The technology behind cryptocurrency has grown from being just a ledger facilitating cryptocurrency transactions to something much bigger. Various major industries including banking and financial sectors are currently looking at ways to integrate this novel technology.
There are no clear regulations regarding cryptocurrencies in most of the countries. But in the United States, especially the State of New York has strict regulations which make it difficult for bitcoin and blockchain technology companies to innovate and come up with new business model. Going by the recent reports, it may all soon change. The Office of the Comptroller of the Currency responsible for overseeing the country’s national banking charter has been studying the digital currency technology and related innovations. The results of this study will be published soon in a white paper titled “Responsible Innovation”.
The soon to be released white paper is part of the Office of the Comptroller of the Currency’s initiative to revisit the existing regulations and devise an approval mechanism for blockchain related fintech business ideas. The idea is to create a single point clearance system where startups and entrepreneurs in the segment can present their new business ideas and products falling under the blockchain technology and fintech segment for approval.
Implementation of such a process will make it easier for the companies to get regulatory approval. In case of any shortcomings, the single window mechanism will help the companies resolve these shortcomings based on the inputs received from the authorities.
It is about time for the countries to make necessary amendments to the existing regulatory framework to accommodate digital currencies and blockchain technology related businesses. Care should be taken to ensure that these amendments do not hamper innovation and growth in the sector. Creating a single window approval system for reviewing and approving fintech business models will also be able to compensate for the stringent regulations put forth by the State of New York under the BitLicense label.