Cryptocurrency firms in Hawaii are now exempt from the requirement to obtain a Money Transmitter License (MTL) to operate in the state. The Hawai‘i Department of Commerce and Consumer Affairs (DCCA) announced the conclusion of the Digital Currency Innovation Lab (DCIL) on June 30, 2024. This initiative, which began in 2020, aimed to explore digital currency activities and assess the necessary regulatory framework for crypto-related companies.

Following the project’s completion, Hawaii authorities decided that digital currency companies no longer need a Hawai‘i-issued MTL to conduct business within the state. However, these companies must still comply with federal regulations set by the Financial Crimes Enforcement Network (FinCEN), the Securities and Exchange Commission (SEC), and the Financial Industry Regulatory Authority (FINRA), among other federal regulatory requirements involving consumer protection and Anti-Money Laundering measures.

Obtaining a MTL license typically requires significant resources, including maintaining permissible investments, a minimum net worth, a business plan, and a compliance program. The requirements for an MTL vary by state, leading to inconsistency and making it difficult for businesses to operate uniformly across the U.S.

Major industry players, such as the crypto payment gateway Alchemy Pay, have been actively working with regulators to secure MTL licensing in multiple states. Despite the exemption in Hawaii, the DCCA emphasized the importance of consumer awareness regarding the risks associated with cryptocurrencies. Banking Commissioner Iris Ikeda highlighted the need for public education on these risks, indicating that this would be a primary focus for the authority moving forward.

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The Federal Bureau of Investigation (FBI) recently warned against emerging criminal schemes targeting cryptocurrency scam victims, advising the public to be cautious of advertisements for crypto recovery services and to protect private information. The FBI has also advised against using unregistered crypto money transmitting services.

Source: cointelegraph.com

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