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New York Revamps Crypto Exchange Listing Rules for Consumer Safety

The New York Department of Financial Services (NYDFS) has recently revamped its crypto exchange regulations, putting an end to the self-certification process for new coins and tokens.

New York Revamps Crypto Exchange Listing Rules for Consumer Safety

The New York Department of Financial Services (NYDFS) has recently overhauled its regulations for crypto exchanges, discontinuing the practice of self-certification for new coins and tokens. This change affects entities such as Circle and Gemini, requiring them to pause new coin certifications until they align with the updated NYDFS standards.

With New York serving as a financial hub in the United States, these regulatory changes are anticipated to influence national trends in financial regulation, particularly in the crypto space. The new guidelines mandate regulated entities to submit two policies for approval—one outlining the coin and token listing process and the other detailing the delisting process.

The detailed and specific guidelines necessitate exchanges and service providers to evaluate factors like token technology, use cases, and safety. Oversight roles for governing authorities, typically boards of directors, must be clearly defined, and these bodies are required to approve and periodically review these policies.

The NYDFS has established stringent criteria for coin listings, restricting stablecoins to those listed on the state’s greenlist, which currently comprises eight coins, six of them stablecoins. Tokens associated with other exchanges or bridged from their native chain are explicitly disallowed, as are tokens with a circulating supply of less than 35% of the total supply.

The guidelines also cover the delisting process, requiring exchanges to provide adequate notice to customers before suspending trading and informing the firm’s governing body. The NYDFS retains the authority to order the delisting of an asset, emphasizing the need for firms to be prepared for such occurrences.

NYDFS Superintendent Adrienne Harris emphasized the importance of adapting to evolving risks and protecting consumers. The updates aim to enhance transparency in cryptocurrency trading, ultimately safeguarding newcomers from potential scam tokens. Overall, these regulatory changes underscore the NYDFS’s commitment to consumer safety and the stability of the financial environment.

Source: AZC News

Disclaimer. This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

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