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Cryptocurrency Regulations across the United States

Cryptocurrencies, digital assets that are already beginning to be a part of our everyday lives, are still murky grounds within the regulatory world. Below is state-by-state guide to some of the cryptocurrency regulations that currently exist:


In Arizona, Bitcoin ATMs are not required to obtain a Money Transmitter License. The application to operate in this state can be found here. The current Money Transmitter Laws do not contain any verbiage or guidance for virtual currencies. However, multiple Senate Bills and House Bills exist on cryptocurrencies and financial technologies.

It is important to note the pilot programs that Arizona has created as well. House Bill 2434 creates a “Regulatory Sandbox Program”. The purpose of the program is to “establish a regulatory sandbox program in consultation with applicable agencies of [Arizona] to enable a person to obtain limited access to the market in this state to test innovative financial products or services without obtaining a license or other authorization that otherwise might be required” (House Bill 2434).

Further Statutes and House Bills relating to virtual currencies and blockchain include:

· Arizona Statute §44-7061: “A contract relating to a transaction may not be denied legal effect, validity or enforceability solely because that contract contains a smart contract term." H.B. 2417, 53d Leg., 1st Reg. Sess. (Ariz. 2017).”

· Arizona Statute §11-269.22 prohibits any county from prohibiting individuals from “running a node on blockchain technology” in a residence, as defined as “providing computer power to validate or encrypt transactions in blockchain technology”

· Arizona Statute §13-3122 makes it unlawful to require people to use or be subject to electronic firearm tracking technology (including distributed ledger or blockchain technology). H.B. 2216, 53d Leg., 1st Reg. Sess. (Ariz. 2017).

· H.B. 2601: creates a framework under the State’s securities laws for crowdfunding sales involving virtual currencies. S.B. 2601, 53d Leg., 2nd Reg Sess. (Ariz. 2018)


Colorado recently passed the Digital Token Act on March 6, 2019, which became effective on August 2, 2019. This Act facilitates the sale and transfer of digital tokens in Colorado. It defines the term “digital token” and provides “limited exemptions from the securities registration and securities broker-dealer and salesperson licensing requirements for persons dealing in digital tokens.” The business must 1) be for consumptive purposes and 2) file a notice of intent.

The Act can be found here! Colorado is a pioneer in creating clearer regulations and guidance for the cryptocurrency world.


In Florida, there are neither regulations nor guidelines on virtual currencies. House Bill 1379, passed in 2017, defines the term “virtual currency” and prohibits its laundering.


Georgia has both regulations and guidelines on virtual currencies. In Spring 2016, Governor Nathan Deal signed a bill into law amending Title 7 of the Official Code of Georgia Annotated. This bill authorizes the state’s Department of Banking and Finance to “enact rules and regulations that apply solely to persons engaged in money transmission or the sale of payment instruments involving virtual currency,” includes rules to “foster the growth of businesses engaged in money transmission or the sale of payment instruments involving virtual currency in Georgia and spur state economic development.” Ga. Code Ann. §7-1-690(b)(1).

Georgia defines virtual currency as “a digital representation of monetary value that does not have legal tender status as recognized by the United States government.”

Some sources do state that one would need a license to conduct any activity involving virtual currency, however, the best way to figure out if your company would need a license would be to reach out to authorities.


Illinois has both regulations and guidelines on virtual currencies. A June 2017 Formal Guidance directly addresses Bitcoin ATMs, stating, “If the machine never involves a third party, and only facilitates a sale or purchase of digital currency by the machine's operator directly with the customer, there is no money transmission because at no time is money received and neither party is engaging in the “business of receiving money for transmission or transmitting money.”

House Bill 5553, passed in February 2018, creates the Blockchain Technology Act. This Act provides for the permitted uses of blockchain technology in transactions and proceedings along with limitations to the use of blockchain technology. The Act prohibits units of the local government from implementing specified restrictions on the use of blockchain technology. It also defines terms specific to blockchain and virtual currencies.

House Bill 5335, also passed in February 2018, amends the Department of Revenue Law of the Civil Administrative Code of Illinois. It provides that in addition to any other method of payment provided for by law, the Department shall accept payment for any tax imposed by the State and administered by the Department by cryptocurrency. It further proovides that the Department shall convert such payments to United States dollars at the prevailing rate within 24 hours after receipt of the payment and shall credit the taxpayer's account with the converted dollar amount.


Michigan has both regulations and guidelines on virtual currencies.

House Bill 6523 includes cryptocurrency in definitions in the embezzlement section of the penal code. “‘Cryptocurrency’ means digital currency in which encryption techniques are used to regulate the generation of units of currency and verify the transfer of funds, and that operates independently of a central bank.”

House Bill 6254 provides a definition of cryptocurrency in its money laundering definition section of the penal code.

House Bill 6258 relates to crimes involving credit cards, including cryptocurrency and distributed ledger technology in the definition section of the credit chapter in the penal code.

Michigan also states that virtual currency itself is not tangible personal property for the purposes of the General Sales Tax Act or the Use Tax Act. Therefore, sales of virtual currency are to subject to the sales or use tax.

There are currently 107 Bitcoin ATMs in Michigan.


Minnesota defined “virtual currency” in 2017 as “a digital representation of value used as a medium of exchange, unit of account or store of value that does not have legal tender status recognized by the United States.”

House Bill 1608, 1st Reg. Sess., 90th Leg. Sess. (Minn. Feb. 2017): Minnesota’s House of Representatives introduced a bill that would amend the Minnesota Unclaimed Property Act to explicitly include virtual currency as property.

Minnesota’s Commerce Department issued a warning for investors on cryptocurrencies, entitled “Be Cautious of the Crypto Investment Craze,” notifying consumers to be wary of “jump[ing] into the crypto crazy.”


Nevada recently issued a new law, NRS Chapter 671 “Issuers of Instruments for Transmission or Payment of Money,” which requires virtual currency exchanges, including Bitcoin ATMs, to have a Money Transmitter License.

Businesses and proprietors must apply and complete a checklist to obtain a license. Included in the list is a surety bond requirement of $10,00 upfront for the first location, plus $5,000 for each additional location. Bond requirements max out at $250,000. The application must contain:

(a) The name and principal business address of the applicant and, if incorporated, the date and place of its incorporation;(b) The name and address of each of the applicant’s branch offices, subsidiaries or affiliates, if any, which will be operated under the license;(c) The name and addresses, business and residential, of the proprietor or partners of the applicant or, if the applicant is a corporation or association, of each of the directors, trustees and principal officers, and of any stockholder who owns 20 percent or more of the applicant’s stock; and(d) Such other pertinent information as the Commissioner requires.

The "Money Transmitter Addendum and Checklist" in addition to the "Money Transmitter Application" and "Bond Form" can be found here.


The only blockchain or virtual currency specific regulation in New Jersey is a recently enacted statute, effective December 12, 2017, titled the Uniform Fiduciary Access to Digital Assets Act that expressly authorizes an estate's executor under certain circumstances to manage digital assets, including virtual currencies, of a decedent. N.J.S.A. 3B: 14-61.1.

Bills pending in the General Assembly (A.B. 3613) and the Senate (S.B. 2297) would establish "the New Jersey Blockchain Initiative Task Force to study whether State, county, and municipal governments can benefit from a transition to a blockchain-based system for record keeping and service delivery." Assemb. 3613, 218th Leg., 1st Ann. Sess. (N.J. 2018).

Another pair of bills (A.B. 3768 and S.B. 2462) pending in each house would permit corporations to use blockchain technology for certain recordkeeping requirements... New Jersey has also issued guidance that it would conform to the federal tax treatment of virtual currency, meaning that virtual currency would be treated as intangible property and subject to sales tax. See Technical Advisory Memorandum, N.J. Division of Taxation, Convertible Virtual Currency (TAM–2015–1(R)) (July 28, 2015).


New Mexico has both regulations and guidance on virtual currency.

Right now – virtual currency exchanges or other businesses engaged in the exchange of crypto currency for monetary value ARE required to be licensed as a money service business. Proposed legislation – (Action Postponed Indefinitely): Feb. 2019: New Mexico House introduced H.B. 649 entitled “Internet Business Development & Innovations.” Part of the proposal states: 1. A person shall not engage in business as a cryptovalue creator and distributor or as a cryptovalue exchange without first having obtained a license to do so from the division. 2. Licensees shall pay to the division an annual licensing fee of one hundred dollars ($100). 3. A licensee shall be an active corporation organized pursuant to the laws of New Mexico. 4. A cryptovalue creator and distributor and a cryptovalue exchange is not a money service as defined in Subsection P of Section 58-32-102 NMSA.

The License/Registration Fee is $2,000, the Application Fee is $2,000 and the NMLS Initial Processing Fee is $0.

The company must submit the company bond in the amount of $300,000 or an amount equal to one percent of the licensee’s total yearly dollar volume of money transmission business in the state of New Mexico or the applicant’s projected total volume of business in New Mexico for the first year of licensure, whichever is greater, up to an ordinary maximum of two million dollars ($2,000,000) furnished by a surety company authorized to conduct business in New Mexico.


SB 300, introduced in May 2018, aims to “amend the Uniform Electronic Transactions Act to define records and contracts secured by blockchain technology as electronic records and to allow the use of smart contract terms.”

There is no mention of crypto/virtual currency in Money Transmitter Laws BUT within the “Application for a Money Transmitter License”, it states a required document as:

· “Virtual Currency: If the applicant will engage in the transaction of virtual currency in the course of money transmission activities, provide a current third party security audit of all relevant computer and information systems.”

Ohio has not clarified its stance on virtual currencies, but the state did make changes to its Liquor Control Law in 2014, banning the purchase of alcohol with bitcoin. Ohio currently has 104 Bitcoin ATMs in the state.


Oregon has typically not required Bitcoin ATMs to become licensed as money transmitters. Oregon’s Money Transmitter Act does not explicitly include/govern currency exchange or sales or crptocurrencies.

Senate Bill 277, passed in May 2015, states that “Money” means a medium of exchange that:

· (a) The United States or a foreign government authorizes or adopts; or

· (b) Represents value that substitutes for currency but does not benefit from government regulation requiring acceptance of the medium of exchange as legal tender.

HB 2487 (Jan. 2019) proposes that “the Oregon Department of Administrative Services shall study and make recommendations regarding the use of blockchain technology by state agencies to administer public services.” 2019 OR H.B. 2487 (NS).

HB 2179 (Jan. 2019) further proposed to establish a task force on blockchain applications and legislation. Per the proposal, “the task force shall study and evaluate the status and development of block technology, investigate potential uses for the technology for economic development and business transactions and make recommendations for any changes necessary in state statutes that can promote adopting, using and developing blockchain technologies.

The House also proposed that unless authorized by the state treasurer:

a. The state government, as defined in ORS 174.111, may not accept payments using cryptocurrencyb. No candidate for public office may accept campaign contributions made using cryptocurrency.


Pennsylvania has both regulations and guidance on virtual currency. Virtual currency is included in money transmitter laws, however, the guidance documents from the state declares that ATMs are not money transmitters:

“... entities operating virtual currency kiosks, ATMs, and vending machines (“Kiosks”) have also sought direction from the DoBS as to whether these entities would be “money transmitters” under the MTA. Some Kiosks are one-way systems which, for a transaction fee, dispense virtual currency in exchange for fiat currency, while others are two-way systems which, for a transaction fee, exchange both fiat currency for virtual currency and virtual currency for fiat currency. In both the one-way and two-way Kiosk systems, there is no transfer of money to any third party. The user of the Kiosk merely exchanges fiat currency for virtual currency and vice versa, and there is no money transmission. Thus, the entities operating the Kiosks would not be money transmitters under the MTA.”

Virtual Currency Trading Platforms are not considered money transmitters eithers. A Money Transmitter License is required under the MTA when money is transmitted, thus “fiat currency must be transferred with or on behalf of an individual to a third party, and the money transmitter must charge a fee for the transmission.” (Money Transmitter Act Guidance for Virtual Currency Businesses).


Washington has both regulations and guidance for virtual currency. Virtual currency is included in the definition of “Money Transmission” in the Uniform Money Services Act (UMSA), chapter 19.230 RCW.

Senate Bill (July 2017), places virtual currency exchange operators under the state’s money transmitter rules and requires them to comply with the same licensing requirements as traditional money transmitters.

The guidance states, "Money transmission" means receiving money or its equivalent value to transmit, deliver, or instruct to be delivered the money or its equivalent value to another location, inside or outside the United States, by any means including but not limited to by wire, facsimile, or electronic transfer. "Money transmission" does not include the provision solely of connection services to the internet, telecommunications services, or network access. "Money transmission" includes selling, issuing, or acting as an intermediary for open loop stored value and payment instruments, but not closed loop stored value.

Companies wishing to transmit money for Washington residents in a digital currency form can contact DFI for a determination whether licensure under the UMSA is required. If it is, a license is required before the company can engage in the activity.

The Department of Financial Institutions dedicates an entire page to “Bitcoin and Virtual Currency Regulation.” It states:

· “When DFI receives an inquiry about licensing or a license application, or when the agency comes in contact with a company as the result of a complaint, we analyze the business model, seek additional information when necessary, and otherwise ensure our knowledge of the company’s activities. When receiving our initial inquiry and information about Washington’s license requirements, some companies engaged in money transmission with business models based on virtual currency have elected to not offer, or discontinue offering, their services in Washington. Other companies begin the license process. We continually work to streamline our license application process, and we use the nationwide licensing portal which is specifically helpful to companies operating in more than one state.”


There are currently no laws/regulations mentioning virtual currency. However, in March 2019, they introduced Senate Bill 213, which provides more clarity for cryptocurrency companies and went into effect in May 2019. This Bill is currently entitled the Blockchain Technology Act.

The Bill defines and clarifies terms related to blockchain technology and exempts a person who facilitates the creation, exchange, or sale of certain blockchain technology-related products from Title 7, Chapter 25, Money Transmitter Act.

New Mexico’s Financial Institutions Division does not do licensing “predeterminations” or give legal advice. Cryptocurrency is not currently recognized as money in Utah, and would fall outside of the department’s jurisdiction.

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