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Kentucky Revised Statutes Title XXIX. Commerce and Trade § 369.130.Definitions for KRS 369.130 to 369.139

Current as of January 01, 2025 | Updated by Findlaw Staff

As used in KRS 369.130 to 369.139:

(1) “Blockchain” means data that is:

(a) Shared across a peer-to-peer network to create a ledger of verified transactions or information among linked network participants using cryptography to:

1. Maintain the integrity of the ledger; or

2. Execute other functions; and

(b) Distributed in a concurrent, automated update to network participants on the state of the ledger and any other functions;

(2) “Blockchain network” means a technical infrastructure that provides ledger and smart contract services to applications;

(3) “Blockchain protocol” means any executable software:

(a) Deployed to a blockchain, including an additional standardized set of rules that:

1. Uses an existing blockchain as a base;

2. Facilitates the transfer of data and electronic records;

3. Allows that data to be broadcast to nodes; and

4. Is governed by a set of predefined rules which execute autonomously without human intervention and can be altered by a predetermined mechanism; and

(b) Composed of a source code that is publicly available and accessible, including a smart contract or any network of smart contracts;

(4) “Cryptocurrency” has the same meaning as in KRS 139.516;

(5) “Cryptography” means the practice of coding information to ensure only the person that a message was written for can read and process that information;

(6) “Digital asset” means:

(a) Virtual currency;

(b) Cryptocurrency; and

(c) Natively electronic assets, including stablecoins, fungible tokens, and nonfungible tokens;

that confer economic, proprietary, or access rights or powers;

(7) “Hardware wallet” means a physical device that:

(a) Stores private keys offline;

(b) Provides a way to sign transactions and interact with the blockchain; and

(c) Allows the owner to retain independent control over the digital asset contained therein;

(8) “Natively electronic asset” means a purely digital asset that exists only on the blockchain network;

(9) “Node” means a computer which:

(a) Uses software to:

1. Communicate with other devices or participants on a blockchain to maintain consensus and integrity of that blockchain;

2. Create and validate transaction blocks; or

3. Contain and update a copy of a blockchain; and

(b) Does not exercise discretion over transactions initiated by the end users of the blockchain protocol;

(10) “Nonfungible token” means a digital asset on a blockchain that:

(a) Has unique identification codes and metadata that are recorded;

(b) Has been tokenized and cannot be replicated;

(c) Is used to certify ownership and authenticity; and

(d) Represents digital or physical items including artwork or real estate;

(11) “Private key” means the access to manage digital assets at a specific internet address and may be used for encryption and digital signature;

(12) “Self-hosted wallet” means a digital interface that can:

(a) Secure and transfer digital assets; and

(b) Allow its owner to retain independent control of the secured digital assets and private keys;

(13) “Smart contract” has the same meaning as in KRS 42.747;

(14) “Stablecoin” means a digital asset that is:

(a) Issued by a corporation;

(b) Backed by cash or high-quality liquid assets; and

(c) Redeemable on demand by the holder at par for a fixed monetary value in equivalent United States dollars;

(15) “Staking” means using a node to commit digital assets to a blockchain network to:

(a) Validate transactions;

(b) Propose and attest to blocks contained in the blockchain; and

(c) Secure the network;

(16)(a) “Staking as a service” means the provision of technical staking services by a service provider on behalf of an individual or business that owns the digital assets being staked.

(b) “Staking as a service” includes the operation of nodes and the associated infrastructure necessary to facilitate participation in blockchain protocols' consensus mechanisms;

(17) “Third-party wallet” means a wallet that is hosted and controlled by a party other than the owner which contains the private keys for the owner of digital assets; and

(18) “Wallet” means a digital interface or a physical device which holds digital assets or private keys, and may include a:

(a) Hardware wallet;

(b) Self-hosted wallet; and

(c) Third-party wallet.

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Cite this article: FindLaw.com - Kentucky Revised Statutes Title XXIX. Commerce and Trade § 369.130.Definitions for KRS 369.130 to 369.139 - last updated January 01, 2025 | https://codes.findlaw.com/ky/title-xxix-commerce-and-trade/ky-rev-st-sect-369-130/

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