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    <p>A new report by the New York State Comptroller has found significant inadequacies in the New York Department of Financial Services’ (NYDFS) BitLicense operations, suggesting the regulator hasn’t conducted due diligence when it comes to crypto firms.</p> 
    <p>To conduct cryptocurrency business in <a rel="dofollow" title="New York" href="https://thebittimes.com/tag/new-york.html">New York</a>, companies need to apply for either a <a rel="dofollow" title="BitLicense" href="https://thebittimes.com/tag/bitlicense.html">BitLicense</a> or a charter under local banking law. However, a lengthy investigation has found only “limited assurance” that the <a rel="dofollow" title="NYDFS" href="https://thebittimes.com/tag/nydfs.html">NYDFS</a> is properly performing its duties in supervising and granting these <a rel="dofollow" title="BitLicense" href="https://thebittimes.com/tag/bitlicense.html">BitLicense</a> applications.</p> 
    <p>The office of <a rel="dofollow" title="New York" href="https://thebittimes.com/tag/new-york.html">New York</a> State Comptroller Thomas DiNapoli said on Monday that <a rel="dofollow" title="NYDFS" href="https://thebittimes.com/tag/nydfs.html">NYDFS</a> could provide no evidence that it was actually reviewing applicants’ tax obligations. Significant lags were found in the time between information submissions and approvals; in one reviewed instance, it took the <a rel="dofollow" title="NYDFS" href="https://thebittimes.com/tag/nydfs.html">NYDFS</a> four years to grant an application after a company submitted documents. This wide gap has created possibilities that the <a rel="dofollow" title="NYDFS" href="https://thebittimes.com/tag/nydfs.html">NYDFS</a> is granting <a rel="dofollow" title="BitLicense" href="https://thebittimes.com/tag/bitlicense.html">BitLicense</a>s based on outdated information, the report stated.</p> 
    <p>NYDFS has also failed to enforce proper fingerprinting processes and has not ensured that crypto firms disclose financial reports — an essential step used to determine whether an applicant conducts sound business.</p> 
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      <blockquote class="wp-embedded-content" data-secret="FISB03qRrw">
       Why is PayPal’s stablecoin PYUSD struggling a month after launch?
      </blockquote><iframe class="wp-embedded-content" sandbox="allow-scripts" security="restricted" style="position: absolute; clip: rect(1px, 1px, 1px, 1px);" title="“Why is PayPal’s stablecoin PYUSD struggling a month after launch?” — Protos" src="https://protos.com/why-is-paypals-stablecoin-pyusd-struggling-a-month-after-launch/embed/#?secret=dROfZOShXw#?secret=FISB03qRrw" data-secret="FISB03qRrw" width="500" height="282" frameborder="0" marginwidth="0" marginheight="0" scrolling="no"></iframe> 
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    <p><em>Read more: New York crypto firms will soon pay for their own regulation, just like banks</em></p> 
    <p>DiNapoli included several key recommendations for the regulator to improve its BitLicense management. These include developing and implementing better procedures, policies, and safety standards, as well as thoroughly documenting actions taken for an application.</p> 
    <p>The comptroller’s report looked as far back as 2018 and sampled eight licensees out of 32, which includes Coinbase, Gemini, Paxos, Circle, and PayPal. In response to the reports, the <a rel="dofollow" title="NYDFS" href="https://thebittimes.com/tag/nydfs.html">NYDFS</a> has said it has already taken steps to fine-tune its processes.</p> 
    <p><em>Got a tip? Send us an email or ProtonMail. For more informed news, follow us on&nbsp;X,&nbsp;</em><em>Instagram</em><em>,&nbsp;</em><em>Bluesky</em><em>, and&nbsp;</em><em>Google News</em><em>, or subscribe to our&nbsp;</em><em>YouTube</em><em>&nbsp;channel.</em></p> 
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<p>Source: <a rel="dofollow" target="_blank" href="https://thebittimes.com/flaws-in-new-york-regulator-s-bitlicense-operation-prompt-action-tbt76050.html">https://thebittimes.com/flaws-in-new-york-regulator-s-bitlicense-operation-prompt-action-tbt76050.html</a></p>

Flaws in New York regulator's BitLicense operation prompt action

TheBitTimes

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