Crypto Companies Warned By New York Attorney General

As the US government seemingly starts to loosen its grip on the crypto industry, New York Attorney General Letitia James has issued a new warning to the sector. James, who recently announced the NYAG office’s $2 billion settlement with Genesis, reinforced her stance on crypto companies this weekend.

Play By The Rules Or Else…

Last week, The New York State Attorney General’s Office reached a $2 billion settlement with bankrupt platform Genesis Global Capital.

This development came as the resolution of the lawsuit filed by the NYAG’s Office in October 2023. It became the largest settlement against a crypto company in New York.

Following the settlement, NY Attorney General Letitia James vowed to maintain the office’s regulatory oversight in the sector and the office’s work to safeguard New York investors:

New York investors deserve the peace of mind that comes from a properly regulated marketplace, and that is something my office will always act to achieve.

Over the weekend, James reinforced her position towards companies in the sector on an X post. The NY Attorney General issued a new warning to the sector, telling all crptocurrency companies operating in the state that they must comply like any other company.

New York Attorney General's statement. Source: Letitia James on X

According to the post, those who don’t follow the rules will be in the eyes of the Attorney General’s Office, which has secured over $2.5 billion in settlements from other platforms.   

Crypto Investors Challenge Industry Crackdown

James’ statement received backlash from US voters and crypto enthusiasts. In replies to her post, many criticized the Attorney General’s decision to single out cryptocurrencies and crypto companies in her warning.

A user expressed concern over the post, stating:

If I lived in NY I’d be busting my Butt to find a way to move like so many Businesses & wealthy people already have.

Moreover, another reply questioned the “rules” James was referring to and where a State Attorney General Fit into this issue:

What “rules” would those be? SEC regulates publicly held companies. Banking regulates portions of the exchanges. How does a state AG fit into this?  Late business registrations?

The user further challenged James’ position after the US government’s recent U-turn. Recently, the Financial Innovation and Technology for the 21st Century Act, also known as FIT21, was passed by the US House of Representatives “with a very strong showing for democrats,” as the post pointed out.

As reported by Bitcoinist, Democratic leaders opted not to whip the FIT21 vote last week regardless of the Senior leaders’ sentiments toward the pro-crypto bill.

Despite the uncertainty of the coming Senate vote results, the shift of the Biden Administration, seemingly fueled by the industry’s positive response to Donald Trump’s endorsement of cryptocurrencies, appears to have offered some hope to investors.

Ultimately, this change allows for a clearer and more industry-friendly regulatory framework to be developed in the country.

Total crypto market capitalization is at $2.5 trillion in the weekly chart. Source: TOTAL on TradingView

Featured Image from Unsplash.com, Chart from TradingView.com