U.S. Regulators for the State Banks Aim to Simplify Crypto Rules and Regulations
Cryptocurrency regulations in the United States have been for long a matter of debate and discussion with different having different rules for crypto trading. Now, the state regulators from all 49 states, Washington, D.C. and Puerto Rico have together to streamline and simplify the entire process.
On Tuesday, September 15, the Conference of State Bank Supervisors (CSBS) unveiled a new process for money services businesses (MSB) including crypto companies. The process will involve having a common money transmitter license removing the hurdle for businesses to get separate licenses in every state.
The new process will involve a single exam administered by regulators of different states across the country. The regulators will rely on experts in cyber-security and anti-money-laundering and get more insights from them while freeing up the state resources.
This initiative will directly apply to 78 of the largest payment and cryptocurrency companies comprising a total of more than $1 trillion in customer funds. The representative from CSBS hasn’t specifically named the companies benefitting out this new law. However, she just specified that “It includes brick-and-mortar firms, it includes cryptocurrency firms.”
Kevin Hagler, Georgia Department of Banking and Finance commissioner and CSBS Board chair, said, “One company, one exam is a significant and important shift in how state regulators will ensure compliance with consumer protection and safety and soundness standards for the largest payments companies. By working together and relying on the excellent work of fellow state regulators, we will be able to do even more.”
Top giants like Western Union, PayPal and crypto companies like Coinbase will be majorly benefitted with this rule. Rosemary Gallagher, Western Union associate general counsel, shared, “Western Union was a proud participant in the CSBS’s successful one company, one exam pilot. We firmly believe that the impact of this new approach to multistate exams will be significant in terms of driving harmonization and streamlining of state supervision across the board.”
This initiative comes just a month later after the U.S. regulators allowed national banks to provide cryptocurrency custodial services. This has also helped some big crypto companies to establish their foothold and work in cooperation with state-registered traditional financial institutions while reducing any king of friction.