On March 31, Idaho Governor Brad Little signed the HB583. Digital Asset Law.. The bill amends Title 28 of the Idaho Code, which generally manages commerce, and adds a new chapter dedicated to the regulation of digital assets. The bill will come into effect on July 1. Idaho’s bill is multifaceted.
(1) Distinguish between digital securities and virtual currencies. Cryptocurrencies do not constitute securities under Idaho law.
(2) Defined “management” or storage of digital assets, automated transactions facilitated by “smart contracts”, and the situation in which a party owns an encrypted private key associated with a particular digital asset. Including.When
(3) Encourage the secured party to manage the security interest of the digital asset, rather than submitting a funding statement.
The principle of money and the definition of Idaho’s cryptocurrency. Historically, money had three functional properties. It served as a medium of exchange, storage of value, and a unit of account.
The first of these qualities is widely considered to be the most important determinant of whether an asset constitutes money. If many merchants begin to accept cryptocurrencies as a payment method in exchange for the provision of goods and services, such currencies will ultimately function like the banknotes and coins used today. There is a possibility.Although the bill classifies both Digital securities When Cryptocurrency that’s why Digital assets Describe (specifically, intangible personal assets), especially cryptocurrencies, as digital assets used as either a medium of exchange, a unit of account, or a valuable store.
Importantly, the bill explicitly excludes cryptocurrencies from the scope of the Idaho Unified Securities Act, which regulates the buying and selling of securities. The bill’s definition of cryptocurrencies could undoubtedly enclose some existing cryptocurrencies, including but not limited to stablecoin and bitcoin, which act as exchange media and storage of value, respectively. ..
Secure transactions, smart contracts, and encryption. Traces of Aidaho’s intention to make digital assets obey existing commercial law are widespread throughout the bill. For example, the bill shows that Idaho’s law on security interest integrity and priority applies to digital assets. Nevertheless, due to the intangibility of digital assets, the bill is usually Lien, where the creditor is the first position of the borrower’s collateral at the time of filing the loan statement.
Under this bill, the protected party who “manages” the digital assets covered by the security interest takes precedence over the otherwise protected party. The bill defines “management” as “the ability to exclude others from use.” [digital assets]Use the “private key”.As explained earlier Here, Digital asset trading is facilitated by public key cryptography, and only the party that owns the private key corresponding to the public key associated with the digital wallet in question truly controls the digital asset linked to the digital wallet. I can do it. The bill, on the other hand, allows protected parties to “control” digital assets by leveraging “smart contracts,” which are self-execution lines of computer code that automate transaction finalization under certain given conditions. It also claims to be satisfied.
For example, Secured Party 1 lends money to Borrower A, and instead, Borrower A agrees to transfer the digital assets as collateral to Secured Party 1. Next, Secured Party 1 and Borrower A agree on certain terms. Secured Party 1 is the full loan plus interest. Secured Party 1 must transfer ownership of the collateral to Borrower A. These conditions may be written in smart contracts and usually cannot be changed once the code is deployed on the blockchain. Therefore, if Borrower A repays the full amount and interest on the loan, the smart contract will automatically return the collateral to her property. Smart contracts are traceable and verifiable on the blockchain and enable contracts to be executed between anonymous parties without the need for enforcement intermediaries (“That is,Escrow Agent).
Our take. Like the recent Wyoming law, Idaho’s Digital Assets Act is Cryptocurrency from Digital security.. This approach generally contradicts the SEC’s perception of (current) digital assets, but until the SEC provides clear guidance on how to regulate digital assets. Howie test Otherwise, state legislators may continue to handle the issue on their own to provide members with a clarification of what digital assets look like from a legal point of view.