Gavin Newsom is about to sign the recently passed bill. This bill requires crypto exchanges and other crypto companies to obtain a special license from the state of California to conduct their activities.
According to Blockchain Home and quoted by CoinDesk, the Digital Financial Assets Act, which is called California’s “BitLicense”, follows the approval of New York’s BitLicense in 2015. The California law, if approved and signed by Newsom, will take effect in January 2025.
Timothy Grayson, a member of the House and sponsor of the bill, said that although the newness and virginity of the crypto space is what makes it exciting to invest in it, it also makes investing in the crypto space riskier for customers because crypto businesses They are not properly regulated and do not have to follow the rules that apply to other businesses.
Among the bill’s requirements and prerequisites is a ban on California-licensed entities operating with stablecoins. Unless said stablecoin is issued by a bank or licensed by the California Department of Financial Protection and Innovation. This bill is similar to a bill in the US Congress that required issuers of stablecoins to have a banking license. However, this bill was never approved.
Another clause in the section related to stable coins of this bill requires the issuers of stable coins who have securities as reserves to have more capital than the value of said stable coin. In addition, the bill states that the market value of the said stablecoin must be calculated using generally accepted GAAP accounting principles. GAAP is a set of accounting rules, standards and procedures issued by the Financial Accounting Standards Board (FASB).
Blockchain Union in twitter He wrote that the bill creates short-sighted and ineffective restrictions that will prevent investors from operating and drive many of them out of the state of California.
This bill is the second attempt by California lawmakers and officials to create a framework similar to BitLicense. Their first attempt in 2015 failed and was dropped after the state senator objected.
In the California State Assembly, the bill received 71 votes in favor and zero votes against. 9 council members refused to participate in the voting. On the floor of the state Senate, the bill received 31 votes in favor and 6 votes against, and all 6 votes were from Republican senators.
Newsom has until September 30 (October 8) to approve or reject this bill.