The New York Department of Financial Services has announced it will hold hearings in the coming months to discuss regulating Bitcoin.
Among the topics they'll discuss is whether to begin issuing what they're calling "BitLicenses" to businesses deemed in compliance with a possibly new set of financial statutes created solely for digital currencies like Bitcoin.
"Our public hearing will review the interconnection between money transmission regulations and virtual currencies," the release states. "Additionally, the hearing is also expected to consider the possibility and feasibility of NYDFS issuing a ‘BitLicense’ specific to virtual currency transactions and activities, which would include anti-money laundering and consumer protection requirements for licensed entities."
Much of the popularity of Bitcoin seems to hinge on its status as an unregulated, decentralized unit of transaction, and we've previously discussed the paradox of how the mainstreaming of Bitcoin could actually cause its value to decline. As Bloomberg View's Timothy Lavin wrote, "Almost all the advantages Bitcoin has -- it's cheap, somewhat convenient, anonymous, free from centralized authority -- derive from the fact that governments haven't taken it very seriously."
Many Bitcoin proponents dismiss that argument, however, noting that even if demand slips in Western countries, there remains a healthy interest abroad, especially in countries where the government sets exchange rates. Indeed, a surge in Chinese Bitcoin users seem to have driven much of the recent climb in value.
In August, representatives from Bitcoin firms met with officials in Washington to answer questions about the cryptocurrency, which can now be used to purchase virtually anything on the web.
Bitcoin's value has climbed more than 70% in the past month to about $430 on the Mt. Gox exchange.
Read more: http://www.businessinsider.com/new-york-to-hold-hearings-on-bitcoin-2013-11#ixzz2khc5VEeb
