NJ Bill Would Prohibit Certain Uses Of Customer Funds By Cryptocurrency Firms

- Advertisement -

A proposed law in New Jersey would make it illegal for firms holding cryptocurrency on the behalf of clients to lend out tokens in its custody.

A bill submitted to the New Jersey General Assembly by Assemblywoman Yvonne Lopez would prohibit firms that hold cryptocurrency on behalf of clients from lending those funds to other entities.

AB3817 would also require such firms to obtain the permission of New Jersey resident-clients before selling, transferring, or assigning any digital assets it holds for those clients.

In addition to its restriction on lending, the bill would prohibit these companies from “hypothecating [and] pledging” cryptocurrency under their custodianship, with or without permission from those tokens’ rightful owners.

The proposed law would also require “any individual, partnership, corporation, association, trust, or other business combination or entity” that is “engaging in digital currency business activity” to register with the state‘s Department of Banking and Insurance, so long as that activity involves “any person that resides, is located, or is conducting business in New Jersey.”

On April 5, the day the bill was submitted, it was referred to the Assembly Science, Innovation and Technology Committee.

- Advertisement -

Adam Reese is a Los Angeles-based writer interested in technology, domestic and international politics, social issues, infrastructure and the arts. Adam is a full-time staff writer for ETHNews and holds value in Ether, Bitcoin, and Monero.

Like what you read? Follow us on X @Bitnewsbot to receive the latest New Jersey, cryptocurrency or other Ethereum law and legislation news.



Previous Articles:

- Advertisement -

Latest

Cryptocurrency Set to Dominate Asset Reserves by 2025

Digital assets are entering a new period of growth, with signs cryptocurrency will be prioritized for asset reserves by 2025. Fans Hash introduced mining tools...

TON Blockchain Hit by Outage, Block Production Halts Temporarily

The Open Network (TON) blockchain experienced a temporary outage on June 1, stopping block production for about 40 minutes.The issue was fixed quickly by...

Pi, IMX, ZBCN in Focus as Key Token Unlocks Threaten More Losses

The crypto market experienced a sharp drop as Bitcoin fell from $111,900 to below $104,000, resulting in widespread altcoin declines.Investors are closely watching key...

Crypto’s “Inverse Cramer”: Trader Gains Millions Opposing James Wynn

A trader known as James Wynn became notable for a $1 billion Bitcoin short position on the Hyperliquid platform.Other crypto traders have started to...

Bitcoin Drops 10% From Highs Amid Quantum Computing Warnings

Bitcoin dropped nearly 10% from its record high, falling close to $103,000 after reaching $112,000 last week. BlackRock warned that advances in quantum computing could...

Must Read

Tutorial: How to Buy a Domain Name Permanently? (Super Easy)

Are you ready to establish a permanent online presence and you want to buy a domain forever?In this tutorial, we'll show you how to...