Empire State Today

NEW YORK – In response to Attorney General Letitia James’ landmark legislation to tighten regulations on the cryptocurrency industry to protect consumers and the broader economy, elected officials, industry experts, and consumer advocates expressed resounding support. Attorney General James’ bill, which proposes the strongest and most comprehensive set of regulations on cryptocurrency in the nation, would increase transparency, eliminate conflicts of interest, and impose commonsense measures to protect investors, consistent with regulations imposed on other financial services.

“The cryptocurrency industry is in need of regulation and oversight,” said New York State Comptroller Thomas P. DiNapoli. “As the financial capital of the world, New York must lead these efforts. I applaud Attorney General James for taking decisive action to protect the public.”

“The lack of transparency plaguing the crypto industry causes immense harm to countless investors, especially low-income New Yorkers and people of color who carry a disproportionate share of the losses,” said New York City Comptroller Brad Lander. “We cannot let the crypto industry operate without a basic infrastructure for accountability. With this bill, Attorney General Letitia James is addressing the urgency for greater oversight of the crypto industry and building a legal framework to protect New Yorkers and the economy from predatory companies.”

“Thank you, Attorney General James, for taking steps to bring greater oversight to the crypto industry by proposing legislation to establish comprehensive regulations in New York,” said State Senator Kevin Thomas. “By raising the bar for this rapidly evolving market, we can ensure that consumers and their investments are secure in this space. We are grateful for your commitment to safeguarding the interests of New York consumers by pushing for fair and transparent practices.”

“As the cryptocurrency industry grows and captures the interest of investors across the state, it is imperative that our constituents are appropriately safeguarded against the threats at hand,” said State Senator James Sanders Jr. “As the Chairman of the Committee on Banks in the New York State Senate, it is no mystery to me that regulated financial markets are essential to avoid consumer fraud and conflicts of interest. Furthermore, with people of color investing in the crypto market at higher rates, the potential for financial harm is greater amongst communities of color. This simple fact calls for a framework to be established which promotes transparency and protections for crypto investors, similar to those which exist for other financial institutions. Only then will our residents be equipped to make fully informed and leveled financial decisions. Therefore, I believe the Crypto Regulation, Protection, Transparency, and Oversight (CRPTO) Act as proposed by the New York State Office of the Attorney General (OAG) in collaboration with the New York Department of Financial Services (DFS) will prove to be beneficial for our communities as it will shield even the most vulnerable investors from financial exploitation.”

“I applaud New York State Attorney General Letitia James for the timely introduction of this legislation to protect New Yorkers from financial harm by establishing a comprehensive regulatory framework for the opaque cryptocurrency market,” said State Senator Kevin Parker. “In the wake of the FTX collapse that tanked the price of Bitcoin to the lowest in years and cost investors over 8 billion, some of whom were New York depositors from Black and brown communities, the cryptocurrency industry must be held to the same macroprudential financial regulations as our traditional financial institutions to ensure accountability and market stability.”

“I strongly support the efforts of Attorney General James to ensure the most robust and meaningful consumer and financial protections for those who use cryptocurrency,” said State Senator Cordell Cleare. “All financial products and instruments must be honest, transparent, and failsafe — this goes double for emerging industries.”

“The failure to properly regulate cryptocurrency poses a real threat to low-income communities and communities of color in this state,” said State Senator Kristen Gonzalez. “I commend the Attorney General’s office for moving forward with legislation to better regulate cryptocurrency, and I look forward to working together to build on these regulations in the future.”

“The proposed bill's measures, including cracking down on conflicts of interest, enhancing transparency, and enforcing strict cybersecurity requirements, will create a level playing field for crypto firms and traditional financial institutions,” said Assemblymember Michaelle Solages. “With communities of color increasingly drawn to investing in crypto, it's essential that we introduce common-sense protections to prevent them from facing higher financial risks. The legislation's provision to hold institutions accountable for fraudulent activities and unauthorized transfers will empower customers to make informed investment decisions and safeguard their assets. This bill is a significant step toward creating a fair and secure environment for crypto investors in New York state.”

“On behalf of all New Yorkers, I stand in support of enacting legislation to protect the public when it comes to crypto currency,” said Assemblymember Inez E. Dickens. “This is a new investment, an investment in the future that many New Yorkers have already invested in and increased their net worth and then suddenly lost it all due to a lack of knowledge and information, which could have been provided through more regulations. Thank you, Madam Attorney General, for having the foresight and tenacity to recognize what must be done to protect public interest.”

“After multiple mega-crashes of crypto currencies, markets, and banks over the past year which cost thousands upon thousands of individuals and families their savings, it is more clear than ever that we need better regulation and oversight across the industry, and we need it now,” said Assemblymember Alex Bores. “I applaud the Attorney General for taking action to protect New Yorkers and to provide more transparency across the crypto industry.”

“I commend our Attorney General Letitia James for her dogged efforts to crack down on unregistered crypto platforms,” said Assemblymember Rebecca Seawright. “Her work is not only protecting New York investors from deceptive practices and misconduct; it is leveling the playing field by eliminating conflicts of interest and increasing transparency. New Yorkers and their hard-earned investments must be safeguarded in the new and changing virtual assets market.”

“Attorney General James has crafted groundbreaking legislation to protect consumers considering investment in cryptocurrency transactions,” said Assemblymember Steve Otis. “The Attorney General’s proposal would increase transparency, address conflicts of interest, require needed disclosures, improve accountability, and impose cybersecurity requirements to protect those investing or offering cryptocurrency products. To protect consumers and our economy, it is important that legislatures across the country keep pace with changes in finance, technology, and the law. Attorney General James’ legislation builds on New York’s strong regulatory framework with new tools that will be a model for other states.”

“As the digital asset space continues to grow and evolve, it is critical that we establish a legal framework that provides clarity and consumer protection while promoting innovation,” said Assemblymember Anna Kelles. “Attorney General James’ proposed bill does just that by requiring digital asset brokers, marketplaces, investment advisers, and issuers to obtain a license from the Department of Financial Services and comply with reporting requirements. By doing so, we can ensure transparency in cryptocurrencies and related blockchain technologies providing consumers with the protections they deserve. This bill represents an important step forward for New York State in embracing the future of finance and technology and I thank Attorney General James for her leadership.”

“It’s no surprise that everyday New Yorkers were largely spared by the collapse of FTX. The New York State Department of Financial Services has established itself as a world leader in promulgating rules that establish a fair playing field for crypto businesses while proactively protecting retail investors that are interested in the space,” said Assemblymember Pamela J. Hunter. “While DFS has been proactive, there is still a need to update our laws to adjust and acknowledge the sustained presence of this new asset class. As Chair of the Assembly Banks Committee, I look forward to working with Attorney General James to build upon the foundation we have in place in a way that improves consumer protection while simultaneously providing a regulatory structure that creates stability for crypto businesses establishing themselves in New York. Our state has long been the financial capital of the world. Updating our laws to accommodate cryptocurrencies and blockchain technology is essential and ensures that New York will continue to be a place of great innovation and a leader in finance.”

“When I held the first-ever oversight hearing on cryptocurrency and blockchain at the New York City Council this year, it was made clear by expert testimony that there is an urgent need for regulation of this fast-growing industry,” said New York City Council Member Jennifer Gutiérrez. “I commend New York State Attorney General Letitia James for her common-sense regulatory framework to ensure that her office and the Department of Financial Services can protect New Yorkers and the broader economy. This legislation will raise the bar for the crypto industry and safeguard the most vulnerable investors, especially investors of color. I look forward to joining this effort to ensure there is transparency and proper oversight of this industry, and to protect consumers from financial exploitation.”

“New York has been a national leader in strong financial services regulation, including through its model framework for the licensing and supervision of digital assets firms and its vigorous enforcement of the Martin Act,” said Maria T. Vullo, former New York State Department of Financial Services Superintendent and former Executive Deputy Attorney General for Economic Justice. “As recent events demonstrate, unregulated actors will exploit consumers and investors in their quest for outsized profits, damaging the market for those who seek to comply with the rules. It is time for New York to lead once again in the dual regulatory system with clear standards that address this evolving industry. By codifying the DFS BitLicense regulation, banning conflicts of interest, regulating affiliate relationships, and mandating transparency, the Attorney General's proposed legislation assures that New York's consumers and investors are protected from unregulated and improper practices by digital assets firms, while maintaining New York's existing regulatory structure. I commend Attorney General Letitia James for taking this important step to introduce a comprehensive legislative proposal and look forward to its negotiation and passage.”

“The Attorney General’s proposed legislation positions New York to once again be a leader in developing sensible regulation of virtual currencies,” said Delicia Hand, Director of Financial Fairness for Consumer Reports. “By expanding New York’s General Business law to include specific oversight of stablecoin businesses and disclosure requirements for crypto brokers and influencers, this bill would strengthen the state’s ability to protect consumers and the broader financial system by improving transparency, addressing potential conflicts of interest, and establishing clear investor safeguards. We look forward to continuing to work with the Attorney General to strengthen the bill and ensure consumers are protected as the industry grows.”

“New York Attorney General Letitia James’ cryptocurrency legislation sets the standard for all U.S. states and territories on how to regulate the fledgling cryptocurrency industry,” said John Stark, former Founder and Chief of the Securities and Exchanges Commission's (SEC) Office of Internet Enforcement. “This legislation brings much needed oversight to the industry and raises the bar, ensuring that investor protection remains paramount. I applaud Attorney General James and her team for this impactful legislation.”

“The cryptocurrency industry is deliberately targeting vulnerable communities of color, all in the service of lining the pockets of rich cryptobros,” said Alicé Nascimento, Campaigns Director of New York Communities for Change. “The industry is promoting itself as a means of financial empowerment and inclusivity, while downplaying the massive risks and drawbacks. Studies have shown that people of color are more likely to invest in cryptocurrency, and are therefore more vulnerable to the volatility and lack of regulation in the market. We commend the Attorney General for taking a critical step to bring accountability to the cryptocurrency industry and protect consumers and low-income communities of color across our state.” 

“Every day, people in New York State suffer as financial institutions use predatory practices designed to extract working people's money while padding profits and executive salaries. The rules are too often stacked against us and written by the industry to protect themselves rather than consumers,” said Sochie Nnaemeka, New York Working Families Party State Director. “We stand with Attorney General Letitia James as she advances a regulatory framework that's focused on protecting consumers, and we look forward to fighting side-by-side with her to ensure these protections become state law.”

“NY StateWide Senior Action Council applauds Attorney General Letitia James' proposed legislation to Establish Digital Asset Safety & Transparency,” said Maria Alvarez, Executive Director of NY StateWide Senior Action Council. “While cryptocurrency is a relatively new field in the financial sector, we must ensure that innovations always occur on an equal footing as consumer protections. As we have seen in recent events, people have lost their life and retirement savings as a result of not having strong regulations in place. Attorney General James' foresight will safeguard the future of many New Yorkers.”

“New financial vehicles, like cryptocurrency, are often poorly regulated and open up opportunities for fraud and financial exploitation, and oftentimes older adults are disproportionately targeted by bad actors in these spaces,” said Allison Nickerson, Executive Director of LiveOn NY. “Attorney General James is taking commendable action to protect New Yorkers from potential financial abuse by creating common sense oversight that is required for many other financial instruments. This will also help to protect older adults who choose to invest their money in this asset, and create a safer environment for those who are exploring new investments in cryptocurrency.”

“Many crypto firms fail to meet even basic investor protection standards set by regulators for traditional finance, and often have business models rife with conflicts of interest,” said Mark Hays, Senior Policy Analyst at Americans for Financial Reform. “This legislative proposal seeks to make it clear these firms can't continue with business as usual, and must play by the same rules as other financial firms. Policymakers in New York, in other states, and in Washington should view this proposal as one promising example of how investor and consumer protection measures based on existing regulatory frameworks might be used to prioritize investor and consumer protection for investors exposed to crypto, rather than invent new industry- friendly rules out of whole cloth.”

“With the promise of high returns, the largely unregulated multi-trillion dollar Crypto industry disproportionately targets Black and other low-income investors who have traditionally been excluded from generational wealth,” said Darrick Hamilton, PhD., University Professor, Henry Cohen Professor of Economics and Urban Policy, and Founding Director of the Institute on Race, Power, and Political Economy at The New School. “The Crypto Regulation, Protection, Transparency, and Oversight (CRPTO) Act will bring stronger oversight, accountability, and regulation to protect New Yorkers, and given New York’s position as the financial capital of the world, our entire economy from the speculatory trends underpinning crypto. I applaud Attorney General James for her continued leadership and efforts to enforce the rule of law and protect vulnerable New Yorkers, who stand the most to lose.”

“This legislation goes to the foundational conflicts and frauds that have become endemic in the crypto business,” said Bartlett Naylor, Financial Policy Advocate/Economist at Public Citizen. “Most importantly, it requires public audits of stablecoin reserves that must only include the safest of securities. New York has learned much from the sordid history of the sector, and this legislation responds responsibly. Once again, the Big Apple finds the core of the problem and leads the way to reform.”

Original source can be found here.