,i  #aae? ,,congress  #b;d ,session  ,h4
 ,r4 #gcef  ,,9 ,,! ,,h\se ,,(          
,,repres5tatives  ,decemb] #bj1         
#bjah,mr4 ,davidson 7= himself & ,mr4   
,soto7 introduc$ ! foll[+ bill2 :i* 0   
ref]r$ to ! ,committee on ,f9ancial     
,s]vices1 & 9 addition to ! ,committee  
on ,ways & ,means1 = a p]iod to be      
subsequ5tly det]m9$ by ! ,speak]1 9 ea* 
case = consid]ation ( su* provisions z  
fall )9 ! jurisdiction ( ! committee    
conc]n$  ,a ,,bill  ,to am5d !          
,securities ,act ( #aicc & ! ,securities
 ,ex*ange ,act ( #aicd to exclude       
digital tok5s f ! def9ition ( a         
security1 to direct ! ,securities &     
,ex*ange ,commission to enact c]ta9     
regulatory *anges reg>d+ digital units  
secur$ ?r\gh public key cryptography1 to
 adju/ taxation ( virtual curr5cies held
 9 individual retirem5t acc\nts1 to     
create a tax exemption = ex*anges ( "o  
virtual curr5cy = ano!r1 to create a de 
m9imis exemption f taxation = ga9s      
realiz$ f ! sale or ex*ange ( virtual   

curr5cy = o!r ?an ca%1 & = o!r purposes4
  #a4 ,%ort title ,?is ,act may be cit$ 
z ! ,tok5 ,taxonomy ,act4  #b4          
,securities ,act ( #aicc  7a7 ,def9ition
 ( digital tok5 ,section #b7;a7 ( !     
,securities ,act ( #aicc 7#ae ,u4,s4,c4 
#gg;b7a77 is am5d$ by add+ at ! end !   
foll[+3  7#bj7 ,digital tok5 ,! t]m     
digital tok5 means a digital unit t--   
7,a7 is creat$--  7i7 9 response to !   
v]ification or collection ( propos$     
transactions2  7ii7 pursuant to rules = 
! digital unit's creation & supply t _c 
be alt]$ by a s+le p]son or gr\p (      
p]sons "u common control2 or  7iii7 z an
 initial allocation ( digital units t w 
o!rwise be creat$ 9 accordance ) clause 
7i7 or 7ii72  7,b7 has a transaction    
hi/ory t-- 7i7 is record$ 9 a di/ribut$1
 digital l$g] or digital data /ructure 9
 :i* cons5sus is a*iev$ ?r\gh a         
ma!matically v]ifiable process2 &  7ii7 
aft] cons5sus is rea*$1 _c be mat]ially 
alt]$ by a s+le p]son or gr\p ( p]sons  
"u common control2  7,c7 is capable (   

be+ trad$ or transf]r$ betwe5 p]sons )\t
 an int]m$iate cu/odian2 &  7,d7 is n a 
repres5tation ( a f9ancial int]e/ 9 a   
company1 includ+ an own]%ip or debt     
int]e/ or rev5ue %>e4  7#ba7 ,digital   
unit ,! t]m digital unit means a        
repres5tation ( economic1 propriet>y1 or
 access rights t is /or$ 9 a            
comput]-readable =mat4  4  7b7          
,def9ition ( security ,section          
#b7;a77#a7 ( ! ,securities ,act ( #aicc 
7#ae ,u4,s4,c4 #gg;b7a77#a77 is am5d$-- 
7#a7 by ins]t+ 7,a7 aft] 7#a72 &  7#b7  
by add+ at ! end ! foll[+3  7,b7 ,su*   
t]m does n include a digital tok54  4   
7c7 ,exemption ,section #d7;a7 ( !      
,securities ,act ( #aicc 7#ae ,u4,s4,c4 
#gg;d7a77 is am5d$ by add+ at ! end !   
foll[+3  7#h7 ,transactions involv+ !   
developm5t1 (f]1 or sale ( a digital    
unit if-- 7,a7 ! p]son develop+1 (f]+1  
or sell+ ! digital unit has a reasonable
 & good fai? belief t su* digital unit  
is a digital tok52 &  7,b7 )9 n9ety days
 foll[+ a writt5 notification f !       

,commission to su* p]son t su* digital  
unit has be5 det]m9$ by ! ,commission to
 be a security1 po/s public notice ( su*
 notification & takes reasonable ef=ts  
to cease all sales & return all proce$s 
f any sales ( su* digital unit1 exclud+ 
funds reasonably sp5t on ! developm5t ( 
te*nology associat$ ) ! digital unit4  4
  #c4 ,securities ,ex*ange ,act ( #aicd 
7a7 ,def9ition ( bank ,section          
#c7;a77#f77;,c7 ( ! ,securities ,ex*ange
 ,act ( #aicd 7#ae ,u4,s4,c4            
#gh;c7a77#f77;,c77 is am5d$-- 7#a7 by   
ins]t+ or tru/ company1 aft] ,home      
,own]s' ,loan ,act12 &  7#b7 by /rik+   
receiv+ deposits or ex]cis+ fiduci>y    
p[]s & ins]t+ receiv+ deposits1 provid+ 
cu/odial s]vices1 or ex]cis+ fiduci>y   
p[]s4  7b7 ,def9ition ( security        
,section #c7;a77#aj7 ( ! ,securities    
,ex*ange ,act ( #aicd 7#ae ,u4,s4,c4    
#gh;c7a77#aj77 is am5d$--  7#a7 by      
ins]t+ 7,a7 aft] 7#a72 &  7#b7 by add+  
at ! end ! foll[+3  7,b7 ,su* t]m does n
 include a digital tok54  4  7c7        

,def9ition ( digital tok5 ,section      
#c7;a7 ( ! ,securities ,ex*ange ,act (  
#aicd 7#ae ,u4,s4,c4 #gh;c7a77 is am5d$ 
by add+ at ! end ! foll[+3  7#hb7       
,digital tok5 ,! t]m digital tok5 has ! 
mean+ giv5 to x 9 section #b7;a7 ( !    
,securities ,act ( #aicc4  4  7d7       
,cl]ical am5dm5ts ,section #c7;a7 ( !   
,securities ,ex*ange ,act ( #aicd 7#ae  
,u4,s4,c4 #gh;c7a77 is am5d$--  7#a7 by 
mov+ p>agraph 7#gi7 s z to appe> aft]   
p>agraph 7#gh72 &  7#b7 by r$esignat+ ! 
second p>agraph 7#hj7 7relat+ to ,fund+ 
portal7 z p>agraph 7#ha74  #d4 ,inve/m5t
 ,advis]s ,act ( #aidj ,section         
#bjb7;a77#b77;,c7 ( ! ,inve/m5t ,advis]s
 ,act ( #aidj 7#ae ,u4,s4,c4            
#hj;b-#b7;a77#b77;,c77 is am5d$ by /rik+
 receiv+ deposits or ex]cis+ fiduci>y   
p[]s & ins]t+ receiv+ deposits1 provid+ 
cu/odial s]vices1 or ex]cis+ fiduci>y   
p[]s4  #e4 ,inve/m5t ,company ,act (    
#aidj ,section #b7;a77#e7 ( ! ,inve/m5t 
,company ,act ( #aidj 7#ae ,u4,s4,c4    
#hj;a-#b7;a77#e77 is am5d$ by /rik+     

receiv+ deposits or ex]cis+ fiduci>y    
p[]s & ins]t+ receiv+ deposits1 provid+ 
cu/odial s]vices1 or ex]cis+ fiduci>y   
p[]s4  #f4 ,satisfactory control        
location requirem5t  ,n lat] ?an #ij    
days aft] ! date ( ! enactm5t ( ?is     
,act1 ! ,commission %all am5d section   
#bdj4ae;c#c-c ( title #ag1 ,code (      
,f$]al ,regulations1 to provide t !     
requirem5t = a satisfactory control     
location is fulfill$ by protect+ a      
digital unit 7z def9$ "u section #b7;a7 
( ! ,securities ,act ( #aicc7 ?r\gh     
public key cryptography & foll[+        
comm]cially reasonable cyb]security     
practices4  #g4 ,individual retirem5t   
acc\nt inve/m5ts 9 c]ta9 virtual        
curr5cies n treat$ z di/ributions  7a7  
,9 g5]al ,section #djh7m7 ( ! ,int]nal  
,rev5ue ,code ( #aihf is am5d$-- 7#a7 9 
p>agraph 7#c7--  7,a7 9 ! head+ ( !     
p>agraph1 by /rik+ & bullion & ins]t+ 1 
bullion1 & virtual curr5cies2  7,b7 9   
subp>agraph 7,a77iv71 by /rik+ or2  7,c7
 9 subp>agraph 7,b71 by ins]t+ or aft]  

futures contract12  7,d7 by ins]t+ aft] 
subp>agraph 7,b7 ! foll[+3  7,c7 virtual
 curr5cy4  2 &  7,e7 by /rik+ if su*    
bullion & ins]t+ ,?is p>agraph %all only
 apply to bullion :i*2 &  7#b7 by add+  
at ! end ! foll[+3  7#d7 ,virtual       
curr5cy def9$ ,= purposes ( ?is         
subsection1 ! t]m virtual curr5cy means 
a digital repres5tation ( value t is us$
 z a m$ium ( ex*ange & is n curr5cy 7)9 
! mean+ ( section #ihh74  4  7b7        
,effective date ,! am5dm5ts made by ?is 
section %all apply to sales or ex*anges 
on or aft] ,janu>y #a1 #bjag4  #h4      
,c]ta9 ex*anges ( virtual curr5cy treat$
 z non-taxable ex*anges  7a7 ,9 g5]al   
,section #ajca ( ! ,int]nal ,rev5ue     
,code ( #aihf is am5d$--  7#a7 9 !      
head+1 by /rik+ real prop]ty & ins]t+   
c]ta9 prop]ty2  7#b7 9 subsection 7a71  
by add+ at ! end ! foll[ new p>agraph3  
7#d7 ,ex*ange ( virtual curr5cy ,an     
ex*ange ( virtual curr5cy 7z def9$ "u   
section #djh7m77 %all be treat$ z if su*
 ex*ange 7 an ex*ange ( real prop]ty "u 

?is section4  4  7b7 ,cl]ical am5dm5t ,!
 table ( p>ts = "p ,,iii ( sub*apt] ,o (
 *apt] #a ( su* ,code is am5d$ by /rik+ 
,ex*ange ( real prop]ty & ins]t+        
,ex*ange ( c]ta9 prop]ty 4  7c7         
,effective date ,! am5dm5ts made by ?is 
section %all apply to ex*anges made on  
or aft] ,janu>y #a1 #bjag4  #i4 ,ga9 f  
sale or ex*ange ( virtual curr5cy  7a7  
,9 g5]al ,"p ,,iii ( sub*apt] ,b ( *apt]
 #a ( ! ,int]nal ,rev5ue ,code ( #aihf  
is am5d$ by ins]t+ aft] section #aci;,f 
! foll[+ new section3  #aci;,g4 ,ga9 f  
sale or ex*ange ( virtual curr5cy  7a7  
,9 g5]al ,gross income %all n include   
ga9 f ! sale or ex*ange ( virtual       
curr5cy 7z def9$ "u section #djh7m77 =  
o!r ?an ca% or ca% equival5ts4  7b7     
,limitation  7#a7 ,9 g5]al ,! am\nt (   
ga9 exclud$ f gross income "u subsection
 7a7 ) respect to a sale or ex*ange (   
virtual curr5cy %all n exce$ #fjj4  7#b7
 ,aggregation rule ,= purposes ( ?is    
subsection1 all sales or ex*anges :i*   
are "p ( ! same transaction 7or a s]ies 

( relat$ transactions7 %all be treat$ z 
"o sale or ex*ange4  7c7 ,inflation     
adju/m5t ,9 ! case ( any taxable ye>    
beg9n+ 9 a cal5d> ye> aft] #bjah1 !     
doll> am\nt 9 subsection 7b7 %all be    
increas$ by an am\nt equal to--  7#a7   
su* doll> am\nt1 multipli$ by  7#b7 !   
co/-(-liv+ adju/m5t det]m9$ "u section  
#a7;f77#c7 = ! cal5d> ye> 9 :i* !       
taxable ye> beg9s1 det]m9$ by sub/itut+ 
cal5d> ye> #bjag = cal5d> ye> #bjaf 9   
subp>agraph 7a77ii7 !re(4  ,any increase
 det]m9$ "u ! prec$+ s5t5ce %all be     
r\nd$ to ! ne>e/ multiple ( #ej4  4  7b7
 ,cl]ical am5dm5t ,! table ( sections = 
"p ,,iii ( sub*apt] ,b ( *apt] #a ( su* 
,code is am5d$ by ins]t+ aft] ! item    
relat+ to section #aci;,f ! foll[+ new  
item3  ,sec4 #aci;,g4 ,ga9 f sale or    
ex*ange ( virtual curr5cy4  4  7c7      
,report+ ( ga9s or losses ,! ,secret>y (
 ! ,treasury %all issue regulations     
provid+ = in=mation returns on          
transactions 9 virtual curr5cy 7z def9$ 
"u section #djh7m7 ( ! ,int]nal ,rev5ue 

,code ( #aihf7 = :i* ga9 or loss is     
recogniz$4  7d7 ,effective date ,!      
am5dm5ts made by ?is section %all apply 
) respect to transactions ent]$ into on 
or aft] ,janu>y #a1 #bjag4