The California assembly passed a crypto bill that requires a crypto business to get a license. It is one step away from becoming law if the governor signs.
A Crypto bill is the only step to regulate crypto in a country. A crypto regulation bill also means that the government has welcomed the crypto space legally, and residents will be allowed to play with cryptocurrency without any trouble or regulation. The California assembly has passed a crypto regulating bill to require cryptocurrency-related businesses to obtain a special license to offer services in the golden state. The crypto bill is now one step away from becoming law in California.
California Is Moving Closer To Crypto Regulation
On Monday, the California senate approved the crypto bill requiring crypto businesses to get a license to offer services in the state. California Assembly member Timothy Grayson introduced the bill, AB 2269, with support from the Consumer Federation of California with a 71-0 majority. The crypto bill will build the Digital Financial Assets Law in California.
The Digital Financial Assets Law is referred to as California’s “BitLicense.” It came into the Californian assembly after New York’s BitLicense regulation was a hot topic. A simple pen stroke is a final step needed to make a full-fledged law in California. The bill now heads to the desk of Governor Gavin Newsom, who has until 30 September to sign or veto the bill. If signed, California will become one of the first states to require business platforms to obtain a special license to offer crypto services in the state.
What Does The Crypto Regulation Bill Aim For?
The crypto law aims to introduce tighter crypto regulations and more transparency for the crypto industry in California. If the governor signs the bill, it will go into effect from 1 January 2025. It will require companies of digital-asset exchanges to get license approval from the state’s Department of Financial Protection and Innovation.
On the other hand, the Department will also be allowed to take legal action against those who are unlicensed. According to the bill, if a non-licensed corporation engages in digital financial asset business activity, it will be charged a civil penalty of up to $100,000 daily. Furthermore, if a licensee violates a provision of this division, they will be liable to pay a fine of $200,000 for each day of violation.
Tim Grayson stated, “While the newness of cryptocurrency is part of what makes investing exciting, it also makes it riskier for consumers because cryptocurrency businesses are not adequately regulated and do not have to follow many of the same rules that apply to everyone else.”
Alongside this, it is to be noted that there is another clause in the stablecoin section of the bill. According to the bill, stablecoin issuers holding securities as reserved must have an amount of stablecoins not less than the total amount of all outstanding stablecoins issued or sold in the United States. Furthermore, the bill also mentions that the aggregate market value must be considered using the generally accepted accounting principles of the United States.
The bill stated, “It would make it impossible for many stablecoin issuers to operate within the state, a rapidly growing sector within the crypto industry set to generate significant economic activity and bring countless jobs to the state.”
Verdict
However, the association was making efforts to get the bill rejected. Despite the opposition, the Senate passed crypto bills 31-6 with three abstentions. The next day, it was approved in the Assembly 71-0 with nine abstentions. Regulators and governments worldwide are shaping up the crypto regulatory infrastructure with crypto bills. Crypto bill gives the user more closure looks to the crypto space. However, a day back, the president of Paraguay rejected the crypto mining law. The California BitLicense now entirely depends on the governor whether to sign it or not.
