California May Have Power to Regulate Bitcoin
The California state government may have the ability to regulate Bitcoin and other digital currencies after reassessing their state laws. The state is debating whether to use this new-found power, and if it would benefit consumers.
Currently, the government has the authority to regulate money transmitters, such as Western Union and MoneyGram. The law that allows this to happen has now been extended to digital currencies.
“The consensus among staff is that the department and commissioner could regulate virtual currency, to some extent, under current state law,” Tom Dresslar, a spokesman for the California Business Oversight Department, told Bloomberg Businessweek. “Consumers would be the prime concern of any regulatory structure we build–making sure they are fully aware of the risks associated with virtual currency and providing effective, reasonable safeguards against those risks.”
While there are no immediate plans for the state to use this power, they could soon be imposing rules on digital currencies to obtain a California business license in order to resume operations. This would require the companies to show they have enough capital to operate their business. They could also be required to go through a criminal background check.
With California discovering their regulating abilities, it would not be a surprise for other states to follow suit.