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General Assembly Substitute Bill No. 7082
January Session, 2025
AN ACT CONCERNING CERTAIN REQUIREMENTS APPLICABLE TO
VIRTUAL CURRENCY MONEY TRANSMISSION LICENSEES AND
PROPERTY INTERESTS IN VIRTUAL CURRENCY AND PROHIBITING
STATE PAYMENTS AND INVESTMENTS IN VIRTUAL CURRENCY.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:
Section 1. Section 36a-596 of the general statutes is repealed and the 1
following is substituted in lieu thereof (Effective October 1, 2025): 2
As used in sections 36a-595 to 36a-614, inclusive, and section 2 of this 3
act, unless the context otherwise requires: 4
(1) "Advertise" or "advertising" has the same meaning as provided in 5
section 36a-485. 6
(2) "Authorized delegate" means a person designated by a person 7
licensed pursuant to sections 36a-595 to 36a-612, inclusive, to provide 8
money transmission services on behalf of such licensed person. 9
(3) "Control" means (A) the power to vote, directly or indirectly, at 10
least twenty-five per cent of the outstanding voting shares or voting 11
interests of a licensee or person in control of a licensee, (B) the power to 12
elect or appoint a majority of key individuals or executive officers, 13
managers, directors, trustees or other persons exercising managerial 14
authority of a person in control of a licensee, or (C) the power to exercise, 15
directly or indirectly, a controlling influence over the management or 16 Substitute Bill No. 7082
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policies of a licensee or person in control of a licensee. For purposes of 17
this subdivision, (i) a person is presumed to exercise a controlling 18
influence when the person holds the power to vote, directly or 19
indirectly, at least ten per cent of the outstanding voting shares or voting 20
interests of a licensee or person in control of a licensee, (ii) a person 21
presumed to exercise a controlling influence can rebut such 22
presumption if the person is a passive investor, and (iii) to determine 23
the percentage of control, a person's interest shall be aggregated with 24
the interest of any other immediate family member, including the 25
person's spouse, parent, child, sibling, mother-in-law, father-in-law, 26
son-in-law, daughter-in-law, brother-in-law, sister-in-law and any other 27
person who shares the person's home. 28
(4) "Control person" means any individual in control of a licensee or 29
applicant, any individual who seeks to acquire control of a licensee or a 30
key individual. 31
(5) "Electronic payment instrument" (A) means a card or other 32
tangible object (i) for the transmission of money or monetary value or 33
payment of money, (ii) which contains a microprocessor chip, magnetic 34
stripe or other means for the storage of information, (iii) that is 35
prefunded, and (iv) for which the value is decremented upon each use, 36
and (B) does not include a card or other tangible object that is 37
redeemable by the issuer in the issuer's goods or services. 38
(6) "Existing customer" means a consumer who (A) is engaging in a 39
transaction at a virtual currency kiosk in the state, (B) has performed not 40
fewer than three virtual currency transactions with the owner or 41
operator of such virtual currency kiosk, and (C) has been registered as a 42
customer of such owner or operator for more than seventy-two hours. 43
(7) "Holder" means a person, other than a purchaser, who is either in 44
possession of a payment instrument and is the named payee thereon or 45
in possession of a payment instrument issued or endorsed to such 46
person or bearer or in blank. "Holder" does not include any person who 47
is in possession of a lost, stolen or forged payment instrument. 48 Substitute Bill No. 7082
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(8) "Key individual" means any individual ultimately responsible for 49
establishing or directing policies and procedures of the licensee, 50
including, but not limited to, an executive officer, manager, director or 51
trustee. 52
(9) "Licensee" means any person licensed or required to be licensed 53
pursuant to sections 36a-595 to 36a-612, inclusive. 54
(10) "Main office" has the same meaning as provided in section 36a-55
485. 56
(11) "Monetary value" means a medium of exchange, whether or not 57
redeemable in money. 58
(12) "Money transmission" means engaging in the business of issuing 59
or selling payment instruments or stored value, receiving money or 60
monetary value for current or future transmission or the business of 61
transmitting money or monetary value within the United States or to 62
locations outside the United States by any and all means including, but 63
not limited to, payment instrument, wire, facsimile, electronic transfer 64
or virtual currency kiosk. 65
(13) "New customer" means a consumer who (A) is engaging in a 66
transaction at a virtual currency kiosk in the state, (B) has performed 67
fewer than three virtual currency transactions with the owner or 68
operator of such virtual currency kiosk, and (C) has been registered as a 69
customer of such owner or operator for less than seventy-two hours. 70
(14) "Outstanding" means (A) in the case of a payment instrument or 71
stored value, that (i) such instrument or value is sold or issued in the 72
United States, (ii) a report of such instrument or value has been received 73
by a licensee from its authorized delegates, and (iii) such instrument or 74
value has not yet been paid by the issuer, and (B) for all other money 75
transmissions, the value reported to the licensee for which the licensee 76
or any authorized delegate has received money or its equivalent value 77
from the customer for transmission, but has not yet completed the 78
money transmission by delivering the money or monetary value to the 79 Substitute Bill No. 7082
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person designated by the customer. 80
(15) "Passive investor" means a person that (A) does not have the 81
power to elect a majority of key individuals or executive officers, 82
managers, directors, trustees or other persons exercising managerial 83
authority of a person in control of a licensee, (B) is not employed by and 84
does not have any managerial duties of the licensee or person in control 85
of a licensee, (C) does not have the power to exercise, directly or 86
indirectly, a controlling influence over the management or policies of a 87
licensee or person in control of a licensee, and (D) attests to 88
subparagraphs (A), (B) and (C) of this subdivision in the form and 89
manner prescribed by the commissioner. 90
(16) "Payment instrument" means a check, draft, money order, 91
travelers check or electronic payment instrument that evidences either 92
an obligation for the transmission of money or monetary value or 93
payment of money, or the purchase or the deposit of funds for the 94
purchase of such check, draft, money order, travelers check or electronic 95
payment instrument. 96
(17) "Permissible investment" means (A) (i) cash in United States 97
currency, including, but not limited to, demand deposits, savings 98
deposits and funds in demand deposit and savings deposit accounts 99
held for the benefit of a licensee's customers in an insured depository 100
institution, and (ii) cash equivalents, including, but not limited to, (I) 101
automated clearing house items in transit to a licensee or payee, (II) 102
international wires in transit to a payee, (III) cash in transit via armored 103
car, (IV) cash in smart safes, (V) cash in locations owned by licensees, 104
(VI) transmission receivables that are funded by debit cards or credit 105
cards and owed by any bank, and (VII) money market mutual funds 106
rated "AAA" or the equivalent by S & P Global, Incorporated, in the "S 107
& P Global Ratings" or by any other rating service recognized by the 108
commissioner, (B) time deposits, as defined in section 36a-2, or other 109
debt instruments of a bank, (C) bills of exchange or bankers acceptances 110
which are eligible for purchase by member banks of the Federal Reserve 111
System, (D) commercial paper of prime quality, (E) interest-bearing 112 Substitute Bill No. 7082
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bills, notes, bonds, debentures or other obligations issued or guaranteed 113
by (i) the United States or any of its agencies or instrumentalities, or (ii) 114
any state, or any agency, instrumentality, political subdivision, school 115
district or legally constituted authority of any state if such investment is 116
of prime quality, (F) interest-bearing bills or notes, or bonds, debentures 117
or preferred stocks, traded on any national securities exchange or on a 118
national over-the-counter market, if such debt or equity investments are 119
of prime quality, (G) receivables due from authorized delegates 120
consisting of the proceeds of the sale of payment instruments which are 121
not past due or doubtful of collection, (H) gold, and (I) any other 122
investments approved by the commissioner. Notwithstanding the 123
provisions of this subdivision, if the commissioner at any time finds that 124
an investment of a licensee is unsatisfactory for investment purposes, 125
the investment shall not qualify as a permissible investment. 126
(18) "Prime quality" of an investment means that it is within the top 127
four rating categories in any rating service recognized by the 128
commissioner unless the commissioner determines for any licensee that 129
only those investments in the top three rating categories qualify as 130
prime quality. 131
(19) "Purchaser" means a person who buys or has bought a payment 132
instrument or who has given money or monetary value for current or 133
future transmission. 134
(20) "Receipt" means a paper record, electronic record or other written 135
confirmation of a money transmission transaction. 136
(21) "Stored value" means monetary value that is evidenced by an 137
electronic record. For the purposes of this subdivision, "electronic 138
record" means information that is stored in an electronic medium and is 139
retrievable in perceivable form. 140
(22) "Travelers check" means a payment instrument for the payment 141
of money that contains a provision for a specimen signature of the 142
purchaser to be completed at the time of a purchase of the instrument 143
and a provision for a countersignature of the purchaser to be completed 144 Substitute Bill No. 7082
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at the time of negotiation. 145
(23) "Unique identifier" has the same meaning as provided in section 146
36a-485. 147
(24) "Virtual currency" means any type of digital unit that is used as 148
a medium of exchange or a form of digitally stored value or that is 149
incorporated into payment system technology. Virtual currency shall be 150
construed to include digital units of exchange that (A) have a centralized 151
repository or administrator, (B) are decentralized and have no 152
centralized repository or administrator, or (C) may be created or 153
obtained by computing or manufacturing effort. Virtual currency shall 154
not be construed to include digital units that are used (i) solely within 155
online gaming platforms with no market or application outside such 156
gaming platforms, or (ii) exclusively as part of a consumer affinity or 157
rewards program, and can be applied solely as payment for purchases 158
with the issuer or other designated merchants, but cannot be converted 159
into or redeemed for fiat currency. 160
(25) "Virtual currency address" means an alphanumeric identifier 161
representing a destination for a virtual currency transfer that is 162
associated with a virtual currency wallet. 163
(26) "Virtual currency control services vendor" means a person who 164
controls virtual currency under an agreement with another person who, 165
on behalf of a third person, assumes control of virtual currency. 166
[(26)] (27) "Virtual currency kiosk" means an electronic terminal 167
acting as a mechanical agent of the owner or operator to enable the 168
owner or operator to facilitate the exchange of virtual currency for fiat 169
currency or other virtual currency, including, but not limited to, by (A) 170
connecting directly to a separate virtual currency exchanger that 171
performs the actual virtual currency transmission, or (B) drawing upon 172
the virtual currency in the possession of the owner or operator of the 173
electronic terminal. 174
[(27)] (28) "Virtual currency wallet" means a software application or 175 Substitute Bill No. 7082
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other mechanism providing a means for holding, storing and 176
transferring virtual currency. 177
Sec. 2. (NEW) (Effective October 1, 2025) (a) Prior to entering into a 178
virtual currency transaction for, on behalf of or with a person, and to the 179
extent applicable to the transaction, each licensee that engages in the 180
business of money transmission in this state by receiving, transmitting, 181
storing or maintaining custody or control of virtual currency shall 182
clearly and conspicuously disclose to such person in a retainable record: 183
(1) A schedule of any fee or charge; 184
(2) If any fee or charge is not set and disclosed in advance of the 185
transaction, the manner and timing by which such fee or charge will be 186
calculated; 187
(3) Any pricing differential on a purchase, sale or exchange of virtual 188
currency related to the transaction and in which the licensee or any 189
affiliate of such licensee is acting in a principal capacity; 190
(4) Whether the transaction is covered by insurance, or is otherwise 191
guaranteed against loss by an agency of the United States or the 192
Securities Investor Protection Corporation, and, if so, (A) the amount, 193
expressed in United States dollars, of such coverage or guarantee, and 194
(B) whether such insurance provides coverage against theft or loss, 195
including, but not limited to, cyber theft; 196
(5) That the transaction is irrevocable, or if there is any exception to 197
such irrevocability; 198
(6) A description of (A) the person's liability for an unauthorized, 199
mistaken or accidental transaction, (B) the person's responsibility to 200
provide notice to the licensee of such unauthorized, mistaken or 201
accidental transaction, (C) the basis for any recovery by the person from 202
the licensee, (D) the general rights of the person to resolve an error 203
related to the transaction, and (E) the method for the person to update 204
the person's contact information with the licensee; 205 Substitute Bill No. 7082
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(7) That the date or time when the transaction is completed and the 206
person's account is debited may differ from the date or time when the 207
person initiates the transaction; 208
(8) Whether the person has a right to stop a preauthorized transaction 209
or revoke an authorization for a transaction and the procedure to initiate 210
such stop or revocation; 211
(9) The person's right to receive a receipt, trade ticket or other 212
evidence of the transaction; 213
(10) The person's right to receive notice not less than thirty days 214
before any change in the licensee's fee schedule, other terms or 215
conditions of the licensee's virtual currency business and any policy 216
applicable to the person's account; 217
(11) That virtual currency is not money; and 218
(12) Any additional disclosure the Banking Commissioner 219
determines to be reasonably necessary for the protection of the public. 220
(b) Each licensee that engages in the business of money transmission 221
in this state by receiving, transmitting, storing or maintaining custody 222
or control of virtual currency shall, upon the completion of any virtual 223
currency transaction with a person, provide to the person a receipt 224
containing the following information: 225
(1) The name and contact information of the licensee; 226
(2) A description of how the person may ask a question or file a 227
complaint; 228
(3) The type, date and precise time of the transaction; 229
(4) The value of the transaction, expressed in United States dollars; 230
and 231
(5) Any consideration the licensee charged for the transaction, 232
including, but not limited to (A) any charge, fee or commission, and (B) 233 Substitute Bill No. 7082
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the amount of any difference between the price paid by the person for 234
virtual currency and the prevailing market price of such virtual 235
currency. 236
(c) The Banking Commissioner may waive a disclosure or receipt 237
requirement established by subsection (a) or (b) of this section and 238
approve an alternative disclosure or receipt proposed by a licensee, if 239
the commissioner determines that the alternative disclosure or receipt is 240
more appropriate for the virtual currency business of such licensee and 241
provides the same or equivalent information and protection to the 242
public. 243
(d) A licensee that engages in the business of money transmission in 244
this state by receiving, transmitting, storing or maintaining custody or 245
control of virtual currency shall not: 246
(1) Sell, transfer, assign, lend, hypothecate, pledge or otherwise use 247
or encumber virtual currency stored, held, controlled, maintained by, or 248
under the custody or control of, such licensee on behalf of a person, 249
except for the sale, transfer of ownership or assignment of such virtual 250
currency at the direction of such person; or 251
(2) Directly or indirectly use or engage any other person, including, 252
but not limited to, a virtual currency control services vendor, to store or 253
hold custody or control of virtual currency for or on behalf of a 254
customer, unless such other person is (A) licensed pursuant to sections 255
36a-595 to 36a-612, inclusive, of the general statutes, (B) a federally 256
insured federal bank, out-of-state bank, Connecticut bank, Connecticut 257
credit union, federal credit union or out-of-state credit union that is 258
exempt from licensure under section 36a-609 of the general statutes, or 259
(C) approved by the Banking Commissioner to store or hold custody or 260
control of virtual currency for or on behalf of a customer. 261
Sec. 3. Section 36a-603 of the general statutes is repealed and the 262
following is substituted in lieu thereof (Effective October 1, 2025): 263
(a) Each licensee shall at all times maintain permissible investments 264 Substitute Bill No. 7082
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having a value, computed in accordance with generally accepted 265
accounting principles, at least equal to the aggregate amount of its 266
outstanding money transmissions in this state, provided the value of 267
receivables due from authorized delegates consisting of the proceeds of 268
the sale of payment instruments that are not past due or doubtful of 269
collection shall not exceed thirty per cent of the permissible investments 270
held by the licensee and receivables due from any one person shall not 271
exceed ten per cent of the value of permissible investments held by the 272
licensee. 273
(b) Each licensee that engages in the business of money transmission 274
in this state by receiving, transmitting, storing or maintaining custody 275
or control of virtual currency on behalf of another person shall at all 276
times hold virtual currency of the same type and amount owed or 277
obligated to such other person. As used in subsection (a) of this section, 278
outstanding money transmissions does not include any virtual currency 279
held pursuant to this subsection, and "value" means the lower of book 280
or market value, except that with regard to debt obligations which the 281
licensee as a matter of policy retains until maturity, "value" means the 282
greater of book or market value unless the commissioner orders that for 283
some or all investments of a particular licensee, "value" means the lower 284
of book or market value. 285
(c) Permissible investments and virtual currency held pursuant to 286
subsection (b) of this section, even if commingled with other assets of 287
the licensee, shall be deemed by operation of law to be (1) property 288
interests of any claimants against the licensee, on a pro rata basis and in 289
the type and amount of virtual currency to which such claimants are 290
entitled, without regard to the time when (A) such claimants became 291
entitled to such virtual currency, or (B) the licensee obtained control of 292
such virtual currency, (2) held in trust for the benefit of any claimants 293
against the licensee to serve the faithful performance of the obligations 294
of the licensee and the licensee's authorized delegates with respect to 295
the licensee's money transmission business in this state in the event of 296
the bankruptcy of the licensee, and [shall be] (3) immune from 297
attachment by creditors or judgment creditors. 298 Substitute Bill No. 7082
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Sec. 4. Subsection (a) of section 36a-607 of the general statutes is 299
repealed and the following is substituted in lieu thereof (Effective October 300
1, 2025): 301
(a) [A] Except as provided in subsection (d) of section 2 of this act, a 302
licensee may conduct its business at one or more locations within this 303
state as follows: 304
(1) The business may be conducted by the licensee or through or by 305
means of such authorized delegates as the licensee may periodically 306
designate or appoint on the system in such form and manner as required 307
by the commissioner. The licensee shall pay any associated processing 308
fees imposed by the system. The licensee shall notify the commissioner 309
on the system of all authorized delegates that act on its behalf. An 310
authorized delegate may not engage in the business of money 311
transmission in this state on behalf of a licensee through or by means of 312
any person who is not identified on the system as an authorized 313
delegate of the licensee. 314
(2) No license under sections 36a-595 to 36a-612, inclusive, shall be 315
required of any authorized delegate. 316
(3) Each authorized delegate shall, from the moment of receipt, hold 317
the proceeds of a sale or delivery of a licensee's money transmissions in 318
this state in trust for the benefit of such licensee. 319
(4) A licensee shall be liable for the loss caused to any purchaser or 320
holder of the licensee's payment instruments or stored value sold in this 321
state by the failure of an authorized delegate to forward to the licensee 322
the amount due from the proceeds of a sale or delivery of the licensee's 323
payment instruments or stored value, or money or monetary value 324
received for transmission. 325
(5) The licensee shall enter into a contract with each of its authorized 326
delegates that requires the authorized delegate to operate in full 327
compliance with sections 36a-595 to 36a-612, inclusive, and provides 328
that appointment of the authorized delegate is not effective during any 329 Substitute Bill No. 7082
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period when the license of the licensee has been suspended. The licensee 330
shall provide each authorized delegate with policies and procedures 331
sufficient to ensure compliance with sections 36a-595 to 36a-612, 332
inclusive. 333
(6) An authorized delegate shall remit all money owing to the licensee 334
in accordance with the terms of the contract between the licensee and 335
the authorized delegate. 336
(7) An authorized delegate shall not provide money transmission 337
services in this state outside the scope of activity permissible under the 338
contract between the authorized delegate and the licensee. 339
Sec. 5. Subsection (e) of section 36a-613 of the general statutes is 340
repealed and the following is substituted in lieu thereof (Effective October 341
1, 2025): 342
(e) (1) The owner or operator of a virtual currency kiosk shall, upon 343
the completion of any virtual currency transaction, provide to the 344
customer a receipt, in addition to the receipt required pursuant to 345
subsection (b) of section 2 of this act, containing the following 346
information: 347
(A) The name of, and contact information for, the owner or operator, 348
including, but not limited to, the owner or operator's business address 349
and a customer service telephone number established by the owner or 350
operator to answer questions and register complaints; 351
(B) The name of the customer; 352
(C) The type, value, date and precise time of such virtual currency 353
transaction, and each virtual currency address; 354
(D) The amount of such virtual currency transaction expressed in 355
United States currency; 356
(E) The full unique transaction hash or identification number; 357 Substitute Bill No. 7082
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(F) The public virtual currency address of the customer; 358
(G) The unique identifier; 359
(H) Any fee charged, including, but not limited to, any fee charged 360
directly or indirectly by the owner or operator or a third party involved 361
in such virtual currency transaction; 362
(I) The exchange rate, if applicable; 363
(J) Any tax collected by the owner or operator for such virtual 364
currency transaction; 365
(K) A statement of the liability of the owner or operator for 366
nondelivery or delayed delivery; 367
(L) A statement of the refund policy of the owner or operator; 368
(M) The name and telephone number of the Department of Banking 369
and a statement disclosing that the owner or operator's customers may 370
contact the department with questions or complaints about the owner 371
or operator's virtual currency kiosk services; and 372
(N) Any additional information the Banking Commissioner may 373
require. 374
(2) The receipt required under subdivision (1) of this subsection: 375
(A) Shall be provided in (i) a retainable form, (ii) the English 376
language, and (iii) the language principally used by the owner or 377
operator of the virtual currency kiosk to advertise, solicit or negotiate, 378
either orally or in writing; and 379
(B) May be provided electronically if the customer requests or agrees 380
to receive an electronic receipt. 381
Sec. 6. (NEW) (Effective October 1, 2025) Neither the state nor any 382
political subdivision of the state shall (1) accept or require payment in 383
the form of virtual currency for an amount due to the state or the 384 Substitute Bill No. 7082
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political subdivision, or (2) purchase, hold, invest in or establish a 385
reserve of virtual currency. For purposes of this section, "virtual 386
currency" has the same meaning as provided in section 36a-596 of the 387
general statutes, as amended by this act. 388
This act shall take effect as follows and shall amend the following
sections:
Section 1 October 1, 2025 36a-596
Sec. 2 October 1, 2025 New section
Sec. 3 October 1, 2025 36a-603
Sec. 4 October 1, 2025 36a-607(a)
Sec. 5 October 1, 2025 36a-613(e)
Sec. 6 October 1, 2025 New section
Statement of Legislative Commissioners:
Section 2(a)(4) was rewritten for clarity; and in Section 2(a)(10), "receive
not less than thirty days' notice of any change" was changed to "receive
notice not less than thirty days before any change" for clarity and
consistency with standard drafting conventions.
BA Joint Favorable Subst. -LCO