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House
File
246
-
Introduced
HOUSE
FILE
246
BY
COLLINS
A
BILL
FOR
An
Act
relating
to
the
investment
of
public
moneys
in
digital
1
assets
and
precious
metals.
2
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
3
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Section
1.
SHORT
TITLE.
This
Act
shall
be
known
and
may
be
1
cited
as
the
“Inflation
Protection
Act”.
2
Sec.
2.
NEW
SECTION
.
12B.10D
Investments
——
digital
assets
3
and
precious
metals.
4
1.
For
purposes
of
this
section:
5
a.
“Digital
asset”
means
digital-only
assets
that
confer
6
economic,
proprietary,
or
access
rights,
including
but
not
7
limited
to
virtual
currency,
cryptocurrency,
and
natively
8
electronic
assets,
including
stablecoins
and
nonfungible
9
tokens.
10
b.
“Exchange-traded
product”
means
a
financial
instrument
11
approved
by
the
United
States
securities
and
exchange
12
commission,
the
commodity
futures
trading
commission,
or
the
13
department
of
insurance
and
financial
services
that
is
traded
14
on
a
regulated
exchange
in
the
United
States
and
derives
its
15
value
from
an
underlying
pool
of
assets,
such
as
stocks,
bonds,
16
commodities,
or
indexes.
17
c.
“Precious
metal”
means
gold,
silver,
or
platinum,
whether
18
in
coin,
bullion,
or
another
form.
19
d.
“Private
key”
means
a
unique
element
of
cryptographic
20
data
that
is
known
to
the
owner
of
the
unique
element
and
is
21
used
for
signing
a
transaction
on
a
blockchain.
22
e.
“Qualified
custodian”
means
a
federal-chartered
or
23
state-chartered
bank,
trust
company,
or
depository
institution,
24
or
a
company
regulated
by
the
state
which
takes
custody
of
25
digital
assets.
26
f.
“Secure-custody
solution”
means
a
technological
product
27
or
blended
product
and
service
that
does
all
of
the
following:
28
(1)
Ensures
that
a
private
key
that
secures
digital
assets
29
meets
all
of
the
following
requirements:
30
(a)
Exclusively
known
to
and
accessible
by
the
owner
of
the
31
private
key.
32
(b)
Exclusively
contained
within
an
encrypted
environment
33
and
accessible
only
by
end-to-end
encrypted
channels.
34
(c)
Not
contained,
accessible,
or
controllable
by
a
35
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cellular
telephone.
1
(d)
Maintained
on
hardware
that
is
in
at
least
two
2
geographically
diverse,
secure
data
centers.
3
(2)
Enforces
user
access
controls
and
a
multiparty
4
governance
structure
for
authorizing
transactions
and
logs
all
5
user-initiated
actions.
6
(3)
Has
a
disaster
recovery
protocol
that
ensures
customer
7
access
to
assets
in
the
event
the
provider
becomes
unavailable.
8
(4)
Undergoes
regular
code
audits
and
penetration
testing
9
from
audit
firms
and
promptly
remedies
any
identified
10
vulnerability.
11
g.
“Stablecoin”
means
a
digital
asset
that
is
issued
by
a
12
corporation
backed
by
United
States
currency
or
high-quality
13
liquid
assets
and
is
redeemable
on
demand
by
the
holder,
at
par
14
for
a
fixed
monetary
value
in
equivalent
United
States
dollars.
15
2.
Notwithstanding
section
12B.10,
subsection
4,
the
16
treasurer
of
state
may
invest
in
precious
metals,
digital
17
assets
with
a
market
capitalization
of
over
seven
hundred
fifty
18
billion
dollars
averaged
over
the
previous
calendar
year,
and
19
stablecoins
using
public
moneys
from
any
of
the
following
20
funds:
21
a.
The
general
fund
of
the
state.
22
b.
The
cash
reserve
fund
created
in
section
8.56.
23
c.
The
Iowa
economic
emergency
fund
created
in
section
8.55.
24
3.
The
amount
of
public
moneys
that
the
treasurer
of
state
25
invests
from
a
fund
under
subsection
2
shall
not
exceed
five
26
percent
of
the
total
amount
of
public
moneys
in
that
fund
at
27
the
time
the
investment
is
made.
28
4.
A
digital
asset
acquired
by
a
fund
listed
in
subsection
2
29
must
be
held
in
one
of
the
following
ways:
30
a.
By
the
treasurer
of
state
through
the
use
of
a
31
secure-custody
solution.
32
b.
On
behalf
of
the
state
by
a
qualified
custodian.
33
c.
As
an
exchange-traded
product.
34
5.
Precious
metals
acquired
by
a
fund
listed
in
subsection
2
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must
be
held
in
one
of
the
following
ways:
1
a.
By
the
state
in
physical
form
or
in
conjunction
with
2
another
state
according
to
rules
adopted
by
the
treasurer
of
3
state.
4
b.
On
behalf
of
the
state
by
a
qualified
custodian.
5
c.
As
an
exchange-traded
product.
6
6.
The
treasurer
of
state
shall
only
hold
stablecoins
which
7
have
received
the
appropriate
regulatory
approvals
from
a
state
8
or
the
United
States.
9
7.
If
a
digital
asset
can
be
loaned
without
increasing
10
the
financial
risk
of
the
state,
the
treasurer
of
state
may
11
loan
the
digital
asset
to
bring
further
return
to
the
state
12
according
to
rules
adopted
by
the
treasurer
of
state.
13
8.
Any
tax
or
fee
that
is
permitted
to
be
paid
to
the
14
state
in
digital
assets
and
is
paid
with
a
digital
asset
with
15
a
market
capitalization
of
over
seven
hundred
fifty
billion
16
dollars
or
stablecoin
shall
be
transferred
from
the
fund
17
designated
for
payment
to
the
general
fund
of
the
state,
if
18
the
fund
designated
for
payment
is
not
the
general
fund
of
the
19
state.
The
treasurer
of
state
shall
reimburse
the
fund
to
20
which
the
qualifying
digital
asset
was
designated
with
United
21
States
currency
from
the
general
fund
of
the
state.
If
the
22
digital
asset
does
not
have
a
market
capitalization
of
over
23
seven
hundred
fifty
billion
dollars,
the
digital
asset
shall
be
24
converted
to
United
States
currency.
25
9.
The
treasurer
of
state
may
adopt
rules
pursuant
to
26
chapter
17A
to
implement
this
section.
27
EXPLANATION
28
The
inclusion
of
this
explanation
does
not
constitute
agreement
with
29
the
explanation’s
substance
by
the
members
of
the
general
assembly.
30
Under
current
law,
the
treasurer
of
state
(treasurer)
may
31
only
make
ceratin
investments
with
public
moneys.
This
bill
32
allows
the
treasurer
to
invest
no
more
than
5
percent
of
the
33
moneys
from
the
general
fund
of
the
state,
cash
reserve
fund,
34
and
Iowa
economic
emergency
fund
in
precious
metals,
digital
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246
assets
with
a
market
capitalization
of
over
$750
billion,
and
1
stablecoins.
The
bill
requires
that
a
digital
asset
be
held
by
2
the
treasurer
through
the
use
of
a
secure-custody
solution,
by
3
a
qualified
custodian,
or
as
an
exchange-traded
product.
The
4
bill
requires
that
precious
metals
be
held
in
physical
form
by
5
the
state
or
in
conjunction
with
another
state,
by
a
qualified
6
custodian,
or
as
an
exchange-traded
product.
The
treasurer
may
7
only
hold
stablecoins
that
have
received
regulatory
approval
8
from
a
state
or
the
United
States.
The
bill
permits
the
9
treasurer
to
loan
a
digital
asset
to
generate
revenue
for
the
10
state
if
doing
so
does
not
increase
the
financial
risk
to
the
11
state.
12
The
bill
provides
that
if
a
tax
or
fee
is
paid
to
the
state
13
in
digital
assets
with
a
market
capitalization
of
over
$750
14
billion
or
stablecoin,
the
asset
must
be
transferred
to
the
15
general
fund
and
the
original
fund
must
be
reimbursed
with
16
United
States
currency.
If
a
tax
or
fee
is
paid
in
digital
17
assets
with
a
lesser
market
capitalization,
the
asset
must
be
18
converted
into
United
States
currency.
19
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