The chief financial regulator of New York State has officially released final rules for Bitcoin and other digital currency companies.
Benjamin Lawsky, who is New York State's first Superintendent of Financial Services, outlined the first impressions of the final version of the BitLicense, which is a document that contains regulatory structure for Bitcoin.
Lawsky and his colleagues have been working on the regulations for about two years. However, on Wednesday, June 3, during a speech at the BITS Emerging Payments Forum in Washington, Lawsky revealed the final list.
The new rules state that businesses should to refer the Department of Financial Services for a BitLicense. The final BitLicense version confirms that companies that only provide financial services like money exchanges should make an application for a BitLicense. Individuals, retailers and software developers may accept crypto-currency payments and will not have to go through the licensing process.
The new rules also suggest that businesses will not have to report all software updates or make a BitLicense application if a money transmitter license is held by the business.
Lawsky has focused on regulating Bitcoins to ensure that businesses that deal with the digital currency are not involved in money laundering.
"We simply want to make sure that we put in place guardrails that protect consumers and root out illicit activity — without stifling beneficial innovation," said Lawsky.
While Lawsky has outlined final version of BitLicense, many market experts believe that the new rules still need a lot of changes.
Jerry Brito, the executive director of Coin Center, a nonprofit research and advocacy center that is focused on public policy issues regarding crypto-currency technologies like Bitcoin, suggests that the new rules have made improvements in comparison to the original proposal. However, the new rules are still quite far from being perfect.
The rules still "create an unprecedented new state-level money laundering requirement. And it's discriminatory because banks don't have to do this in New York State and money transmitters don't have to do this in New York State," says Brito.
Bitcoin has faced a lot of criticism; however, Lawsky states that the new rules will be beneficial to customers in New York who can take advantage of the innovative financial services.
Photo: Zach Copley | Flickr