Regulators In New York Establish New Department For Licensing Crypto Businesses

The New York Department of Financial Services (NYDFS), decided to establish a new department that will be in charge of licensing cryptocurrency-related businesses in this jurisdiction. The information was released on July 23rd by the NYDFS in a statement.

Regulators In The U.S. Continue Regulating The Space

According to the statement released by the regulatory agency of New York, they have created the Research and Innovation Division that will be working as the department in charge of issuing licenses and supervising cryptocurrencies. This division will also try to understand how it is possible to address financial exclusion.

Crypto companies that want to operate in New York must have the so-called BitLicense in order to assure that crypto companies follow certain standards regarding their operations. It is also worth mentioning that these firms need to provide information about customers and follow strict KYC and AML regulations.

This division is going to be led by Matthew Homer that worked with the NYDFS in the past and has also been working on different cybersecurity initiatives.

Linda Lacewell, the appointed superintendent, mentioned:

“The financial services regulatory landscape needs to evolve and adapt as innovation in banking, insurance and regulatory technology continues to grow.”

The NYDFS has been working in the space regulating firms since 2015. At that time, the BitLicense program came into effect, which has been criticized by many experts in the industry. At the moment, there have been granted over 20 licenses, which have been very difficult for firms to receive. Small companies tend not to even apply due to the difficult process they must undertake to be granted that license.

About the appointments, Lacewell explained that they will be positioning the DFS as the regulator of the future. Because of it, companies will be developing best practices and consumers will be protected.