The New York State Senate may be considering revising or revamping the controversial 2015 BitLicense law that currently regulates many different companies offering cryptocurrency services in the Empire State.
New York State Senators Jesse Hamilton and David Carlucci hosted a roundtable in New York City aiming to gather feedback from companies in the industry and potentially reassessing the BitLicense legal framework. Blockchain entrepreneurs and other industry experts were invited to sit in and share their thoughts with the group.
BitLicense was crafted by the New York State Department of Financial Services under former superintendent Benjamin Lawsky and grants a sort of business license for companies to engage in business activities related to virtual currencies in the state of New York. It has come under fire from independent cryptocurrency startups for being prohibitively expensive, costing between $50,000 and $100,000 just to apply.
Companies operating under a BitLicense face additional operational burdens, including robust compliance policies and processes with respect to anti-fraud, anti-money-laundering, cybersecurity, privacy and information security, among others. Only four companies have received a BitLicense, while two others have received a trust charter.
Startups represented at the roundtable had many critical suggestions for Senators Hamilton and Carlucci. Most of the criticism addressed the fact that the BitLicense significantly raises costs for startups and covers all cryptocurrency related activities across the board, which critics say doesn’t make sense for companies that don’t have anything to do with cryptocurrency trading or other financial operations.
Some participants suggested that the BitLicense take different approaches to different companies, with major exchanges like CoinBase falling under a different framework than smaller tech startups looking to use blockchain in novel ways.