New York State Wants To Heavily Regulate Bitcoin Trading
2014 07 21

By Frederick Reese | MintPress News

The proposal would establish a mandatory “BitLicense” for any company involved with the buying, selling, mining or trading of cryptocurrencies.

In a move that has upset many in the bitcoin community, New York has become the first state to issue guidelines for the regulation of the trade and storage of bitcoins and other virtual currencies. With New York City being the hub of the nation’s financial network, state regulators introduced the new rules in an attempt to introduce safeguards to cryptocurrencies — which have received scrutiny recently as several states have moved to remove restrictions on virtual currency use or to clarify existing virtual currency laws.

The proposal introduced Thursday by the New York State Department of Financial Services would establish a mandatory “BitLicense” for any company involved with the buying, selling, mining or trading of cryptocurrencies. Licensed firms would be required to learn the names of all cryptocurrency customers they accrue; maintain a reserve of cryptocurrency funds equal to 100 percent of all deposits — similar to cushioning requirements for banks; carry bonds to protect their customers from theft or collapse; and submit to security audits.

“We have sought to strike an appropriate balance that helps protect consumers and root out illegal activity — without stifling beneficial innovation,” said Benjamin Lawsky, New York’s Superintendent of Financial Services. “Setting up common sense rules of the road is vital to the long-term future of the virtual currency industry, as well as the safety and soundness of customer assets.”

These requirements are meant to safeguard cryptocurrency transactions from incidents like the collapse of Mt.Gox. The bitcoin market is still recovering from the fallout of Mt.Gox, which saw 850,000 bitcoins lost due to alleged hacking attacks earlier this year. So far, only 200,000 bitcoins have been recovered.

The licensing requirement is also meant to create a “paper trail” to assist in attempts to combat the use of cryptocurrencies in money laundering and in illicit merchandise trafficking. Merchants and consumers that utilize cryptocurrencies solely for buying and selling goods and services, however, would be exempt from the license requirement.

[...]

The Bitcoin Foundation, an organization that works to promote the virtual currency, argues that new and separate rules may not be the best way to promote security within the cryptocurrency. Instead, bitcoin operators should be included in existing securities regulations. This would lend both credibility and fairness in dealing with virtual currencies as investment and trading vehicles.

Read the full article at: mintpressnews.com




Tune into Red Ice Radio:

Radio 3Fourteen - Peter Eric Hendrickson - Cracking the Code: The Truth About Taxation in America

Ellen Brown - The Web of Debt, The Manufactured Financial Crash, Global Tax & The Basel Accords

Radio 3Fourteen - Spencer Barclay - Currency Creation & Private Exemption

Clif High - Hour 1 - Bandwidth Caps, Bitcoin, ISON & Nummo Origins

Jason Erb - Hour 1 - Economic History & Alternative Currencies




Related Articles
World’s first bitcoin only’ candidate runs for Swedish parliament
Reddit censoring words like: NSA, Tesla, Bitcoin, net neutrality
New Bitcoin Documentary: Boom or Bust
IRS Makes Bitcoin Rules Simple for Wall Street, Impossible for Everyday Users
I.R.S. Says Bitcoin Should Be Considered Property, Not Currency
Bitcoin under all out assault
Bitcoin Threatens Banking Cleptocracy, Saves Capitalism
Young CEO of Crypto Currency Exchange Found Dead
Explain Bitcoin Like I’m Five (In case you want to understand the cryptocurrency)
Meet Dark Wallet – How Crypto-Anarchists Will Store Their Bitcoins


Latest News from our Front Page

Exponential growth of Ashkenazi Jews following a Medieval population bottleneck
2014 09 17
A recent paper by Marta Costa et al. found that around 80% of Ashkenazi mitochondrial DNA had a prehistoric European origin (and ruled out the Khazar hypothesis). Combined with previous Y chromosome studies indicating that the male line is Middle Eastern, the results suggested a scenario in which Jewish males married European females after traveling to Europe. Now another paper, ...
Bankers Rule: City of London vs. Scottish Independence
2014 09 17
Now that the independence referendum is too close to call, the bankers express their worry. The media blitz ramps up to tip the outcome. Scottish independence has finally rattled the City of London has the usual banksters forecasting the dislocations from a currency panic. Scotland has a long and noteworthy history of banking. Money, savings and investing is entrenched in the ...
French separatists want Scots to say "yes"
2014 09 17
Separatist leaders in Brittany, Corsica and the French Basque Country will watch with interest as Scotland votes on independence next week, but they don’t expect France to follow the UK’s lead any time soon. Pro-independence activists point to the fact they have their own languages and cultural identities. France, however, remains a deeply centralized country and any talk of a negotiated ...
Devil’s Deal: US-Backed Syrian Rebels Already Signed Pact with ISIS Prior to Haines Beheading
2014 09 17
While Washington considers appropriating half a billion in funds to the Syrian rebels, we now learn that opposition groups the Free Syrian Army (FSA) and al Qaeda affiliate ‘al Nusra Front’, have officially aligned themselves with ISIS… Despite grand words by US President Obama and British PM David Cameron, here’s what’s really behind their plan to bomb ISIS in Syria… In a ...
World War III for Dummies
2014 09 16
A Step-by-Step Guide to Understanding the Present World Situation. 1998 - 2000 Powerful elites and influential think tanks forecast a coming period of American aggression. Zbigniew Brzezinski speaks for the Globalist faction of the western PRC (Predatory Ruling Class) in ’The Grand Chessboard’, a book in which he openly advocates for bolder American action in dominating the Eurasian land mass. During this ...
More News »