NY’s Proposed BitRegs a Threat to Privacy and Innovation
The New York State Department of Financial Services recently proposed
sweeping regulations for digital currencies – the first such rules in the United States dedicated to digital currency – that would require this burgeoning privacy-friendly industry to watch their users’ every move. New York’s proposed regulations would impose more restrictions on digital currency than on standard currency, requiring many digital currency services to identify all customers and track all transactions, and retain this data, largely for the sake of state surveillance.
Digital currency, such as Bitcoin, is a disruptive technology with vast potential to democratize financial services and spawn a new generation of innovative products from startups. In addition to its decentralized nature and global transferability, an appealing feature of most digital currencies is relative anonymity
, since transactions are not directly linked to users’ names. Other than cash and prepaid cards, options for private transactions are limited. As fewer people carry cash, digital currency is shaping up to be important to the future of financial privacy. However, digital currency faces scrutiny from law enforcement and regulators due to persistent questions about security
, and the potential to fund criminal activity
New York should ensure its “BitRegs” take digital currencies’ unique nature into account and do not unnecessarily invade user privacy or stifle innovation.
Read the full article https://cdt.org/blog/nys-bitregs-a-threat-to-privacy-and-innovation/