State banks in the state of Virginia will be able to offer cryptocurrency storage services.
Virginia wants to assist cryptocurrency investors.
According to the Virginia Senate, a motion to amend the law has been approved, which will allow traditional banks in the state to provide cryptocurrency storage services.
Representative Christopher T. Head, a local politician, introduced the relevant bill in January 2022 (House Bill No. 263).
Banks can provide their clients with virtual currency storage services while following 26 procedures that effectively manage risk and comply with applicable laws.
Despite opposition from the state House of Representatives, the bill was passed by an absolute majority in the Senate (39 to 0, to be exact) and awaits the signature of Governor Glenn Youngkin.
In order to offer cryptocurrencies to their customers, banks will have to meet three specific requirements:
- Implement effective risk management processes.
- Have adequate insurance coverage.
- Launch a surveillance program to address the risks associated with cryptocurrencies.
Banks that act as custodians will require their customers to transfer their virtual currencies to the bank by creating new private keys, which will be held on the bank’s behalf.
Other U.S. Actions
Wyoming has also recently passed regulations for the cryptocurrency market, which include the issuance of state-issued stablecoins.
The Financial Services Commission discussed regulating stablecoins and digital assets last month. As a result, North Carolina politician Patrick McHenry proposed a state-level regulatory framework instead of a comprehensive federal law.
Jean Nellie Liang, undersecretary of domestic finance at the Treasury Department, cited a report by the Presidential Working Group on Financial Markets, noting that banks that offer U.S. dollar-related stablecoins, such as state banks and federal banks, should abide by the same standards as banks that are insured depository institutions.
As you can see, the cryptocurrency market is being regulated and strengthened in the United States. The above regulations will enhance the level of security in the digital asset market.