In an official letter, California Governor Gavin Newsom has vetoed the Crypto Licensing Bill as he has refused to sign the proposal that would establish a licensing and regulatory framework for digital assets.
While opposing the Assembly Bill 2269, Newsom has advocated a “more flexible approach” that would evolve with time and is equipped to address trends and alleviate consumer harm.
The letter said, “It is premature to lock a licensing structure in statute without considering both this work [in-house efforts to create a transparent regulatory environment] and forthcoming federal actions.
Newsom wrote that the bill, currently, would need “tens of millions of dollars” from the state’s general fund and this huge amount must be considered and accounted for in the annual budget process.
Newsom pointed out that he would collaboratively be working with the Legislature to gain regulatory clarity after federal regulations are clearer about digital financial assets. All the while making sure California remains a competitive place for firms seeking to invest and innovate.
The bill had proposed to allow the issuing of operational licenses for crypto firms in California. The California State Assembly passed the bill on September 1, with no objection from the assembly floor and later was forwarded to the governor’s office for approval.