New York Attorney General Wants State Regulators To Oversee Crypto

Media sources report that the Attorney General of New York, Letitia James, recently introduced a bill to increase the New York Department of Financial Services’ (NYDFS) ability to oversee digital assets. The proposed legislation would require exchanges to compensate customers who fall victim to fraud.

A Call For Extra Enforcement Powers

According to reports, Attorney General Letitia James has been actively involved in crypto, taking action against Celsius, Nexo, and KuCoin in recent months. Despite legal uncertainties, James has argued that specific crypto tokens should be classified as securities or commodities.

In a lawsuit filed in March, Attorney General James alleged that tokens, including ETH, should have been registered with her office as securities. She made similar claims following the collapse of the LUNA token, one of the governance tokens associated with the now-defunct Terra Labs.

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For the proposed bill to become law, it still needs to be approved by the state lawmakers. Meanwhile, Celsius founder, Alex Mashinsky, refuted allegations made by Attorney General James earlier this week, stating that he did not mislead investors about the crypto lending platform before it filed for bankruptcy in 2020.

The Celsius founder debunked an allegation of fraud in a lawsuit filed against him by the state of New York. Mashinsky argued that James had selectively chosen statements made by Celsius investors.

James reportedly stated that the former Celsius boss misled investors about the company’s financial health during his time as the firm’s CEO.

Voting Against Crypto Payment

Meanwhile, North Carolina’s House of Representatives recently voted unanimously in favor of a bill to prevent all government agencies and institutions from accepting payments in digital assets. In a unanimous vote of 118-0, with two absences excused, lawmakers approved the bill’s second reading.

The proposed bill prevents the state’s court system and affiliated agencies from accepting any digital dollar issued by the Federal Reserve. Additionally, the bill prohibits the state from participating in any Central Bank Digital Currencies (CBDCs) trials.

Although the U.S. Treasury Department has indicated that it is considering issuing a digital dollar, other nations, such as China, have already conducted trials for the digital version of their fiat currencies. Similarly, the European Union has started a two-year trial period for the digital euro.

As the debate over a digital dollar heats up, some American lawmakers are becoming increasingly opposed to its issuance. For example, Florida Governor Ron DeSantis has proposed a bill prohibiting CBDC payments in his state.

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Meanwhile, Representative Tom Emmer (R-Minn.), known for his pro-crypto stance, has warned that CBDCs could be used as a political tool if they fall into the wrong hands. Originally titled “No Cryptocurrency Payments to State,” the North Carolina bill was introduced last month.

But it has since been revised to address digital currencies issued by the U.S. Federal Reserve. The updated version of the bill was filed on Tuesday, May 2.

Author: Owen Clark

Owen Clark, a seasoned crypto newsman and broker, deciphers the intricacies of the digital currency realm, empowering investors with his astute analysis and actionable insights.

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