California’s assembly commission on banking together with finance has approved a nib that would regulate cryptocurrencies such equally Bitcoin inward a similar fashion to New York’s controversial BitLicense. Dubbed AB-1326 Virtual Currency, the legislation is right away headed to the appropriations commission earlier reaching a vote on the assembly floor.
The nib would teach inward a offense inward California to operate a virtual currency line concern without outset registering alongside the commissioner of line concern oversight, satisfying all requirements, together with paying an application fee of $5,000. Businesses must equally good file audits together with reports to the commissioner multiple times a yr inward gild to seek solvency together with know-your-customer records.
piece of legislation that would house strict requirements on businesses inward the digital currency space, non different the BitLicense beingness crafted past times New York’s subdivision of financial services. But inward contrast to that regulatory effort, the California police describe is moving through the traditional legislature past times attempting to modify the state’s Money Transmission Act.
It broadly defines a “virtual currency business” equally whatever activeness involving the storage of digital currency on behalf of others; the telephone substitution of fiat money for digital currency together with vice versa; together with fifty-fifty the telephone substitution of 1 type of digital currency for another. It applies to all businesses together with organizations who perform these activities inward relation to a California resident.
Among the diverse rules contained inward the bill, businesses must:
- Pay a non-refundable $5,000 application fee to the subdivision of line concern oversight (DBO)
- Maintain working capital missive of the alphabet reserves of an arbitrary sum determined past times the DBO commissioner
- Verify that all representatives together with employees are of “good graphic symbol together with audio financial standing,” together with overstep away along records of these reviews for 3 years
- Not allow representatives or employees to acquit virtual currency line concern for outside, unlicensed parties
- Be aware that the DBO commissioner tin examine the line concern or whatever branch office, fifty-fifty if exterior California, at whatever time
- Provide whatever accounts, books, correspondence, memoranda, papers, together with other records at the DBO commissioner’s request
- Notify the DBO inside 5 days inward the representative of bankruptcy filing; felony charges against a manager, manager or executive officer; or other major legal developments related to the business
- Retain all records relating to compliance alongside this license for at to the lowest degree 3 years
- File an annual audit written report to the commissioner inside ninety days of the financial year-end
- File quarterly reports detailing residuum sheets, income, cash flows, together with changes inward shareholders’ equity