Why did the main cryptocurrency bill die in California State?
Regulation is one of the pressures on the crypto market. Many countries’ regulators have consistently supported crypto asset control and monitoring. These regulators are always creating laws to manage the industry and protect the funds of investors.
California and New York are setting the global standard for crypto regulations. For example, crypto companies in New York are currently required by law to obtain a “BitLicense” before providing virtual asset services. The law is now in effect in the state, though the current mayor, Eric Adams, is opposed to it.
Other states, such as Arizona and Wyoming, are developing diverse crypto regulations in addition to these top players.
California’s Crypto Business and Exchange Bill
Another bill, similar to the BitLicense legislation, has emerged in California. The “Digital Financial Assets Bill” requires exchanges and industry businesses to obtain a licence from California regulators.
This bill had previously passed the assembly by a vote of 71-0. It was also passed by the Senate and now awaits Governor Gavin Newsom’s signature by September 30. Unfortunately, but not unexpectedly, Newsom vetoed the bill.
The decision surprised regulators, but the crypto community is ecstatic. Newsom informed the California State Assembly that he would veto the bill. He believes the crypto oversight bill is unsuitable for the state.
The Governor believes that the cryptocurrency industry is gaining traction by the day. As a result, the state’s citizens should be protected by a clear law. To that end, Newsom stated that his administration had investigated the cryptocurrency industry in order to find ways to protect investors.
As a result, signing a bill without considering his research will be incorrect. He also stated that the federal midterm elections are in the works and should be completed first.
According to Newsom, the bill will cost the state tens of millions of dollars from the general fund. This sum will be required for the bill’s cost-benefit analysis and will be accounted for during the state’s budgeting process.
As a result, he believes that regulators should wait for now and devise a flexible plan to strike a balance between new ideas and safety.
The Digital Asset Community Is Overjoyed!
Every regulation in the crypto industry has an impact on operations in some way. As a result, the community applauds Newsom’s actions to keep the bill alive.
The Blockchain Organization Jake Chervinsky praised the Governor’s bravery and strength in defying the State Assembly. Miles Jennings of a16z also lauded Newsom for his support of Web3 in California.