Consumer Federation California Makes New Efforts To Control Crypto Businesses

Key Points:

• A bill that aims to authorize and oversee the operations of cryptocurrency exchanges was sponsored by the Consumer Federation of California (CFC), a nonprofit advocacy group campaigning for consumer rights.
• The California Department of Motor Vehicles (DMV) is testing the digitization of automobile titles and title transfers via a private Tezos blockchain while Californian politicians work to enact crypto legislation.

A bill that aims to authorize and oversee the operations of cryptocurrency exchanges was sponsored by the Consumer Federation of California (CFC), a nonprofit advocacy group campaigning for consumer rights.

Assemblymember Timothy Grayson sponsored the Digital Financial Assets Law, a bill requiring governmental control of cryptocurrency enterprises, in an effort to shield Californians from financial hardship and promote responsible innovation. According to Grayson, the next logical step for the cryptocurrency industry is licensing, and he continues:

“And it is equally clear that until we take that step, Californians will continue to be vulnerable to prevalent and preventable financial scams.”

This is the CFC’s second attempt to license and oversee bitcoin and digital asset businesses. Gavin Newsom, the governor of California, vetoed the bill (AB 39) when it was initially introduced in 2022.

If it is approved, the bill will go into effect on January 1, 2025 and forbid people from cooperating with cryptocurrency enterprises until “certain criteria are reached.” Assuring regulatory clarity and investor safety, AB 39 will grant licenses to cryptocurrency businesses under the jurisdiction of the California Department of Financial Protection and Innovation.

“The bankruptcies and scams of the past year only bolster our collective interest in ensuring basic and foundational consumer protections in this marketplace, which has up to now looked like the Wild West in terms of ‘anything goes’ behavior by key players in the cryptocurrency industry,” added Robert Herrell, executive director of the CFC, while revealing the intent behind the move.

The CFC anticipates that the Assembly will take up this bill’s first hearing in April.

The California Department of Motor Vehicles (DMV) is testing the digitization of automobile titles and title transfers via a private Tezos blockchain while Californian politicians work to enact crypto legislation.

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