California 'BitLicense' Bill Signed by Gov. Newsom

California Governor Gavin Newsom signed a crypto licensing bill on Friday, set to take effect in July 2025.

Considered California's answer to New York's "BitLicense," the Digital Financial Assets Law faced heavy industry criticism but was passed by the U.S. state's Assembly in September 2022.

The law requires California's Department of Financial Protection (DFPI) and Innovation to create a regulatory framework for crypto. The framework includes a licensing regime and gives the department enforcement and rulemaking authority over the sector. The DFPI also gets an 18-month implementation period to ensure "the adopted regulatory framework can be thoughtfully tailored to address industry trends and mitigate consumer harm," the letter said.

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"Ambiguity of certain terms and the scope of this bill will require further refinement in both the regulatory process and in statute to provide clarity to both consumers, regulators and businesses subject to this new licensure framework," Newsom said in the letter. "It is essential that we strike the appropriate balance between protecting consumers from harm and fostering a responsible innovation and I look forward to working with the author [of the bill] to achieve this."

Read more: California Assembly Passes Crypto Regulation Bill That Requires Bank-Issued Stablecoins