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California Governor Rejected Crypto Regulation Bill

California Governor Gavin Newsom vetoed Assembly Measure 2269, a regulation bill. California Department of Financial Protection and Innovation had proposed a unique license for crypto firms and exchanges under the proposed legislation. The state senate, along with the Assembly, voted in favor of the approved measure unanimously (71-0). Newsom, however, vetoed the legislation despite having until September 30th for the vote.

The legislation is quite similar to New York’s statute— that mandates virtual asset businesses to get a “BitLicense.” Eric Adams, the current mayor of the city, said that this restriction hampers the possibility of New York becoming a center of virtual assets.

The Digital Financial Assets Bill aimed to establish new regulations for California’s crypto industry, but Governor Gavin Newsom notified the Assembly that he was rejecting a measure that would regulate the cryptocurrency industry. He spoke about the widespread usage of cryptocurrency and the need for clear regulations for the protection of citizens.

Newsom stated that his government invested a considerable amount of time and energy in studying methods to safeguard individuals from the dangers of cryptocurrency. Furthermore, Newsom believes his study has to be taken into account before a licensing framework is passed as law.

Additionally, Newsom also brought up the forthcoming federal midterm election. He proposed a refined strategy that balances security and innovation. The governor also discussed the bill’s potential financial benefits. He claimed that for this measure to be realized, the state of California would have to borrow tens of millions of dollars, and such a big sum should be included in budget planning.