The New York State Supreme Court has granted a motion to dismiss a years-long lawsuit that tried to overturn a technology-specific regulatory regime that targeted cryptocurrency, a newly released document shows.
Theo Chino, a former bitcoin entrepreneur, sued the New York State Department of Financial Services (NYDFS) in October 2015 over the regulation, often referred to generally as the “BitLicense.” Officially introduced in June 2015, the policy requires bitcoin-related firms that reside in the state to apply for a license to operate.
Chino accused the agency of over-regulating the bitcoin industry, claiming the restrictions it imposed overstepped its ability to regulate companies using the technology. He further claimed that NYDFS’s regulations forced him to shut down his own business.
After an initial delay on a decision, the court granted the defendant’s motion for dismissal, throwing out the notable one-man fight that tried to overturn a state-wide introduced regulation.
In a media statement sent to CoinDesk, Chino’s lawyer said that while the court has decided Chino has no standing to challenge the BitLicense regulation, he plans to file an appeal to the New York State Supreme Court.
It further stated:
“Obviously, our client disagrees with this conclusion, since it would mean that, for all practical purposes, no business located in New York or in another state would have access to the court system to challenge this regulation, and possibly other regulations promulgated by NYDFS.”
The dispute mainly stemmed from the controversy that arrived with the introduction of BitLicense. Entrepreneurs complained that the license enforced too many regulations, as well as imposed high compliance costs.
As previously reported by CoinDesk, in addition to the $5,000 non-refundable application fee for the BitLicense, legal fees and time allocation could result in several thousand dollars spent. Cryptocurrency exchange Bitstamp, for example, estimated at the time that one company could spend up to $100,000.
The full content of the court decision on the case is shown below:
Justice lady image via CoinDesk’s archive.
Correction note: This article has been updated to reflect the current status of the plaintiff’s appeal.
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Published at Wed, 03 Jan 2018 20:40:13 +0000