{"id":9959,"date":"2023-01-24T04:51:55","date_gmt":"2023-01-24T04:51:55","guid":{"rendered":"http:\/\/cryptoheretostay.com\/?p=9959"},"modified":"2023-01-24T04:51:56","modified_gmt":"2023-01-24T04:51:56","slug":"nydfs-advises-crypto-account-segregation","status":"publish","type":"post","link":"https:\/\/cryptoheretostay.com\/?p=9959","title":{"rendered":"NYDFS advises crypto account segregation"},"content":{"rendered":"<p> <script type=\"text\/javascript\">\r\namzn_assoc_placement = \"adunit0\";\r\namzn_assoc_tracking_id = \"totafreearti-20\";\r\namzn_assoc_ad_mode = \"search\";\r\namzn_assoc_ad_type = \"smart\";\r\namzn_assoc_marketplace = \"amazon\";\r\namzn_assoc_region = \"US\";\r\namzn_assoc_default_search_phrase = \"crypto\";\r\namzn_assoc_default_category = \"All\";\r\namzn_assoc_search_bar = \"false\";\r\namzn_assoc_title = \"\";\r\namzn_assoc_rows =\"1\";\r\n<\/script>\r\n<script src=\"\/\/z-na.amazon-adsystem.com\/widgets\/onejs?MarketPlace=US\"><\/script><br \/>\n<\/p>\n<p>The New York Department of Financial Services (NYDFS) recommended on Jan. 23 that custodians should segregate customer and corporate crypto assets.<\/p>\n<p>Superintendent Adrienne A. Harris suggested that today\u2019s guidance is a part of the state\u2019s broader attempts to regulate cryptocurrency. She said:<\/p>\n<p>\u201c[The Department of Financial Services\u2019] virtual currency regulation has protected New Yorkers since 2015. Today\u2019s guidance reminds DFS-regulated virtual currency companies of our expectations regarding the safekeeping of customer assets.\u201d<\/p>\n<p>The main recommendation advanced in today\u2019s guidance is the segregation of crypto accounts. The NYDFS suggests that a company\u2019s custodian should separately manage corporate assets and virtual currencies deposited by customers.<\/p>\n<p>Specifically, corporate and customer assets should be held in separate on-chain wallets, though individual customer accounts can be combined into an omnibus account. The two groups of assets should also be treated separately during accounting.<\/p>\n<p>Today\u2019s guidance also specifies that the custodian should have limited interest in assets: custodians should hold all assets solely for safekeeping and should not enter a debtor-creditor relationship. Custodians can, however, make sub-custody arrangements with a third party. Custodians should disclose all relevant terms and conditions.<\/p>\n<p>This guidance is explicitly intended to protect customers in case a service becomes insolvent. It is also meant to prevent the co-mingling of funds.<\/p>\n<p>Harris told Reuters that the newly-announced guidance was not specifically motivated by the collapse of FTX, which saw the company mismanage funds and user deposits in conjunction with Alameda Research. Harris called that event \u201ctimely\u201d but asserted that the NYDFS had planned to release guidance on the matter for some time.<\/p>\n<p>Harris said that the NYDFS plans to release upcoming guidance on stablecoins, advertising, and disclosures. The agency will also focus on anti-money laundering rules this year.<\/p>\n<p>Today\u2019s guidance applies to companies that are permitted to provide custody in New York, which is recognized for its strict regulatory stance toward crypto. To date, just 31 firms have obtained either the state\u2019s BitLicense or its Limited Purpose Trust Charter.<\/p>\n<p><script type=\"text\/javascript\">\r\namzn_assoc_placement = \"adunit0\";\r\namzn_assoc_tracking_id = \"totafreearti-20\";\r\namzn_assoc_ad_mode = \"search\";\r\namzn_assoc_ad_type = \"smart\";\r\namzn_assoc_marketplace = \"amazon\";\r\namzn_assoc_region = \"US\";\r\namzn_assoc_default_search_phrase = \"bitcoin\";\r\namzn_assoc_default_category = \"All\";\r\namzn_assoc_search_bar = \"false\";\r\namzn_assoc_title = \"\";\r\namzn_assoc_rows =\"1\";\r\n<\/script>\r\n<script src=\"\/\/z-na.amazon-adsystem.com\/widgets\/onejs?MarketPlace=US\"><\/script><br \/>\n<br \/><a href=\"https:\/\/cryptoslate.com\/nydfs-advises-crypto-account-segregation\/\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The New York Department of Financial Services (NYDFS) recommended on Jan. 23 that custodians should segregate customer and corporate crypto assets. Superintendent Adrienne A. Harris suggested that today\u2019s guidance is a part of the state\u2019s broader attempts to regulate cryptocurrency. She said: \u201c[The Department of Financial Services\u2019] virtual currency regulation has protected New Yorkers since [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":9960,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_wp_rev_ctl_limit":""},"categories":[3],"tags":[],"class_list":["post-9959","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-ethereum-news"],"_links":{"self":[{"href":"https:\/\/cryptoheretostay.com\/index.php?rest_route=\/wp\/v2\/posts\/9959","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/cryptoheretostay.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/cryptoheretostay.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/cryptoheretostay.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/cryptoheretostay.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=9959"}],"version-history":[{"count":1,"href":"https:\/\/cryptoheretostay.com\/index.php?rest_route=\/wp\/v2\/posts\/9959\/revisions"}],"predecessor-version":[{"id":9961,"href":"https:\/\/cryptoheretostay.com\/index.php?rest_route=\/wp\/v2\/posts\/9959\/revisions\/9961"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/cryptoheretostay.com\/index.php?rest_route=\/wp\/v2\/media\/9960"}],"wp:attachment":[{"href":"https:\/\/cryptoheretostay.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=9959"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/cryptoheretostay.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=9959"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/cryptoheretostay.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=9959"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}