(The Center Square) – Licensed cryptocurrency businesses in New York will have fees levied, the New York State Department of Financial Services said Thursday.
The proposed rule would treat virtual currency companies the same way as other financial institutions in the state, with the fees allowing the department to hire the staff needed to monitor compliance, DFS Superintendent Adrienne A. Harris said in a statement.
“New York State has been regulating virtual currency companies since 2015 with a robust prudential framework,” she said. “Through licensing, supervision and enforcement, we hold companies to the highest standards in the world. The ability to collect supervisory costs will help the department continue protecting consumers and ensuring the safety and soundness of this industry.”
Thursday’s announcement starts a 10-day preproposal comment period. A 60-day public comment window will open once the draft policy is published in the State Register. The Finance Department will then review the feedback and determine if any revisions are needed before implementing the regulation.
The move comes a week after Democratic Gov. Kathy Hochul signed a bill into law that puts a two-year moratorium on new permits for cryptocurrency mining facilities powered by fossil fuels and authenticated by proof-of-work methods.
Environmental groups praised Hochul for the decision, but industry leaders say the decision will not have the intended effect ban supporters want.
John Olsen, the New York state lead for Blockchain Association, a national crypto-industry group, said in a statement to The Center Square that Hochul should set up a task force to see how the state can reap the benefits of virtual currency mining and trading.
“Governor Hochul’s decision to sign the anti-proof of work bill is a step backwards for New York and may push crypto mining to states with less stringent environmental and emissions standards,” Olsen said. “Crypto is here for good – and New York should study it rather than ban it.”
Also on Thursday, Blockchain Association issued an economic impact report that determined member companies sampled for the study helped create or support more than 3,200 jobs in New York. Those businesses are also responsible for a $716 million economic impact, with $416 million of that a direct contribution.
