§ 48-5-101 — Definitions.

Utah § 48-5-101

• Jurisdiction: Utah
• Title 48: Unincorporated Business Entity Act
• Ch. 48-5: Decentralized Autonomous Organization Act
• Part 48-5-1: General Provisions

Text

As used in this chapter:
(1) "Administrator" means a person that is appointed in a manner specified in the by-laws to make decisions for specific, predefined operations of the decentralized autonomous organization.
(2) "Asset" means an item of value, whether on-chain or off-chain.
(3) "By-laws" means the procedural rules and regulations that govern a decentralized autonomous organization and the interaction of the decentralized autonomous organization's members and participants.
(4) "Cryptographic proof" means a mathematical proof that verifies that a message has not been tampered with or altered in any way and can be verified by a person that has access to the original message and the proof.
(5) "Decentralized" means that decision-making is distributed among multiple persons.
(6) "Decentralized autonomous organization" means an organization:

(6)(a) created by one or more smart contracts;
(6)(b) that implements rules enabling individuals to coordinate for decentralized governance of an organization; and
(6)(c) that is an entity formed under this chapter.
(7) (7)(a) "Developer" means a person involved in the development or maintenance of a decentralized autonomous organization.
(7)(b) "Developer" includes a person that provides:
(7)(b)(i) software code; or
(7)(b)(ii) design, business, legal, or ancillary support.
(8) (8)(a) "Dispute resolution mechanism" means an on-chain alternative dispute resolution system that enables persons to resolve disputes arising out of a decentralized autonomous organization.
(8)(b) "Dispute resolution mechanism" includes:
(8)(b)(i) arbitration;
(8)(b)(ii) expert determination; or
(8)(b)(iii) an on-chain alternative court system.
(9) "Division" means the Division of Corporations and Commercial Code.
(10) "Failure event" means an error in the decentralized autonomous organization's software code or an exploit that:

(10)(a) renders the decentralized autonomous organization inoperative; or
(10)(b) fundamentally changes the expected operation of the decentralized autonomous organization.
(11) "Graphical user interface" means a publicly accessible interface through which a person interacts with computer software through visual indicator representations.
(12) "Hard fork" means a blockchain software upgrade that is not compatible with previous versions of the blockchain software and requires all users to upgrade to the latest version of the blockchain software.
(13) "Legal representative" means an individual appointed in the manner specified in the by-laws of a decentralized autonomous organization to perform procedural functions off-chain on behalf of a decentralized autonomous organization.
(14) "Majority chain" means the version of the blockchain accepted by more than half of the blockchain's validators following a hard fork.
(15) "Meeting" means a synchronous or asynchronous event for the purpose of discussing and acting upon decentralized autonomous organization related matters by members or participants.
(16) (16)(a) "Member" means a person who has governance rights in a decentralized autonomous organization.
(16)(b) "Member" does not include an individual that has involuntarily received a token with governance rights, unless that person has chosen to participate in governance by undertaking a governance behavior, on-chain or off-chain, for the decentralized autonomous organization.
(17) "Minority chain" means the version of the chain that is not the majority chain following a hard fork.
(18) "Off-chain" means any action that is not on-chain.
(19) "On-chain" means any action that is recorded and verified on a blockchain.
(20) "On-chain contribution" refers to any token segregated and locked in one of the decentralized autonomous organization's smart contracts for the purpose of member buy-in to the decentralized autonomous organization and the provision of withdrawable capital.
(21) "Organizer" means a person that submits the certificate of filing as required in Section 48-5-201.
(22) "Participant" means a person that:

(22)(a) is not a member of a decentralized autonomous organization; and
(22)(b) holds or interacts with a token of a decentralized autonomous organization.
(23) "Permissionless blockchain" means a publicly distributed ledger that allows a person to transact and produce blocks in accordance with the blockchain protocol, in which the validity of the block is independent of the identity of the user.
(24) "Public address" means a unique, durable identifier that an individual can transact with on a permissionless blockchain.
(25) "Public forum" means a freely accessible online environment that is commonly used for the exercise of speech and public debate.
(26) "Public signal" means a declaration authorized by the decentralized autonomous organization in a public forum.
(27) "Quality assurance" means a security review of the software code of the decentralized autonomous organization in accordance with industry standards.
(28) "Redeem" means to exchange a token for the value that the token represents.
(29) "Smart contract" means software code that:

(29)(a) is deployed on a permissionless blockchain;
(29)(b) consists of a set of predefined instructions executed in a distributed manner by the nodes of an underlying blockchain network; and
(29)(c) produces a change on the blockchain network.
(30) "Token" means a record on a permissionless blockchain that represents an asset, participation right, or other entitlement.
(31) "Transaction" means a new entry in a permissionless blockchain, including the recording of a change in ownership of an asset or participation in a decentralized autonomous organization.

Legislative History

Enacted by Chapter 85, 2023 General Session