SB 19-023: Colorado Digital Token Act Summary

• Enacts the "Colorado Digital Token Act" creating exemptions from Colorado securities laws for digital tokens with a primarily consumptive purpose.

• Issuers and marketplace facilitators must file a notice of intent with the Securities Commissioner and comply with specified requirements to qualify for exemptions from securities registration and licensing.

• Digital tokens with a consumptive purpose must either be available at the time of sale or become available within 180 days, with initial buyers prohibited from reselling until the consumptive purpose is available.

• Defines "digital token" as a digital unit created on a blockchain, recorded in a decentralized digital ledger, and capable of being traded without an intermediary; defines "consumptive purpose" as providing or receiving goods, services, or content.

• Takes effect August 2, 2019, unless a referendum petition is filed, in which case it requires voter approval at the November 2020 general election before becoming effective.