The New York State Department of Financial Services (NYDFS) has issued new rules to ensure the activities of crypto firms protect investors from financial harm, demonstrating its commitment to regulating the crypto space effectively.
NYDFS Publishes New Guidance on Crypto Assets
The new guidance, which replaces the standards issued in 2020, comes into effect immediately and requires all virtual asset firms to incorporate the latest standards into their coin listing and delisting policies by December 8, according to an official post from the department.
Daryl Sever, a financial analyst, in a comment submitted during the proposal of the updates, stated that “the risk associated with a digital asset partly depends on the nature of a crypto firm’s business activities.” This sentiment was reflected in the new standards that included risk-based considerations and tailored risk assessment expectations for specific crypto business activities, according to the department.
Firms Required to Update Policies
Under the new rules, crypto firms with previously approved coin listing and delisting policies are prohibited from self-certifying coins until they incorporate the new guidance and receive fresh approval from the NYDFS.
“Following DFS approval of a coin-listing policy, a VC Entity may proceed with self-certification of coins, thereby making them available for approved virtual currency business activity in New York or to New Yorkers. The Department will not approve a coin-listing policy absent an accompanying coin-delisting policy,” the department said.
Crypto entities without DFS-approved coin listing policies are also subject to instructions from the department to delist any coins not on the greenlist and to submit their final coin delisting policies for approval by January 31, 2024, as part of the new requirements.
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