California Governor Has Thrown A Cudgel At The Assembly Bill 2269 – A Crypto Oversight Bill

California Governor has thrown a cudgel at Assembly Bill 2269 – a crypto oversight bill. The bill would require the crypto businesses and exchanges to acquire a special license from the California Department of Financial Protection and Innovation. The bill sailed through the assembly (with a 71-0 vote) and the state senate. However, Newsom, who had until 30th September to decide, vetoed the bill.

The bill is akin to the law in New York, where cryptocurrency companies must obtain a “BitLicense” for virtual asset services. Present New York mayor Eric Adams has criticized this provision, preventing New York from becoming a virtual assets hub. Named the Digital Financial Assets Bill, it envisages creating more oversight over crypto companies in California.

Reasons Newsom Vetoed The Crypto Oversight Bill

Newsom had already made it very clear that he would veto the bill. He also pointed out that cryptocurrencies are finding increasing acceptance among the public, and there is a need for a transparent regulation that will deal with the interests of Californians.

Newsom also detailed the steps taken by his government, including extensive research to protect the investors’ rights. However, Newsom contends it is still early to bring all crypto assets under some licensing structure into a statute without considering his research. With the federal mid-term election just round the corner, Newsom believes that.

Newsom revealed that his administration had conducted extensive research on approaches that protect citizens from the risk of cryptocurrencies. However, Newsom believes it is early to lock a Moreover; the governor points to the upcoming federal mid-term election. He believes that a different lithe approach is needed that can stand in a balance between protection and innovation.