NYDFS Advocates States Crypto Regulation as National Model

Adrienne A. Harris, head of the New York State Department of Financial Services (NYDFS) is asking Congress to consider her state rules on crypto when designing a national model for the nascent digital asset industry. In addition, the financial regulator has cautioned that Congress should not allow federal laws to rule against the already laid out state jurisdiction.

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During her meeting at Brookings Institution in Washington, D.C., Harris who came into office about a year ago and is regarded as crypto’s most powerful regulator, voiced her inclination that federal legislation may want to override state regulatory framework in her jurisdiction. The advice to choose the New York regime is owing to the fact that she believes it is a robust and sustainable regime.

“When we go to the Hill, we say we want there to be a state path. We would like for there to be a framework nationally that looks like what New York has because I think it is proving itself to be a very robust and sustainable regime,” She said.

NY Regulator Says FTX Not Licensed in NewYork

She spoke of the FTX implosion which happened a few days ago after Binance refused Alameda Research’s offer to buy out its FTX token (FTT) holdings and also withdrew from purchasing the firm. When asked about the operation of FTX’s United States arm in New York, the NY financial regulator stated that the exchange never operated legally in the region because they never got a BitLicense.

“They had an application pending, which they noted publicly. And it was pending,” Harris clarified. In a separate panel, Peter Marton, the head of virtual currency at NYDFS also made a statement to corroborate Harris’ claim, “I want to acknowledge first and foremost that FTX.US was not operating in New York.”

For some time now, the NYDFS BitLicense has been a constant subject of discussion and criticism in the crypto ecosystem owing to the stringent nature of the license.

With the recent push for federal regulations for the digital assets industry, many firms may turn to get a federal license instead of the state license like BitLicence. Hence, Harris’ warning to Congress concerning an override.

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