Sound Money Campaign looks at the issues regarding the proposed regulation of Bitcoin by New York. Before we get to those proposed regulations, it is important to understand why the proposal of these regulations occurred in the first place.
Mt Gox
The crash of Mt Gox is the plainest point on which to ponder. There were a reported 800,000 Bitcoins that went missing. That value is approximately $350 million US Dollars. There are pages of SERP results about stolen Bitcoin wallets. All of this points to the fact that there are problems with the infrastructure around virtual currency.
Those consumers who are out their investment have plenty of bitterness in which to demand changes. Currently, who is in charge of regulating or even handling customer service complaints? It is the very companies who are concerned over regulation that must front customer service complaints. So what is to prevent dishonesty and fraud from occurring within the virtual currency infrastructure?
What’s on the Table?
Vast, broad sweeping changes for companies that operate within the State of New York and deal with Bitcoins. The aim of the regulations is at every level of participation, including those companies that accept Virtual Currency as legal tender.
The proposed changes aim to bring Bitcoin into a legals state that complies with the State Laws of New York. These changes aim to address topics like money laundering, cybersecurity definitions and levels of protection and to add in components that offer protection to consumers.
Historically, New York:
The State of New York has a reputation for protecting consumer interest as the primary method of attracting both new businesses and people to the state. We see this across many industries within the state. This move does not appear to be more than it seems; a way to protect the people of New York from harm. In so doing, New York could create a Mecca of sorts for virtual currencies and companies that work with them and accept them as payments.
The Outcry of Grief
The problem that is causing most business to be wary of these changes is the fact that the proposed changes are huge. They are not only broad they are comprehensive. The biggest complaint is that small companies do not have the time or the resources to understand the changes and provide comprehensive rebuttal in the time frame allotted by State Dept.
of Finance. There is a letter circulating that contains signatures of people asking for additional time to read and respond. Benjamin M. Lawsky is the power behind the proposed changes at the New York Dept. of Finance. Lawsky has gone on record expressing his willingness to extend the deadline. He seems genuinely concerned about creating change that is both a source of protection for consumers, and benefits for those companies who work with Bitcoin.
Are the Changes Good or Bad?
Sound Money Campaign sees these changes as mostly beneficial. There is an opportunity to strengthen the virtual currency and its uses in New York. The proposed changes do not specifically change Bitcoin. They aim to regulate the infrastructure around Bitcoin. The biggest obstacle that needs addressing is the security of the small players. There needs to be some consideration about keeping the playing field equal.
