Washington's New Cryptocurrency Exchange Rules Are Now in Effect

New regulations that apply money transmitter laws to cryptocurrency exchanges have gone into effect in the U.S. state of Washington.

Jul 27, 2017 at 1:00 p.m. UTC
Updated Sep 13, 2021 at 6:46 a.m. UTC

New regulations for cryptocurrency exchanges have gone into effect in the U.S. state of Washington.

Following the passing of Senate Bill 5031 into law at the weekend, the state's money transmitter laws now apply to exchanges, meaning that they need to obtain a license from the Washington State Department of Financial Institutions and must provide a third-party audit of their data systems.

Among other requirements, the law also mandates a new transmitter bond requirement, with the figure being tied to the amount of currency exchanged during the previous year.

Lawmakers finalized the measure in April, sending it to the desk of Gov. Jay Inslee, who signed it days after work on the bill was completed. According to public records, the law went into effect on Sunday, July 23.

As CoinDesk has previously reported, lawmakers in the western U.S. state have been working since January to develop regulations for exchange startups.

The bill's passage wasn't without controversy, however. Cryptocurrency exchanges Poloniex and Bitfinex declared that they would would stop serving customers there, citing the new regulations.

At the same time, startups such as New York-based exchange Gemini moved in the opposite direction, obtaining approval to begin serving customers in the state earlier this year.

Washington State Capitol image via Shutterstock

The Festival for the Decentralized World
Thursday - Sunday, June 9-12, 2022
Austin, Texas
Save a Seat Now

DISCLOSURE

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.

Trending

1
UST Won't Be the End of Algorithmic Stablecoins

The trail for a monetary "holy grail" continues, despite Terra’s collapse. So what do we do about it?

The trail for a monetary "holy grail" continues, despite Terra’s collapse. So what do we do about it?

2
Crypto News Roundup for May 16, 2022

With crypto markets continuing to slump and a look what a recent bill on crypto mining might mean for New York’s economy, CoinDesk’s Markets Daily is back with the latest news roundup.

With crypto markets continuing to slump and a look what a recent bill on crypto mining might mean for New York’s economy, CoinDesk’s Markets Daily is back with the latest news roundup.

3
Kwon Proposes Forking Terra, Nixing UST Stablecoin in 'Revival Plan 2'

"$UST peg failure is Terra’s DAO hack moment - a chance to rise up anew from the ashes," Terraform Labs CEO Do Kwon said.

"$UST peg failure is Terra’s DAO hack moment - a chance to rise up anew from the ashes," Terraform Labs CEO Do Kwon said.

4
Bitcoin Struggles at $27K-$30K Support Zone; Resistance at $35K

BTC's upside appears limited despite short-term support.

BTC's upside appears limited despite short-term support.