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A BILL TO BE ENTITLED
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AN ACT
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relating to the control of virtual currency and the rights of |
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purchasers who obtain control of virtual currency for purposes of |
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the Uniform Commercial Code. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 9.102(b), Business & Commerce Code, is |
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amended to read as follows: |
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(b) The following definitions in other chapters apply to |
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this chapter: |
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"Applicant"Section 5.102. |
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"Beneficiary"Section 5.102. |
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"Broker"Section 8.102. |
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"Certificated security"Section 8.102. |
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"Check"Section 3.104. |
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"Clearing corporation"Section 8.102. |
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"Contract for sale"Section 2.106. |
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"Control" (with respect to a document of title)Section 7.106. |
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"Customer"Section 4.104. |
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"Entitlement holder"Section 8.102. |
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"Financial asset"Section 8.102. |
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"Holder in due course"Section 3.302. |
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"Issuer" (with respect to a letter of credit |
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or letter-of-credit right)Section 5.102. |
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"Issuer" (with respect to a security)Section 8.201. |
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"Lease"Section 2A.103. |
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"Lease agreement"Section 2A.103. |
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"Lease contract"Section 2A.103. |
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"Leasehold interest"Section 2A.103. |
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"Lessee"Section 2A.103. |
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"Lessee in ordinary course of business"Section 2A.103. |
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"Lessor"Section 2A.103. |
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"Lessor's residual interest"Section 2A.103. |
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"Letter of credit"Section 5.102. |
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"Merchant"Section 2.104. |
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"Negotiable instrument"Section 3.104. |
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"Nominated person"Section 5.102. |
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"Note"Section 3.104. |
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"Proceeds of a letter of credit"Section 5.114. |
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"Prove"Section 3.103. |
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"Sale"Section 2.106. |
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"Securities account"Section 8.501. |
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"Securities intermediary"Section 8.102. |
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"Security"Section 8.102. |
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"Security certificate"Section 8.102. |
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"Security entitlement"Section 8.102. |
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"Uncertificated security"Section 8.102. |
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"Virtual currency"Section 12.001. |
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SECTION 2. Subchapter A, Chapter 9, Business & Commerce |
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Code, is amended by adding Section 9.1071 to read as follows: |
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Sec. 9.1071. CONTROL OF VIRTUAL CURRENCY. A secured party |
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has control of virtual currency as provided by Section 12.004. |
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SECTION 3. Section 9.310(b), Business & Commerce Code, is |
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amended to read as follows: |
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(b) The filing of a financing statement is not necessary to |
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perfect a security interest: |
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(1) that is perfected under Section 9.308(d), (e), |
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(f), or (g); |
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(2) that is perfected under Section 9.309 when it |
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attaches; |
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(3) in property subject to a statute, regulation, or |
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treaty described in Section 9.311(a); |
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(4) in goods in possession of a bailee that is |
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perfected under Section 9.312(d)(1) or (2); |
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(5) in certificated securities, documents, goods, or |
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instruments which is perfected without filing, control or |
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possession under Section 9.312(e), (f), or (g); |
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(6) in collateral in the secured party's possession |
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under Section 9.313; |
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(7) in a certificated security that is perfected by |
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delivery of the security certificate to the secured party under |
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Section 9.313; |
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(8) in deposit accounts, electronic chattel paper, |
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electronic documents, investment property, virtual currencies, or |
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letter-of-credit rights that is perfected by control under Section |
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9.314; |
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(9) in proceeds that is perfected under Section 9.315; |
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(10) that is perfected under Section 9.316; or |
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(11) in oil or gas production or their proceeds under |
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Section 9.343. |
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SECTION 4. The heading to Section 9.312, Business & |
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Commerce Code, is amended to read as follows: |
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Sec. 9.312. PERFECTION OF SECURITY INTERESTS IN CHATTEL |
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PAPER, DEPOSIT ACCOUNTS, DOCUMENTS, AND GOODS COVERED BY DOCUMENTS, |
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INSTRUMENTS, INVESTMENT PROPERTY, VIRTUAL CURRENCIES, |
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LETTER-OF-CREDIT RIGHTS, AND MONEY; PERFECTION BY PERMISSIVE |
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FILING; TEMPORARY PERFECTION WITHOUT FILING OR TRANSFER OF |
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POSSESSION. |
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SECTION 5. Section 9.312(a), Business & Commerce Code, is |
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amended to read as follows: |
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(a) A security interest in chattel paper, negotiable |
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documents, instruments, [or] investment property, and virtual |
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currencies may be perfected by filing. |
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SECTION 6. Sections 9.314(a) and (b), Business & Commerce |
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Code, are amended to read as follows: |
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(a) A security interest in investment property, deposit |
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accounts, letter-of-credit rights, virtual currencies, electronic |
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chattel paper, or electronic documents may be perfected by control |
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of the collateral under Section 7.106, 9.104, 9.105, 9.106, [or] |
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9.107, or 9.1071. |
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(b) A security interest in deposit accounts, electronic |
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chattel paper, virtual currencies, letter-of-credit rights, or |
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electronic documents is perfected by control under Section 7.106, |
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9.104, 9.105, [or] 9.107, or 9.1071 when the secured party obtains |
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control and remains perfected by control only while the secured |
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party retains control. |
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SECTION 7. The heading to Section 9.331, Business & |
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Commerce Code, is amended to read as follows: |
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Sec. 9.331. PRIORITY OF RIGHTS OF PURCHASERS OF |
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INSTRUMENTS, DOCUMENTS, [AND] SECURITIES, AND VIRTUAL CURRENCIES |
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UNDER OTHER CHAPTERS; PRIORITY OF INTERESTS IN FINANCIAL ASSETS AND |
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SECURITY ENTITLEMENTS UNDER CHAPTER 8 AND VIRTUAL CURRENCIES UNDER |
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CHAPTER 12. |
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SECTION 8. Sections 9.331(a) and (b), Business & Commerce |
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Code, are amended to read as follows: |
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(a) This chapter does not limit the rights of a holder in due |
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course of a negotiable instrument, a holder to which a negotiable |
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document of title has been duly negotiated, [or] a protected |
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purchaser of a security, or a qualifying purchaser of a virtual |
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currency. These holders or purchasers take priority over an earlier |
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security interest, even if perfected, to the extent provided in |
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Chapters 3, 7, [and] 8, and 12. |
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(b) This chapter does not limit the rights of or impose |
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liability on a person to the extent that the person is protected |
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against the assertion of a claim under Chapter 8 or 12. |
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SECTION 9. Title 1, Business & Commerce Code, is amended by |
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adding Chapter 12 to read as follows: |
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CHAPTER 12. VIRTUAL CURRENCY |
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Sec. 12.001. DEFINITION. In this chapter, "virtual |
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currency": |
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(1) means a digital representation of value that: |
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(A) is used as a medium of exchange, unit of |
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account, or store of value; and |
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(B) is not legal tender, whether or not |
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denominated in legal tender; and |
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(2) does not include: |
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(A) a transaction in which a merchant grants, as |
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part of an affinity or rewards program, value that cannot be taken |
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from or exchanged with the merchant for legal tender, bank credit, |
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or virtual currency; or |
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(B) a digital representation of value issued by |
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or on behalf of a publisher and used solely within an online game, |
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game platform, or family of games sold by the same publisher or |
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offered on the same game platform. |
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Sec. 12.002. SCOPE. This chapter applies to virtual |
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currency. |
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Sec. 12.003. RIGHTS IN VIRTUAL CURRENCY. (a) In this |
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section: |
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(1) "Adverse claim" means a claim that a claimant has a |
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property interest in a virtual currency and that it is a violation |
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of the rights of the claimant for another person to hold, transfer, |
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or deal with the virtual currency. |
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(2) "Qualifying purchaser" means a purchaser that |
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obtains control of a virtual currency for value and without notice |
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of any adverse claim. |
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(b) Subject to Subsections (c) through (h), law other than |
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this chapter determines whether a person acquires rights in a |
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virtual currency and the rights that the person acquires. |
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(c) A purchaser of a virtual currency acquires all rights in |
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the virtual currency that the transferor had or had power to |
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transfer. |
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(d) A purchaser of a limited interest in a virtual currency |
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acquires rights only to the extent of the interest purchased. |
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(e) In addition to acquiring the rights of a purchaser, a |
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qualifying purchaser acquires the purchaser's rights in a virtual |
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currency free of any adverse claim. |
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(f) An action based on an adverse claim to a virtual |
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currency, whether framed in conversion, replevin, constructive |
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trust, equitable lien, or other theory, may not be asserted against |
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a qualifying purchaser that acquires the purchaser's interest in, |
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and obtains control of, the virtual currency for value and without |
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notice of the adverse claim. |
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(g) A person has notice of an adverse claim if: |
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(1) the person knows of the adverse claim; or |
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(2) the person is aware of facts sufficient to |
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indicate that there is a significant probability that the adverse |
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claim exists and deliberately avoids information that would |
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establish the existence of the adverse claim. |
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(h) Filing of a financing statement under Chapter 9 is not |
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notice of an adverse claim to a virtual currency. |
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Sec. 12.004. CONTROL OF VIRTUAL CURRENCY. (a) A person has |
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control of a virtual currency if the following conditions are met: |
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(1) the virtual currency or the system in which the |
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virtual currency is recorded, if any, gives the person: |
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(A) the power to derive substantially all the |
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benefit from the virtual currency; |
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(B) subject to Subsection (b), the exclusive |
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power to prevent others from deriving substantially all the benefit |
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from the virtual currency; and |
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(C) subject to Subsection (b), the exclusive |
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power to transfer control of the virtual currency to another person |
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or cause another person to obtain control of a virtual currency that |
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derives from the virtual currency; and |
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(2) the virtual currency, a record attached to or |
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logically associated with the virtual currency, or the system in |
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which the virtual currency is recorded, if any, enables the person |
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to readily identify the person as having the powers specified in |
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Subdivision (1). |
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(b) A power specified in Subsection (a)(1)(B) or (C) can be |
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exclusive, even if: |
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(1) the virtual currency or the system in which the |
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virtual currency is recorded, if any, limits the use to which the |
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virtual currency may be put or has protocols that are programmed to |
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result in a transfer of control; and |
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(2) the person has agreed to share the power with |
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another person. |
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(c) For the purposes of Subsection (a)(2), a person may be |
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identified in any way, including by name, identifying number, |
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cryptographic key, office, or account number. |
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SECTION 10. The changes in law made by this Act apply to a |
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transaction entered into on or after the effective date of this Act. |
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SECTION 11. The changes in law made by this Act apply only |
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to an action, case, or proceeding commenced on or after the |
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effective date of this Act. |
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SECTION 12. This Act takes effect September 1, 2021. |