Colorado Digital Token Act

The Act provided that an offer or sale of a qualifying digital token could be exempt from Colorado’s securities registration requirement when the issuer filed a notice of intent with the Securities Commissioner, the token’s primary purpose was consumptive, and the token was marketed for use rather than for speculative or investment purposes. If the consumptive purpose was not available at sale, the statute required availability within 180 days, a restriction on resale or transfer until the consumptive purpose became available, and a clear buyer acknowledgment of consumptive intent.

The Act also addressed persons engaged in effecting or attempting to effect the purchase, sale, or transfer of digital tokens. A person could qualify for a Colorado broker-dealer or salesperson licensing exemption only if the person acted after implementing rules were initially promulgated, filed a notice of intent, complied with the statutory and rule conditions, and the token could be used for a consumptive purpose at the time of the transaction.

The statutory definition of “digital token” focused on a digital unit created through a digital ledger, database, or blockchain-network code; recorded in a chronological, consensus-based, decentralized, and mathematically verified ledger or database; and capable of being transferred without an intermediary or custodian of value. “Consumptive purpose” meant providing or receiving goods, services, or content, including access to them.

Notice filings were central to the exemption structure. Issuers and persons effecting transfers had to file before relying on the exemption, and materially inaccurate notices had to be amended within 30 days. The Securities Commissioner was authorized to adopt rules to implement or enforce the section and to provide exemptions or waivers.

The Colorado Digital Token Act is best understood as a historical Colorado state-law framework for utility-token style offerings and transfer activity. Its affected actors included token issuers, persons facilitating digital-token transactions, and buyers of tokens represented as having a consumptive purpose. Because the law has been repealed, current Colorado analysis should start with the Colorado Securities Act and current Division of Securities rules rather than the former digital-token exemption.

The Act remains relevant for historical research, comparison with other state token laws, and review of conduct during the 2019–2024 period. For current publication, the profile should be labeled “Repealed” and linked to the Colorado jurisdiction archive, the SB19-023 enactment record, and the SB24-180 repeal record.