New York Virtual Currency Regulations

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New York Virtual Currency Regulations

For virtual currency businesses in New York, understanding and complying with New York virtual currency regulations is critical to business longevity. At Bates Group, our experienced consulting experts can help your company understand virtual current regulations and how to meet compliance requirements. To learn more, reach out to our team directly by phone or online to get started. 

What Is Virtual Currency Business Activity?

Businesses that engage in virtual currency business activity are required to meet the virtual currency regulations established by the state of New York. According to the law, conducting any of the following activities in New York or as a New York resident subjects a person to the virtual currency regulations:

  • Controlling or issuing a virtual currency
  • Performing virtual currency exchange services
  • Selling or purchasing virtual currency as a business
  • Transmitting virtual currency or receiving virtual currency for transmission unless the transfer does not involve more than a nominal amount of currency
  • Storing or holding virtual currency on the behalf of others

Essentially, if your business uses, stores, transfers, buys, sells, or exchanges virtual currency, then it is subject to the state’s virtual currency regulations. 

Regulations for NY Virtual Currency Businesses

The New York virtual currency regulation law is found under 23 NYCRR Part 200. The law requires those businesses engaging in virtual currency activities to apply for a BitLicense or a charter under the New York Banking Law. 

  • BitLicense. The “BitLicense” is required for nearly any business that is engaging in the commercial sale, transfer, issuance, or purchase of virtual currency. If a business engages in the sale, transfer, issuance, or purchase of both virtual currency and fiat currency, it will also require a traditional money transmitter license as well. 
  • Charter under New York Banking Law. A BitLicense and a charter under New York Banking Law are similar, although the charter may provide additional benefits for some businesses, according to NY.gov. A limited purpose trust company with a charter can exercise fiduciary powers, for example. This charter also allows the business to engage in money transmission in the state without acquiring a separate money transmitter license. 

Preparing Your Business for Virtual Currency Regulations

If your business is engaged in virtual currency activities, it’s important that you are well-prepared to meet compliance requirements. Failure to hold or maintain a license could result in penalties for your business, including a costly halt on business activities and fines and fees. 

At Bates Group, our expert consultants have experience working with money-service businesses and virtual currency businesses like yours. In addition to helping your business obtain the proper licenses that are required under the law for virtual currency operations, we can also help your company meet other compliance requirements, including Bank Secrecy Act and anti-money laundering compliance requirements

To learn more about our consulting team and how we can help to prepare your business for virtual currency regulations, as well as the specific New York virtual currency regulations your business may be facing, call us directly or send us a message online at your convenience. We have a reputation you can trust.

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