Money service businesses received a reprieve last week that will make cryptocurrency firms very happy since they will be able to more easily expand across the United States. The Conference of State Bank Supervisors (“CSBS”) – 48 state regulators – agreed on a regulatory system for money services’ businesses, including a single set of supervisory rules and exam program conducted by state regulators.
The new regime applies to nearly 80 large payment and cryptocurrency firms, doing business of over $1 trillion annually. In recent years, state regulators have been working together to address complaints that the state-by-state supervisory system is redundant and overly burdensome. Cryptocurrency firms, typically are licensed state by state, but, under the new arrangement, a group of state examiners will jointly supervise a business, instead of individual states. This approach should be more efficient with states sharing information; however, states may still conduct independent examinations.
In short, this new regime should make it easier for cryptocurrency firms to operate. However, seasoned counsel is still necessary to manage this new path for cryptocurrency firms.