KRS 286.11-007: Exemptions.

This subtitle does not apply to:

(1) The United States or any department, agency, or instrumentality thereof;

(2) The United States Post Office or a contractor acting on behalf of the United States

Post Office;

(3) A state or any agency, department, or political subdivision of a state;

(4) A financial institution or its subsidiaries, affiliates, and service corporations, or any

office of an international banking corporation, branch of a foreign bank, or

corporation organized pursuant to the Bank Service Corporation Act, 12 U.S.C.

secs. 181 to 1867, or a corporation organized under the Edge Act, 12 U.S.C. secs.

611 to 633;

(5) A service provider that:

(a) Pursuant to a written agreement, acts on behalf of an entity exempt from

licensure as set forth in subsection (4) of this section; and

(b) Allows the state or federal regulators with regulatory jurisdiction over the

exempt entity to examine and inspect the service provider's applicable

records, books, and transactions;

(6) A service provider that receives money or monetary value on behalf of an entity

selling goods or services other than money transmission services if:

(a) The entity, upon receipt of funds by the service provider, immediately either:

1. Provides the purchased goods or services to the purchaser; or

2. Credits the purchaser for the full amount of money or monetary value

received by the service provider, which credit is not revocable by the

entity, and evidences this credit in writing; and

(b) The entity is obligated to provide the purchased goods or services to the

purchaser regardless of whether or not the service provider transmits the

money or monetary value to the entity;

(7) The provision of electronic transfer of government benefits fo r any federal, state, or

county governmental agency as defined in Federal Reserve Board Regulation E, by

a contractor for and on behalf of the United States or any department, agency, or

instrumentality thereof, or any state or any political subdivisions thereof; or

(8) (a) Any individual or business that:

1. Develops or deploys software on a blockchain protocol, even if the

software effectuates the exchange of one digital asset for another digital

asset;

2. Exchanges digital assets for other digital assets; or

3. Operates a node or series of nodes on a blockchain protocol.

(b) As used in this subsection, "blockchain protocol," "digital asset," and "node"

have the same meaning as in KRS 369.130.