As we've
previously written, the Token Taxonomy Act (TTA) is an
ambitious and potentially impactful piece of legislation that, by
exempting digital tokens from the securities laws, might remove
regulatory inhibitions from the maturing digital token industry.
The bill is not without fault, however. As it stands, the language
of the bill requiring that a digital token's consensus be
inalterable is ambiguously written and the SEC could use a strict
interpretation to preclude many digital assets from qualifying as
digital tokens.
The proposed additional language of Section 2(a)(20)(B) of the
Securities Act of 1933 reads that to qualify for the exemption, a
digital token:
(i) must be recorded in a
distributed, digital ledger or digital data structure in which
consensus is achieved through a mathematically verifiable process;
and
