New Jersey tends to pull ahead in digital currency industry. Two Jersey lawmakers have recently come up new regulation for bitcoin industry. New Jersey official site announced a 30-page bill (A4478) that provides legislative framework for companies making transactions in bitcoin. Besides it contains tax benefits for bitcoin exchangers.
Raj Mukherji and Gordon M Johnson see a great potential in developing bitcoin industry in New Jersey. Efficient regulation will allow to create more working places in the state.
The main clauses of the bill will establish rules common for all bitcoin companies. They will not be able to come up with own taxes and regulations. Companies will be obliged to register with the Department of Banking of Insurance providing some information like business plan, fingerprints and photos of leading staff. Registration fee is mandatory.
According to the new legislation the companies will need effective cyber security program to offer customers safety of their funds. Besides they will have to maintain records of activity for the last five years.
Bitcoin as digital currency appeared in 2009 and has already come through ups and downs. There was a peak of its popularity in 2013 when it reached $1,150 per bitcoin. Now the average rate makes up around $238.
Many people have already appreciated the benefits of bitcoin. Bitcoin transaction can be compared to more habitual cash transaction – it takes place between two people, without any intermediaries. There is no central management of the process, blockchain technology maintains records of all transactions.
Jerry Brito, bitcoin enthusiast, underlined the innovative nature of digital currencies: “Bitcoin today looks very much the internet did in 1995. Then some dismissed the internet as curiosity, but because it was an open platform, you could build on top of it. You maybe couldn’t imagine what you could build on top of it. We couldn’t imagine Skype or Netflix or Facebook. But we could see the pieces were there to build something”.
Bitcoin companies have been up in arms over strict regulations in the sphere proposed earlier. New York opposed to the BitLicense created by Benjamin M. Lawsky. The regulatory base was considered to be too strict. Following New York’s bitcoin charter North Carolina also started developing regulations for digital currencies.
Raj Mukherji is justifiably proud that New Jersey is seeking ways to attract promising businesses in the state. He says that they not only want to be involved in the industry of digital currencies but also to make it as comforting and effective for entrepreneurs as possible: “The legislation clarifies where digital currency stands sort of in the rubric of New Jersey law. In other states that’s been confusing. I think this would be the first statute of its kind in the country. We would be establishing the framework legislatively”.