The New York State Department of Financial Services (NYDFS) has stringent crypto rules and guidance for crypto firms operating and providing services in the state. In a recent rule change, the NYDFS will propose a framework to improve transparency regarding crypto-related activities, including crypto listings and delistings.
The New York State Department of Financial Services (NYDFS) to introduce proposed guidance for crypto firms on evaluating a crypto offering before listing and delisting, reported The Wall Street Journal on September 18.
The NYDFS’ proposed framework prepares to increase transparency in coin listing. The regulator also describes steps and criteria for deciding the delisting of a crypto. In addition, the proposed framework will guide firms on firm-specific crypto listing and delisting.
NYDFS Superintendent Adrienne Harris said the guidance will help standards related to crypto offerings more robust. the regulator found many shortcomings in recent studies.
“When we know that a coin that someone once thought was OK, when we see that new risks have emerged or the coin is being misused, we want our entities to have a way to delist the coin in a way that’s still protective of consumers and protects safety and soundness as well.”
Crypto companies registered in the state are required to submit new coin-listing and delisting policies to the NYDFS. The areas of policy requirement are governance for the crypto-listing process, risk assessments of crypto, and procedures to monitor crypto. Also, the listing policy must reflect a company’s business model, operation, and customers. The proposed legislation is open for public comment until October 20.
Crypto firms can continue listing after their policy is approved by the NYDFS. However, firms must continue to provide written notice before listing new crypto and share details on all crypto it offers or uses.
Read More: NYDFS Revokes Crypto Firms From Coin Listing
The NYDFS has maintained a strict regulatory stance against the crypto market, bringing fines and enforcement against crypto companies.
In fact, the New York regulator’s action against Paxos caused major challenges for Binance after it ordered to stop minting BUSD in February. Coinbase, BitPay, and Robinhood among others were fined by the NYDFS maintaining its strict stance.
Harris noted that NYDFS’ crypto unit now has about 60 staff, almost tripling its size from two years ago. The regulator is also known for having strict crypto regulations.
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