70 (allowing the Wyoming Secretary of State to "develop and implement a blockchain filing system"), and HB 185 (allowing "corporations to issue certificate tokens in lieu of stock certificates"). Other legislation, specifically SF 125, has achieved such milestones as classifying digital assets as property under the UCC, "establishing an opt-in framework for banks to provide custodial services for digital asset property as custodians", and "clarifying the jurisdiction of Wyoming courts relating to digital assets".
The latest piece of blockchain legislation enacted was HB 62, focusing primarily on open blockchain tokens. This bill rolled back some of the blanket protections previously granted to blockchain tokens, noting that "open blockchain tokens with specified consumptive characteristics are intangible personal property and not subject to a securities exemption" and repealed prior provisions that granted such an exemption.

Contribute Knowledge

This is an ongoing process, and regulation is always changing! Please let us know about any regulations we're missing, either from the jurisdictions we have listed or others that we may be listing in the future.

Note: Do not use this form to submit High Risk Data.

* indicates required fields

Name*
This field is for validation purposes and should be left unchanged.