Ask Reggi Your Question Now
Can I offer a cryptocurrency as a form of payment without violating financial regulations in California? What are the requirements?
To offer cryptocurrency as a form of payment in California, you must comply with the state’s financial regulations. The California Department of Business Oversight (DBO) requires businesses that engage in virtual currency activities to obtain a license under the Money Transmission Act. Additionally, businesses must comply with the state’s anti-money laundering (AML) and know-your-customer (KYC) regulations.
According to the Short Form Application for Deferred Deposit Transaction Licensee Seeking Additional Location License [3.1], businesses must file an application with the Department of Corporations and pay a fee of $300, which includes an application fee of $200 and an investigation fee of $100. The application must include the name of the applicant, the applicant’s licensed place of business, the name of the individual in charge of the location, and the name and address of one other California Deferred Deposit Transaction license held by the applicant.
To comply with AML and KYC regulations, businesses must implement policies and procedures to detect and prevent money laundering and terrorist financing. This includes verifying the identity of customers and reporting suspicious transactions to the Financial Crimes Enforcement Network (FinCEN).
It is recommended that you consult with a legal professional to ensure that you are in compliance with all applicable regulations.
[3.1] 10 CACR Section 2021, Short Form Application for Deferred Deposit Transaction Licensee Seeking Additional Location License; Form.
Source(s):
Jurisdiction
California