NYDFS proposes regulation to assess costs of 'supervision and examination' for licensed crypto firms

Though some crypto firms operate in New York with a BitLicense, many including NYC Mayor Eric Adams have criticized the licensing regime as a difficult barrier to cross.

The New York State Department of Financial Services, or NYDFS, has proposed a regulation that would allow the government department to assess supervisory costs from licensed crypto firms operating in the state.

In a Dec. 1 announcement, NYDFS Superintendent Adrienne Harris opened the proposed budget measure for public comment. The regulation, if approved, would grant the department the authority to assess costs for the supervision and examination of firms operating in the state with a BitLicense — a state requirement for crypto companies since 2015.

“This assessment authority will allow the Department to continue building the team that is leading the nation with a suite of regulatory tools,” said Harris. “The ability to collect supervisory costs will help the Department continue protecting consumers and ensuring the safety and soundness of this industry.”

#ICYMI: DFS Superintendent Adrienne A. Harris Announces New Proposed Virtual Currency Assessment Regulation. Read the Superintendent’s quote below ⬇️ pic.twitter.com/ITI9cxcPFA

— NYDFS (@NYDFS) December 1, 2022

Though some crypto firms continue to operate in New York with a BitLicense, many including New York City Mayor Eric Adams have criticized the measure as a difficult barrier. The BitLicense originally cost $5,000 in application fees, with the NYDFS setting certain capital requirements for operations.

Related: NYDFS calls for crypto firms to use blockchain analytics

The proposed regulation built upon a rule signed into law in April granting the NYDFS “authority to collect supervisory costs from licensed virtual currency businesses.” Harris said the rule would help bring regulations of crypto firms in line with those imposed on banks and insurance companies.

According to the NYDFS, the proposal will initially be open to public comment for 10 days, then an additional 60 days upon publication in the state register.