A proposed California law to regulate virtual currency has drawn mixed reactions from industry advocates, in stark contrast to the New York BitLicense that met united industry opposition. AB 1236 sponsored by Assemblyman Matt Dababneh requires virtual currency companies to be licensed. The measure passed the Assembly in June and awaits Senate action.
The Electronic Frontier Foundation (EFF), based in San Francisco, has launched a petition opposing the measure. Coin Center, a Washington, D.C.-based group, supports the bill, calling it a cautious and well-researched approach to virtual currency regulation. Both groups opposed the New York BitLicense, which recently took effect.
EFF opposes all virtual currency regulations while Coin Center claims legislation can provide “much needed regulatory certainty,” according to Bloomberg. Coinbase, the bitcoin exchange that opposed the BitLicense, has sided with Coin Center in California.
EFF Defends Small Players
EFF claims to be representing smaller companies and opposes the law’s $5,000 license application fee and extensive reporting requirements. “Unfortunately, the bill’s language is so vague that it’s unclear what companies are, in fact, ‘virtual currency businesses’” So in spite of carve-outs for smaller companies and for software developers who don’t exercise control over the currency, the proposal threatens the