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New York financial regulator sets up new division to police cryptocurrency businesses

BitLicense will be part of a new NYDFS division

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The New York State Department of Financial Services has announced the launch of a new division which will absorb the regulator’s current department that oversees cryptocurrency businesses in the state.

In a statement released yesterday, financial services superintendent Linda Lacewell announced the regulator’s new research and innovation division. The new division will be responsible for “keeping pace” with technological developments in banking, insurance, and fintech. In essence, it appears the division will be tasked with assessing new financial technologies and devising suitable regulations.

The division will also become home to the regulator’s department that licenses and supervises businesses that deal in or issue virtual currencies, AKA the BitLicense.

The new division will now be responsible for issuing approvals under the state’s BitLicense. “The division will oversee the virtual currency licensing process and will encourage development in the area,” the NYDFS told CoinDesk.

Indeed, it seems that the BitLicense being part of this new division won’t change things much, for now. But the new division now does have the opportunity to investigate a broader range of financial technologies.

Over the last five years since the BitLicense came into force, the NYDFS has currently issued just over 20 of them. The NYDFS issued licenses to two subsidiaries of institutional cryptocurrency exchange Seed CX. Earlier this year, the state granted its 18th license to digital asset brokerage Tagomi.

Published July 24, 2019 — 08:02 UTC