New York State issues guidance for banks seeking to engage in activities with crypto

The New York authorities Department of Financial Services (DFS) released guidance connected Dec. 15 for regulated banks seeking to prosecute successful activities with virtual currency. The guidance, which took effect immediately, describes the exertion process and “summarizes the types of accusation the Department considers relevant” for obtaining the agency’s approval.

The 11-page papers consisted mostly of slug points arsenic it described the informational requirements for respective categories, specified arsenic “Business Plan” and “Consumer Protection,” successful detail, followed by a bid of ceremonial checklists.

Approval is required 90 days earlier engaging successful activities, the papers reminded. Approval for anterior activities “does not represent wide consent” for different activities, and immoderate activities by third-party work providers whitethorn necessitate the agency’s support arsenic well.

As overmuch arsenic it pains maine to admit this, the @NYDFS Bitlicense accomplishes galore of these goals; and the DFS is moving intimately w/ different regulators similar the UK. https://t.co/q2zEJfZ3qT pic.twitter.com/8CxSX2UZ91

— matthew sigel, recovering CFA (@matthew_sigel) December 14, 2022

Furthermore, institutions that are already engaged successful virtual currency activities were instructed successful the connection accompanying the guidance to cheque successful with their points of interaction astatine the bureau immediately.

DFS superintendent Adrienne A. Harris said successful a connection connected the caller guidance:

“It is captious that regulators pass successful a timely, transparent mode astir the improvement of our regulatory approach.”

New York is known arsenic a pugnacious regulator of crypto businesses, and has come nether disapproval from New York City Mayor Eric Adams and galore others for stifling economical innovation and growth. Harris has defended the state’s approach vigorously. In airy of this, elaborate guidance whitethorn beryllium highly invaluable for regulated institutions.

Related: New York’s politician seeks equilibrium with regulators aft PoW mining moratorium

New York was 1 of the archetypal states to licence virtual currency activities erstwhile it introduced its alleged BitLicense successful 2014. It besides claimed to beryllium the archetypal authorities to enforce strict requirements for stablecoin reserves and redeemability successful June. In December, the authorities projected adding an yearly appraisal fee for licensed crypto firms nether caller powers granted to the bureau successful April.