December 11, 2019 / 5:13 PM / a month ago

New York state regulator proposes new framework for crypto coin listings

FILE PHOTO: A man works beneath a display showing the market price of Bitcoin on the floor of the Consensus 2018 blockchain technology conference in New York City, New York, U.S., May 16, 2018. REUTERS/Mike Segar

(Reuters) - New York State’s financial regulator on Wednesday proposed a plan that would allow licensed virtual currency firms that have already received approval for coin listings to introduce new coins without additional permission.

The New York State Department of Financial Services (NYDFS) is asking for the public’s input about the plan, which the regulator said stems from a review of its current virtual currency framework.

New York introduced its BitLicense and initial framework in 2015, when other regulators will still skeptical of virtual currencies. Those currencies are now part of a broader, rapidly growing industry that blends finance and technology, and which leading financial centers are keen to attract.

Since 2015, NYDFS granted two dozen licenses and charters to virtual currency firms. Some of those firms have asked to list new coins in addition to those that NYDFS approved in their initial applications, the regulator said.

The plan aims to improve efficiency by allowing virtual currency firms licensed by New York "to offer and use new coins in a timely fashion," the regulator said in the proposal. (on.ny.gov/2qGvDpF)

The plan would impose certain conditions on New York- licensed virtual currency firms that want to offer new coins without the regulator’s preapproval. For example, firms would have to develop a coin-listing policy, to be approved by NYDFS, that includes processes for reviewing new coins and procedures for notifying the regulator when they are listed.

Virtual currency firms would also have to conduct risk assessments of new coins, including for cyber security risk.

Firms that do not have an NYDFS-approved policy would have to obtain the regulator’s prior approval before listing coins other than those permitted by their original license.

Public comments about the proposal are due by Jan. 27, 2020.

Reporting by Suzanne Barlyn in New York; Editing by Matthew Lewis

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