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- The governor of California, Gavin Newsom has rejected a bill that looked to license and manages crypto. Assembly Bill 2269 was presented by Assemblyman Timothy Grayson.
- At the same time, the bill was heavily criticized by crypto enthusiasts and groups.
The bill passed on 30th August 2022, with the complete majority, and got 71 yes votes, and no negative votes in California’s Assembly, just a day after being accepted by the California Senate.
“As the freshness of cryptocurrency is a part of what makes investing thrilling, at the same time it makes it unsafe for users. The crypto business is not sufficiently regulated and doesn’t have to go through those similar laws that apply to someone else,” Grayson elaborated,
If the governor of California has signed the bill into the act, it may have identified crypto transactions as formal money transactions. This may successfully bring cryptos under the attention of the Money Transmission Act.
Moreover, the proposed bill would have limited bodies licensed by the state of California from communicating with stablecoins. Particularly those that weren’t passed by banks or licensed by the state Department of Financial protection and innovation.
In a letter denoted to the members of the California State Assembly, Governor Newsom elaborated the reason behind the rejection of the bill. He said that he had the intention of safeguarding people from financial damage against increasing demand for creative financial assets. He explained:
“It will be too early to lock a licensing framework in statute without acknowledging both this work and upcoming federal acts. One more volatile approach is required to make sure regulatory errors can keep up with quickly involving technology and its use cases, and is customized with the right tools to denote trends and reduce users’ damage.”
The people who are criticizing the bill referred to it as the Californian version of New York’s BitLicense. BitLicense is a law that was imposed in the state of New York in 2015. At that time, it was an indicator to indulge in crypto-related activities.
At the same time, the law got criticized widely for changing the crypto landscape in the state. Witnessing many years of criticism along with complaints, state regulators finally changed the bill in June 2020. Moreover, officials decided to impose a more relaxed regulatory framework to simplify the licensing process.
Steve Anderson is an Australian crypto enthusiast. He is a specialist in management and trading for over 5 years. Steve has worked as a crypto trader, he loves learning about decentralisation, understanding the true potential of the blockchain.
