The New York State Department of Financial Services (“NYDFS”) released its revised proposed BitLicense regulatory framework earlier today. Once the revised framework is published in the New York State Register, it will trigger a new thirty-day public comment period. Further analysis will be available on the Virtual Currency Report in the coming days, but proposed changes to the prior version of the NYDFS’s framework include: carving out from the definition of Virtual Currency those digital units used in connection with “Gift Cards” (as that term is defined by the proposal); vesting broad power in the superintendent to issue two-year “conditional licenses” to applicants based on a non-exhaustive list of factors; removal of the requirement that licensees obtain the identity and address of transaction counterparties, except to the extent practicable; and, a shift from prescribing permitted uses of retained earnings and profits to requiring the maintenance (in one or more denominated forms) of to-be-determined or negotiated capital reserves.
