New York DFS Reveals New Restrictions for Crypto Listings
- The New York financial regulator has unveiled new restrictions on crypto listings on crypto exchanges.
- The existing rules established in 2020 have now been updated to incorporate stringent policies.
- The regulator said that it seeks to protect investors from fraudulent activities and market manipulation.
- All crypto firms licensed under the New York Codes, Rules, and Regulations will fall under the new rules.
The New York Department of Financial Services (DFS) has revealed new restrictions for crypto listings on digital asset trading platforms operating in the city. The current rules have become stricter as the regulator seeks to protect investors from fraud and manipulation of prices.
The New York financial regulator introduced a new set of policies on November 15, stating that it will be mandatory for crypto exchanges operating in the city to submit their coin listing and delisting policies for NYDFS approval. The NYDFS Superintendent, Adrienne A. Harris, stated that the prior framework issued by the Department in 2020 has now been updated to incorporate stringent policies.
“This guidance continues the Department’s commitment to an innovative and data-driven approach to virtual currency oversight, keeping pace with industry developments,” said Harris. “DFS is consistently at the forefront of virtual currency regulation, translating years of knowledge and experience into timely and relevant guidance that protects consumers and markets.”
To protect investors, the NYDFS will measure businesses operating in New York against more stringent regulations. The NYDFS has taken into consideration several factors, including technological, operational, cybersecurity, market, liquidity, and illicit activity surrounding the listing of cryptocurrencies on digital asset trading platforms.
The new rules will be applicable to all the blockchain-focused businesses that are currently licensed under the New York Codes, Rules, and Regulations or limited purpose trust companies under the New York Banking Law. Initially, the NYDFS released proposals on guidance for “enhanced criteria for coin-listing and delisting procedures” in September, calling for public feedback.
The regulator builds upon Superintendent Harris’ VOLT initiative, through which the NYDFS “has added more than 60 experts to oversee licensing and strengthen supervision, enhanced existing and established new policies and procedures, and enacted new assessment authority to support the continued growth of the virtual currency unit,” said the release.
“Leveraging the Department’s vast knowledge of the industry, DFS has now issued eight pieces of virtual currency regulatory guidance, protecting consumers, businesses, and markets as the industry develops and changes,” said the regulator.
Additionally, under Superintendent Harris, the Department has imposed fines worth over $132 million against digital asset firms using existing supervisory and enforcement authority. According to recent reports, Democratic Assembly Member Clyde Vanel of New York introduced a new bill in January that would permit state agencies to accept cryptocurrency as payment for state-imposed fines like fees, taxes, and civil penalties.