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- BitLicense became the common term to describe the license governing companies for digital asset space in New York.
- Blockchain and digital assets are going to be an essential aspect of economic growth and development.
- Lawsky met Ripple General Counsel Stuart Alderoty at Swell to discuss the conception and design of BitLicense.
Blockchain and digital assets are going to be an essential aspect of economic growth and development. However, to ensure that they used most efficiently, we need regulations and frameworks.
In 2014, Benjamin Lawsky proposed one such framework, New York’s BitLicense. Over the years, BitLicense became the common term to describe the license governing companies for digital asset space in New York.
Lawsky met Ripple General Counsel Stuart Alderoty at Swell to discuss the conception and design of BitLicense. They also talked about how the experience with BitLicense will help with the formation of future regulatory frameworks.
Civil-War era code for Digital Asset
When Lawksy began working on BitLicense, there was no pre-established framework for digital asset regulations. Lawsky stated that the rules applied to BitLicense created during the Civil-War.
Lawsky believes that BitLicense was a success and considers the numbers to be substantial evidence. He further states that 22 companies acquired BitLicense, and 15 companies refused.
Today, those 22 companies are operating successfully, whereas the 15 companies have suffered a hack or got caught in money laundering. Lawsky explains that getting a BitLicense provides a competitive edge as it gives a sign of confidence to investors and customers.
Impact of BitLicense
Lawsky is surprised that frameworks haven’t caught on with more US regulators. He was hoping for more clarity in the previous year. Sadly, the US lacked the momentum, and this led to other countries getting ahead. He said that Singapore had done magnificent work in the past few years.
He further states that Singapore’s plan of creating two different licenses is brilliant. One license is for the regular companies, while the second one is focused on smaller companies and saves them from the burden and cost of a full license.
The Future
Lawsky expects states such as California to adopt new regulations, and this will create a model that will be followed by other countries and maybe at the middle level.
He also hopes that a foolproof regulatory framework would create more opportunities. According to Lawsky, “The genie is out of the bottle,” and it will only lead to an improvement in the financial service sector.
With a background in journalism, Ritika Sharma has worked with many reputed media firms focusing on general news such as politics and crime. She joined The Coin Republic as a reporter for crypto, and found a great passion for cryptocurrency, Web3, NFTs and other digital assets. She spends a lot of time researching and delving deeper into these concepts around the clock, and is a strong advocate for women in STEM.
