A state (Hawaii) in the US has given the green light to 12 different cryptocurrency firms to begin operation. The green light was given without these firms needing to get a money transmission license. The 12 firms also would not face charges for not being licensed for the space of two years.
The crypto firms in Hawaii made the announcements independently of the US state decision. All 12 crypto firms also have been admitted to the state’s Digital Currency Innovation Lab (DCIL). The DCIL program would enable digital currency firms to do business in Hawaii without obtaining a state money transmitter license, a statement on the program website explains.
Also, regulatory sandbox is in partnership with the Hawaii Division of Financial Institutions (DFI).
Spanning from August 19 till December 2022, companies applied to be part of the program between March 17 and May 1. Reportedly, 19 firms applied with 12 companies, including several crypto exchanges, were approved for the program.
Enabled firms, what’s required from them?
The 12 crypto firms approved for the program are Apex Crypto, bitFlyer USA, Blockfi, Cex.io, Cloud Nalu, Novi Financial, River Financial, Robinhood Crypto Coinme, Erisx, Flexa, and Gemini Exchange.
The DFI responsible for regulating these crypto firms would monitor crypto transactions taking place in the Digital Currency Innovation Lab. The 12 crypto firms are required to provide updates alongside the number and value of transactions.
The firms are also expected to give information as regards complaints they receive and regulatory enforcement order. Upon completion of the two years earmarked for the DCIL, firms that do not get approval to continue operation would cease to operate after completing all crypto transactions.
“Per the participation agreement, companies must also execute on the wind-down plan and exit strategy.
DFI according to a statement on its website would determine the appropriate license if these firms have to continue operation.
Previously, Hawaii had strict crypto regulation that made crypto firms leave the state as in case of Coinbase. The exchange firm left Hawaii two years ago over requirements to hold fiat reserves.
Reactions from DCIL participating firms
Gemini exchange expressed excitement as they announced heir break into Hawaii and participation in DCIL.
In an official tweet, the New York-based crypto firm said We are excited to announce our participation in the Digital Currency Innovation Lab (DCIL), a two-year pilot program designed to bring #crypto to the people of Hawaii.
bitFlyer USA upon announcement of their inclusion in the program was also excited about their participation in the program.
Joel Edgerton, COO of bitFlyer USA said: “We are happy to partner with the State of Hawaii to bring our world-class services here. Now residents in Hawaii have access to a trusted, licensed exchange to support their Bitcoin and cryptocurrency trading.”