|September 2, 2014|
Previously published on August 2014
The New York State Department of Financial Services ("DFS") recently became the first state regulator to propose a regulatory framework for the bitcoin virtual currency industry. DFS posted its "Regulation of the Conduct of Virtual Currency Business" on its website, as well as on the social media websites Reddit and Twitter, forums utilized by many bitcoin stakeholders. Given New York's historical role as a clearinghouse for financial and currency transactions, DFS's broad regulatory purview as New York's main financial regulator, and the high-profile initiatives and enforcement actions this new regulator has pursued since opening its doors in October 2011, it is no surprise that DFS is at the forefront in attempting to regulate bitcoin.