A Bill for an Act
Page 1, Line 101Concerning the "Colorado Vending of Digital Assets Act".
Bill Summary
(Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://leg.colorado.gov.)
The bill enacts the "Colorado Vending of Digital Assets Act", which requires an owner or operator of a virtual currency kiosk to:
- Provide certain disclosures to customers of the virtual currency kiosk;
- Provide each customer with a printed and an electronic receipt detailing the customer's virtual currency transaction; and
- Fully refund a customer's first virtual currency transaction if the virtual currency transaction is to a virtual currency wallet or exchange located outside of the United States and is determined by law enforcement to be fraudulent.
The bill establishes a daily transaction limit of $1,000 for a customer of a virtual currency kiosk.
The bill defines "virtual currency" as a type of digital unit that is used as a medium of exchange or a form of digitally stored value or that is incorporated into payment system technology. "Virtual currency kiosk" is defined as an electronic terminal acting as a mechanical agent of the owner or operator to enable the owner or operator to facilitate the exchange of virtual currency for other virtual currency or fiat currency.
Page 2, Line 1Be it enacted by the General Assembly of the State of Colorado:
Page 2, Line 2SECTION 1. In Colorado Revised Statutes, add article 112 to title 11 as follows:
Page 2, Line 3ARTICLE 112
Colorado Vending of Digital Assets
Page 2, Line 411-112-101. Short title.The short title of this article 112 is the "Colorado Vending of Digital Assets Act".
Page 2, Line 511-112-102. Definitions.As used in this article 112, unless the context otherwise requires:
Page 2, Line 6(1) "Blockchain technology" has the meaning set forth in section 24-36-121.5 (2)(a).
Page 2, Line 7(2) "Transaction hash" means a unique identifier made up
Page 2, Line 8of a string of characters that acts as a record and provides
Page 2, Line 9proof that a transaction was verified and added to blockchain technology.
Page 2, Line 10(3) (a) "Virtual currency" means a type of digital unit
Page 2, Line 11that is used as a medium of exchange or a form of digitally
Page 2, Line 12stored value or that is incorporated into payment system
Page 2, Line 13technology.
(b) "Virtual currency" includes digital units that:
Page 3, Line 1(I) Have a centralized repository or administrator;
Page 3, Line 2(II) Are decentralized and have no centralized repository or administrator; or
Page 3, Line 3(III) May be created or obtained by computing or manufacturing effort.
Page 3, Line 4(c) "Virtual currency" does not include digital units that:
Page 3, Line 5(I) Are used solely within online gaming platforms, with no market or application outside the gaming platforms; or
Page 3, Line 6(II) Are used exclusively as part of a consumer affinity or
Page 3, Line 7rewards program and can be applied as payment for purchases
Page 3, Line 8with the issuer or other designated merchants but cannot be converted into or redeemed for fiat currency.
Page 3, Line 9(4) "Virtual currency address" means an alphanumeric
Page 3, Line 10identifier representing a destination for a virtual currency transfer that is associated with a virtual currency wallet.
Page 3, Line 11(5) "Virtual currency kiosk" means an electronic
Page 3, Line 12terminal acting as a mechanical agent of the owner or operator
Page 3, Line 13to enable the owner or operator to facilitate the exchange of
Page 3, Line 14virtual currency for other virtual currency or fiat currency, including by:
Page 3, Line 15(a) Connecting to a separate virtual currency exchanger that performs the actual virtual currency transmission; or
Page 3, Line 16(b) Drawing upon the virtual currency in the possession of the owner or operator of the electronic terminal.
Page 3, Line 17(6) "Virtual currency wallet" means a software
Page 3, Line 18application or other mechanism providing a means for holding, storing, and transferring virtual currency.
Page 4, Line 111-112-103. Virtual currency kiosks - disclosures - receipts -
Page 4, Line 2daily limit - cancellation and refund. (1) Before entering into a
Page 4, Line 3virtual currency transaction for, on behalf of, or with a
Page 4, Line 4customer, the owner or operator of a virtual currency kiosk
Page 4, Line 5shall disclose to the customer in clear and conspicuous writing
Page 4, Line 6in the English language all material risks associated with
Page 4, Line 7virtual currency. The disclosures must be displayed on the
Page 4, Line 8screen of the virtual currency kiosk with the ability for a
Page 4, Line 9customer to acknowledge receipt of the disclosures. The disclosures must include at least the following information:
Page 4, Line 10(a) A disclosure provided separately from the disclosures
Page 4, Line 11provided pursuant to subsections (1)(b) to (1)(i) of this section
Page 4, Line 12and featured prominently and in bold-faced type stating the
Page 4, Line 13following: "WARNING: LOSSES DUE TO FRAUDULENT OR
Page 4, Line 14ACCIDENTAL TRANSACTIONS MAY NOT BE RECOVERABLE
Page 4, Line 15AND TRANSACTIONS IN VIRTUAL CURRENCY ARE IRREVERSIBLE.";
Page 4, Line 16(b) Virtual currency is not backed or insured by the
Page 4, Line 17government, and accounts and value balances are not subject
Page 4, Line 18to federal deposit insurance corporation, national credit union
Page 4, Line 19administration, or Securities Investor Protection Corporation protections;
Page 4, Line 20(c) For some virtual currency transactions, the
Page 4, Line 21transaction will be deemed recorded when recorded on a public
Page 4, Line 22ledger, which may not be the date or time when the customer
Page 4, Line 23initiates the virtual currency transaction;
Page 5, Line 1(d) The value of virtual currency may be derived from the
Page 5, Line 2continued willingness of market participants to exchange fiat
Page 5, Line 3currency for virtual currency, which may result in the
Page 5, Line 4permanent and total loss of the value of a particular virtual currency if the market for that virtual currency disappears;
Page 5, Line 5(e) There is no assurance that a person that accepts
Page 5, Line 6virtual currency as payment today will continue to do so in the future;
Page 5, Line 7(f) The volatility and unpredictability of the value of
Page 5, Line 8virtual currency relative to fiat currency may result in a significant loss over a short period of time;
Page 5, Line 9(g) The nature of virtual currency may lead to an increased risk of fraud or cyberattack;
Page 5, Line 10(h) The nature of virtual currency means that
Page 5, Line 11technological difficulties experienced by the owner or operator
Page 5, Line 12may prevent access to or use of a customer's virtual currency; and
Page 5, Line 13(i) Any bond maintained by the owner or operator for the
Page 5, Line 14benefit of the customers of the owner or operator may not be sufficient to cover all losses incurred by customers.
Page 5, Line 15(2) When opening an account for a customer, the owner or
Page 5, Line 16operator of a virtual currency kiosk shall disclose to the
Page 5, Line 17customer in clear and conspicuous writing in the English
Page 5, Line 18language all relevant terms and conditions associated with the
Page 5, Line 19products, services, and activities of the owner or operator and virtual currency generally, including the following:
Page 5, Line 20(a) The customer's liability for unauthorized virtual currency transactions;
Page 6, Line 1(b) The customer's right to stop payment of a
Page 6, Line 2preauthorized virtual currency transfer and the procedure used to initiate a stop-payment order;
Page 6, Line 3(c) Under which circumstances the owner or operator
Page 6, Line 4will, absent a court or government order, disclose information concerning the customer's account to third parties;
Page 6, Line 5(d) The customer's right to receive periodic account statements and valuations from the owner or operator;
Page 6, Line 6(e) The customer's right to receive a receipt, a trade ticket, or other evidence of a virtual currency transaction; and
Page 6, Line 7(f) The customer's right to prior notice of a change in the rules or policies of the owner or operator.
Page 6, Line 8(3) Prior to a transaction in virtual currency for, on
Page 6, Line 9behalf of, or with a customer, the owner or operator of a
Page 6, Line 10virtual currency kiosk shall disclose to the customer in clear
Page 6, Line 11and conspicuous writing in the English language the terms and
Page 6, Line 12conditions of the virtual currency transaction, including the following:
Page 6, Line 13(a) The amount of the transaction;
Page 6, Line 14(b) The fees, expenses, and charges borne by the customer, including applicable exchange rates;
Page 6, Line 15(c) The type and nature of the transaction;
Page 6, Line 16(d) A warning that, once completed, the transaction is irreversible, if applicable;
Page 6, Line 17(e) The difference in the virtual currency's sale price
Page 6, Line 18versus the current market price; and
Page 7, Line 1(f) Other disclosures that are customarily given in connection with a virtual currency transaction.
Page 7, Line 2(4) The owner or operator of a virtual currency kiosk
Page 7, Line 3shall ensure that each customer acknowledges receipt of all disclosures required under this section.
Page 7, Line 4(5) Upon the completion of a virtual currency
Page 7, Line 5transaction, the owner or operator of a virtual currency kiosk
Page 7, Line 6shall provide to the customer a printed and an electronic receipt containing the following information:
Page 7, Line 7(a) The name of and contact information for the owner or
Page 7, Line 8operator, including a telephone number established by the owner or operator to answer questions and register complaints;
Page 7, Line 9(b) The type, value, date, and precise time of the virtual
Page 7, Line 10currency transaction, the transaction hash, and each virtual currency address;
Page 7, Line 11(c) The fee charged;
(d) The exchange rate, if applicable;
Page 7, Line 12(e) A statement of the liability of the owner or operator
Page 7, Line 13for nondelivery or delayed delivery of the currency for which the customer exchanged virtual currency; and
Page 7, Line 14(f) A statement of the refund policy of the owner or operator.
Page 7, Line 15(6) The maximum daily transaction limit of a virtual currency kiosk is one thousand dollars per customer.
Page 7, Line 16(7) (a) The owner or operator of a virtual currency kiosk
Page 7, Line 17shall, at the expense of the owner or operator, allow a
Page 7, Line 18customer to cancel and receive a full refund for a virtual currency transaction if:
Page 8, Line 1(I) The virtual currency transaction was the customer's first virtual currency transaction;
Page 8, Line 2(II) The virtual currency transaction was to a virtual
Page 8, Line 3currency wallet or exchange located outside of the United States; and
Page 8, Line 4(III) Law enforcement determines that the virtual currency transaction was fraudulent.
Page 8, Line 5(b) If the conditions of subsection (7)(a) of this section are
Page 8, Line 6met, the owner or operator shall issue a full refund within
Page 8, Line 7seventy-two hours after being notified that the virtual currency transaction was fraudulent.
Page 8, Line 8SECTION 2. Act subject to petition - effective date. This act
Page 8, Line 9takes effect January 1, 2026; except that, if a referendum petition is filed
Page 8, Line 10pursuant to section 1 (3) of article V of the state constitution against this
Page 8, Line 11act or an item, section, or part of this act within the ninety-day period
Page 8, Line 12after final adjournment of the general assembly, then the act, item,
Page 8, Line 13section, or part will not take effect unless approved by the people at the
Page 8, Line 14general election to be held in November 2026 and, in such case, will take
Page 8, Line 15effect on the date of the official declaration of the vote thereon by the governor.