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California Governor Rejects Key Crypto Bill | CoinGabbar News

California Governor Gavin Newsom rejects Assembly Bill 2269, a crypto monitoring bill. The bill was passed by both the state assembly (

24-Sep-2022 By: Ashish Sarswat
California Governor

California Governor Gavin Newsom rejects 

Assembly Bill 2269, a crypto monitoring bill. 

The bill would have required cryptocurrency firms and exchanges to get a special license from the California Department of Financial Protection and Innovation. 

The bill was passed by both the state assembly (71-0) and the state senate. However, Newsom, who had until September 30th to make a choice, vetoed the bill.

The bill is similar to the New York law that mandates crypto firms to get a "BitLicense" for virtual asset services. This provision, according to current New York mayor Eric Adams, prevents New York from becoming a virtual asset center.

The vetoed bill, called the Digital Financial Assets Bill sought to increase oversight of crypto firms in California.

Why Newsom Vetoed Crypto Oversight Bill

In a letter, Newsom informed the California State Assembly that he will veto the crypto monitoring bill. He emphasized the growing popularity of cryptocurrencies and stressed the importance of clear regulation that protects Californians.

Newsom revealed that his government has conducted extensive research on methods to protect citizens from the risk of cryptocurrency. However, Newsom argues that it is early to enact a licensing regime without considering his research. Furthermore, the governor mentions the forthcoming federal midterm elections. He feels that a more flexible strategy that fosters a balance between protection and innovation is required.

Newsom also highlights the proposed bill's cost-benefit study. According to him, this bill will draw tens of millions of dollars from California's general fund. He argues that such a large sum must be accounted for during the budgeting process.

Newsom Receives Praise From Crypto Community

The crypto community praises the governor of California's decision. The Blockchain Association's Jake Chervinsky applauds Newsom for his courage in standing up to the assembly. Similarly, Miles Jennings of the crypto firm a16z praises him for providing a great opportunity for the Web3 sector in California.

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