US: NYDFS regulator unveils updates on Bitcoin regulation

Lawsky has argued that the new rules are meant to better protect consumers and the financial markets from cybernetic attacks, thehill.com reports.

Under the proposal, financial firms handling Bitcoins would need to obtain a “BitLicense” from the NYDFS, ensure a strong cyber defense and maintain detailed records of all cryptocurrency transactions. The recently released NYDFS draft rule on Bitcoin raised tech companies and digital advocacy groups’ eyebrows, arguing they would dampen innovation and damage privacy.

Lawsky also clarified that software developers and individuals using Bitcoin will not be required to get a license, as well as companies managing customer rewards programs or gift cards. The same case applies for both merchants who accept virtual currencies as payment for goods and services and customers buying products with the virtual currency.