California Governor Signs Bill to Regulate Crypto in State
California Governor Gavin Newsom has signed a bill into law that will regulate the cryptocurrency industry in the state. The bill, which was passed by the California legislature in August, requires crypto companies to obtain a license to operate in the state. This move comes after last year’s collapse of the FTX crypto exchange and other turmoil in the broader market.
New Crypto Regulation Expands to Stablecoins
The new law is expected to go into effect in January 2025 and expands crypto regulatory aspects to stablecoins. Under the law, stablecoins must be issued by a bank or licensed by the California Department of Financial Protection and Innovation. The market value of stablecoins will be computed using US generally accepted accounting principles (GAAP).
Congress Working on Crypto Regulatory Framework
In addition to California’s new crypto regulation, the US Congress is also working on several bills to regulate the cryptocurrency industry at a federal level. These bills aim to provide clarity on whether the SEC or the CFTC has authority to regulate the crypto industry in the US.
Hot Take: California Takes Steps Towards Crypto Regulation
With Governor Gavin Newsom signing a bill to regulate crypto in California, it marks an important step towards establishing clear rules for the cryptocurrency industry in the state. By requiring crypto companies to obtain licenses and expanding regulations to stablecoins, California aims to protect investors and promote transparency in this rapidly evolving sector. This move aligns with ongoing efforts at the federal level, where Congress is also working on regulatory frameworks for cryptocurrencies. Overall, these developments indicate a growing recognition of the importance of regulating crypto assets and ensuring their responsible use within existing financial systems.
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