New York has given the first authorization to a stablecoin, backed by the Japanese Yen, to operate in the US
Given New York’s status as a global center, the NYDFS is the most prominent state financial regulator in the US. It is also one of the most aggressive. A pass to operate in New York often opens the rest of the country.
GMO’s charter is like a limited liability trust company rather than a full bank, the main difference being the authorization to handle deposits. While a stablecoin operator typically needs the ability to hold reserves of the pegged assets, the GMO charter limits its rights to hold other types of deposits that are not central to its ability to issue its stablecoins. manage and redeem.
The right to issue such non-deposit charters is a apple of discord between government regulators such as the NYDFS and national bank regulators in the US.
GMO President and CEO Ken Nakamura said, “We are breaking new ground with our move to issue the first regulated JPY-pegged stablecoin, which many see as a safe haven.”
The NYDFS recently made changes to its famous BitLicense, including a conditional format that connects newly licensed companies with existing licensees. The first conditional BitLicense went to PayPal, which enabled the launch of its new crypto services earlier this fall with the help of long-standing licensee Paxos.