contributor
Posted:
- The new regulations compel crypto companies to submit their coin listing and delisting policies for approval.
- The guidelines apply to all licensed digital currency business entities in New York.
The New York State Department of Financial Services (NYDFS) has introduced stricter guidelines for cryptocurrency listing and delisting.
On 15th November, the NYDFS unveiled regulations compelling crypto companies in New York to submit their coin listing and delisting policies for approval.
These policies will undergo scrutiny against more robust risk assessment standards. They will also cover technological, operational, cybersecurity, market, liquidity, and illicit activity risks.
The tightened guidelines apply to all licensed digital currency business entities in New York. Firms licensed under the state’s Banking Law or the New York Codes, Rules, and Regulation will be subject to the new regulations.
Notable entities affected include stablecoin issuer Circle, crypto exchange Gemini, fund manager Fidelity, trading platform Robinhood, and payments giant PayPal.
New rules aimed to facilitate “innovative and data-driven approach”
Under the new rules, cryptocurrency firms with previously approved coin listing policies cannot self-certify tokens without obtaining NYDFS approval.
The NYDFS emphasizes aligning coin listing and delisting policies with its standards for a more secure crypto environment.
The financial regulator initiated the proposal in September, seeking public feedback before finalizing the guidelines.
Superintendent of Financial Services Adrienne A. Harris clarified that the updated rules are not indicative of a statewide crackdown on the cryptocurrency industry.
Instead, the NYDFS aims to implement an “innovative and data-driven approach” to oversee coin listings, delistings, and the broader cryptocurrency market.
Affected firms are required to meet with the NYDFS by 8th December 2023 to present their draft coin listing and delisting policies.
The finalized policies must be submitted by 31 January 2024 for regulatory review.
In February, the NYDFS expanded its capabilities to identify illicit activities in the cryptocurrency space. It also addressed concerns such as insider trading and market manipulation.
New York maintains significant blockchain presence
New York remains a significant hub for blockchain-based companies, hosting about 690 such entities. Crypto firms have been in the government’s crosshairs for quite some time now.
In February, the NYDFS ordered Paxos to stop issuing Binance USD [BUSD], a popular stablecoin that is affiliated with Binance [BNB].
Paxos also received a notice from the SEC saying that the agency was considering recommending an action alleging that BUSD is an unregistered security.
Irrespective of the regulatory fog, the public seem interested in crypto. An August report by Coinbase highlighted various milestones New York had reached with crypto adoption.
It revealed that 19% of New Yorkers own cryptocurrency. Additionally, one in three New Yorkers agreed that crypto makes the financial system fairer. They also described it as a “worthwhile investment for the future.”
Over 800 founders of blockchain organizations are based in New York state.
Source: https://eng.ambcrypto.com/new-york-regulator-issues-rules-to-strengthen-crypto-listing