Summary of Original Version

Amend various sections and create new sections of Subtitle 11 of KRS Chapter 286 to expand the scope of the subtitle to include virtual currency kiosk business; define terms; require licensure for virtual currency kiosk business in this state; require each virtual currency kiosk business location to be approved by the commissioner of the Department of Financial Institutions; require each application for a license to engage in virtual currency kiosk business to be accompanied by a surety bond or other similar security; establish requirements for approval to engage in virtual currency kiosk business at a location in this state; apply examination, investigation, recordkeeping, registered agent, and trade practice requirements to virtual currency kiosk operators; establish reporting, transaction, trade practice, notice, disclosure, fraud detection, and refund requirements for virtual currency kiosk operators; apply license and civil penalties to virtual currency kiosk operators; authorize the commissioner to order any virtual currency kiosk operator to provide refunds and to direct any peace officer to seize, impound, or render inoperable a virtual currency kiosk; establish the purpose of the Act; amend KRS 286.2-015 to authorize political subdivisions of this Commonwealth to enact and enforce ordinances, regulations, and resolutions pertaining to virtual currency kiosk business; create a new section of KRS Chapter 367 to provide that a violation of Subtitle 11 of KRS Chapter 286 by a virtual currency kiosk operator shall be deemed a violation of, and subject to the remedies and penalties of, KRS 367.170; repeal KRS 286.11-065, relating to licenses issued under former KRS Chapter 366; require the commissioner to promulgate emergency and ordinary administrative regulations to implement the Act within 30 days after the effective date of the Act; provide that persons shall not be required to comply with licensing and other provisions of the Act until certain contingencies are satisfied.

Summary of Amendment: House Committee Substitute 1

Summary Retain original provisions; except establish Subtitle 13 of KRS Chapter 286 and create new sections thereof to regulate virtual currency kiosk business; establish definitions and exemptions; provide for enforcement by the commissioner of the Department of Financial Institutions; authorize the commissioner to require licensees to file special and regular reports; establish license requirements for virtual currency kiosks; permit regulatory filings to be submitted to a nationwide licensing system registry; establish initial and renewal application processes and requirements, reporting, bond and tangible net worth, and change of control requirements for virtual currency kiosk operators; require the commissioner to promulgate administrative regulations to establish format, document submission, and fee requirements for virtual currency kiosk operators; establish agent, record retention, and permissible investment requirements for virtual currency kiosk operators; establish virtual currency kiosk transaction limits, disclosures, receipt requirements, trade practice requirements, prohibited practices, anti-fraud and information security compliance procedures, and refund requirements; authorize the commissioner to accept complaints and conduct investigations and examinations; provide for the confidentiality of certain documents provided to the commissioner; authorize the commissioner to share, disclose, and report information and take other actions to assist in the commissioner's duties; require the commissioner to publish an annual report on the department's website; establish due process requirements for adverse actions taken by the commissioner against licensees and other persons; establish requirements for the denial, suspension, or revocation of a license; authorize the commissioner to enter cease and desist orders and emergency orders; authorize the commissioner to order civil penalties; establish criminal penalties for false records and unlicensed activity; amend KRS 431.073 to authorize expungement of a Class D felony under the virtual currency kiosk business subtitle; require the commissioner of the Department of Financial Institutions to promulgate any required emergency and ordinary administrative regulations on or before January 1, 2027; EFFECTIVE, in part, April 30, 2027.

Summary of Amendment: House Floor Amendment 1 -- M. Meredith

Summary Retain original provisions, except make technical amendment; add definition of "new virtual currency kiosk user"; apply certain transaction limits, and 72 hour hold or refund requirement, to new virtual currency kiosk users.

Summary of Amendment: House Floor Amendment 2 -- M. Meredith

Summary Retain original provisions, except make technical amendments; add definition of "new virtual currency kiosk user"; apply certain transaction limits, and 72 hour hold or refund requirement, to new virtual currency kiosk users.

Summary of Amendment: House Floor Amendment 3 -- T. Smith

Summary Create a new section of KRS 369.130 to 369.139 to define "hardware wallet provider"; require hardware wallet providers to provide live customer service during operating hours and to provide a mechanism for, and assistance with, resetting any password, pin, seed phrase, or other similar information necessary to access the contents of a hardware wallet; provide that a violation of the section is an unfair, false, misleading, or deceptive trade practices in violation of KRS 367.170; provide that the remedies and penalties are cumulative; authorize the Attorney General to promulgate administrative regulations for the proper enforcement of the section.

Summary of Amendment: House Floor Amendment 4 -- T. Smith

Summary Make title amendment.

Statutes affected:
House Committee Substitute 1: 431.073
Current: 431.073