Las Vegas, NV August 19, 2019
The
Nevada Financial Institutions Division (NFID) regulates financial institutions
within Nevada to maintain a safe financial industry and to protect consumers
and the overall public interest. Over time, the NFID has monitored the growth
and expansion of the blockchain, bitcoin, and virtual currency industries. Recently,
several businesses and interested persons contacted the NFID to determine if a
license was required to operate within the State of Nevada. Based upon the
business model presented, a license may have been required for money
transmission under NRS Chapter 671. Thereafter, S.B. 195 was introduced during
the 2019 legislative session. During the session, the NFID stayed the issuance
of licensure determinations as S.B. 195 proposed to create a new statutory
license program for entities already licensed under NRS Chapter 671. Continuing
to issue licenses under NRS Chapter 671 may have created an undue burden for
licensees if they were then required to transition to a new statutory scheme
within a few months or a year after the session. However, S.B. 195 did not
pass, and the NFID has resumed licensing this industry as money transmitters,
when applicable.
It is important to note the NFID issues a licensure
determination based upon a review of an entity’s specific business model in
order to determine the relevant Chapter of the Nevada Revised Statutes (NRS)
the entity is regulated under, if any. Generally, an entity engaged in the
business of selling or issuing checks or of receiving for transmission or
transmitting money or credits is required to have a license under NRS 671.
However, if an entity proposes to serve as a digital custodian for any form of
digital currency, then the business may be regulated as a trust company under
NRS Chapter 669.
Any entity that facilitates the transmission of or
holds fiat or digital currency by way of brick-and-mortar, kiosk, mobile,
internet or any other means, should contact the NFID to request a licensure
determination.