Rich by Coin

On January 14, 2026, State Senator Zellnor Myrie introduced Senate Bill S.8901, the CRYPTO Act, which would amend New York law to criminalize operating a virtual currency business in the state without a proper license. Manhattan District Attorney Alvin Bragg joined the announcement, arguing that it is long past time for unlicensed crypto operators to face criminal penalties and to bolster enforcement tools against fraud and money laundering in the crypto space. If enacted, the CRYPTO Act would require virtual currency businesses involving New York or New York residents to be licensed by the New York State Department of Financial Services (the BitLicense) or a Limited Purpose Trust Charter (LPTC), and would make unlicensed activity a crime, bringing New York in line with federal practice. It would establish a graduated penalty structure: Class A misdemeanor for unlicensed activity; Class E felony if the unlicensed activity involves $25,000 or more in 30 days, $250,000 or more in one year, or if the violator knows the virtual currency is criminal proceeds; Class D felony if the unlicensed activity involves $50,000 or more in 30 days, or $500,000 or more in one year; Class C felony if $100,000 or more in 30 days, or $1,000,000 or more in one year. Penalties could include prison terms, with misdemeanors carrying less than one year and Class C potentially carrying five to 15 years upon conviction.

Advocates see the CRYPTO Act as a signal that New York will intensify enforcement against unlicensed virtual currency businesses. The proposal follows scrutiny from law enforcement, with DA Bragg highlighting risks such as crypto ATMs, P2P exchanges, and mixers. It also echoes a 2025 memorandum from U.S. Deputy Attorney General Todd Blanche, Ending Regulation of Prosecution, which directs prosecutors not to charge unlicensed money transmission unless there is willful knowledge of the licensing requirement.

Market participants operating in New York should evaluate their compliance with NYDFS requirements and consider legal counsel, noting that licensing can be costly and time-consuming and that criminal penalties could shift enforcement risk toward criminal prosecution. If enacted, New York would become the nineteenth state to criminalize unlicensed virtual currency activity, signaling a substantial shift in the regulatory landscape for digital assets. Ultimately, the CRYPTO Act would heighten the importance of licensing and compliance for crypto firms operating in New York.