Rep. Norm Thurston — Voting Record

Bill

Number

S.B. 160 First Substitute (2023GS)

Sponsor

Sen. Cullimore, K. A.

Final action

Governor Signed 3/17/2023

Outcome

Became law — signed by Gov. Spencer J. Cox

Summary

What it does

• This bill:
• defines terms;
• creates a cause of action for fraudulent transactions that have been committed on a blockchain that has specific technology implemented to allow reversal of transactions; and
• authorizes the Attorney General's Office to operate a node on a blockchain that allows the Attorney General's Office to reverse a fraudulent transaction on a blockchain.

Every vote on this bill

Bill text

BLOCKCHAIN LIABILITY AMENDMENTS
GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Kirk A. Cullimore
House Sponsor: 
Jordan D. Teuscher
LONG TITLE
General Description:
This bill creates a judicial cause of action for the reversal of certain transactions
occurring on a blockchain.
Highlighted Provisions:
This bill:
▸ defines terms;
▸ creates a cause of action for fraudulent transactions that have been committed on a
blockchain that has specific technology implemented to allow reversal of
transactions; and
▸ authorizes the Attorney General's Office to operate a node on a blockchain that
allows the Attorney General's Office to reverse a fraudulent transaction on a
blockchain.
Money Appropriated in this Bill:
None
Other Special Clauses:
None
Utah Code Sections Affected:
ENACTS:
67-5-39
, Utah Code Annotated 1953
78B-3-112
, Utah Code Annotated 1953
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 
67-5-39
 is enacted to read:
 67-5-39.
Sheriff Node Program.
(1) As used in this section:
(a) "Blockchain" means the same as that term is defined in Section 
78B-3-112
.
(b) "Reversible blockchain" means the same as that term is defined in Section
78B-3-112
.
(c) "Sheriff node" means a computer that:
(i) is connected to a reversible blockchain;
(ii) is administered by the Office of the Attorney General; and
(iii) allows the Office of the Attorney General to reverse a mistaken or fraudulent
transaction upon receipt of:
(A) a court order issued under Section 
78B-3-112
; or
(B) an award issued in a valid and binding arbitration.
(d) "Transaction" means the same as that term is defined in Section 
78B-3-112
.
(2) (a) There is created a program known as the "Sheriff Node Program" within the
Office of the Attorney General to operate a sheriff node on a reversible blockchain.
(b) The attorney general shall administer the program with funds available for this
purpose.
(3) The attorney general shall operate the program only to reverse a transaction on a
reversible blockchain upon receipt of:
(a) a court order issued under Section 
78B-3-112
; or
(b) an award issued in a valid and binding arbitration.
(4) The attorney general may make rules in accordance with Title 63G, Chapter 3, Utah
Administrative Rulemaking Act, to carry out the program, including to:
(a) establish the number of reversible blockchains for which the attorney general may
administer a sheriff node;
(b) charge and assess fees and costs for the operation of a sheriff node on a reversible
blockchain;
(c) establish criteria for determining the validity of an arbitration award; and
(d) establish other rules reasonably necessary to efficiently carry out the sheriff node
program.
Section 2. Section 
78B-3-112
 is enacted to read:
 78B-3-112.
Action for mistaken or fraudulent transaction on a reversible
blockchain.
(1) As used in this section:
(a) "Blockchain" means a digital ledger of transactions:
(i) that is distributed across multiple nodes;
(ii) that is mathematically verified; and
(iii) where the validity of transactions is maintained by consensus of nodes.
(b) "Blockchain administrator" means a person that is responsible for maintaining and
overseeing a blockchain.
(c) "Division" means the Division of Consumer Protection created in Section 
13-2-1
.
(d) "Fraudulent transaction" means a transaction that a person undertakes with the
intent to deceive another person, including a transaction that involves:
(i) false representation;
(ii) omissions of material fact; or
(iii) the use of a false or stolen identity.
(e) "Node" means a computer connected to a blockchain.
(f) "Proof of identity" means government-issued identification that contains the
following information:
(i) a person's name;
(ii) an individual's date of birth;
(iii) a person's address, which is:
(A) for an individual, a residential or business street address;
(B) for an individual who does not have a residential or business street address, a Post
Office box number or the residential or business street address of next of kin or of another
contact individual; or
(C) for a person other than an individual, the principal place of business; and
(iv) an identification number, which is:
(A) for a United States person, a taxpayer identification number; or
(B) for a non-United States person, a taxpayer identification number, passport number
and country of issuance, alien identification card number, or the number and country of
issuance of any other government-issued document evidencing nationality or residence and
bearing a photograph or similar safeguard.
(g) "Reversible blockchain" means a blockchain that:
(i) requires the blockchain's users to:
(A) provide proof of identity to the blockchain administrator;
(B) acknowledge and agree that all transactions occurring on the blockchain are subject
to reversal by a sheriff node; and
(C) agree to be subject to jurisdiction of a court in Utah; and
(ii) requires the blockchain administrator to:
(A) verify a user's identity by checking the user's proof of identity against
government-issued identification databases; and
(B) maintain records of a user's proof of identity for a minimum of five years.
(h) "Sheriff node" means the same as that term is defined in Section 
67-5-39
.
(i) "Transaction" means the transfer of digital assets, rights, privileges, or obligations
from one person to another that occurs on a blockchain.
(j) (i) "User" means a person that interacts with a blockchain.
(ii) "User" includes a person that is:
(A) sending or receiving transactions;
(B) accessing data stored on the blockchain;
(C) participating in consensus or governance mechanisms;
(D) running a node on the blockchain;
(E) interacting with smart contracts or decentralized applications; or
(F) holding or managing digital assets.
(2) A plaintiff may bring a cause of action against a person to reverse:
(a) a fraudulent transaction if:
(i) the transaction occurred on a reversible blockchain;
(ii) the plaintiff entered into the transaction with reasonable reliance on the person's:
(A) fraudulent representation;
(B) omission of material fact; or
(C) use of a false or stolen identity; and
(iii) the plaintiff was injured as a result of that reasonable reliance; or
(b) a mistaken transaction if:
(i) the transaction occurs on a reversible blockchain;
(ii) the transaction resulted in a transfer of assets:
(A) to the wrong recipient; or
(B) in the wrong amount; and
(iii) the recipient's refusal to return the assets resulted in the unjust enrichment of the
recipient.
(3) Upon a finding of a mistaken or fraudulent transaction, the court shall issue an
order to the Office of the Attorney General to reverse the transaction in accordance with
Section 
67-5-39
.