Final Bitlicense rules released
The New York State Department of Financial Services (NYDFS) released the final version of its BitLicense virtual currency regulatory framework on Wednesday 3 June. All virtual currency financial intermediaries now will have to apply to operate in New York State, according to a statement Superintendent Benjamin Lawsky released at the Bits Emerging Payments Forum.
The BitLicense – which is the product of a nearly two-year-long NYDFS inquiry – contains key consumer protection, anti-money laundering compliance, and cyber security rules tailored for digital currency companies.
Lawsky emphasized that software developers would not be subject to this regulation. “Students or other innovators who are simply developing software and are not holding onto customer funds are not required to apply for a BitLicense,” Lawsky said. However, Lawsky said there was a need to regulate financial intermediaries.
“There is a basic bargain that when a financial company is entrusted with safeguarding customer funds and receives a license from the state to do so, it accepts the need for heightened regulatory scrutiny to help ensure that a consumer’s money does not just disappear into a black hole,” Lawsky said.
In addition, companies will not need approval for software or app updates, nor will they have to submit two separate applications for a BitLicense and money transmitter license. Companies that submit suspicious action reports with other federal regulators do not need to submit duplicate reports to the NYDFS.
“Again, we recognize that we are not going to please everyone. That is the nature of regulatory oversight,” Lawsky said. “For example, when we write new regulations for Wall Street, if the banks are completely happy with something we’ve drafted, it probably means we haven’t done our jobs right. Our goal, as always, is to be sensible and fair.”
The entire BitLicense document is available on the NYDFS website.