The state government of New Jersey (USA) has proposed a new bill to determine licensing requirements for digital asset and currency trading firms in the state. Following the adoption of strict licensing requirements in the neighboring state of New York, known as BitLicense, New Jersey plans to roll out its own requirements.
The new bill, entitled Digital Asset and Blockchain Technology Act will require digital asset businesses to submit significant information in order to be licensed by the New Jersey Department of Banking and Insurance. The proposed legislation would require firms to provide some of the same information already required elsewhere, such as AML policies and KYC rules. Furthermore, businesses will need to submit a list of any license revocation, suspension, rejection or other disciplinary action taken against the applicant in another state; a list of criminal convictions, deferred prosecution agreements, and pending criminal proceedings.
The bill also requires cryptocurrency businesses to disclose the terms and conditions of a consumer’s account at the time the consumer contracts for service along with information on the schedule of fees and charges.
It remains to be seen if the legislation will be amended as it is processed through committees within the New Jersey state government and if any requirements will be added or removed, so as to make the NJ license more competitive or attractive, as opposed to the one issued in NY state. Indeed several digital asset businesses have left the NY jurisdiction precisely because they found the requirements too harsh to continue business.