May 18, 2022

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California Governor Signs an Executive Order Forming the State's Cryptocurrency Regulations

California Governor Signs an Executive Order Forming the State’s Cryptocurrency Regulations

California Governor Gavin Newsom Sign an executive order Wednesday that lays the groundwork for the promotion and regulation of the cryptocurrency industry in the state (via CNBC). as described in executive orderNewsom’s goal is to “create a transparent and consistent business environment for companies operating in the blockchain,” which balances “benefits and risks for consumers.”

The executive order calls on the California Governor’s Office of Business and Economic Development (GO-Biz) to cooperate with the state’s Department of Financial Protection and Innovation (DFPI) and the Agency for Business, Consumer Services, and Housing (BCSH). Together, state agencies are in charge of creating “potential blockchain applications and projects,” which can include applications in “the private sector, academia, and society.”

It also orders the DFPI to form a regulatory approach to cryptocurrencies, create consumer protections, as well as produce educational materials that inform Californians about the risks and benefits associated with cryptocurrencies. The order specifically states that the materials “will include information on how to avoid scams and frauds,” one of which is Key Concerns About Cryptocurrency.

“Government often lags behind in technological progress, so we are moving up this curve, laying the groundwork to allow consumers and businesses to thrive,” Newsom said in a statement.

Newsom’s plan complies with Executive order signed by President Joe Biden in MarchIt serves as the White House’s framework for regulating cryptocurrencies in the future. For now, it’s too early to tell how Newsom’s demand will affect the California crypto industry — no regulatory measures have been introduced yet, but plans are in place to do so.

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Kristen Smith, CEO of the Blockchain Association, a trade group representing companies in the cryptocurrency industry, welcomed Newsom’s executive order. Smith said in a statement to the edge. She also added that the crypto industry is looking forward to collaborating with the government “on industry rationale to allow the state of California — and the United States — to lead crypto innovation.”

The Chamber of Digital Commerce, an advocacy group for blockchain technologies, had a similar response, note The order “rightfully recognizes the role that blockchain technologies play in stimulating job growth and the economic competitiveness of a country, as well as of the national economy.”