How to be a Bitcoin Millionaire => http://goo.gl/8Xobwl
This summer, “every important person in Bitcoin” got subpoenaed by New York’s state financial regulator because it wanted information about their business practices in order to get a lay of the virtual currency land. New York’s financial sheriff Benjamin Lawsky said he wanted to wrap his head around the virtual currencies in order to figure out what regulation was necessary to promote legitimate commercial uses and tamp down on the use of Bitcoin for fun stuff like drugs, guns, money laundering and child porn. On Thursday with the value of Bitcoin soaring to new highs, over $400 or double its value of a month ago, Lawsky announced plans to hold a hearing to “consider the possibility and feasibility of NYDFS issuing a ‘BitLicense’.”
That “BitLicense” would allow virtual currency companies to do business in New York and send currency to New Yorkers, and would require compliance with anti-money laundering and consumer protection requirements tailored to the digital cash crowd. With double news this month of “secure” Bitcoin wallet provider Inputs.io being hacked — resulting in 4000 BTC (or $1.6 million) being stolen from its customers — and the overnight shutdown of a Chinese exchange, that took $4.1 million worth of users’ cryptocoins with it, some consumer protections sound pretty attractive. But what would a “BitLicense” do that existing regulations don’t already provide for?
New York’s financial regulator says it plans to determine that at a hearing in “coming months.” Among the issues Lawsky hopes to work out are which entities would need to get a BitLicense and what kind of “specifically tailored examination requirements” they would need. Those who prefer other cryptocurrencies to Bitcoin will likely be miffed at the non-generic name of the license. The agency, seems aware of that, noting in a footnote, “For the avoidance of doubt, a potential ‘BitLicense’ could apply to firms involved with all virtual currencies, not just Bitcoin.”
“It is not clear at this point whether virtual currencies will become a long-term, prevalent fixtures of the electronic commerce world,” says the agency in a press release. “But given the increased demand from consumers and investors, as well as demonstrated concerns regarding money laundering, regulators would be remiss if they turned a blind eye to virtual currencies. We have a responsibility to take a hard look at these issues.”
In other words, Bitcoin is hot right now, and not just to investors, but to states that would like to set the tone for how the currently-valuable coin should be treated. On the federal level, Bitcoin has two dates with policymakers next week. On Monday, it gets scrutinized for safety and security issues by the Senate’s Homeland Security Committee. On Tuesday, its implications for finance and banking go before the Senate Banking Committee.
Bitcoin’s milkshake brings all the regulators to the yard.
