New York State Wants To Heavily Regulate Bitcoin Trading
2014-07-21 0:00

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

4 beheaded in Saudi Arabia less than a week into King Salman's rule
2015-01-30 3:13
Comment: So when will the the "Human rights" promoting liberal west elite decide invade Saudi Arabia like they did Libya? Members of Magic Movement stage a mock execution scene in protest of Saudi Arabia beheading of eight Bangladeshi workers in October 2011. Four people have been executed in Saudi Arabia less than a week after 79-year-old King Salman assumed power following the ...
Swedish Office Block Pushes Microchips on its Staff
2015-01-30 2:12
Sweden is heading over the cliff in multiple areas, all at once. They are pushing the abolition of cash, run amok state feminism, gender war, pacification of the police and perhaps even more frightening: open borders. A policy that have given the country a "gold medal" in asylum seeker acceptance. Run away
Charlie Hebdo: Where Neocons, Zionists, Masons and Communists Converge
2015-01-30 1:20
Charlie Hebdo, raising the banner of revolt, has always regurgitated precisely what the “system” required. Charlie Hebdo (CH) came out of the New Left milieu of the 1960s and is a product of the 1968 revolt against President Charles de Gaulle. It happens that the most famous of the New Left revolts came at a time when (1) the CIA was ...
The Liberation of Auschwitz
2015-01-30 0:12
This article is perhaps a day late, but it will be some time before talk of the Holocaust subsides in the mainstream press, especially now that we are to have a vast new Holocaust Memorial Centre built with £50 million of taxpayers money in central London, to replace the rather unimpressive one that already exists in Hyde Park. In the various ...
Facebook’s New ‘Chinese-style’ Political Censorship System Goes Global
2015-01-29 4:35
Last week 21WIRE reported on Facebook’s new communitarian policy whereby readers can ‘flag’ content as “fake news” if they believe it’s not real, or if they do not like it. In the wake of the Charlie Hebdo False Flag event, the social media giant is now allowing governments to determine what is ‘good free speech’, and what is not. “An article ...
More News »