CSBS Releases Its Policy on Cryptocurrency Regulation, Favors Activity-based Licensing and Supervision

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CSBS Releases Its Policy on Cryptocurrency Regulation, Favors Activity-based Licensing and Supervision

ForexMinute.com – Conference of State Bank Supervisors (CSBS), the US-based organization of banking regulators, today released its policy on state virtual currency (cryptocurrency) regulation, and further asked public for comments to sketch out a moderate Bitcoin law.

In its Policy Statement, CSBS proposed that cryptocurrency businesses, acting as a third-party for the purposes of “transmitting, exchanging, holding, or otherwise controlling virtual currency,” should be licensed and supervised in order to operate in the same manner. “Licensing and supervision serve as a mechanism for protecting consumers, ensuring system stability, safeguarding market development, and assisting law enforcement,” the report reasoned.

In the meantime, the CSBS policy statement excluded consumers and merchants from obtaining the license who use Bitcoin and other cryptocurrencies solely for the purpose of buying and selling goods or services. The proposed framework further excused the non-financial activities from any sort of supervision or licensing. They include services that “utilize technologies similar to those used by digital currency.”

On the other hand, the businesses that will be exposed to licensing are payment transfer services, exchanges, ATM providers, payment processors, wallet and vault providers, and merchant-acquirers.

You can read the entire policy here.