The California Federation of Consumers (CFC), a non-profit advocacy organization working for consumer rights, is sponsoring a bill that seeks to license and regulate cryptocurrency exchange activities.
Legislation demanding regulatory oversight of crypto businesses – the Digital Financial Assets Act – was introduced by Assemblyman Timothy Grayson with the goal of protecting Californians from financial hardship and fostering responsible innovation. Grayson believes that licensing is the next natural step for the crypto industry, adding:
“And it’s also clear that until we take these steps, Californians will continue to be vulnerable to common and preventable financial fraud.”
This is CFC’s second attempt to license and regulate digital asset and cryptocurrency companies. The bill (AB 39) was first introduced in 2022, but California Governor Gavin Newsom vetoed it.
If passed, the bill would become law on January 1, 2025, prohibiting citizens from engaging in crypto businesses until “certain criteria are met.” AB 39 will license crypto companies under the California Department of Financial Protection and Innovation, ensuring regulatory clarity and investor protection.
“The bankruptcies and frauds of the past year have only increased our collective interest in ensuring basic and basic consumer protection in this market, which until now has seemed like the Wild West in terms of ‘whatever’ behavior by key players in the cryptocurrency industry,” added Robert Herrell, director. CFC executive, while revealing the intentions behind the move.
CFC believes that the first hearing of this bill in the Assembly will be taken up in April.
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As California politicians try to introduce crypto regulations, the California Department of Motor Vehicles (DMV) is testing the digitization of car titles and title transfers via the private Tezos blockchain.
As Cointelegraph reported, the agency wants to have the shadow book ironed out in the next three months, according to California DMV chief digital officer Ajay Gupta.