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A00938 Text:

                STATE OF NEW YORK
                               2023-2024 Regular Sessions
                   IN ASSEMBLY
                                    January 11, 2023
        Introduced  by M. of A. VANEL -- read once and referred to the Committee
          on Science and Technology
        AN ACT to amend the financial services law,  in  relation  to  requiring
          certain disclosures in advertisements involving virtual tokens
          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:
     1    Section 1. Subdivision (a) of section 104 of  the  financial  services
     2  law is amended by adding a new paragraph 6 to read as follows:
     3    (6) "Virtual token" shall mean any interchangeable or non-interchange-
     4  able  unit  of  data that is stored on any blockchain ledger which shall
     5  include, among other digital units that the superintendent determines to
     6  be virtual tokens in accordance with this definition,  cryptocurrencies,
     7  virtual  currencies, digital assets and digital tokens, whether fungible
     8  or non-fungible. Virtual tokens shall not be construed to include any of
     9  the following:
    10    (A) digital units that: (i) are used solely within online gaming plat-
    11  forms; (ii) have no market or application outside of those gaming  plat-
    12  forms; (iii) cannot be converted into, or redeemed for, fiat currency or
    13  virtual  currency;  and (iv) may or may not be redeemable for real-world
    14  goods, services, discounts, or purchases;
    15    (B) digital units  that  can  be  redeemed  for  goods,  services,  or
    16  purchases  as  part  of  a customer affinity or rewards program with the
    17  issuer and/or other designated merchants or can be redeemed for  digital
    18  units  in  another  customer  affinity or rewards program, but cannot be
    19  converted into, or redeemed for, fiat currency or other virtual  curren-
    20  cy; or
    21    (C) digital units used as part of prepaid cards.
    22    § 2. The financial services law is amended by adding a new section 410
    23  to read as follows:
    24    §  410.  Restrictions concerning advertising.  (a) No person shall, in
    25  any manner, advertise, print, display, publish,  distribute,  or  broad-
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.

        A. 938                              2
     1  cast,   or  cause  or  permit  to  be  advertised,  printed,  displayed,
     2  published, distributed, or broadcasted, any statement or  representation
     3  with  regard  to  any virtual token for consideration without disclosing
     4  the  amount  of  consideration,  whether  past or prospective, direct or
     5  indirect, and the nature thereof.
     6    (b) No  person  shall,  in  any  manner,  advertise,  print,  display,
     7  publish,  distribute, or broadcast, or cause or permit to be advertised,
     8  printed, displayed, published, distributed, or broadcasted,  any  state-
     9  ment  or representation with regard to any virtual token or other finan-
    10  cial product or service if such statement or representation is,  in  any
    11  manner, false, misleading or deceptive.
    12    (c) For the purposes of this section and without limiting subdivisions
    13  (a)  and  (b)  of  this  section, a statement or representation shall be
    14  false, misleading and deceptive if it states  or  implies,  directly  or
    15  indirectly,  that  a person is authorized legally to offer or provide in
    16  New York state or to New York state residents a virtual token  or  other
    17  financial product or service, and such person is not so authorized.
    18    § 3. This act shall take effect immediately.
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