N.Y., Federal Regulators to Examine Virtual Currencies (Nov. 18, 2013)
New York State and federal officials plan to take a hard look at virtual currencies, such as Bitcoin, to determine whether they need to be regulated. The U.S. Senate’s Committee on Homeland Security & Government Affairs plans to meet this afternoon to consider how virtual currencies are affecting law enforcement and banking. Pay News will cover the hearing, which will have in attendance members of the U.S. Departments of Justice and the Treasury, as well as a representative from the Bitcoin Foundation, among others.
The New York State Department of Financial Services (NYDFS) announced last week that it will hold public hearings as part of an investigation into virtual currencies launched in August. The agency is concerned some virtual currency firms might be engaging in money transmission, which is an activity that is licensed and regulated by the NYDFS.
Bitcoin recently has been at the center of some high-profile crimes, including the shutdown of the Silk Road Website, which allegedly enabled users to purchase illegal drugs and launder money using the currency.
New York officials are considering issuing “a BitLicense specific to virtual currency transactions and activities, which would include anti-money laundering and consumer protection requirements for licensed entities,” according to a NYDFS announcement. The agency stresses it has not decided that virtual currency regulations are necessary, but that it is in the process of “a broad-based inquiry” into this “new frontier in electronic commerce.”
The hearings will be held in coming months, according to the NYDFS, with more details to be released soon.