New York Regulator To Tighten Rules for Listing Crypto Assets

The regulator has introduced new guidance designed to help companies develop a coin placement policy.

According to NYDFS superintendent Adrienne Harris, the document is necessary to establish reliable rules for exchanges that protect investors. The need to update the manual arose due to shortcomings discovered during recent inspections of unnamed organizations, she stressed.

"When we see new risks or misuse of the coin, we want our companies to be able to exclude the asset from the listing, while still ensuring consumer protection, safety and reliability," Harris added.

As part of the new rules, NYDFS requires cryptocurrency organizations registered in the state to implement a new policy of listing and excluding tokens. The document is open for public discussion until October 20.  

At the same time, firms must independently develop their own standards in three areas: managing the process of placing coins, assessing the risk of assets and monitoring procedures. 

"We continue to monitor the risk-based analysis of organizations in our jurisdiction, ensure that these checks are successful, and monitor the timely elimination of consequences. The department, of course, will continue to apply coercive measures where necessary," the report says.

In February, the NYDFS initiated an investigation into the Paxos infrastructure company, which is the issuer of the Pax Dollar and Binance USD (BUSD) stablecoins. The department ordered to stop the release of the latter.

Paxos stopped issuing BUSD in accordance with the instructions of the regulator, but will continue to support repurchase and conversion operations at least until February 2024.

Recall that in May, the NYDFS fined the bitFlyer USA cryptocurrency exchange $ 1.2 million for non-compliance with the state's cybersecurity requirements.