New York’s top financial regulator plans to issue new guidelines that will require firms to separate their crypto assets from those of their clients.
the New York State Department of Financial Services (NYDFS) will also require state-regulated businesses reveal how they account for customers’ digital currenciesReuters reported Monday, quoting NYDFS Superintendent Adrienne Harris.
“It was something we had on our political roadmap even before what happened FTP extensionHarris reportedly said.
The move comes amid reports of a mix of funds between now-bankrupt FTX and its trading arm. Research Alameda. This firm was able to discreetly use FTX client funds through a backdoor that allowed the loan to fly under the radar of investors, employees and auditors.
John Ray III, the new CEO ofand FTX, it also said that the fallen exchange and Alameda Research mixed users’ funds, allowing the quantum trading firm to use FTX customers’ money and make risky financial bets..
The latter directive is part ofa cryptocurrency-related series that the NYDFS released last year. According to Harris, the NYDFS virtual currency unit has almost 50 employees and is working to hire more.
New York State is theone of the few states to require companies that transmit fiat and virtual currency to hold both a BitLicense and a traditional funds transmission license. The state also requires companies to undergo audits to ensure they comply with requirements and adhere to know-your-customer (KYC) and anti-money laundering rules.
“Bien que je ne serais jamais assez téméraire pour dire qu’aucun New-Yorkais ne sera lésé, je pense qu’il est très juste de dire que les New-Yorkais sont mieux lotis que quiconque au pays en raison du cadre que nous avons here.”
FTX and its group of cryptocurrency companies filed for Chapter 11 bankruptcy in early November. Sam Bankman-Fried, the founder of FTX, was later arrested in the Bahamas after US prosecutors formally filed criminal charges against him. Finally it was extradited to the United States where he has he was freed jail after posting $250 million bail in a New York court.
The Southern District of New York, which is investigating Bankman-Fried and the collapse of FTX and its Alameda subsidiary, has charged with eight felony counts, including wire fraud and conspiracy to embezzle client funds.
According to the latest news, FTX managed to recover more than $5 billion in cash and cash that could be used to pay off creditors. However, an advisor to FTX said the size of FTX’s creditor settlement fund was still unclear.
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