![FEATURE
Leigh Cuen
Mar 20, 2018 at 08:03 UTC | Updated Mar 20, 2018 at 13:43 UTC
"This will replace the BitLicense."
It's safe to say Assemblyman Ron Kim has high hopes for his newly proposed New York law, Bill A9899. Submitted to the state legislature in February, Kim's legislation takes aim
squarely at the so-called "BitLicense," the much-maligned regulatory regime now imposed on crypto startups serving the fourth most populous U.S. state.
In interview with CoinDesk, Kim went so far as to state his goal is to clear a path for startups, eliminating some of the more controversial components of the law, while preserving
those he believes can help protect consumers.
"It would get rid of the fee and the actual license itself," he explained. "We want to embrace the startup companies that are trying to launch exchanges."
Such a change would no doubt be welcome by the startup community, including those that have struggled to work within the confines of the BitLicense. Those tensions were on
display during a public forum held in February by two state senators who are planning a piece of reform legislation of their own.
To date, only a handful of companies have managed to acquire a BitLicense since 2015. (In fact, the bill's five backers - four co-sponsors and one multi-sponsor according to
public records -might outnumber the companies that have been approved).
Still, it's not entirely clear if and when the bill would become law. Kim said he hopes the bill will start the long road this summer, although it could take until early 2019.
Sure to win him support among the technology's enthusiasts, though, is that his argument against the BitLicense is that it puts too much power in the hands of the New York State
Department of Financial Services (NYDFS) and that it was approved through a unilateral process.
"As of now, one person, the superintendent from one state government agency, has way too much power over the current regulations, without any oversight, to determine which
exchanges are allowed in the market," he told CoinDesk, adding:
"The BitLicense, and its [regulations], were created unilaterally through the executive office without any legislative authority. That's not the way we should treat the tech
sector."
Exchange focus
That said, Kim's bill calls for a range of requirements on companies that offer exchange services for cryptocurrencies, including mandates on cybersecurity and record-keeping.
This includes requiring exchanges to appoint a third-party depository to safeguard against fraud, bookkeeping errors, hacking, money laundering "and all sorts of things," he
explained.
"It's more of a monitor system than actually holding an actual amount of money," he said.
The bill would also require exchanges use some kind of insurance, similar to other financial institutions, to ensure accounting records are transparent and independently verified.
So far, Kim says he is working with stakeholders like Bernard Moon, co-founder of the investment fund SparkLabs, and Crypto Working Group's chief economist Richie Hecker,
who heads up a network focused on best practices for the emerging industry.
He added that he is still open to feedback from more industry experts as the process moves forward.
This New York Lawmaker Wants to End the BitLicense
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This New York Lawmaker Wants to End the BitLicense
- 1. FEATURE Leigh Cuen Mar 20, 2018 at 08:03 UTC | Updated Mar 20, 2018 at 13:43 UTC "This will replace the BitLicense." It's safe to say Assemblyman Ron Kim has high hopes for his newly proposed New York law, Bill A9899. Submitted to the state legislature in February, Kim's legislation takes aim squarely at the so-called "BitLicense," the much-maligned regulatory regime now imposed on crypto startups serving the fourth most populous U.S. state. In interview with CoinDesk, Kim went so far as to state his goal is to clear a path for startups, eliminating some of the more controversial components of the law, while preserving those he believes can help protect consumers. "It would get rid of the fee and the actual license itself," he explained. "We want to embrace the startup companies that are trying to launch exchanges." Such a change would no doubt be welcome by the startup community, including those that have struggled to work within the confines of the BitLicense. Those tensions were on display during a public forum held in February by two state senators who are planning a piece of reform legislation of their own. To date, only a handful of companies have managed to acquire a BitLicense since 2015. (In fact, the bill's five backers - four co-sponsors and one multi-sponsor according to public records -might outnumber the companies that have been approved). Still, it's not entirely clear if and when the bill would become law. Kim said he hopes the bill will start the long road this summer, although it could take until early 2019. Sure to win him support among the technology's enthusiasts, though, is that his argument against the BitLicense is that it puts too much power in the hands of the New York State Department of Financial Services (NYDFS) and that it was approved through a unilateral process. "As of now, one person, the superintendent from one state government agency, has way too much power over the current regulations, without any oversight, to determine which exchanges are allowed in the market," he told CoinDesk, adding: "The BitLicense, and its [regulations], were created unilaterally through the executive office without any legislative authority. That's not the way we should treat the tech sector." Exchange focus That said, Kim's bill calls for a range of requirements on companies that offer exchange services for cryptocurrencies, including mandates on cybersecurity and record-keeping. This includes requiring exchanges to appoint a third-party depository to safeguard against fraud, bookkeeping errors, hacking, money laundering "and all sorts of things," he explained. "It's more of a monitor system than actually holding an actual amount of money," he said. The bill would also require exchanges use some kind of insurance, similar to other financial institutions, to ensure accounting records are transparent and independently verified. So far, Kim says he is working with stakeholders like Bernard Moon, co-founder of the investment fund SparkLabs, and Crypto Working Group's chief economist Richie Hecker, who heads up a network focused on best practices for the emerging industry. He added that he is still open to feedback from more industry experts as the process moves forward. This New York Lawmaker Wants to End the BitLicense Join 4,500+ attendees at Consensus 2018. Register Now! ☰
- 2. Ultimately, Kim said he wants to create a more accommodative environment for cryptocurrency startups - and that doing so could open up new forms of revenue for the state if exchanges start opening up shop there. "There's a tremendous opportunity, as the financial capital of the world, to take a leadership role," he told CoinDesk, concluding: 'There are so many people interested in getting involved, with cryptocurrency, for the right reasons that I envision a whole new revenue stream that would help the state of New York." Image courtesy of Ron Kim The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. Exchanges BitLicense New York Regulation SPONSORED FINANCIAL CONTENT How 1 Man Turned $50,000 into $5.3 Million Investing Daily Motley Fool Gives Rare "Total Conviction" Buy Sign The Motley Fool Here's the real way to calculate how much house you can afford. Better Mortgage Forget Cryptocurrencies: This Will Create the First Trillionaires Angel Publishing Market Prediction: Gold Collapse Will Wipe Out Trillions Dent Research The No. 1 Stock to Buy Right Now (It's Not Pot) Banyan Hill New Guide Shows Beginners How to Trade Cryptos at Their Own Pace. Profits Run Turn $100 into Fortune Without Risking a Dime in the Stock Market Crowdability PREVIOUS ARTICLE Canada's VersaBank Lands Two Prospects to Use Its Crypto... NEXT ARTICLE Russian Government Resolves Disagreement on Draft Crypto Law Former Fund Manager: Three Cryptos I'm Watching Like a Hawk Underground Finance How And Why The Smart Money Is Moving From Bitcoin To ICO's Moon Syndicate Why Buying Some Tiny Cryptos Today is Like Buying Bitcoin 8 Years Ago 10x-wealth If You Already Have Amazon Prime - Here's How to Make It Even Better Honey Explore the 2017 Mazda Cx-5 Ratings and Pricing J.D. Power Cars Guess Who's About to Go Bankrupt In America Stansberry Research Ads by Revcontent
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- 4. Winner-Turned-Loser ICON Tanks 40 Percent as Crypto Markets Falter 1 comment • 4 days ago Hugh Shaw — Tron...lol Bitcoin Eyes Bottom After 50-Day Low Below $7K 76 comments • 4 days ago rohit gupta — its all FUD..tax issue, child pornography issue in blockchain, bubble popping issue, mining issues, manipulation … 120 Million: Vitalik Proposes Cap on Ether Cryptocurrency Creation 36 comments • 2 days ago J Schmidt — and this is decentralized how? I Survived the Eternal Boy Playground, But Will Puerto Rico? 58 comments • 2 days ago BlockchainGypsy — Totally clueless opinionated article. Are you in high school? You went to a couple conferences and … ALSO ON COINDESK 4 Comments CoinDesk Login1 Share⤤ Sort by Best LOG IN WITH OR SIGN UP WITH DISQUS Name Join the discussion… ? • Reply • Tom Connelly • 14 days ago 'bout time, NY. Better late than never though. Good thing they have guys that have a clue in NYC politics. The old dogs need to go. These younger ones are with the times. There are several startups over in Brooklyn... I believe that Mike Novogratz was impressed with the ones he saw and that roped him into crypto. Bit License is a big liability to crypto business in NY. It needs to go bye bye. 2 △ ▽ • Reply • Nicholas J. Malino • 14 days ago Bitlicense has got to go and the sooner the better. There still may be time to allow NYC to develop into the Cryptocurrency of the world. Benjamin Lawsky has done more to derail NYC's leadership than anyone since Sheldon Silver made sure that NYC would not be awarded the Olympics several decades ago. Bureaucrats like him screw up everything that they touch. △ ▽ • Reply • SG • 14 days ago If the new law doesn't distinguish between custodial and non-custodial exchanges, then should go back to the drawing board. △ ▽ • Reply • Charley Harman • 14 days ago Governments have demonstrated repeatedly that they have a marvelous record of inefficiency. Just look at housing, healthcare, Social Security, and Welfare to name a few. The culture of politics is such that the aim of politicians is to be able to put their name on a piece of legislation, a freeway, or some building, regardless of whether it stifles innovation and progress. In the meantime, we fall further behind those who embrace new technology and grasp the opportunity to become partners in any successes. Unfortunately Tom is correct, it is "better late than never". Maybe we won't be too far behind to gain back our lost ground. △ ▽ Subscribe✉ Add Disqus to your siteAdd DisqusAddd Privacy🔒 Recommend Share › Share › Share › Share › $7,372.62Bitcoin + $400.65Ethereum + $689.7Bitcoin Cash +
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