What's happening
This bill recognizes blockchain technology and smart contracts as legally valid for electronic signatures and records in New York.
Why it matters
Clarifies legal standing for blockchain-based records and signatures. , reducing ambiguity for businesses and individuals who want to use blockchain and smart contracts in commercial, legal, or governmental processes.
Prevents discrimination against smart contract terms. , ensuring that contracts using these technologies are not denied legal effect simply because they employ smart contract mechanisms, which could encourage innovation and broader adoption.
Protects existing ownership rights when using blockchain to secure information. , so users do not lose control or rights over their data by virtue of securing it via blockchain—unless the contract specifically states otherwise—helping to safeguard personal and corporate data interests.
Establishes a foundation for future digital commerce in New York. , positioning the state to better accommodate emerging technologies and potentially attract more tech-driven businesses and investments.
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Who cares
Headline styles
Recognize Blockchain E-Signatures
Plain English, a few words. Used as the page title.
Sponsors
1 Co-sponsor
History
- Referred to governmental operations
- Delivered to assembly
- Passed senateVote 60–0
- Advanced to third reading
- 2nd report cal.
- 1st report cal.413
- Referred to internet and technology
- Returned to senate
- Died in assembly
- Referred to governmental operations
- Delivered to assembly
- Passed senateVote 60–0
Show 4 earlier actions
- Advanced to third reading
- 2nd report cal.
- 1st report cal.278
- Referred to internet and technology
Companion bill
The same bill in the other chamber. A bill becomes law when one version passes both houses and the governor signs it, so either number can carry it.
Legalize Blockchain Signatures
In Assembly Committee · Governmental Operations · Sponsor Clyde Vanel
Full text
2 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
4142
2019-2020 Regular Sessions
IN SENATE
March 1, 2019
Introduced by Sen. SAVINO -- read twice and ordered printed, and when printed to be committed to the Committee on Internet and Technology
AN ACT to amend the state technology law, in relation to blockchain technology and smart contracts
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Section 302 of the state technology law is amended by adding two new subdivisions 6 and 7 to read as follows:
6. "Blockchain technology" shall mean distributed ledger technology that uses a distributed, decentralized, shared and replicated ledger, which may be public or private, permissioned or permissionless, or driven by tokenized crypto economics or tokenless. The data on the ledger is protected with cryptography, is immutable and auditable and provides an uncensored truth.
7. "Smart contract" shall mean an event-driven program that runs on a distributed, decentralized, shared and replicated ledger and that can take custody over and instruct transfer of assets on that ledger.
§ 2. The state technology law is amended by adding a new section 310 to read as follows:
§ 310. Signatures and records secured through blockchain technology and smart contracts. 1. A signature that is secured through blockchain technology is considered to be in an electronic form and to be an electronic signature.
2. A record or contract that is secured through blockchain technology is considered to be in an electronic form and to be an electronic record.
3. Smart contracts may exist in commerce. A contract relating to a transaction may not be denied legal effect, validity or enforceability solely because that contract contains a smart contract term.
4. Notwithstanding any other law, rule or regulation to the contrary, a person that, in or affecting interstate or foreign commerce, uses
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD01269-01-9
S. 4142 2
blockchain technology to secure information that the person owns or has the right to use retains the same rights of ownership or use with respect to that information as before the person secured the information using blockchain technology. This subdivision does not apply to the use of blockchain technology to secure information in connection with a transaction to the extent that the terms of the transaction expressly provide for the transfer of rights of ownership or use with respect to that information.
§ 3. This act shall take effect immediately.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the state technology law, in relation to blockchain technology and smart contracts
Purpose
Amends the Electronic Signature and Records Act of the State Technology law to define and permit signatures secured through blockchain technolo- gy to be considered an electronic signature.
Summary of provisions
Section 1 amends section 302 of the state technology law to define:
"blockchain technology" - as a distributed ledger technology that uses a distributed, decentralized, shared and replicated ledger.
"smart contract" - is defined as an event-driven program that runs on a distributed, shared and replicated ledger.
Section 2 - Adds a new section 310 to the state technology law allowing:
a signature secured through blockchain technology to be accepted as an electronic signature; a record or contract through blockchain technology to be accepted as an electronic record; and providing for smart contracts and their enforceability.
Additionally, it maintains a person's right to ownership and use of information secured using blockchain technology for interstate or foreign commerce.
Section 3 - provides for an immediate effective date
Existing law
According to NYS Office of Technology website - Article 3 of the State Technology Law - The Electronic Signatures and Records Act (ESRA) provides that "signatures" made via electronic means will be legally binding just as hand-written signatures now are. The law also enhances and clarifies the authority of government to create and retain records in computer produced electronic form. There is now no doubt that elec- tronic records have the same legal force as those produced in other formats such as paper and microfilm.
Justification
The Federal and state governments are evaluating distribution technolo- gy, such as blockchain, to improve transparency, efficiency and trust in government transactions. Several states have enacted blockchain legis- lation and this bill is modeled after Arizona's recent amendments to its Electronic Transactions ACT (AETA) through Chapter 97 of the Laws of 2017. Blockchain is a distributed ledger database that records and shares every transaction that occurs in its network of users and its applica- tions are growing beyond cryptocurrency. In addition, according to Assembly sponsor Vanel per memo for same as bill A1683 of 2019 Session:
"We are in a dynamic transitional time for technology in the world and in New York State, in particular. Of utmost importance is New York's transmission of information over the Internet, the electronic storage of data, electronic record-keeping and cyber security. The state should explore viability of the use of new technologies. Blockchain technology is a form of encryption. "A blockchain is a continuously growing list of records called blocks, which are linked and secured using cryptography. They are encrypted with their own unique signature and timestamp. A signature secured through the blockchain will be more secure than any other protected server due to its level of encryption and decentrali- zation from privatization."
Legislative history
2019 Session - New Bill in Senate
Fiscal implications
No anticipated fiscal impact to the state or any localities
Effective date
Immediately
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.