This bill proposes to implement strategies relating to blockchain, cryptocurrency, and financial technology in order to: promote regulatory efficiency; enable business organizational and governance structures that may expand opportunities in financial technology; and promote education and adoption of financial technology in the public and private sectors. Sec. 3. 11 V.S.A. chapter 25, subchapter 12 is added to read: Subchapter 12. Digital Currency Limited Liability Companies. § 4171. ELECTION A limited liability company organized pursuant to this title for the purpose of operating a digital currency system may elect to be a digital currency limited liability company by: (1) specifying in its articles of organization that it elects to be a digital currency limited liability company; and (2) meeting the requirements in subdivision 4172(2) and section 4173 of this title. § 4172. AUTHORITY; REQUIREMENTS Notwithstanding any provision of this chapter to the contrary: (1) A digital currency limited liability company may provide for its governance, in whole or in part, through the technological architecture of the system. (2) A digital currency limited liability company shall: (A) adopt procedures to respond to necessary innovations and changes in the system architecture; (B) adopt protocols to respond to system security breaches or other unauthorized actions that affect the system; (C) specify how the company designates the participants within the system, including nodes and miners, as members or managers, or both; (D) specify the scope and extent to which limited liability and agency authority apply to a participant or class of participants in the system; (E) specify participants’ access to information and protocols to ensure transparency; (F) specify the fiduciary duties of core developers; (G) adopt rules concerning hard forks; and (H) adopt rules governing the responsible use of computing power by mining pool operators. § 4173. PHYSICAL PRESENCE; TAXATION; EXEMPTION. (a) A digital currency limited liability company shall maintain a physical presence within this State or conduct some or all of its activities within this State, or both. (b) A digital currency limited liability company shall remit to the State in the form of its digital currency a transaction tax equivalent to $0.01, at the then current exchange rate for the currency with the U.S. dollar, per transaction for: (1) each unit of currency mined or otherwise created; and (2) each sale or other transfer of one or more units of currency. (c) A digital currency limited liability company is exempt from taxes otherwise applicable under Title 32 of the Vermont Statutes Annotated. § 4174. MULTIPLE ROLES OF MEMBERS AND MANAGERS. (a) A member or manager of a digital currency limited liability company may interact with the company in multiple roles, including as a node or miner in the network or as a trader and holder of the currency in its own account and for the account of others. (b) A member or manager who interacts with the company in multiple roles does not violate a fiduciary duty solely because of those interactions if the member or manager acts in good faith with respect to the company. (c) The activities of a member or manager who interacts with the company through multiple roles are not deemed to take place in Vermont solely because of the location of the digital currency limited liability company in Vermont. § 4175. CONSENSUS FORMATION ALGORITHMS In its governance, a digital currency limited liability company may adopt any reasonable algorithmic means for accomplishing the consensus process for validating records of the holders of its currency, and may, in accordance with any procedure specified pursuant with section 4172 of this title, provide for the modification of this consensus process or the substitution of a new process that complies with the requirements of law and the governance provisions of the digital currency limited liability company. § 4176. SCOPE OF SUBCHAPTER; OTHER LAW Except as expressly provided otherwise, this subchapter does not exempt a digital currency limited liability company from any other judicial, statutory, or regulatory provision of Vermont law. Sec. 4. E-RESIDENCY; STUDY; REPORT. (a) The Agency of Commerce and Community Development, in collaboration with the Department of Financial Regulation, shall review the e residency program established in the country of Estonia and consider areas for potential adoption of a comparable program or regulatory changes within Vermont. (b) On or before January 15, 2019, the Agency shall submit a report of its findings and recommendations to the House Committee on Commerce and Economic Development and the Senate Committee on Economic Development, Housing and General Affairs. Additional sections can be seen in the source document.
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Read 1st time & referred to Committee on Economic Development, Housing and General AffairsWed, Jan 3rd 2018