[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[S. 4109 Introduced in Senate (IS)]

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117th CONGRESS
  2d Session
                                S. 4109

 To authorize the development of a national strategy for the research 
     and development of distributed ledger technologies and their 
 applications, to authorize awards to support research on distributed 
ledger technologies and their applications, and to authorize an applied 
    research project on distributed ledger technologies in commerce.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             April 28, 2022

Mr. Wicker (for himself and Ms. Lummis) introduced the following bill; 
    which was read twice and referred to the Committee on Commerce, 
                      Science, and Transportation

_______________________________________________________________________

                                 A BILL


 
 To authorize the development of a national strategy for the research 
     and development of distributed ledger technologies and their 
 applications, to authorize awards to support research on distributed 
ledger technologies and their applications, and to authorize an applied 
    research project on distributed ledger technologies in commerce.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``National R & D Strategy for 
Distributed Ledger Technology Act of 2022''.

SEC. 2. DEFINITIONS.

    In this Act:
            (1) Director.--Except as otherwise expressly provided, the 
        term ``Director'' means the Director of the Office of Science 
        and Technology Policy.
            (2) Distributed ledger.--The term ``distributed ledger'' 
        means a ledger that--
                    (A) is shared across a set of distributed nodes, 
                which are devices or processes, that participate in a 
                network and store a complete or partial replica of the 
                ledger;
                    (B) is synchronized between the nodes;
                    (C) has data appended to it by following the 
                ledger's specified consensus mechanism;
                    (D) may be accessible to anyone (public) or 
                restricted to a subset of participants (private); and
                    (E) may require participants to have authorization 
                to perform certain actions (permissioned) or require no 
                authorization (permissionless).
            (3) Distributed ledger technology.--The term ``distributed 
        ledger technology'' means technology that enables the operation 
        and use of distributed ledgers.
            (4) Institution of higher education.--The term 
        ``institution of higher education'' has the meaning given the 
        term in section 101 of the Higher Education Act of 1965 (20 
        U.S.C. 1001).
            (5) Relevant congressional committees.--The term ``relevant 
        congressional committees'' means--
                    (A) the Committee on Commerce, Science, and 
                Transportation of the Senate; and
                    (B) the Committee on Science, Space, and Technology 
                of the House of Representatives.
            (6) Smart contract.--The term ``smart contract'' means a 
        computer program stored in a distributed ledger system that is 
        executed when certain predefined conditions are satisfied and 
        wherein the outcome of any execution of the program may be 
        recorded on the distributed ledger.

SEC. 3. NATIONAL DISTRIBUTED LEDGER TECHNOLOGY R&D STRATEGY.

    (a) In General.--The Director, or a designee of the Director, 
shall, in coordination with the National Science and Technology 
Council, and the heads of such other relevant Federal agencies as the 
Director considers appropriate and in consultation with such 
nongovernmental entities as the Director considers appropriate, develop 
a national strategy for the research and development of distributed 
ledger technologies and their applications, with a particular focus on 
applications of public and permissionless distributed ledgers. In 
developing the national strategy, the Director shall consider the 
following:
            (1) Current efforts and coordination by Federal agencies to 
        invest in the research and development of distributed ledger 
        technologies and their applications, including through programs 
        like the Small Business Innovation Research and Small Business 
        Technology Transfer programs.
            (2)(A) The potential benefits and risks of applications of 
        distributed ledger technologies across different industry 
        sectors, including their potential to--
                    (i) lower transactions costs and facilitate new 
                types of commercial transactions;
                    (ii) protect privacy and increase individuals' data 
                sovereignty;
                    (iii) reduce friction to the interoperability of 
                digital systems;
                    (iv) increase the accessibility, auditability, 
                security, efficiency, and transparency of digital 
                services;
                    (v) increase market competition in the provision of 
                digital services;
                    (vi) enable dynamic contracting and contract 
                execution through smart contracts;
                    (vii) enable participants to collaborate in 
                trustless and disintermediated environments;
                    (viii) enable the operations and governance of 
                distributed organizations; and
                    (ix) create new ownership models for digital items.
            (B) In consideration of the potential risks of applications 
        of distributed ledger technologies under subparagraph (A), the 
        Director shall take into account, where applicable--
                    (i) software vulnerabilities in distributed ledger 
                technologies and smart contracts;
                    (ii) limited consumer literacy on engaging with 
                applications of distributed ledger technologies in a 
                secure way;
                    (iii) the use of distributed ledger technologies in 
                illicit finance and their use in combating illicit 
                finance;
                    (iv) manipulative, deceptive, and fraudulent 
                practices that harm consumers engaging with 
                applications of distributed ledger technologies;
                    (v) the implications of different consensus 
                mechanisms for digital ledgers and governance and 
                accountability mechanisms for applications of 
                distributed ledger technologies, which may include 
                decentralized networks;
                    (vi) foreign activities in the development and 
                deployment of distributed ledger technologies and their 
                associated tools and infrastructure; and
                    (vii) environmental, sustainability, and economic 
                impacts of the computational resources required for 
                distributed ledger technologies.
            (3) Potential uses for distributed ledger technologies that 
        could improve the operations and delivery of services by 
        Federal agencies, taking into account the potential of digital 
        ledger technologies to--
                    (A) improve the efficiency and effectiveness of 
                privacy-preserving data sharing among Federal agencies 
                and with State, local, territorial, and Tribal 
                governments;
                    (B) promote government transparency by improving 
                data sharing with the public;
                    (C) introduce or mitigate risks that may threaten 
                individuals' rights or access to Federal services; and
                    (D) automate and modernize processes for assessing 
                and ensuring regulatory compliance.
            (4) Ways to support public and private sector dialogue on 
        areas of research that could enhance the efficiency, 
        scalability, interoperability, security, and privacy of 
        applications using distributed ledger technologies.
            (5) The need for increased coordination of the public and 
        private sectors on the development of voluntary standards, 
        including those regarding security, smart contracts, 
        cryptographic protocols, virtual routing and forwarding, 
        interoperability, zero-knowledge proofs, and privacy, for 
        distributed ledger technologies and their applications.
            (6) Applications of distributed ledger technologies that 
        could positively benefit society but that receive relatively 
        little private sector investment.
            (7) The United States position in global leadership and 
        competitiveness across research, development, and deployment of 
        distributed ledger technologies.
    (b) Consultation.--
            (1) In general.--In carrying out the Director's duties 
        under this section, the Director shall consult with the 
        following:
                    (A) Private industry.
                    (B) Institutions of higher education.
                    (C) Nonprofit organizations, including foundations 
                dedicated to supporting distributed ledger technologies 
                and their applications.
                    (D) State governments.
                    (E) Such other persons as the Director considers 
                appropriate.
            (2) Representation.--The Director shall ensure 
        consultations with the following:
                    (A) Rural and urban stakeholders from across the 
                Nation.
                    (B) Small, medium, and large businesses.
                    (C) Subject matter experts representing multiple 
                industrial sectors.
    (c) Coordination.--In carrying out this section, the Director 
shall, for purposes of avoiding duplication of activities, consult, 
cooperate, and coordinate with the programs and policies of other 
relevant Federal agencies, including the interagency process outlined 
in section 3 of Executive Order 14067 (87 Fed. Reg. 14143; relating 
ensuring responsible development of digital assets).
    (d) National Strategy.--Not later than 1 year after the date of 
enactment of this Act, the Director shall submit to the relevant 
congressional committees and the President a national strategy that 
includes the following:
            (1) Priorities for the research and development of 
        distributed ledger technologies and their applications.
            (2) Plans to support public and private sector investment 
        and partnerships in research and technology development for 
        societally beneficial applications of distributed ledger 
        technologies.
            (3) Plans to mitigate the risks of distributed ledger 
        technologies and their applications.
            (4) An identification of additional resources, 
        administrative action, or legislative action recommended to 
        assist with the implementation of such strategy.
    (e) Research and Development Funding.--The Director shall, as the 
Director considers necessary, consult with the Director of the Office 
of Management and Budget and with the heads of such other elements of 
the Executive Office of the President as the Director considers 
appropriate, to ensure that the recommendations and priorities with 
respect to research and development funding, as expressed in the 
national strategy developed under this section, are incorporated in the 
development of annual budget requests for Federal research agencies.
    (f) Authorization of Appropriations.--There are authorized to be 
appropriated to the Director $1,000,000 to carry out this section for 
fiscal years 2022 and 2023.

SEC. 4. DISTRIBUTED LEDGER TECHNOLOGY RESEARCH.

    (a) In General.--The Director of the National Science Foundation 
shall make awards, on a competitive basis, to institutions of higher 
education or nonprofit organizations (or consortia of such institutions 
or organizations) to support research, including socio-technical 
research, on distributed ledger technologies and their applications, 
with a particular focus on applications of public and permissionless 
distributed ledgers, which may include research on--
            (1) the implications on trust, transparency, privacy, 
        accountability, and energy consumption of different consensus 
        mechanisms and hardware choices, and approaches for addressing 
        these implications;
            (2) approaches for improving the security, privacy, 
        resiliency, interoperability, performance, and scalability of 
        distributed ledger technologies and their applications, which 
        may include decentralized networks;
            (3) approaches for identifying and addressing 
        vulnerabilities and improving the performance and expressive 
        power of smart contracts;
            (4) the implications of quantum computing on applications 
        of distributed ledger technologies, including long-term 
        protection of sensitive information (such as medical or digital 
        property), and techniques to address them;
            (5) game theory, mechanism design, and economics 
        underpinning and facilitating the operations and governance of 
        decentralized networks enabled by distributed ledger 
        technologies;
            (6) the social behaviors of participants in decentralized 
        networks enabled by distributed ledger technologies;
            (7) human-centric design approaches to make distributed 
        ledger technologies and their applications more usable and 
        accessible; and
            (8) use cases for distributed ledger technologies across 
        various industry sectors and government, including applications 
        pertaining to--
                    (A) digital identity, including trusted identity 
                and identity management;
                    (B) digital property rights;
                    (C) delivery of public services;
                    (D) supply chain transparency;
                    (E) medical information management;
                    (F) inclusive financial services;
                    (G) community governance;
                    (H) charitable giving;
                    (I) public goods funding;
                    (J) digital credentials;
                    (K) regulatory compliance;
                    (L) infrastructure resilience; and
                    (M) peer-to-peer transactions.
    (b) Accelerating Innovation.--The Director of the National Science 
Foundation shall consider supporting startups that leverage distributed 
ledger technologies, have the potential to positively benefit society, 
and have the potential for commercial viability, through programs like 
the Small Business Innovation Research and Small Business Technology 
Transfer programs.
    (c) Consideration of National Distributed Ledger Technology 
Research and Development Strategy.--In making awards under subsection 
(a), the Director of the National Science Foundation shall take into 
account the national strategy, as described in section 3(d).
    (d) Fundamental Research.--The Director of the National Science 
Foundation shall continue to make awards supporting fundamental 
research in areas related to distributed ledger technologies and their 
applications, such as applied cryptography and distributed systems.

SEC. 5. DISTRIBUTED LEDGER TECHNOLOGY APPLIED RESEARCH PROJECT.

    (a) Applied Research Project.--Subject to the availability of 
appropriations, the Director of the National Institute of Standards and 
Technology, shall carry out an applied research project to study and 
demonstrate the potential benefits and unique capabilities of 
distributed ledger technologies.
    (b) Activities.--In carrying out the applied research project, the 
Director of the National Institute of Standards and Technology shall--
            (1) identify potential applications of distributed ledger 
        technologies, including those that could benefit activities at 
        the Department of Commerce or at other Federal agencies, 
        considering applications that could--
                    (A) improve the privacy and interoperability of 
                digital identity and access management solutions;
                    (B) increase the integrity and transparency of 
                supply chains through the secure and limited sharing of 
                relevant supplier information;
                    (C) facilitate increased interoperability across 
                healthcare information systems and consumer control 
                over the movement of their medical data; or
                    (D) be of benefit to the public or private sectors, 
                as determined by the Director in consultation with 
                relevant stakeholders;
            (2) solicit and provide the opportunity for public comment 
        relevant to potential projects;
            (3) consider, in the selection of a project, whether the 
        project addresses a pressing need not already addressed by 
        another organization or Federal agency;
            (4) establish plans to mitigate potential risks, for 
        example those to privacy, of potential projects;
            (5) produce an example solution leveraging distributed 
        ledger technologies for 1 of the applications identified in 
        paragraph (1);
            (6) hold a competitive process to select private sector 
        partners, if they are engaged, to support the implementation of 
        the example solution;
            (7) consider hosting the project at the National 
        Cybersecurity Center of Excellence; and
            (8) ensure that cybersecurity best practices consistent 
        with the Cybersecurity Framework of the National Institute of 
        Standards and Technology are demonstrated in the project.
    (c) Briefings to Congress.--Not later than 1 year after the date of 
enactment of this Act, the Director of the National Institute of 
Standards and Technology shall offer a briefing to the relevant 
congressional committees on the progress and current findings from the 
project under this section.
    (d) Public Report.--Not later than 12 months after the completion 
of the project under this section, the Director of the National 
Institute of Standards and Technology shall make public a report on the 
results and findings from the project.
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