Following the milestone introduction of a Bitcoin regulatory license by New York State’s financial services regulatory authority this summer, Benjamin Lawsky, New York State’s Superintendent of Financial Services, has today announced that individuals and companies involved in Bitcoin-related software development are free to conduct their business without having to apply for the BitLicense.
The regulatory framework which New York State has designed provides the entire Bitcoin industry with a more certain future than it had last year, as BitLicense will provide all entities in New York with a methodology to follow, and state backing should matters go awry and affect investors.
Indeed, software development is at the heart of virtual currency development, with North America being one of the key leaders in the advancement of Bitcoin worldwide, therefore Mr. Lawsky’s comments are likely to give rise to further venture capital investments into Bitcoin technology startups, as the technological development aspect remains totally unencumbered by regulatory boundaries, whereas the buying and selling of Bitcoin falls under the remit of the BitLicense.
The “BitLicense” is the first proposal by a state to create guidelines specifically for virtual currencies. It includes proposed rules on consumer protection, the prevention of money laundering, and cybersecurity.
Mr. Lawsky has confirmed that companies which develop the latest platforms for virtual currencies will not need a license, nor will individual users. Banks and dealers will not be exempt.
“The banks we regulate cannot start providing virtual currency services without prior approval from DFS (Department of Financial Services), and they will be have to comply with any requirements that are otherwise imposed on virtual currency businesses,” Mr. Lawsky concluded.