NEW YORK, April 13 (IFR) - Former New York state financial
services chief Benjamin Lawsky may have taken a harsh view of
virtual currency as a regulator, but he has begun to stump for
the technology behind it.
The man accused of implementing tough regulations on
Bitcoins and other online currency now heads a consultancy that
is acting as an adviser and media liaison for one of the
sector's major new players.
The Lawsky Group, which provides legal and strategic counsel
for clients on financial regulation issues, was the press
contact last week for Axoni, a blockchain technology firm.
Axoni was promoting its successful test of blockchain
technology into the back office settlement process for
"We'll be doing a broad range of financial consultancy ...
and some financial technology public relations," said Lawsky
Group spokesman Matthew Anderson.
Anderson was spokesman for the Department of Financial
Services, the state regulator where Lawsky was accused of
slowing the development of virtual currencies.
Lawsky said last June he wanted to "put in place guard rails
that protect consumers and root out illicit activity without
stifling beneficial innovation".
Though some Bitcoin proponents welcomed the safeguards,
Lawsky's about-face now that he is profiting from the technology
in the private sector has miffed more than a few observers.
"I think the most interesting thing about Mr Lawsky's newest
venture is that it highlights the cozy relationship between
regulators and the regulated industry," Pamela Morgan, CEO of
Third Key Solutions, told IFR.
Morgan, whose company consults for other companies that use
digital currencies such as Bitcoin, called Lawsky's new role
"crony capitalism at its finest".
Lawsky's spokesman did not respond to two requests for
further detail about his work, though others saw no problem with
"I think it is fantastic that he has entered the private
sector and continued to support the Bitcoin/blockchain space,"
said Adam Draper, CEO of Boost VC, a venture capital firm
focused on blockchain and other virtual technologies.
Some suggest the addition of public relations brings out a
strength that helped raise Lawsky's profile in the first place -
his ability to interact with the media.
(Reporting by Mike Kentz; Editing by Jack Doran and Marc