Coinbase: North Carolina’s Bitcoin Regulation is ‘Sensible’

Leading bitcoin wallet and exchange Coinbase recently tipped its hat to North Carolina’s forward-thinking regulatory requirements for bitcoin businesses.

Coinbase commented on North Carolina’s Money Transmitters Act, which the company said was on “the right avenue for regulation.”

Rather than introducing new money transmitter laws to apply to bitcoin businesses, North Carolina adapts its existing framework to make the arduous process of licensing simpler.

If this same approach were adopted by all 50 states, businesses dealing in bitcoin would need to apply 50 times (once per state) like any other money transmitting business, instead of the potential 100 applications required if digital currency-specific transmitter rules were put into effect.

On top of this, the anti-money laundering rules for digital currency firms are based on those introduced by FinCEN in 2013, negating any friction caused by having redundant or conflicting requirements on either the state or federal levels.

In regards to consumer protection, and everyday business operations in general, North Carolina’s Bank Commissioner has, at its discretion, the ability to require or exempt businesses from obtaining insurance coverage for cybersecurity.

This alleviates some of the arduous costs of doing business, especially for startups wishing to break into this new field.

North Carolina’s Money Transmitter Association also allows businesses to hold digital currencies to back like-kind transmissions to send and receive bitcoin for their customers.

This is logical, as now there is no inherent need for the business to convert back and forth between dollars and bitcoin in order to send money.

Compare North Carolina’s approach to that of New York, which saw over 3,700 comments on its first proposal, owing to the much more burdensome rules that would make any bitcoin startup tremble.