A vigorous competition among the states to regulate digital assets has begun to develop. Some states, such as New York, have adopted regulations that take a very proscriptive approach to regulation in the interest of consumer protection. States like Wyoming, on the other hand, see an opportunity to stimulate the local economy and take a far more permissive view of digital assets. Two bills now under consideration by the Wyoming Legislature seek to further expand the digital asset economy in the state.
The first Wyoming bill seeks to provide legal clarity under Wyoming law for the treatment of various classes of “digital assets” (defined as a representation of economic, proprietary or access rights that is stored in a computer readable format). The bill contemplates three different legal classifications for digital assets, as follows:
- “Digital consumer asset” means a digital asset that is used or bought primarily for consumptive, personal or household purposes and includes an open blockchain token constituting intangible personal property as otherwise provided by law, and any other digital asset that is not characterized as either a “digital security” or “virtual currency.”
- “Digital security” means a digital asset which constitutes a contract, transaction or arrangement where a person invests money in a common enterprise and is led to expect profits from the efforts of a promoter or a third party, and does not include any other asset within the meaning of “security” under Article 8-102 of the Uniform Commercial Code.
- “Virtual currency” means a digital asset that is used as a medium of exchange, unit of account or store of value; and not recognized as legal tender by the United States government.
The bill then provides for treatment of the different classes of digital assets under the Uniform Commercial Code, including the perfection of security interests in them. Additionally, the bill would create a voluntary regime for permitting banks to serve as custodians of digital assets. Moreover, the bill clarifies that Wyoming courts would have jurisdiction to hear claims in both law and equity relating to digital assets.
The second Wyoming bill would clarify the legal status of so-called “certificate tokens.” Under this bill, the articles of incorporation or bylaws of a Wyoming corporation may specify that all or a portion of the shares of the corporation may be represented by share certificates in the form of certificate tokens. “Certificate token” is defined to include a representation of shares of stock that is entered into a blockchain or other secure, auditable database; linked to or associated with the certificate token; and able to be transmitted electronically to the issuing corporation, the person to whom the certificate token was issued and any transferee.