Chapter 359-V: Blockchain Basic Laws

In this chapter:

I. "Blockchain" means any technology:

(a) Where data is:

(1) Shared across a network to create a public ledger of verified transactions or information among network participants;

(2) Linked using cryptography to maintain the integrity of the public ledger and to execute other functions; and

(3) Distributed among network participants in an automated fashion to concurrently update network participants on the state of the public ledger and any other functions; and

(b) Composed of source code that is publicly available.

II. "Blockchain protocol" means any executable software deployed to a blockchain composed of source code that is publicly available and accessible, including a smart contract or any network of smart contracts.

III. "Decentralized" means a blockchain system in which no person has the unilateral authority, directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise, to control or materially alter the functionality or operation of the blockchain system.

IV. "Digital asset" means any fungible or non-fungible digital representation of value, unit of value, voting, or usage right that can be exclusively possessed and transferred, person to person, without necessary reliance on an intermediary, and is recorded on a blockchain system. This includes virtual currencies, cryptocurrencies, natively electronic assets (such as stablecoins and non-fungible tokens), and other digital-only assets that confer economic, proprietary, access rights, or powers.

IV-a. "Digital asset mining" or "mining" means using a computer or node for the purpose of securing a blockchain network through computational processes. For the purposes of this chapter only, mining shall also include securing a blockchain through validation mechanisms based on proof-of-stake.

V. "Digital asset exchange" means any platform or network established for purchasing, selling, staking, or exchanging digital assets.

VI. "Digital asset mining business" means a person or entity operating a group of computers on one contiguous property that together consume more than one megawatt of energy for the purpose of securing a blockchain protocol.

VII. "Discriminatory rates" mean electricity rates substantially different from other industrial uses of electricity in similar geographic areas.

VIII. "Node" means a computational device which contains and updates a copy of a blockchain.

IX. "Self-hosted wallet" means a digital interface used to secure and transfer digital assets; and under which the owner of the digital asset retains independent control over the digital assets that are secured by such digital interface.

X. "Smart contract" means software code deployed in a blockchain system that consists of a set of predefined and deterministic instructions and conditions that may be executed in a decentralized manner by participants in the underlying blockchain network. Execution of a smart contract shall produce a change in the blockchain state and may autonomously enforce, execute, and record rules and actions, including but not limited to financial transactions, compliance mechanisms, and the creation of irrevocable digital arrangements. A smart contract need not meet the common law requirements of a legal contract to satisfy this definition.

XI. "Staking" means using a node to lock digital assets in order to operate the consensus mechanism of a blockchain protocol.

No state or local government agency or subdivision thereof shall prohibit, restrict, or otherwise impair the ability of an individual to:

I. Use digital assets to purchase legal goods or services.

II. Self-custody digital assets using a self-hosted wallet or third-party wallet.

III. Use digital assets as a method of payment without the imposition of any tax, withholding, assessment, or charge based solely on the fact that a digital asset was used as the method of payment.

I. No state or local government agency or subdivision thereof shall prohibit any person or business from operating a node for the purpose of connecting to a blockchain protocol or a protocol built on top of a blockchain protocol and transferring digital assets on a blockchain protocol or participating in staking on a blockchain protocol.

II. A person engaged in home digital asset mining or a digital asset mining business shall not be required to obtain a money transmitter license under RSA 399-G.

III. Operating a node or a series of nodes on a blockchain protocol shall not require an individual or business to obtain a money transmitter license under RSA 399-G.

IV. A person engaging in the act of digital asset mining or staking solely with that person's own funds or digital assets and not the funds or digital assets of another, shall not be deemed to be offering or selling a security pursuant to RSA 421-B.

V. A digital asset exchange that offers to provide staking as a service to any person shall not be deemed to be offering or selling a security pursuant to RSA 421-B provided that:

(a) The digital assets staked do not leave the control of the digital asset exchange; or

(b) The digital assets remain under the control of the person who owns them. Nothing in this chapter shall preclude the secretary of state or the secretary of state's designee from instituting appropriate proceedings against a person or digital asset exchange that falsely claims to be offering digital asset staking as a service under RSA 421-B.

VI. Notwithstanding any other provision of law, anyone engaged in digital asset mining, operating a node or series of nodes on a blockchain network, or providing digital asset mining or staking services for individuals or other businesses shall not face liability related to a specific transaction merely by validating that transaction.

I. Any person directly affected by a violation of this chapter may petition the superior court or the blockchain dispute docket for relief.

II. The superior court may order declaratory, injunctive, or other equitable relief.

III. Any person who prevails on any claim brought pursuant to this chapter, and shows by a preponderance of the evidence that the defendant engaged in a purposeful violation of this chapter, shall be entitled to an award of reasonable attorney's fees.

If any provision of this chapter or the application thereof to any person or circumstances is held invalid, such invalidity shall not affect other provisions or applications of the chapter which can be given effect without the invalid provision or application. This chapter shall retain its purpose and effect to the maximum extent permitted under the state and federal constitutions, whether through the severance of provisions or applications, judicial injunction or construction, or any other just and proper remedy.