Nevada 2023 Regular Session Status: Passed Senate 1 D cosponsors

SB 333 — Revises provisions relating to virtual currency. (BDR 57-18)

Last action — (Pursuant to Joint Standing Rule No. 14.3.3, no further action allowed.)

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  1. ✓
    Introduced
  2. ✓
    In Committee
  3. 3
    Passed Senate
  4. 4
    Passed Assembly
  5. 5
    To Executive
  6. 6
    Enacted

This bill died with 2023 Regular Session. It reached “Passed Senate” and never advanced before the session ended, so it can no longer move — a new version would have to be reintroduced in the current session.

This bill is no longer active — its legislative session has ended, so there is no live prognosis. It would have to be reintroduced in the current session to move again.

Bill Text

What changed in the latest version

405 added · 227 removed

405 line(s) added, 227 removed.

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REQUIRES TWO-THIRDS MAJORITY VOTE (§ 12) S.B.
(Reprinted with amendments adopted on April 24, 2023) FIRST REPRINT S.B.
333 S ENATE BILL NO .
333 SENATE B ILLN O.
333–SENATOR N EAL M ARCH 20, 2023 ____________ Referred to Committee on Commerce and Labor SUMMARY—Revises provisions relating to virtual currency.
333–S ENATOR N EAL M ARCH 20, 2023 ____________ Referred to Committee on Commerce and Labor SUMMARY—Revises provisions relating to virtual currency.
requiring a virtual currency business to provide to the Commissioner of Financial Institutions a written disclosure before engaging in virtual currency business activity with or on behalf of a resident of this State;
requiring a virtual currency business to register with the Commissioner of Financial Institutions before engaging in virtual currency business activity with or on behalf of a resident of this State;
requiring a virtual currency business to pay to the Commissioner an annual assessment;
authorizing the Commissioner to impose a civil penalty on a virtual currency business that engages in certain conduct;
authorizing the Commissioner to award grants to certain residents who are customers of certain virtual currency businesses who are unable to satisfy their monetary obligations to customers;
authorizing the Commissioner to award payments of restitution to certain residents who are victims of fraud committed by a virtual currency business;
prohibiting a person from engaging in certain conduct relating to the solicitation of virtual currency business activity;
prohibiting a domestic life insurer from investing money allocated to certain accounts in virtual currency;
LegiThis bill, based in part on similar legislation proposed in Massachusetts and Connecticut, sets forth various requirements and restrictions concerning virtual currency business activity.
Legislative Counsel’s Digest:
(S.
This bill, sets forth various requirements and restrictions concerning virtual “virtual currency business activity” to mean, in general:
690, 193rd Gen.
(1) receiving virtual currency for transmission or transmitting virtual currency;
Court (Mass.
(2) storing, holding or maintaining custody or control of virtual currency on behalf of others;
2023);
H.B.
5320, Gen.
Assem., Reg.
Sess.
(Conn.
2022)) Section 9 of this bill defines “virtual currency business activity” to mean, in general:
(1) receiving virtual currency for custody or control of virtual currency on behalf of others;
(4) performing exchange services as a business;
(4) performing exchange services as a - *SB333_R1* – 2 – designates a person who engages in virtual currency business activity as a “virtual currency business.” Sections 3-7 and 9.5 of this bill define additional words and terms for the purposes of sections 2-17.5 of this bill.
or (5) controlling or issuing virtual currency.
Section 10 of this bill exempts a broker-dealer registered with the Securities and Exchange Commission and certain financial institutions from the provisions of sections 2-17.5.
Section 8 of this bill designates a person who engages in virtual currency business activity as a “virtual currency business.” Sections 3-7 of this bill define additional words and terms for the purposes of this - *SB333* – 2 – bill.
Section 11 of this bill requires a virtual currency business, before engaging in virtual currency business activity with or on behalf of a resident of this State, to register with the Commissioner of Financial Institutions by submitting a form Commissioner determines that a virtual currency business has committed an act constituting fraud against an older person, vulnerable person or a person under 21 years of age, the Commissioner is authorized to impose a civil penalty against the virtual currency business in an amount not to exceed 5 percent of the gross revenue of the virtual currency business in the immediately preceding year that was derived from engaging in virtual currency business activities.
Section 10 of this bill exempts certain financial institutions from the provisions of this bill.
Section 12 requires the money collected from the civil penalty to be deposited in the Virtual Currency Recovery Account, which is created by section 13 of this bill.
Section 11 of this bill requires a virtual currency business, before engaging in virtual currency business activity with or on behalf of a resident of this State, to containing certain information.
Section 14 of this bill authorizes the Commissioner to award payments of eligible for a grant from the Account if:
Section 12 of this bill requires each virtual currency business who engages in virtual currency business activity with or on behalf of a resident to pay to the Commissioner an annual assessment in an amount equal to 5 percent of the gross revenue of the virtual currency business in the immediately preceding year that was derived from engaging in virtual currency business activities with or on behalf of residents.
(1) the resident is a victim of fraudt is committed by a virtual currency business;
Section 12 requires the money collected which is created by section 13 of this bill.irtual Currency Recovery Account, Section 14 of this bill authorizes the Commissioner to award grants from the Account to eligible residents.
(2) at the time the fraud was committed, the resident was an older person, a vulnerable person or a person under 21 years of age;
Under section 14, a resident is eligible for a grant from the Account if:
and (3) the resident meets any other criteria for eligibility established by the Commissioner by regulation.
(1) the resident has deposited government currency with a virtual currency business or used the services of a virtual currency business to exchange government currency;
Section 15 of this bill requires a virtual currency business, before engaging in virtual currency business activity with or on behalf of a resident, to provide to the resident a written disclosure containing the material risks involved in the activity and certain other information.
(2) the virtual currency business is unable to meet other criteria for eligibility established by the Commissioner by regulation.any Section 15 of this bill requires a virtual currency business, before engaging in virtual currency business activity with or on behalf of a resident, to provide to the resident a written disclosure containing the material risks involved in the activity and certain other information.
Section 15.5 of this bill prohibits a person from business activity with a resident of this State that is intended to produce an erroneous belief by the resident that the person wishes to pursue a romantic or sexual relationship.
Section 16 of this bill prohibits a virtual currency business from engaging in advertising or promotions which target any person or financial exploitation.
Section 16 of this bill prohibits a virtual currency business from engaging in advertising or promotions which target any person or group of persons who, for certain specified reasons, is particularly vulnerable to financial exploitation.
Section 17 of this bill authorizes the Commissioner to adopt regulations to carry out the provisions of this bill.
Section 17 of this bill authorizes the Commissioner to adopt regulations to carry out the provisions of sections 2-17.
THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:
Existing law authorizes a domestic life insurer to establish separate accounts and allocate to those accounts amounts to provide for life insurance or annuities allocated to a separate account to be invested without regard to any requirements or limitations set forth under existing law governing the investments of life insurance companies.
(NRS 688A.390) Section 17.5 of this bill prohibits a domestic life insurer from investing any amount allocated to a separate account to provide for life insurance in virtual currency.
- *SB333_R1* – 3 – THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:
As used in this chapter, unless the context otherwise requires, the words and terms defined in sections 3 to 9, inclusive, of this act have the meanings ascribed to them in those sections.
As used in this chapter, unless the context otherwise requires, the words and terms defined in sections 3 to 9.5, inclusive, of this act have the meanings ascribed to them in those sections.
“Government currency” means currency which has been issued by a government and has been designated as legal - *SB333* – 3 – tender in its country of issuance through law, regulation or government decree.
“Government currency” means currency which has been issued by a government and has been designated as legal tender in its country of issuance through law, regulation or government decree.
5.5.
“Older person” has the meaning ascribed to it in NRS 200.5092.
Sec.
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An Internet protocol address connected with a location in this State.
An Internet protocol address connected with a location in thiSec.
Sec.
(a) Within one or more online game platforms and which does not have a market or application outside of those gaming platforms and cannot be converted to or redeemed for government currency;
(a) Within one or more online game platforms and which does not have a market or application outside of those gaming - *SB333_R1* – 4 – platforms and cannot be converted to or redeemed for government currency;
9.5.
“Vulnerable person” has the meaning ascribed to it in NRS 200.5092.
Sec.
The provisions of this chapter do not apply to a bank, trust company, bank holding company, credit union, building and loan association, savings and loan association, savings bank or mutual savings bank organized under the laws of any state or the United States.
The provisions of this chapter do not apply to a:
- *SB333* – 4 – Sec.
1.
Bank, trust company, bank holding company, credit union, building and loan association, savings and loan association, savings bank or mutual savings bank organized under the laws of any state or the United States.
2.
Broker-dealer registered with the Securities and Exchange Commission.
Sec.
Before engaging in any virtual currency business activity with or on behalf of any resident, a virtual currency business shall submit to the Commissioner, on a form prescribed by the Commissioner, a written disclosure that contains, without limitation:
Before engaging in any virtual currency business activity with or on behalf of any resident, a virtual currency business shall register with the Commissioner by submitting to the Commissioner a form prescribed by the Commissioner that contains, without limitation:
A virtual currency business that has submitted a disclosure pursuant to subsection 1 shall thereafter promptly notify the Commissioner of every material change in the information provided in the disclosure.
A virtual currency business that has registered pursuant to subsection 1 shall thereafter promptly notify the Commissioner of every material change in the information provided in the form submitted pursuant to subsection 1.
On or before a date prescribed by the Commissioner each year, each virtual currency business that has engaged in virtual currency business activity with or on behalf of a resident in the immediately preceding year shall submit to the Commissioner an assessment in an amount equal to 5 percent of the gross revenue of the virtual currency business in the immediately preceding year that was derived from engaging in virtual currency business activities with or on behalf of residents.
If the Commissioner determines that a virtual currency business has committed any act constituting fraud against a resident who is an older person, vulnerable person or under 21 years of age, the Commissioner may, after notice and a - *SB333_R1* – 5 – hearing, impose a civil penalty against the virtual currency business in an amount not to exceed 5 percent of the gross revenue of the virtual currency business in the immediately preceding year that was derived from engaging in virtual currency business activities.
The money collected by the Commissioner from the assessment imposed pursuant to subsection 1 must be deposited in the Virtual Currency Recovery Account created by section 13 of this act.
The money collected by the Commissioner from the civil penalty imposed pursuant to subsection 1 must be deposited in the Virtual Currency Recovery Account created by section 13 of this act.
The money in the Account must be expended to award grants to eligible residents in accordance with section 14 of this act.
The money in the Account must be expended to award payments of restitution to eligible residents in accordance with section 14 of this act.
To the extent that money is available in the Virtual Currency Recovery Account created by section 13 of this act, the Commissioner may award grants from the Account to eligible residents who submit an application to the Commissioner in the form and manner prescribed by the Commissioner.
To the extent that money is available in the Virtual Currency Recovery Account created by section 13 of this act, the Commissioner may award payments of restitution from the Account to eligible residents who submit an application to the Commissioner in the form and manner prescribed by the Commissioner.
- *SB333* – 5 – 2.
2.
Except as otherwise provided in subsection 3, a resident is eligible for a grant from the Account if:
Except as otherwise provided in subsection 3, a resident is eligible for a payment of restitution from the Account if:
(a) The resident has:
(a) The resident is a victim of fraud committed by a virtual currency business;
(1) Deposited government currency with a virtual currency business for the purchase of virtual currency;
(b) At the time the fraud was committed by the virtual currency business, the resident was:
or (2) Used the services of a virtual currency business to exchange government currency for virtual currency;
(1) An older person;
(b) At the time the resident submits an application to the Commissioner for a grant from the Account, the virtual currency business that conducted the virtual currency business activity described in paragraph (a) with the resident is unable to meet any monetary obligations to any of the customers of the virtual currency business;
(2) A vulnerable person;
or (3) Under 21 years of age;
4.
- *SB333_R1* – 6 – 4.
(a) The procedure by which a person may apply for a grant from the Account;
(a) The procedure by which a person may apply for a payment of restitution from the Account;
(b) Any additional criteria that a person must meet to be eligible for a grant from the Account;
(b) Any additional criteria that a person must meet to be eligible for a payment of restitution from the Account;
That laws determining the rights and obligations of virtual currency users are not fully developed and a court may find that - *SB333* – 6 – the elements of the transaction, including, without limitation, the timing, amount, identity or location of the parties may not be the same as if the transaction had occurred with government currency;
That laws determining the rights and obligations of virtual currency users are not fully developed and a court may find that the elements of the transaction, including, without limitation, the timing, amount, identity or location of the parties may not be the same as if the transaction had occurred with government currency;
5.
and 5.
That the value of the virtual currency held by the virtual currency business on behalf of the resident may change more quickly and unexpectedly than that of government currency and may in fact become zero;
That the value of the virtual currency held by the virtual currency business on behalf of the resident may change more quickly and unexpectedly than that of government currency and may in fact become zero.
and 6.
Sec.
That technological difficulties experienced by the virtual currency business may prevent the resident from accessing the virtual currency held by the virtual currency business on behalf of theSec.
15.5.
A person shall not engage in any act or practice for the purpose of soliciting virtual currency business activity with a resident that is intended to produce an erroneous belief by the resident that the person wishes to pursue a romantic or sexual relationship with the resident.
Sec.
Sec.
- *SB333_R1* – 7 – Sec.
17.5.
NRS 688A.390 is hereby amended to read as follows:
688A.390 1.
A domestic life insurer may establish one or more separate accounts, and may allocate thereto amounts (including without limitation proceeds applied under optional modes of settlement or under dividend options) to provide for life insurance or annuities (and benefits incidental thereto), payable in fixed or variable amounts or both, subject to the following:
(a) The income, gains and losses, realized or unrealized, from assets allocated to a separate account shall be credited to or charged against the account, without regard to other income, gains or losses of the company.
(b) Except as may be provided with respect to reserves for guaranteed benefits and funds referred to in paragraph (c):
(1) Amounts allocated to any separate account and accumulations thereon may be invested and reinvested without regard to any requirements or limitations prescribed by the laws of this state governing the investments of life insurance companies [;] , except that no amounts allocated to any separate account or any accumulations thereon to provide for life insurance may be invested in virtual currency, as defined in section 7 of this act;
and (2) The investments in such separate account or accounts shall not be taken into account in applying the investment limitations otherwise applicable to the investments of the company.
(c) Except with the approval of the Commissioner and under such conditions as to investments and other matters as the Commissioner may prescribe, which shall recognize the guaranteed nature of the benefits provided, reserves for:
(1) Benefits guaranteed as to dollar amount and duration;
and (2) Funds guaranteed as to principal amount or stated rate of interest,  shall not be maintained in a separate account.
(d) Unless otherwise approved by the Commissioner, assets allocated to a separate account shall be valued at their market value on the date of valuation, or if there is no readily available market, then as provided under the terms of the contract or the rules or other written agreement applicable to such separate account;
but unless otherwise approved by the Commissioner, the portion if any of the assets of such separate account equal to the company’s reserve liability with regard to the guaranteed benefits and funds referred to in paragraph (c) shall be valued in accordance with the rules otherwise applicable to the company’s assets.
- *SB333_R1* – 8 – (e) Amounts allocated to a separate account in the exercise of the power granted by this section shall be owned by the company, and the company shall not be, nor hold itself out to be, a trustee with respect to such amounts.
If and to the extent so provided under the applicable contracts, that portion of the assets of any such separate account equal to the reserves and other contract liabilities with respect to such account shall not be chargeable with liabilities arising out of any other business the company may conduct.
(f) No sale, exchange or other transfer of assets may be made by a company between any of its separate accounts or between any other investment account and one or more of its separate accounts unless, in case of a transfer into a separate account, such transfer is made solely to establish the account pursuant to subsection 6 or to support the operation of the contracts with respect to the separate account to which the transfer is made, and unless such transfer, whether into or from a separate account, is made:
(1) By a transfer of cash;
or (2) By a transfer of securities having a readily determinable market value, provided that such transfer of securities is approved by the Commissioner.
 The Commissioner may approve other transfers among such accounts if, in the opinion of the Commissioner, such transfers would not be inequitable.
(g) To the extent such company deems it necessary to comply with any applicable federal or state laws, such company, with respect to any separate account, including without limitation any separate account which is a management investment company or a unit investment trust, may provide for persons having an interest therein appropriate voting and other rights and special procedures for the conduct of the business of such account, including without limitation special rights and procedures relating to investment policy, investment advisory services, selection of independent public accountants and the selection of a committee, the members of which need not be otherwise affiliated with such company, to manage the business of such account.
2.
Any contract providing benefits payable in variable amounts delivered or issued for delivery in this state, including a group contract and any certificate issued thereunder, shall contain a statement of the essential features of the procedures to be followed by the insurance company in determining the dollar amount of such variable benefits.
Any such contract under which the benefits vary to reflect investment experience, including a group contract and any certificate in evidence of variable benefits issued thereunder, shall state that such dollar amount will so vary and shall contain on its - *SB333_R1* – 9 – first page a statement to the effect that the benefits thereunder are on a variable basis.
3.
No company shall deliver or issue for delivery within this state variable contracts unless it is licensed or organized to do a life insurance or annuity business in this state, and the Commissioner is satisfied that its condition or method of operation in connection with the issuance of such contracts will not render its operation hazardous to the public or its policyholders in this state.
In this connection, the Commissioner shall consider among other things:
(a) The history and financial condition of the company;
(b) The character, responsibility and fitness of the officers and directors of the company;
and (c) The law and regulations under which the company is authorized in the state of domicile to issue variable contracts.
 If the company is a subsidiary of an admitted life insurance company, or affiliated with such company through common management or ownership, it may be deemed by the Commissioner to have met the provisions of this subsection if either it or the parent or the affiliated company meets the requirements hereof.
4.
Notwithstanding any other provision of law, the Commissioner has sole authority to regulate the issuance and sale of variable contracts, and to issue such reasonable rules and regulations as may be appropriate to carry out the purposes and provisions of this section.
5.
Except for NRS 688A.190, 688A.240 and 688A.250 in the case of a variable annuity contract and NRS 688A.060, 688A.110, 688A.120, 688A.130, 688A.290 to 688A.360, inclusive, and 688B.050 in the case of a variable life insurance policy and except as otherwise provided in this Code, all pertinent provisions of this Code shall apply to separate accounts and contracts relating thereto.
Any individual variable life insurance contract, delivered or issued for delivery in this state, shall contain grace, reinstatement and nonforfeiture provisions appropriate to such a contract.
Any individual variable annuity contract, delivered or issued for delivery in this state, shall contain grace and reinstatement provisions appropriate to such a contract.
The reserve liability for variable contracts shall be established in accordance with actuarial procedures that recognize the variable nature of the benefits provided and any mortality guarantees.
6.
A domestic life insurer which establishes one or more separate accounts pursuant to this section may participate therein by allocating and contributing to such separate account funds which otherwise might be invested pursuant to NRS 682A.410 and 682A.514.
The insurer shall have a proportionate interest in any such account, along with all other participating contract holders, to - *SB333_R1* – 10 – the extent of its participation therein.
The aggregate amount so allocated or contributed by such an insurer to one or more separate accounts shall not, without the consent of the Commissioner, exceed the greater of:
(a) One hundred thousand dollars;
(b) One percent of its admitted assets as of December 31 next preceding;
or (c) Five percent of its surplus as to policyholders as of December 31 next preceding.
 All funds allocated or contributed by the insurer to a separate account for the purpose of participation therein shall be included in Code.
The insurer shall be entitled to withdraw at any time in wholes or in part its participation in any separate account to which funds have been allocated or contributed and to receive upon withdrawal its proportional share of the value of the assets of the separate account at the time of withdrawal.
Sec.
Sections 1 to 17, inclusive, of this act become effective:
Sections 1 to 17.5, inclusive, of this act become effective:
and (b) On January 1, 2024 for all other purposes.
and (b) On January 1, 2024, for all other purposes.
H - *SB333*
H - *SB333_R1*
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Amendments

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Action History

  1. (Pursuant to Joint Standing Rule No. 14.3.3, no further action allowed.)

  2. In Assembly. Read first time. Referred to Committee on Commerce and Labor. To committee.

  3. From printer. To engrossment. Engrossed. First reprint. Read third time. Passed, as amended. Title approved, as amended. (Yeas: 17, Nays: 4.) To Assembly.

  4. From committee: Amend, and do pass as amended. Placed on Second Reading File. Read second time. Amended. (Amend. No. 244.) To printer.

  5. From printer. To committee.

  6. Read first time. Referred to Committee on Commerce and Labor. To printer.

Sponsors

Sponsorship breakdown

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1 sponsors · 0 co-sponsors · 66 not signed on

Sponsors (1)

Co-sponsors (0)

None.

Not signed on (66)

66 members have not signed on to this bill.

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Frequently asked questions

Who sponsors SB 333?
SB 333 is sponsored by Neal, Dina (Democratic).
What is the current status of SB 333?
This bill died with 2023 Regular Session. It reached “Passed Senate” and never advanced before the session ended, so it can no longer move — a new version would have to be reintroduced in the current session.
Where can I track SB 333?
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