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ENGROSSED HOUSE
BILL NO. 3279 By: Humphrey, Pae and Phillips
of the House
and
Jett of the Senate
[ technology - creating the Oklahoma Distributed
Ledger Technology Assets Offering Act - permitting
act be used to regulate medical marijuana -
effective date ]
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. NEW LAW A new section of law to be codified
in the Oklahoma Statute s as Section 12001 of Title 74, unless there
is created a duplication in numberin g, reads as follows:
This act shall be known and may be cited as the "Oklahoma
Distributed Ledger Technology Assets Offering Act".
SECTION 2. NEW LAW A new section of law not to be
codified in the Oklahoma Statutes reads as follows:
The Legislature makes the following findings con cerning the
necessity for the Oklahoma Distributed Ledger Technology Assets
Offering Act:
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1. For the immutable recording of i dentity, contracts, and
payments, as well as protocols that govern the production ,
distribution, and consumption of goods and serv ices in a digital
economy, distributed ledger technology assets offering ecosystems
afford the most efficient, effective, and transparent method of
achieving such, necessitating a proactive strategy to creat e,
maintain, and advance the regulation of Intern et activities;
2. Especially configured and government -regulated blockchain
and distributed ledger technologies have emerged as critical
solutions to many Internet crimes, cyberwarfare, tax revenue
collection, product diversion, state and non state acts of terrorism,
money laundering, foreign interference with information
technologies, and corruption problems; and in view of suc h, the
State of Oklahoma has the pote ntial to foster an Internet of
regulation and to create new forms of decentralized platforms and
distributed networks and distributed applications, and under the
jurisdiction and control of the state, such networks and
applications may have advantages over the current centralized
Internet platforms and applications;
3. The State of Oklahoma has the power and opportunity to
establish its own regulatory fr amework and to realize its potential
to become a global leader and a center for companies and
entrepreneurs that seek to utilize distributed ledger technology
ecosystems to power blockchain - or distributed-ledger-technology-
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based business models, social media, and governmental systems , all
of which will drive innovation within the state and give the State
of Oklahoma an economic opportunity and global advantage to develop
a regulated and operated ne twork for local economies, to create new
jobs, and export locally developed technologies;
4. Oklahoma's many sovereign entities and governmental units
are not optimally integrated or united in law enforceme nt, Internet
regulation, or first -responder efforts. Regulated distributed
ledger technology assets offerings, digital contra cts, and immutable
identities can enable precise financial auditing and the coordinated
tracking and tracing of the activities of criminal elements, cyber
incursions, and organize d crime, making it more difficult for these
criminal and terrorist elements t o be able to hide their activities.
These same capabilities will augment, facilitate, and integrate the
protection of public safe ty and can immediately help first
responders to identify and meet the needs of the citizenry,
especially in victim identificat ion, triage, treatment, search-and-
rescue functions during natural and man-made disaster events, such
as pandemics, tornadoes, and floods, and also will assist in
detecting and preventing foreign military cyber and signals
intelligence operations;
5. The unalterable recordings of revenue collection and product
tracking by any state, county, or local governmental unit or agency
of the State of Oklahoma should occur through an ecosystem operator
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that has had prior successful participation in state and fede ral no-
action processes pertaining to securities registration, exemption,
regulation, and compliance requirements for persons or e ntities
using distributed ledger technology asset s offerings. In addition,
an ecosystem operator should have a demonstrated c apacity to assist
in the incubation of distributed ledger technology utilities, and
may be available to assist in incubating use cases and collaborate
with other ecosystem operators cooperatively to thwart the creation
or formation of monopolies and to promot e a thriving, free market
approach; and
6. The anticipated benefits of the development and use by the
State of Oklahoma and its political subdivisions or agencies thereof
of an integrated logistics, information, custodial, and payment
tracking ecosystem, which uses hack -resistant distributed ledger
technologies and a convertible virtual currency include:
a. keeping customers' and any government citizens ' or
licensees' data secure and confidential, under the
auspices of Oklahoma licensed fiduciaries, but
available to ecosystem participants, stakeholders,
regulators, and law enforcement communities on a
transparent and need-to-know basis, as allowed or
required by relevant laws or agreements between
cooperating customers, persons, or parties ,
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b. automating notifications of a child attempting to
purchase contraband,
c. minimizing black market activities by:
(1) integrating smart packaging, facilitated by Radio
Frequency Identificatio n (RFID), Near-Field
Communication (NFC), or other uniquely
identifiable technology, to be placed o n all
products with payments and tracking throughout
the supply chain using digital assets and
distributed ledger technologies,
(2) making cashless purchasin g easier with biometric
identification and database matching and
providing for the availability of easy digital
asset payment systems, which can also accommodate
cash payments as required in specific
circumstances where parties do not have access to
banking services,
(3) holding down compliance costs and allowing legal
transactions at a lower price point, and
(4) increasing logistical velocity and improving
quality and quantity in supply chains by reducing
delivery time, increasing s pecific product
availability, and facilitating predictive, just -
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in-time production, processing , and
merchandising,
d. enhancing the stability of any legal market by:
(1) using the cashless, electronic fund s transfer of
digital assets for transactions between parties
within the specified community, including
employees, to maximize micropayment capabilities
and to create a maximally productive and legally
adherent business community wherever lawfully
possible,
(2) reporting shrinkage and lost product in the
supply chain at any point and identifying
culprits,
(3) complying with the Anti -Money Laundering and Know
Your Customer provisions of th e federal Bank
Secrecy Act, and the Suspicious Activity Reports
of the United States Treasury Financial Crimes
Enforcement Network,
(4) increasing data collection for business owners
and policymakers at a lower cost, thus reducing
administrative compliance overhead, and
(5) automating periodic data reporting volume and
tracking data from point -of-sale systems, thereby
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providing policymakers and regulators with data
that predicts black market emergence,
e. generating statistical data for decision -making by:
(1) allowing designated agency or authorized
political subdivision personnel to create surveys
and order data sets,
(2) allowing digital asset micropayments to obtain
survey reporting participation, thereby
reinforcing research efficacy,
(3) establishing and collecting Health Insurance
Portability and Accountability Act of 1996
(HIPAA) compliant, self-reported, voluntary
patient reviews, and correlating and tracking
specific products for their physiological and
psychological efficacy, thus enabling patients,
health care providers, labs, processors , and
producers to better calibrate and correlate their
related choices, and
(4) giving policymakers empirically based and broad
statistical samples based on surveys,
f. optimizing the remittance, accounting, and reporting
of tax revenue by:
(1) tabulating financials for bu sinesses and
regulators and making data available to business
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owners and government agencies in an expedient
manner and on a need-to-know basis, while using
data privacy best practices,
(2) allowing regulators to calculate business or
activity density, estimate illegal activity, and
model taxation rates to compete with and minimize
black market activities,
(3) monitoring consumer price sensitivity to allow
for appropriate modification of taxation policy ,
and
(4) keeping retail prices below the threshold
consistent with best practices for preve nting
illegal activities,
g. allowing local and tribal governments to train first
responders and search -and-rescue dogs as critical
adjuncts to a distributed ledger technology asset s
offering used in a payment and tracking ecosystem for
detecting and preventing criminal activity, tax
evasion, and other unlawful behaviors, and also used
in response to natural and man-made disasters,
h. enabling vocational technical training in distributed
ledger technologies for incarcerated persons in the
custody of the Department of Corrections, and
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i. facilitating public and private education on the
usefulness of distributed ledger technologies and the
law through Oklahoma Bar Foundation programs .
SECTION 3. NEW LAW A new section of law not to be
codified in the Oklahoma Statutes reads as follow s:
This act may first be implemented for the lawful regulation of
the medical marijuana industry so long as the commodity is lawfully
permitted for use in the State of Oklahoma.
SECTION 4. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 12002 of Title 74, unless there
is created a duplication in numbering, reads as follows:
As used in this act:
1. "Application programming interface " means a connection
between computers or between computer programs using a type of
software interface offering a service to other pieces of software;
2. "Blockchain" means a system or digital ledger of
transactions maintained by a network of computers in a way that
makes it difficult to hack or alter , and every time a new
transaction occurs on the blockchain, a record of that transaction
is added to every participant 's ledger. "Blockchain" may also be
interpreted as "ecosystem" interchangeably;
3. "Consumptive purpose" means a purpose to provide or receive
goods, services, or content, including access to goods, services, or
content;
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4. "Convertible virtual currency" means a substitute or avatar
for real and legally recognized currency, even though it does not
have the status of legal tender. Convertible virtual currency
includes convertible digital currency, digital asset s, or
distributed ledger techn ology assets, a convertible virtual
currency;
5. "Customer" means any person, corporation , or entity who may
qualify for the required Anti-Money Laundering and Know Your
Customer provisions of the Bank Secrecy Act , 31 U.S.C., Section 5311
et seq., and thereby obtains confirmation of their identity;
6. "Decision tree" means a decision support tool that uses a
tree-like model of decisions and possible consequences, including
chance event outcomes, to record agreements between parties;
7. "Digital contract" means a coded contract that functions as
an immutable digital agreement which is entered into between
customers, in order to s pecify the terms and conditions of payment,
custody, performance, timing, delivery, tax remittance, regulatory
compliance, escrow, contingencies, choice of law, forum, or other
terms. Digital contract does not mean an asset or convertible
virtual currency;
8. "Digital identity" means immutable informati on about an
entity or individual used by computer systems to record and
represent an external or internal agent , which may be a person,
organization, application, or device , and any permissive access
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relative to such is protected with biometric identificat ion.
Digital identity is functional software programmed uniquely for the
individual customer and cannot be resold, duplicated, or
counterfeited;
9. "Digital asset processor " means a method for recording and
converting virtual currency as a digital asset to and from United
States dollars, where both the processor and currencies use
distributed ledger technologies and smart contracts programmed with
computer code that will enable self -executing escrow accoun ts, also
referred to as an electronic funds transfer system interchange;
10. "Distributed ledger technology " means a type of data base
spread across multiple sites, regions, or participants , known as
validators, that does not require a sequence of blocks;
11. "Distributed ledger technology asset " means a digital unit
with specified characteristics, secured through a decentralized
ledger or database, exchangeable for goods or services, and capable
of being traded or transferred bet ween persons with the use o f a
distributed ledger technology asset offering agent and fiduciary or
the custodial intermediary. A distributed ledger technolo gy asset
is a digital unit that is:
a. created in response to the verification or collection
of a specified number of transact ions relating to a
digital ledger or database by d eploying computer code
to a blockchain or distributed ledger technology
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network that allows for the creation of distribu ted
ledger technology assets, or
b. recorded in a digital ledger or d atabase that is
chronological, consensus-based, decentralized, and
mathematically verified in nature, especially relating
to the supply of units an d their distribution;
12. "Digital ledger technology asset offering card " means any
instrument or device, whether known as a credit card, identification
card, credit plate, gi ft card, prepaid card, charge plate, debit
card, or by any other name, issued wi th or without fee by an
ecosystem operator for the use of the cardholder in obtaining goods,
services, or anything of value on credit or debit;
13. "Distributed ledger technology asset offering agent " means
a person who is appointed by a distributed ledger technology asset
offering ecosystem operator and who is a licensed attorney with at
least fifteen (15) years of law practice, in good standing with the
Oklahoma Bar Associati on, and is appointed as counsel by the
submission of entry of appearance documen tation to the Oklahoma
Department of Securities, the Office of Management and Enterprise
Services, and the Oklahoma Tax Commis sion;
14. "Electronic funds transfer " means any transfer of funds,
other than a transaction originated by check, draft, or simila r
paper instrument, which is initiated through an electronic terminal,
telephonic instrument, computer, or magnetic tape, so as to order,
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instruct, or authorize a financial ins titution to debit or credit an
account. Such term includes, but is not limited to, point-of-sale
transfers, automated teller machine transactions, automated
clearinghouses, direct deposits or withdrawals o f funds, and
transfers initiated by telephone;
15. "Electronic funds transfer system interchange " means a
distributed ledger tech nology asset offering, an interchange
platform, or digital asset processor, which operates with a protocol
that allows customers to acquire and transfer any fiat currencies,
lawful cryptocurrencies, digital assets, convertible virtual
currency, or distributed ledger technology assets from one form of
value to the other by using a convertible virtual currency to
acquire and to transfer;
16. "Ecosystem" means a complex network of an interconnected
technology system or systems;
17. "Distributed ledger techno logy asset offering ecosystem
operator" or "ecosystem operator" means a person or entity
contracted with the State of Oklahoma or its instrumentalities,
agencies, or political subdivisions, which employs at least one
licensed Oklahoma fiduciary as its principal agent and which has
general supervisory control over the subject ecosystem and provides
to its customers smart contracts for electronic funds transfers, tax
remittances, contract forms, escrow, custody, and goods and services
tracking that become obligations for customers to pay the ecosystem
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operator by agreement and in accordance with the terms of a
designated and immutable smart contract;
18. "Fintech" means a combination of finance and technology and
is a technology that seeks to improve, support, and automate
payment, banking, and other financial services;
19. "Hack" means to use a computer to gain unauthorize d access
to data in a system;
20. "Micropayment" means small transactions or payments ,
usually of less than One Dollar ($1.00) and, in some cases, only a
fraction of a cent, that are mainly made online and which are a way
to leverage the Internet to facilitate the immediate distribution of
digital rights, royaltie s, in-game purchases, online tipping, and to
coordinate devices connected via the Internet ;
21. "Onboarding" means identifying and adding customers to an
ecosystem by first qualifying them with Anti-Money Laundering and
Know Your Customer provisions of the Bank Secrecy Act, 31 U.S.C.,
Section 5311 et seq. ;
22. "Smart contract" means a self-executing digital contract ,
which can be an escrow agreement , with the terms of the agreement
between buyer and seller directly written into lines of code wherein
the code and the agreement contained therein exist across a
distributed, decentralized, blockchain network. Smart contracts are
not digital assets but are software packages and use distributed
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ledger technologies with unalterable accounting and immutable
identification and escrow functions; and
23. "Travel Rule" means the rule promulgated under the Bank
Secrecy Act, 31 C.F.R. , Section 1010.410(f), which requires
financial institutions to pass certain in formation on to the next
financial institution in certain funds transmittals involving more
than one financial institution .
SECTION 5. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 12003 of Title 74, unless there
is created a duplication in numbering, read s as follows:
A. Utilizing the assistance of any distributed ledger
technology company that contracts with the state, the State of
Oklahoma shall develop and employ an integrated logistics,
information, and payment tracking ecosystem as a publicly owned,
operated, and regulated payment tracking utility network, which uses
hack-resistant, distributed ledger technologies in support of state
agencies and tribal, county, and local governmental units :
1. To facilitate information and revenue recording, collect ion,
and sharing; and
2. To prevent cybercrimes, black market activities, money
laundering, and tax evasion.
B. Every distributed ledger technology ecosystem described in
this section shall use types of software that are:
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1. Digital representations of d ollars such as convertible
virtual currency;
2. Digital representation s of identities such as blockchain and
biometrics; or
3. Digital representations of contracts such as digital and
smart contracts.
C. To contract with the state or any of its politica l
subdivisions, a distributed ledger technology asset offering
ecosystem which is equipped to license, maintain, and offer for sale
software and to perform electronic fund s transfers and logistical
tracking services using digital assets or convertible virt ual
currencies as the medium of value transfer shall fulfill the
following minimum threshold securities regulatory requirements:
1. Prior to the acceptance by a state, county, or local
governmental unit or agency of a vendor's bid or offer to contract,
the prospective ecosystem or distributed ledger technology asset
offering ecosystem operator shall show proof of having successful ly
participated in a state or federal convertible virtual currency a nd
payment gateway demonstration and no-action processes; and
2. Demonstrate the proper procedural protocol publicly or
privately in a test of the distributed ledger technology to the
satisfaction of the state or federal securitie s regulators'
compliance review processes.
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D. Preferences should be given to ecosyst em operator applicants
which have capabilities of a distributed ledger technology e cosystem
incubator or which have obtained United States Treasury, United
States Department of Agriculture, and government charters, or
certification as community developm ent entities or credit programs
which have maintained such status for at least ten (10) years and
which are headed by licensed Oklahoma fiduciaries.
E. Every fintech vendor or data company employing blockchain or
distributed ledger technologies on behalf of the state, or its
political subdivision s or agencies, and operating within the state
shall adhere to the securities and finance law s of the state and the
United States.
F. A convertible virtual currency o r digital asset designed and
used by the state and any of its agencies or political subdivisions
shall be prepaid and stable and shall be designed for correlated
payment and the trac king of goods, services, and custodians.
G. Distributed ledger technology asset offering ecosystem
operators or blockchain-specialized vendors may use smartphone
applications for the purchase and redemption of the convertible
virtual currencies for onboa rding customers who need payment and
tracking services pursuant to any stat e-authorized program.
H. Every distributed ledger technology asset offering ecosystem
shall be designed as a publicly owned, operated, and regulated
entity and as the property of the State of Oklahoma and to become
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autonomous and disintermediated by using programmable smart
contracts managed by algorithms and encoded with relevant state,
county, local, tribal, or federal laws and regulations for taxation,
accounting, escrows, remittances, custody tracking, and other
applications.
I. The initial use case shall be a distributed ledger
technology asset offering ecosystem which shall provide an
integrated logistics, payment, and tax recording and remittance
system for the use of government taxing and regulatory authorities
that will also provide for customer p ayment and custody transfe rs
using escrow and smart contracts for services and goods at the
retail and wholesale levels among producers, merchants, and
customers.
J. Every distributed ledger technology or fintech vendor shall
tailor its technology to comply with and conform to the state's
anti-monopoly and records laws and to include regulations for
dispute resolution, evidentiary proceedings, money services
businesses, tax revenue remittance, tax reporting, securities, and
escrow.
K. For logistical track ing and recording, the ecosystem shall
use correlated payment-custodian-product registries, technologies,
or other vendors with lawfully permissive technology for the state
and the ecosystem to achieve its end s, such as matching Radio
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Frequency Identificat ion, quick response code, or other bar-code-
enabled identification.
L. 1. Pursuant to the ecosystem 's requirements, agencies,
customers, or users of the software shall:
a. create an unalterable recorded digital identity or
digital account or technology such as a lawful digital
wallet, and
b. open a digital or smart contract account which shall
enable the customer or user to interact within the
ecosystem.
2. Customers may purchase software -based contracts as digital
contracts for customer-to-customer, customer-to-business, business-
to-business, government-to-customer, business-to-government, or
government-to-government.
SECTION 6. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Sect ion 12004 of Title 74, unless there
is created a duplication in numbering , reads as follows:
A. For convertible virtual currency designed for the state and
its political subdivisions, an entity operating an ecosystem, and
any entity affiliated with an ecosystem operator, shall not use any
proceeds from the convertible virtual currency sales, purchases,
transfers, or conversions to develop the ecosystem, applications, or
platforms referenced by this act, which shall be fully developed and
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operational at the time of any convertible virtual currency transfer
or conversion.
B. The convertible virtual currency designed for the state and
its political subdivisions shall be exclusively marketed to
customers and immediately usable for its intended function or
functions at the time it is purchased, sold, transferred, or
converted and not with any potential for the increase in the market
value of the convertible virtual currency.
C. An ecosystem operator shall restrict sales, purchases,
transfers, and conversions of the convertible virtual currency to
ecosystem digital wallets only.
D. Any customer who holds convertible virtual currency designed
for the state and its political subdivisions may only transfer or
convert the convertible virtual currency at the face v alue of One
United States Dollar ($1.00) per convertible virtual currency t o
another ecosystem-approved wallet.
E. An ecosystem operator shall sell, purchase, transfer, and
convert the convertible virtual currency designed for the state or
its political subdivisions at a price of One United States Dollar
($1.00) per convertible virtual currency throughout the life of the
program, and each convertible virtual currency shall represent an
ecosystem obligation to convert or transfer the convertible virtual
currency at a value of One United States Dollar ($1.00) per
convertible virtual currency.
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F. Convertible virtual currency designed for the state or its
political subdivisions shall be fully backed by United States dollar
assets deposited in United St ates financial institut ions.
G. Selling, buying, converting, or transferring conve rtible
virtual currency designed for the state or its political
subdivisions for less or more than One United States Dollar ($1.00)
shall be technologically impossible.
SECTION 7. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 12005 of Title 74, unless there
is created a duplication in numbering, reads as follows:
A. Digital contracts or smart contracts used by this state and
its political subdivisions shall be programmed for accountancy,
identity, regulatory permissibility, and legality, credit
verification, product location, work performance, customer status,
agreements, and various relationships as conditions precede nt to
escrowed funds release.
B. Smart contracts shall track performance from ince ption to
completion and legally satisfy the release from escrow, which
initiates a convertible virtual currency transfer.
C. The ecosystem network provided for the benefit of state
agencies, political subdivisions, and tribal-level entities on a
voluntary basis shall be controlled and regulated by an electronic
funds transfer system interchange .
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D. Anyone who interacts with the ecosystem shall have a digital
identity, or like technology, which shall be a precondition to
initiating a convertible virtual cu rrency transfer.
E. Any transfer of convertible virtual currency shall be in
accordance with the Travel Rule as defined in Section 4 of this act.
F. Customers shall agree with a con spicuous electronic
signature declaring that they are acquiring the conve rtible virtual
currency for a consumptive purpose and not as an investment, nor
with an expectation that the convertible virtual currency shall earn
profits based upon the activities and efforts of third pa rties.
G. Convertible virtual currency functional ity shall always be
associated with a digital contract, which shall determine the terms
of how, when, where, and to whom any convertible virtual currency is
transferred or converted b y an ecosystem operator .
H. Before any transfer, purchase, sale, or conv ersion of
convertible virtual currency is finalized, the customer shall first
enter decision tree terms to show mutuality of consent between
customers.
I. To form a smart contract or to obtain any service s from an
ecosystem, customers in a supply chain must agree to terms and fees
for using the smart contract software , which may be established by
the participating state agency, political subdivision, or tribal
entity regulating that ecosystem operator who provides various
services in exchange for the custo mer paying the fees to the
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ecosystem operator, as set forth in a smart contract agreement for
services rendered as determined between the parties or by operation
or direction of the participating government agency, tribal entity,
or political subdivision .
J. Customers may purchase digital contracts and the n egotiation
of the charged fee in another digital contract , which is the smart
contract, escrow, and accounting tool that determines the income
going to an ecosystem operator for its services and that defines
that particular relationship of an ecosystem operator-to-customer
and any controlling law or regulation affecting or specifying
contractual relationships .
K. The digital contract shall determine how an ecosystem
operator compensates the customer and how the customer compensates
its ecosystem operator for goods and services . The contents of a
digital contract may be determined by reference to existing terms
administered by an ecosystem operator as an agent of a participating
state agency, tribe, or political subdivision, but any participation
by a tribal entity must be voluntary and as part of a memorandum of
understanding or other appropri ate agreement as provided by this act
or by federal, state, or tribal law. A digital contract and payment
to the customer by an ecosystem operator may include , but is not
limited to, customer efforts as measured by vo lume of transfers or
conversions, payment for the customer filling out a survey , or a
referral fee for additional customers brought in by a customer.
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Services that an ecosystem operator may p rovide to customers for
which the operator is compensated may include such matters as
identification, transfers, conversions, agreements, escrow, consent,
due diligence, custody, taxation, or other matters.
L. Any state-authorized ecosystem operator shall extract fees
pursuant to the controlling law, regulation, agency rule, or digital
contract account's defined terms, debited from the business or
customer bank account as payment for the ecosystem operator's
services. The defined terms for those services shall be found in
the digital contract accounts or the relevant law or regulation
affecting the specific agency, political subdivision , or tribal
entity.
M. An ecosystem operator's debits and credits shall be entered
onto the immutable ledger in the form of a customer credit or debit
to their digital wallets or corresponding bank acco unts using
automated clearinghouse services and application program interface .
N. Compensation shall be paid to or by an ecosystem operator in
United States dollars. Any fees an ecosystem operator charges for
transfers, conversions, escrows, tax remittances , or other services
performed in assisting in the execution of customers ' transactions,
or digital contracts entered between customers, shall be based upon
a negotiated fee schedule, which shall be calculated, accounted for,
tracked, and collected from any transaction between the customers,
and a deduction shall be debited from th e customers' accounts
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pursuant to an agreement a s memorialized in the smart contract
account. Such fees charged may differ depending on matters such as
the type of transaction, identity of the parties to the transaction,
amount and level of services or goods, and the terms of individual
smart contracts.
O. Tax remittances, withholding, reporting, or payments shall
be determined by reference to the digital or smart contract, and
that particular ecosystem operator in that transaction shall collect
the same as an agent on behalf of individuals, businesses,
government regulators, and taxing authorities. Nothing in this
subsection shall be used to limit the authority or power of agencies
to define the contours best applicable to the custody and transfer
of monies owed to the state.
SECTION 8. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 12006 of Title 74, unless there
is created a duplication in numbering, reads as follows:
A distributed ledger technology asset offering ecosystem
operator shall provide relevant tax revenue and information sharing
optimization models, designs, and processes to the Office of
Management and Enterprise Services and the Oklahoma Tax Commission,
and shall prevent tax evasion and other financial crimes.
SECTION 9. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 12007 of Title 74, unless there
is created a duplication in numbering, reads as follows:
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A. The Oklahoma Tax Commission shall determine which cards or
smartphone applications shall be accepted. However, the Tax
Commission shall ensure that no loss of state revenue shall occur
using any such card or smartphone application in relation to tax
collection and remittance.
B. The Tax Commission and Office of Management and Enterprise
Services shall promulgate rules to allow for the orderly
implementation of payment by digital assets and distributed ledger
technologies using the services of an ecosystem operator.
SECTION 10. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 12008 of Title 74, unless there
is created a duplication in numbering, reads as follows:
A. Taxes may be collected using a digital asset loaded onto a
card or smartphone application as a credit or a p repaid store of
value as long as no loss of state revenue shall occur by the
acceptance of such payment .
B. The Oklahoma Tax Commission shall have discretion to
determine the nature of the instru ment or device used for tax
remittance, so long as the Tax C ommission ensures that the
electronic funds transfer solution does not result in any loss of
state revenue because of the use of such a card , device, or
application. The Tax Commission shall prom ulgate rules to allow for
the orderly implementation of paym ent by convertible virtual
currency. The digitized credit or distributed ledger technology
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asset shall then be transmitt ed via electronic fund s transfer system
interchange.
C. The Tax Commission, or the ap plicable taxing jurisdiction,
may exercise authori ty to ensure monies correlation as with the
purpose of this act.
D. Businesses shall as sist in the collection of taxes. The Tax
Commission may mandate how the taxes are paid when using electronic
fund transfer cards or smartphone applications. The duty to pay and
collect the tax shall be on the customer, business, or other end
user.
SECTION 11. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 12009 of Title 74, unless there
is created a duplication in numbering, reads as follows:
A. The Oklahoma Tax Commission shall promulgate rules and
regulations on how to collect taxes using a convertible virtual
currency, by and through the services of distributed ledger
technology asset offering ecosystem operators, to provide a
functional electronic fund s transfer asset offering system
interchange platform and network.
B. The Tax Commission may appoint a qualified ecosystem
operator as its agent to assist in collecting taxes using
distributed ledger technologies and for enforcing the tax laws by
examination and investigation.
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SECTION 12. NEW LAW A new section of l aw to be codified
in the Oklahoma Statutes as Section 12010 of Title 74, unless there
is created a duplication in numbering, read s as follows:
A. Every distributed ledger technology asset offering ecosystem
operator is required to appoint, and always have in place, a
distributed ledger technology asset offering agent:
1. Who shall be a licensed attorney in good standing wi th the
Oklahoma Bar Association; and
2. Whose representation is made known to the Oklahoma
Department of Securities, the Office of Management and Enterprise
Services, and the Oklahoma Tax Commission .
B. The distributed ledger technology asset offering a gent
shall:
1. Ensure that his or her ecosystem operator has satisfied all
requirements as prescribed in the provisions of this act and of any
rules or regulations issued thereunder, including that such issuer
is a fit and proper person to carry out the activity o r activities
under this act;
2. Advise and guide his or her ecosystem operator as to its
responsibilities and obligations to ensure compliance with the
provisions of this act and any rules or regulations i ssued
thereunder;
3. Advise and guide his or her ecosystem operator on all
matters relating to the admission of the issuer 's convertible
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virtual currencies for transfer on an electronic funds transfer
system interchange, and ongoing interchanges and transf ers thereon,
and submit all required documentation and information in relation
thereto;
4. Submit to the United States Securities and Exchange
Commission, Oklahoma Department of Securities, Office of Management
and Enterprise Services, Oklahoma Banking Department, and the Tax
Commission all required information and documentation under this act
and any regulations made or rules issued thereunder, including the
confirmations in terms, in a timely manner;
5. Disclose to the Office of Management and En terprise
Services, the Tax Commission, or other cooperating agencies,
political subdivisions, or tribal entities without delay any
information or explanations that those a gencies may reasonably
require for the purpose of verifying any information submitted;
6. Act as liaison between the ecosystem operator and th e Office
of Management and Enterprise Services and the Tax Commission on all
matters in connection with the transfer of his or her ecosystem
operator's distributed ledger technology assets on an electronic
funds transfer system interchange ;
7. Notify the Office of Management and Enterprise Services or
the Tax Commission in writing without delay of the distributed
ledger technology asset offering agent's resignation, his or her
intention to surrender his or her appointment, or if his or her
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appointment is terminated, giving details of any relevant fact or
circumstances thereto. A copy of such notification shall also be
sent to the ecosystem operator;
8. Submit to the Office of Management and Enterprise Serv ices
and the Tax Commission, on behalf of his or her ecosystem operator,
an annual certificate of compliance; and
9. Comply with any other conditions as the Oklahoma Department
of Securities, Office of Man agement and Enterprise Services, and the
Tax Commission may require or as may be prescribed.
C. In discharging his or her obligations under subsection B of
this section, a distributed ledger technology asset offering agent
shall:
1. Deal with the Oklahoma Department of Securities, Office of
Management and Enterprise Services, and the Tax Commission in an
open and cooperative manner;
2. Deal promptly with all inquiries raised by any such agency;
3. Disclose to the agencies in a timely manner any mate rial
information relating to the agent's or his or her ecosystem
operator's, of which the agent has kno wledge of, noncompliance with
any of the provisions of this a ct or of any regulations made or
rules issued thereunder ; and
4. Provide upon request, and with out unreasonable delay, data
to the Legislative Office of Fiscal Transparency to ensure that
policymakers are operating with t ransparent data sets.
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SECTION 13. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 1201 1 of Title 74, unless there
is created a duplication in numbering, reads as follows:
A distributed ledger technology asset offering ecosystem
operator shall:
1. Conduct its busi ness with honesty and integrity;
2. Communicate with all stakeholders in a fair, clear, and
nonmisleading manner;
3. Conduct its business with due skill, care , and diligence;
4. Identify and manage any conflict of interest that may arise;
5. Have effective arrangements in place for the protection of
stakeholders' and customers' funds;
6. Have effective administrati on arrangements;
7. Maintain all of its systems a nd security access protocol s to
appropriate international standards; and
8. When an ecosystem operator maintains a website and is
required to make public disclosures, m ake public any information or
provide notice to the public on its website as required b y law.
SECTION 14. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 12012 of Title 74, unless there
is created a duplication in numbering, reads as foll ows:
A. The Oklahoma Tax Commission, the State Tr easurer, the
Secretary of State, and the Office of Management and Enterprise
Services shall promulgate rules to implement the provisions of this
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act including, without limitation, the implementation of meth ods to
validate transactions for distributed ledge r technologies.
B. The Tax Commission and Office of Management and Enterprise
Services may contract with third-party vendors and other
governmental entities to carry out the respective duties and
functions as specified in this act, and may work with the O klahoma
State Banking Department, the State Treasurer , and the Oklahoma
Development Finance Authority to develop good practices and
standards for banking and finance for distributed ledger technology
assets offering businesses.
C. The Office of Management and Enterprise Services, Secretary
of State, Oklahoma Development Finance Authority, and the Tax
Commission may be assisted by ecosystem operators and shall be
authorized to enter and negotiate the terms o f any memorandums of
understanding between themsel ves and other states, federal, tribal,
county, and local governments and agencies thereof in effectuating
the terms of this act.
D. The Office of Management and En terprise Services, the Tax
Commission, the Secretary of State, the Oklahoma State Banking
Department, the Oklahoma Sta te Bureau of Investigation, the Oklahoma
Department of Securities, Oklahoma Development Finance Authority,
and the State Treasurer may participate in an interagency working
group, assisted by ecosystem operators designated by the agencies,
for implementing data-driven solutions for sustainable economic
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development, financial crime , and tax evasion problems by using
distributed ledger technologies.
E. The Office of Management and Enterprise Services may
coordinate with any designated ecosystem operator to de termine the
funding requirements and information data points state agencies and
local governments need in order to optimize their regulatory duties
for compliance and enforcement and for using fintech and databases.
The Office of Management and Enterpris e Services and the Tax
Commission shall appoint a steering committee or working group to
determine the compliance burdens and optimal revenue sharing
formulas between the local and state governmental subunits.
Thereafter, there shall be developed a formul a for revenue-sharing
or apportioning regulatory funding based upon the needs and burdens
of state agencies and local governme nts, all to be memorialized by a
memorandum of understanding.
SECTION 15. NEW LAW A new section of law to b e codified
in the Oklahoma Statutes as Section 1201 3 of Title 74, unless there
is created a duplication in numbering, reads as follows:
No cause of action brought pursuant to this act shall be
certified as a class action.
SECTION 16. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 1201 4 of Title 74, unless there
is created a duplication in numbering, reads as f ollows:
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A. An individual filing any pleading that raises or attempts to
raise a claim under this act must file at the same time as filing
the pleading a surety bond or other security if the pendency of the
case would impede or interfere with:
1. The operation of any distributed ledger technology asset
offering ecosystem operator;
2. The collection of any tax;
3. The tracking of products, payment s, or custodians; or
4. Any other state or local governmental function un der this
act.
B. The surety bond or other security required by subsection A
of this section must be approved by the Oklahoma Tax Commission and
shall be in such form and amount as a pplicable tax law shall require
or, in the absence of a specific requireme nt, in such amount as the
Tax Commission may require, and shall be signed as surety by a
surety company authorized to transact bus iness in this state. In
lieu of such surety bond, a claimant may file with the court clerk
security in the form of a negotiabl e bond or other obligation of the
United States or this state of an actual market value not less than
the amount fixed by applicab le law or the Tax Commission.
C. The surety bond or other security required by this section
shall not exceed Twenty -five Million Dollars ($25,000,000.00).
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SECTION 17. NEW LAW A new section of law to be cod ified
in the Oklahoma Statu tes as Section 12015 of Title 74, unless there
is created a duplication in numbering, reads as follows:
The provisions of this act are severable and if any part of this
act be decided by the courts to be unconstitutional or inval id, the
same shall not affect the validity of this act as a whole, or any
part thereof other than the part so decided to be unconstitutional
or invalid.
SECTION 18. This act shall become effective November 1, 2022.
Passed the House of Representatives the 15th day of March, 2022.
Presiding Officer of the House
of Representatives
Passed the Senate the ___ day of __________, 2022.
Presiding Officer of the Senate