BILL ANALYSIS Ó
SENATE COMMITTEE ON
BANKING AND FINANCIAL INSTITUTIONS
Senator Marty Block, Chair
2015 - 2016 Regular
Bill No: AB 1326 Hearing Date: July 15,
2015
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|Author: |Dababneh |
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|Version: |July 6, 2015 Amended |
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|Urgency: |No |Fiscal: |Yes |
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|Consultant:|Eileen Newhall |
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Subject: Virtual currency.
SUMMARY Establishes a framework for the licensing and regulation of
virtual currency businesses by the Department of Business
Oversight (DBO), effective July 1, 2016.
DESCRIPTION
1. Provides that a licensee under the Money Transmission Act
(MTA), who wishes to engage in a virtual currency business
without a virtual currency license, must seek permission to
do so from the Commissioner of Business Oversight
(commissioner). Authorizes the commissioner to approve such
requests, as specified, and clarifies that the commissioner
may require a licensee granted such approval to increase its
surety bond or amount of eligible securities above those
required under the MTA, or impose any additional conditions
on the authorization, as specified.
2. Authorizes a licensee in good standing under the virtual
currency law to apply to the commissioner to convert its
license into a MTA license, as specified.
3. Creates a new division under the Financial Code to regulate
virtual currency businesses, effective July 1, 2016
(Division 11), as follows:
a. Defines virtual currency as any type of digital unit
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that is used as a medium of exchange or a form of
digitally stored value.
b. Provides that virtual currency does not include any
of the following:
i. Digital units that are used solely within
online gaming platforms, with no market or application
outside of those gaming platforms.
ii. Digital units that are used exclusively as
part of a consumer affinity or rewards program.
iii.Digital units that can be redeemed for goods,
services, or for purchases with the issuer or other
designated merchants, but cannot be converted into, or
redeemed for fiat currency. Fiat currency is defined
as government-issued currency that is designated as
legal tender through government decree, regulation, or
law, that customarily refers to paper money and coin
and is circulated, used, and accepted as money.
c. Defines virtual currency business as maintaining
full custody or control of virtual currency in California
on behalf of others.
d. Prohibits a person from engaging in any virtual
currency business in California unless that person is
licensed under Division 11 of the Financial Code or is
exempt from licensure under that division.
i. Establishes exemptions from licensure under
the division for the United States or any federal
department, agency, or instrumentality; state and
local governments; depository institutions, as
specified; licensed money transmitters; merchants or
consumers that utilize virtual currency solely for the
purchase or sale of goods or services; and
transactions in which the recipient of virtual
currency is an agent of the payee pursuant to a
preexisting written contract, and delivery of the
virtual currency to the agent satisfies the payor's
obligation to the payee.
AB 1326 (Dababneh) Page 3
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ii. Authorizes the commissioner to approve
additional exemptions, either partial or full, to
persons, transactions, or both, by regulation or
order, either unconditionally or upon specified terms
and conditions, or for specified periods. Requires
the commissioner to post on DBO's web site a list of
all persons, transactions, or classes of persons or
transactions exempted by the commissioner, and the
provision or provisions of the division from which
they are exempt.
e. Requires virtual currency business licensees to
provide the following disclosure to consumers in a form
and manner prescribed by the commissioner: "Once
submitted to the network, a virtual currency transaction
will be unconfirmed for a period of time (usually less
than one hour, but up to one day or more) pending
sufficient confirmation of the transaction by the
network. A transaction is not complete while it is in a
pending state. Virtual currency associated with
transactions that are in a pending state will be
designated accordingly, and will not be included in your
account balance or be available to conduct transactions.
"The risk of loss in trading or holding virtual currency
can be substantial. You should therefore carefully
consider whether trading or holding virtual currency is
suitable for you in light of your financial condition.
In considering whether to trade or hold virtual currency,
you should be aware that the price or value of virtual
currency can change rapidly, decrease, and potentially
even fall to zero.
"(insert company name) is licensed by the Department of
Business Oversight to do business in California. If you
have complaints with respect to any aspect of the virtual
currency business conducted by (company name), you may
contact the California Department of Business Oversight
at its toll-free telephone number, 1-800-622-0620, by
email at consumer.services@dbo.ca.gov , or by mail at the
Department of Business Oversight, Consumer Services, 1515
K Street, Suite 200, Sacramento, CA 95814."
f. Requires licensees to provide receipts to consumers
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upon completion of virtual currency transactions.
Receipts must include the name and contact information
for the licensee; the type, value, date, and time of the
transaction; the type and amount of any fees charged; the
exchange rate, if applicable; a statement of the
licensee's refund policy; and any additional information
required by the commissioner. Receipts must be provided
in English and in the language principally used by the
licensee to advertise, solicit, or negotiate, if other
than English.
g. Requires licensees to maintain levels of capital
that the commissioner determines are sufficient to ensure
the safety and soundness of the licensees, and to
maintain consumer protection and their ongoing
operations. Additionally requires licensees to maintain
bonds or trust accounts in United States dollars for the
benefit of their consumers, in forms and amounts
specified by the commissioner.
h. Authorizes the commissioner to examine the business
and branch office of each licensee, whether in California
or outside the state, to ascertain whether the business
is being conducted in a lawful manner and whether all
virtual currency held or exchanged is properly accounted
for. Provides the commissioner with broad authority to
bring enforcement action against a licensee or a person
required to be licensed, who does not hold such a
license.
i. Requires each licensee to annually submit an audit
report to the commissioner, prepared by an independent
certified public accountant or independent public
accountant, as specified. Additionally requires each
licensee to submit specified financial statements to the
commissioner on an annual basis, verified by two of the
licensee's principal officers.
j. Authorizes the commissioner to levy fees and
assessments on licensees sufficient to cover the
commissioner's costs to administer the virtual currency
law and provide a reasonable reserve for contingencies.
aa. In lieu of many of the aforementioned requirements,
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authorizes a person or entity conducting virtual currency
business with less than $1 million in outstanding
obligations, whose business model represents no or low
risk to consumers, as determined by the commissioner, to
apply for and be granted a provisional virtual currency
license. Grants the commissioner full discretion to
prescribe the terms and conditions applicable to a
provisional licensee and to suspend or revoke a
provisional license, as specified. Provides that a
provisional license is effective for two years and may be
renewed by the commissioner. Requires a provisional
licensee to notify the commissioner within 15 days after
it surpasses the $1 million threshold and to apply for a
virtual currency license within 30 days following that
notice.
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EXISTING LAW
1. Provides for the Money Transmission Act (MTA),
administered by DBO (Division 1.2 of the Financial Code),
which establishes a framework for the licensing and
regulation of money transmitters, as specified (Financial
Code Sections 2000 et seq.). The MTA defines money
transmission as selling or issuing payment instruments,
selling or issuing stored value, or receiving money for
transmission (Financial Code Section 2003).
COMMENTS
1. Purpose: AB 1326 is intended to ensure that entities which
store virtual currency or offer consumers the opportunity to
exchange their virtual currency for fiat currency are
operated in a safe and sound manner. It is also intended to
provide regulatory certainty to companies who are engaging
in or planning to engage in virtual currency businesses.
2. Background: Virtual currency, also called digital currency,
has been defined by several different financial authorities.
One of the most comprehensive definitions was developed by
the European Banking Authority in 2014. In its Opinion on
Virtual Currencies, issued July 4, 2014, the EBA defined
virtual currency as "a digital representation of value that
is neither issued by a central bank or a public authority,
nor necessarily attached to a fiat currency, but is accepted
by natural or legal persons as a means of payment and can be
transferred, stored or traded electronically"
(http://www.eba.europa.eu/documents/10180/657547/EBA-Op-2014-
08+Opinion+on+Virtual+Currencies.pdf).
Bitcoin is perhaps the most well-known among virtual currencies,
but other virtual currencies exist, including Ripple,
Stellar, Litecoin, Darkcoin, Peercoin, Primecoin, Dogecoin,
and others. Increasing numbers of companies are offering
services that support the use of virtual currencies (e.g.,
Coinbase, Circle, BitGo, Bitnet, Blockstream, Chain.com,
Gem, Mirror, Xapo, and others). This bill establishes a
regulatory framework intended to cover certain companies
that offer services which support the use of virtual
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currencies; it does not purport to regulate the developers
of existing or new virtual currencies.
3. Efforts by Other Regulators to Regulate Virtual Currency:
Because of the increasing exposure of and interest in
virtual currencies and their related businesses, federal and
other state regulators have begun to issue guidance and
enact rules in this area. In March, 2013, the federal
Financial Crimes Enforcement Network (FinCEN) issued
guidance to address the extent to which a person's conduct
related to convertible virtual currency brings them within
the Bank Secrecy Act's (BSA's) definition of a money
transmitter and triggers a requirement to register with
FinCEN as a money services business (MSB). Every MSB is
required to have an anti money-laundering program in place
and has the obligation to file a Suspicious Activity Report
with FinCEN whenever a transaction they facilitate is
"suspicious," as defined, and in an amount of $2,000 or
more.
According to FinCEN, to the extent a user creates or "mines" a
convertible virtual currency solely for a user's own
purposes, the user is not a money transmitter under the BSA.
Further, a company purchasing and selling convertible
virtual currency as an investment exclusively for the
company's benefit is also not a money transmitter. However,
the administrator of a centralized repository of convertible
virtual currency is a money transmitter to the extent that
it allows transfers of value between persons or from one
location to another. Additionally, any exchanger that uses
its access to the convertible virtual currency services
provided by the administrator to accept and transmit the
convertible virtual currency on behalf of others, including
transfers intended to pay a third party for virtual goods
and services, is also a money transmitter.
The Conference of State Bank Supervisors, an association of
state financial regulators, has also addressed the
regulation of virtual currency. In December 2014, CSBS
issued a draft model state regulatory framework for virtual
currency activities
( http://www.csbs.org/regulatory/ep/Documents/CSBS%20Draft%20M
odel%20Regulatory%20Framework%20for%20Virtual%20Currency%20Pr
oposal%20--%20Dec.%2016%202014.pdf ). The eight components
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in CSBS' draft framework include licensing requirements; a
mechanism for states to share state licensing and
enforcement data; financial strength and stability
requirements; consumer protection; cybersecurity; compliance
with BSA and anti-money laundering rules; recordkeeping and
financial reporting; and regulatory supervision. Most of
the eight components are addressed by AB 1326.
In June, 2015, New York became the first state in the
country to finalize rules for virtual currency companies.
New York defines virtual currency as "any type of digital
unit that is used as a medium of exchange or a form of
digitally stored value" and states that the term should be
broadly construed to include digital units of exchange that
have a centralized repository or administrator, are
decentralized and have no centralized repository or
administrator, or may be created or obtained by computing or
manufacturing effort.
New York defines "virtual currency business activity" as the
conduct of any one of the following types of activities
involving New York or a New York resident: a) receiving
virtual currency for transmission or transmitting virtual
currency, except where the transaction is undertaken for
non-financial purposes and does not involve the transfer of
more than a nominal amount of virtual currency; b) storing,
holding, or maintaining custody or control of virtual
currency on behalf of others; c) buying and selling virtual
currency as a customer business; d) performing exchange
services as a customer business; or e) controlling,
administering, or issuing a virtual currency. All entities
that engage in virtual currency business activity and are
not covered by an exemption from New York's virtual currency
rules are required to obtain a BitLicense from the New York
Department of Financial Services.
Because of the expansive definitions and limited exemptions
contained in New York's rules, those rules have been
criticized by many virtual currency businesses. Several
virtual currency businesses contacted by Committee staff
have indicated they will be forced to suspend business to
customers based in New York, because they cannot afford to
operate under New York's regulatory regime.
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AB 1326 is structured in ways that attempt to avoid some of
the criticism virtual currency businesses have voiced about
New York's rules. For example, New York requires virtual
currency businesses to hold both BitLicenses and money
transmission licenses. AB 1326 recognizes that some
virtual currency businesses may not be engaged in activities
which require an MTA license in California; for that reason,
the bill does not require all virtual currency businesses to
hold MTA licenses. Second, New York regulates network
administrators, software providers, and exchange services,
all of which are exempted from California's virtual currency
law.
4. Regulation of An Emerging Industry: This bill and the other
regulatory efforts summarized above illustrate a tension
common to the regulation of emerging industries. Those who
craft rules regulating emerging industries must balance the
importance of protecting consumers against the risk of
stunting the growth of a young industry through
over-regulation. They must balance the importance of
avoiding barriers to entry among startups against the danger
of establishing an unlevel playing field among industry
participants, which favors certain business models over
others. Finally, they must balance industry participants'
desire to minimize litigation risk through the establishment
of clear rules of conduct against regulatory compliance
costs.
Many within the virtual currency industry want California to
lead the nation in enacting a law which encourages
innovation and allows startups to be established and grown
without undue regulatory interference. They point to New
York's rules as problematic for their industry and want
California to enact an alternative regulatory framework to
which other states can look when crafting their own laws.
Others would prefer that California give the virtual
currency industry more time to evolve before deciding
whether to regulate it.
AB 1326 attempts to provide balance the myriad competing
interests cited above. However, the extent to which the
bill will succeed in protecting consumers, without
discouraging innovation among virtual currency businesses or
creating an insurmountable barrier to entry among new
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applicants will only be known once the bill has been
operative for a few years. If this bill is enacted, it will
be important for the Legislature to track the progress of
the regulatory regime the bill creates, and be willing to
modify it as needed, to ensure that the correct balance is
achieved.
5. Unresolved Issues: A variety of interested parties have
expressed strong opinions regarding a variety of issues
addressed by this bill. Two issues remain extremely
contentious.
First, there is no consensus to date regarding the way in which
"virtual currency business" should be defined. At present,
the bill defines virtual currency business as "maintaining
full custody or control of virtual currency in California on
behalf of others." While most industry participants believe
that this bill's definition is vastly superior to the very
broad definition used by New York, some have criticized this
bill's definition as being too vague. For example, the term
"full custody and control" can be a challenging concept to
interpret when applied to a virtual currency business that
offers a virtual currency wallet which requires multiple
parties to independently approve a withdrawal before it can
be authorized. Some suggest that no single entity has full
control over the wallet in this situation, because multiple
parties must independently agree to a withdrawal before it
can be made. Others counter that all of the entities in
this situation have full control, because each can
independently prevent a withdrawal by failing to authorize
it. Clarification of this bill's definition of virtual
currency business, either in statute or through regulation,
will be critical if this bill becomes law.
Another issue of great importance to the regulated
community, whose details remain the subject of controversy,
is the availability and nature of a regulatory framework
specifically directed toward start-ups. Colloquially,
industry members argue that two programmers tinkering with
code in a basement should not be regulated in the same
manner as a multi-million dollar company with thousands of
customers. To address this concern, the July 6th amendments
added language authorizing the commissioner to award
provisional licenses to small businesses determined by the
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commissioner to pose low or no risk to consumers. The July
6th amendments give the commissioner sole control to
determine which rules will apply to each provisional license
holder. The expectation is that businesses awarded
provisional licenses will be able to operate under a less
expensive and less restrictive regulatory scheme than larger
or riskier businesses, although the details of the
regulatory scheme(s) applicable to provisional licensees
will be left to the commissioner to decide.
Although one might suspect that most industry participants
would welcome the availability of a less costly, less
restrictive license for certain start-ups, several small
businesses reached out to the author's office and Committee
staff, requesting an even less restrictive regulatory scheme
than the one added to the bill on July 6th. These
businesses would prefer registration to licensure and would
prefer to substitute a set of best practices applicable to
all registrants for the business-specific rules that AB 1326
authorizes the commissioner to apply.
6. Input from DBO: Numerous issues in AB 1326 would benefit
from input by the regulator who will be responsible for
administering the new law. However, as of the date this
analysis was prepared, DBO was not authorized by the
Governor's Office to offer official input regarding the
bill. Informal conversations with DBO staff suggest that
the Department expects to propose several amendments to the
author, but the content and timing of those amendments are
unknown at the present time. If this Committee chooses to
pass AB 1326, it may wish to reserve its ability to call the
measure back for a re-hearing, once the content of DBO's
amendments is known and the status of the unresolved issues
summarized above is clearer.
7. Summary of Arguments in Support:
a. Coin Center is a nonprofit research and advocacy
center focused on public policy issues affecting
decentralized digital currencies, such as Bitcoin. The
organization supports AB 1326, because the bill
acknowledges that virtual currency businesses may have
business models that do not involve money transmission
and should not be required to hold money transmission
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licenses. "Decentralized digital currencies, such as
Bitcoin, are an exciting new innovation with a great many
potential uses - from simple value transfer, to property
title and copyright ownership recordation, identity
management, and even the creation of self-executing
contracts. Some uses of digital currency technology look
exactly like money transmission, an activity that
requires licensing in California as in almost every other
state. However, many other possible uses of the
technology have little or nothing to do with money
transmission and pose little or no risk to consumers. A
smart approach to regulating digital currency businesses
would distinguish between these possible uses and only
require licensing for those who engage in activities that
are truly like traditional money transmission. AB 1326 -
better than any other legislative proposal we have seen -
accomplishes this. As a result, it preserves important
consumer protections while not saddling cutting-edge
innovation with unjustified regulatory burdens."
Coin Center believes that AB 1326's definition of a virtual
currency business as one that maintains full custody or
control of virtual currency on behalf of others makes a
very important distinction. "The specific use of the
words 'full custody' is very important because
decentralized digital currency technology allows for
divided control of assets. Such divided control for the
first time makes possible financial services in which
consumers do not give up control of their funds. By
removing the need to completely trust a service provider,
this innovation is a potential boon to cybersecurity and
consumer protection."
Coin Center also believes that the exemptions from
licensing contained in AB 1326 are well-crafted. "These
exemptions, along with the bill's definition of 'virtual
currency business,' if enacted, will provide the kind of
regulatory clarity and certainty that will encourage
investment in, and development of, these innovative
technologies while at the same time ensuring that
consumers have access to safe and reliable cutting-edge
services."
b. Coinbase is the world's leading Bitcoin service
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provider; its mission is to make Bitcoin as easy as
possible for the average person to understand and use.
"We believe AB 1326 brings greater regulatory certainty
for digital currency businesses, provides necessary
protections for consumers, and creates a nurturing
environment for small startups to build their businesses
in the Golden State. Moreover, it eliminates a
regulatory 'grey zone' that currently exists for our
industry and gives businesses greater clarity. As a
California based company, we are happy to see the state
leading the nation in creating policy that will foster
technological innovation and economic growth."
Coinbase is particularly supportive of the provisional
licensing that AB 1326 would authorize. Provisional
licensing "provides small digital currency startups or
those with limited consumer exposure the ability to start
and operate their businesses with an unencumbered runway.
This section provides these businesses a low barrier to
entry by means of registration, self-certified compliance
with risk based performance standards, and a low fee.
From there, they can focus on building and growing
solutions for consumers and not worry about overly
burdensome regulations and related expenses. While
Coinbase would not be eligible for this licensing due to
our relative size, we strongly support the inclusion and
believe it's extremely important to the overall health of
the ecosystem. This provision will help seed the next
round of the nation's most groundbreaking and innovative
technologies companies, and make California one of the
nation's most attractive places for digital currency
businesses to grow and thrive."
c. The Electronic Transactions Association supports the
bill, because it will "help create regulatory and legal
certainty for digital currency companies in California
and encourage them to call California home. By enacting
this legislation, California would join a handful of
states throughout the country, including North Carolina,
Connecticut, New Jersey, and others which are also
working on legislation to provide greater regulatory
certainty for virtual currency businesses, important
guardrails for consumers, and flexibility for financial
innovators."
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8. Summary of Arguments in Opposition:
a. The Electronic Frontier Foundation (EFF) opposes AB
1326 on the grounds that the bill is premature,
technically inaccurate in spots, and will do more harm
than good. "Virtual currencies are still developing, and
this bill threatens to both stunt the growth of this
innovative industry and hamper the enthusiasm driving
consumer interest. Also, privacy and free speech are
central issues in the virtual currency space, which the
bill fails to adequately consider."
Among EFF's concerns: "AB 1326's definition of 'virtual
currency business,' while much improved, remains both
vague and overbroad. For instance, the question of who
maintains 'full custody and control' of virtual
currencies will likely prove to be complicated and will
implicate multiple parties specified in a 'smart
contract.' The vague language of the bill will leave
those in the virtual currency space unclear about their
obligations and may also deter those who are thinking
about getting involved in the nascent industry."
"Although the bill attempts to exempt video game currencies
from regulation, we believe it fails to do so. Any game
currency that can be shared, traded, or gifted among
users may result in market value outside the game,
whether or not the company's terms allow for these
transactions. Because the definition of 'virtual
currency business' includes maintaining full custody of
the currency, this bill could require any video game
company that offers an in-game currency feature to submit
to this regulatory scheme."
Finally, "the statutorily prescribed disclosure statement
is wrong in its description of how Bitcoin works. For
example, there is no fixed amount of time after which a
transaction is 'confirmed;' six confirmation blocks
(roughly one hour) is simply a popular choice. In
addition, for many other virtual currencies (such as
Stellar, Ripple, or Tendermint), the notion of
confirmation time is completely different and
transactions are confirmed within seconds. More
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generally, it is a mistake to mandate this kind of
technical description given the large variety of possible
technical designs."
b. The Copia Institute, a Silicon Valley-based think
tank, writes, "Innovation only exists when those who have
ideas can go out and try to execute them, quickly, with
as few barriers as possible. Each hurdle weeds out more
and more innovators before they have a chance to breathe
the open air of the marketplace, and find out whether or
not they've truly created something useful. So we should
be concerned when governments create unnecessary
'permission' requirements without clear benefit...We
should be exceptionally careful when implementing rules
that have the potential to shape - or strangle - the very
roots of innovation. New York, for instance, has already
established BitLicense regulation, chilling Bitcoin
innovation in the state that is the financial center of
the world."
"At this stage of the game, creating licensing regimes and
putting permission barriers on innovation is very, very
premature. Everyone is still figuring out just what the
blockchain is good for, and it's a long and varied list.
Blockchain technology was crafted to solve a difficult
currency problem, but it has enabled all sorts of
powerful new apps and services that are often much more
secure and useful than the alternatives...On top of that,
because Bitcoin is programmable, many of the biggest
concerns that regulators are expressing can be dealt with
in the code itself. Rules can be built into the code
without having to rely on a centralized bureaucracy."
"We should be very wary about deciding to put layers of
government bureaucracy on things that can be accomplished
in the code itself....Silicon Valley was built on
permissionless innovation, especially on the internet.
Saddling new core infrastructure like Bitcoin and the
blockchain with a permission-based framework sets the
wrong tone entirely, and virtually ensures that Silicon
Valley won't be home to the leading innovators in this
new and exciting space."
9. Amendments:
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a. Although the licensing framework contained in AB
1326 is quite comprehensive, it does not include an
annual reporting requirement, as is common among DBO
licensees. An amendment is recommended to require
licensees to submit information to DBO on an annual basis
regarding their virtual currency activities, and to
require DBO to annually summarize that information, along
with information regarding the numbers and types of
businesses to which licenses and provisional licenses
have been issued and the types of enforcement actions
brought by the commissioner against virtual currency
licensees.
Page 18, between lines 32 and 33, insert: (d) Each licensee
shall file an annual report with the commissioner, on or
before the 15th day of March, giving the relevant
information that the commissioner reasonably requires
concerning the business and operations conducted by the
licensee within the state during the preceding calendar
year. Each licensee shall also make other special
reports to the commissioner that may be required by the
commissioner from time to time. The reports required by
this subdivision shall be kept confidential pursuant to
Chapter 3.5 (commencing with Section 6250) of Division 7
of Title 1 of the Government Code and any regulations
adopted thereunder.
(e) The commissioner shall annually prepare a report for
publication on his or her internet Web site, summarizing
consolidated information gained from the reports required
pursuant to subdivision (d), documenting the number of
regular and provisional licenses outstanding during the
prior calendar year, and summarizing the numbers and
types of enforcement actions brought by the commissioner
pursuant to this division during the prior calendar year.
b. Language applicable to the provisional license
requires amendment to clarify that the provisional
license is in lieu of a regular license, define the term
"outstanding obligations," and make other technical and
clarifying changes.
Page 20, lines 30 through 38, amend as follows: (a) In
AB 1326 (Dababneh) Page 17
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lieu of Section 26006, a A person or entity conducting
virtual currency business with less than one million
dollars ($1,000,000) in outstanding obligations and whose
business model, as determined by the commissioner,
represents low or no risk to consumers, may pay an
application fee of five hundred dollars ($500) register
with a five-hundred-dollar ($500) licensee fee to the
commissioner and, if approved, receive a provisional
license to conduct virtual currency business. For
purposes of this section, outstanding obligations mean
value under the full custody and control of the person or
entity. A person or entity that receives such a license
shall also register with FinCEN as a money services
business, if applicable.
Page 21, after "(c)", insert: Sections 26006, 26008,
26023, 26024, and 26031 shall not apply to a person or
entity to which a provisional license has been issued.
Page 21, line 29, strike "audit" and insert: examine
Page 21, line 30, after "protection" strike "and enhance
safety and soundness", and insert the following: ,
enhance safety and soundness, and gather information
regarding the business and operations of provisional
licensees. Reports concerning the business and
operations of provisional licensees shall be kept
confidential pursuant to Chapter 3.5 (commencing with
Section 6250) of Division 7 of Title 1 of the Government
Code and any regulations adopted thereunder. The
commissioner shall include information about the business
and operations of provisional licensees in the report
required pursuant to subdivision (d) of Section 26023.
10. Prior and Related Legislation:
a. AB 129 (Dababneh), Chapter 74, Statues of 2014:
Deleted the provision which prohibited any individual or
entity from issuing or putting into circulation, as
money, anything but the lawful money of the United
States.
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LIST OF REGISTERED SUPPORT/OPPOSITION
Support
Coinbase
Coin Center
Electronic Transactions Association
Opposition
Electronic Frontier Foundation
The Copia Institute
-- END --