Top Summary
This section of the bill addresses the treatment of secondary transactions in digital commodities that initially involved investment contracts. It states that the offer or sale of such digital commodities by parties other than the issuer, or its agents or underwriters, is not considered an offer or sale of the original investment contract under various federal securities laws or applicable state laws. Additionally, it clarifies that end user distributions do not constitute an offer or sale of a security, and defines "agent" in the context of a digital commodity issuer as any person controlled directly or indirectly by the issuer or under common control with it.
Original Bill Text:
SEC. 203.Treatment of secondary transactions in digital commodities that originally involved investment contracts.
(a) Secondary market treatment.—Notwithstanding any other provision of law, the offer or sale of a digital commodity that originally involved an investment contract by a person other than the issuer of such digital commodity, or an agent or underwriter thereof, shall be deemed not to be an offer or sale of such investment contract between the issuer of the investment contract involving the digital commodity, or an agent or underwriter thereof, and the purchaser of such digital commodity under—
(1) the Securities Act of 1933 (15 U.S.C. 77a et seq.);
(2) the Investment Advisers Act of 1940 (15 U.S.C. 80b–1 et seq.);
(3) the Investment Company Act of 1940 (15 U.S.C. 80a–1 et seq.);
(4) the Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.);
(5) the Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa et seq.); and
(6) any applicable provisions of State law.
(b) End user distributions not an offer or sale of a security.—An end user distribution does not involve the offer or sale of a security.
(c) Agent defined.—In this section and with respect to a digital commodity issuer, the term “agent” means any person directly or indirectly controlled by the issuer or under direct or indirect common control with the issuer.