California Vetoes Crypto Licensing and Regulatory Framework

California Governor Gavin Newsom has vetoed a cryptocurrency bill that would establish a licensing and regulatory framework for digital assets, claiming it was “premature.”

Governor Gavin Newson of California has refused to sign a bill that proposed bill that seeks to create licensing requirements for cryptocurrency companies in the state. The bill, which was sponsored by Democrat Assemblyman Tim Grayson, was passed by the state assembly and senate on September 1. The Digital Financial Assets Law, or Assembly Bill 2269, sought to allow the issuance of operational licenses for crypto firms in California. Opposing the notion, Newsom recommended a “more flexible approach” that would evolve over time while at the same time considering the safety of consumers and related costs. He added:

It is premature to lock a licensing structure in statute without considering both this work (in-house efforts to create a transparent regulatory environment) and forthcoming federal actions.

Newsom said that the bill, as it stands, requires loaning “tens of millions of dollars” from the state’s general fund:

Such a significant commitment of general fund resources should be considered and accounted for in the annual budget process.

The Governor added that he is waiting for federal regulations to “come into sharper focus for digital financial assets” before his office would work with the Legislature to establish cryptocurrency licensing initiatives.

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