New York has held the title of “Financial Capital of......

New York has held the title of “Financial Capital of the World” for a long time, but perhaps all of that is about to change. UK Finance Minister George Osborne seems to think so, declaring that “with the right backing from government” they can make London the “fintech capital of the world.”

This announcement came in a speech at London’s Canary Wharf in the east of London, where Osborne said that the government had begun exploring the potential of cryptocurrencies such as bitcoin.

This is a very positive turn of events, especially in light of the proposed “bitlicense” that has come out of the New York Department of Financial Services. The license has been described by an overwhelming majority in the bitcoin tech sphere as too heavy-handed, creating the risk that bitcoin startups will be driven out of New York State. Many say that the license will not help secure people from fraud as it claims to do, but will instead only place unworkable obstruction in front of the innovators trying to develop this technology.

Yesterday in an open letter to the NYDFS (August 5th), the Bitcoin Foundation has argued for an extended comment period on the proposed legislation. They have stated that there needs to be greater cooperation with the bitcoin community and more transparency for the process as a whole.

However, if the proposed license does indeed go through as it stands, perhaps Osborne is right and NYC’s day in the sun has indeed passed.

On Thursday the New York Department of Financial Services issued......

On Thursday the New York Department of Financial Services issued the first draft of what they call a “bitlicense”. People have been restless to find out how the New York State government plans to regulate cryptocurrency, and what was unveiled is possibly a worst-case-scenario come true for bitcoiners. Most people in the Bitcoin community see the proposed regulations as being completely outdated. The “bitlicense” treats cryptocurrency like paper money, hauling it back into an old-fashioned financial system, when it is in fact a revolutionary technology that should be recognized as unique. This license will not help secure people from fraud, it will only place so much obstruction in front of the innovators trying to develop this technology that it will simply drive these people out of New York State. Many have already remarked that the bitlicense is unworkable for startups already devoting all of their resources to inventing entirely new businesses.

If digital currency is the future, which makes sense in a digital age, then the current financial capital of the world won’t hold that title for much longer. The New York Department of Financial Services is currently taking feedback from the community about the proposed regulations, and this is certainly a step in the right direction. Now is the time for the Bitcoin community to mobilize and really educate people. New York will provide a precedent for other states regarding regulation, so let’s hope that the people who understand this technology the best can lead the regulators in the right direction. This is our chance to get it right, and education is the key.