A BitLicense Could Be Coming To Florida, but It Is Not The Banks Pushing It
A bill has been introduced in Florida that looks similar to New York's Bitlicense. Its backers are crypto companies, and the industry doesn't seem to mind..yet
The bill's intentions may be friendly, but its wording is problematic. It proposes a licensing regime for any company wishing to "issue, sell, store, or transmit virtual currency."
Broadly interpreted, this could hinder the adoption of companies willing to accept Bitcoin. For instance, if McDonald's wanted to accept Bitcoin from customers, it would need a license to store that Bitcoin if it chose to self-custody. The alternative would be relying on a third party for everything, which contradicts the ethos of the digital asset space, or at least it used to.
However, the original mission of the digital asset space seems long forgotten. Those involved in politics and Web3 will acknowledge this shift. While some might still give lip service to ideals of freedom, regulation of digital assets now appears more focused on either creating protective moats around certain products or integrating the digital asset space into the existing financial system frameworks.
That's why it's not surprising that the companies promoting this bill are large crypto companies with New York interests.
Although the bill could impede user adoption, Bitcoin and Web3 companies don't seem overly concerned. After discussions with several companies in the sector, it's clear that they would prefer to simply obtain the license rather than oppose the bill. The downstream effects of reduced user adoption are less significant when institutions are poised to enter the market and potentially drive up prices.
I've maintained for a while that we are not early adopters of Bitcoin. Those entering now are, in fact, late, especially depending on their goals. What's happening now is the mainstream finance sector's recognition of Bitcoin as a successful financial product.
To maintain the status quo, new innovative products must be controlled in such a way that a few institutions and companies must accumulate most of the wealth, leaving the majority with little. This is the underlying goal of the upcoming regulation in the Bitcoin and Web3 industry.
The average consumer may soon find their exposure to Bitcoin limited to index funds, ETFs, and other financial instruments, rather than holding the asset directly. Newcomers attempting to start businesses in this field will face increasing federal and state regulations, established by the first movers to limit competition.
In the end, despite laws and regulations, the price of Bitcoin is likely to continue rising, much to the delight of early market entrants who have restricted access to it. Fortunately for Floridians, this bill will be fought until the language is made more clear. But it is not lost on anyone that Bitcoin and crypto companies are backing the bill.
Is this what true adoption looks like?