- California Governor Signs New Crypto Bill Into Law For 2025
- The government is developing a new framework for crypto regulations.
- The new regulations focus on tax laws, crypto service providers, and DFPI licenses.
The government and other organizations were already in a conundrum when it came to regulating cryptocurrencies. Until now, several countries have framed their rules to regulate cryptocurrencies and the cryptocurrency services they provide.
In the same course of events, the Department of Financial Protection and Innovation (DFPI) is on its way to creating a framework for crypto. The framework covers tax policies and other crypto regulatory policies.
Despite the heavy criticism, the California government passed the Digital Financial Asset Law. This law introduces an 18-month implementation window, offering flexibility for new industry trends.
California Governor Signs New Crypto Bill Into Law For 2025
According to California’s Governor Gavin Newson’s statement, “the adopted regulatory framework can be thoughtfully tailored to address industry trends and mitigate consumer harm”. Their goal is to address the technological advancements in the financial system and protect consumers from making risky investments.
Further, he added the statement “We must strike the appropriate balance between protecting consumers from harm and fostering a responsible innovation environment”.
Newson clarified that the law will minimize fraud and investor protection, enhance consumers, and come up with a solution that benefits businesses and common people.
Here are some of the common points on which the California government is emphasizing:
- Bill has the notion that a DFPI license is mandatory for all the crypto businesses operating in the crypto space.
- Cryptocurrency service providers are under strict audit. This includes all the entities like crypto investment firms, crypto trading firms, and even crypto exchange platforms.
- California is also exploring tax-related laws and regulations
US Regulatory Framework
The need for crypto regulatory firms is increasing gradually. A clear framework ensures a safer marketplace that will build people’s confidence in decentralized currencies. Digital assets don’t fit into any existing category. Therefore, regulators have to define a new category and redefine all the financial laws.
According to current rules, the crypto regulatory firms are complex and not fully developed yet. However, the Bank Secrecy Act (BSA), with multiple amendments provided by the US Patriot Act and AMLS, manages all the anti-money laundering activities.
Moreover, there are several acts, like the Responsible Financial Innovation Act and the Commodity Exchange Act (CEA). All these regulations are controlling crypto in the US.
With just multiple rules, several organizations handle the crypto.
The Securities and Exchange Commission (SEC) regulates the digital assets that qualify as crypto areas. On the other hand, the Financial Crimes Enforcement Network (FinCEN) manages anti-money laundering (AML) and ceases counter-terrorism activities. Each department manages different aspects of the cryptocurrency.
Conclusion
The US government is keen to develop a crypto regulatory framework that will be implemented in July 2025. Its 18-month implementation period comes with the flexibility to adapt according to technological advancements.
