- New York lawmakers are looking to legalize crypto as a legitimate payment method.
- The state generally maintains a strict crypto regulatory stance with a focus on consumer protection.
New York State is gradually progressing towards becoming a crypto hub following a new bill proposal. The bill proposes amending the State Finance Law to permit New York state agencies to accept crypto for payments.
New York Catching Up With Cryptocurrency Regulation
The new bill introduced by Assembly member Clyde Vanel represents an advancement for crypto adoption in New York. It also suggests the potential shift by the state to adopt strict crypto regulation while enjoying tax revenue from digital assets.
The bill does not encourage the commercial adoption of crypto. Rather, it would amend existing State Finance laws to allow state agencies to accept cryptocurrencies like Bitcoin and Ethereum for payments. These agencies could accept crypto for payments related to taxes, rent, fines, penalties, and interest through agreements with individuals and groups.
It is important to note that the bill has not yet been passed into law in the state. Before it comes into effect, it must first receive approval from the New York Assembly and Senate and be signed by Governor Kathy Hochul.
Meanwhile, New York Attorney General Letitia James urged lawmakers to pass legislation to create a federal regulatory framework for cryptocurrencies. She wrote a letter to top congressional leadership, including Senate Majority Leader John Thune and U.S. House Speaker Mike Johnson.
Letitia argued that digital asset investors urgently need stronger protections. In the letter, Letitia said lawmakers should require crypto firms to register with a federal regulatory agency, set minimum listing standards for cryptocurrencies, and request stablecoin issuers have a U.S. presence.
The letter from Letitia comes as Congress appears likely to pass a bill creating stablecoin rules for the first time. As indicated in our earlier discussion, lawmakers are pushing to pass legislation through the House and Senate to establish a regulatory framework for stablecoins.
New York’s Strict Crypto Stance
New York is known for its strict policies toward the crypto industry. Only 32 firms can operate under its BitLicense or limited purpose trust charter. Also, the state imposed strict regulations on crypto mining late last year.
In February, Senator James Sanders introduced the New York State Cryptocurrency and Blockchain Study Act. As noted in our earlier post, the bill proposes a 17-member crypto task force to examine crypto use cases and related systems.
The task force will also compare New York’s crypto regulations with those of other states and global financial hubs. The goal is to identify competitive strengths and regulatory gaps.
Subsequently, New York state lawmakers reviewed a proposed bill to fight crypto scams and rug-pull attacks. In our previous update, we examined the bill’s purpose in protecting retail investors from fraud involving new technologies.
