Speaking at the Digital Asset Compliance and Market Integrity Summit held in Manhattan, Harris touched upon the importance of the innovations that federal crypto legislation will bring, and pointed out the need to protect the states’ ability to act quickly in this area and their supervisory skills.

“States have the ability to move faster,” Harris said. It was thought that states’ regulation of digital assets was creating a ‘race to the bottom’. However, we see that these concerns are no longer valid,” he said. He stated that states create a healthy balance in the sector with their own regulations, encouraging innovation and ensuring consumer protection.

New York’s BitLicense went into effect in 2015 and has served as inspiration for other regulatory systems around the world. Harris stated that BitLicense has an impact on regulations in other countries and noted that this regulation is also taken as an example in places such as Singapore and the European Union.

“We are perhaps the most eager to find a federal partner,” Harris said. “We want to see federal laws passed and regulations written, but it is extremely important that states also have a role in this process,” he said.

He noted that NYDFS plays a major role in regulating cryptocurrencies and has a team of 60 full-time employees in this field. This team follows the developments in the crypto industry, carries out the necessary audits and updates the regulations.

Harris stated that public opinion of BitLicense has become more positive over time. He stated that members of the federal legislature also appreciated New York’s approach, citing BitLicense as an example. However, Harris acknowledged that this system is not perfect and there are some valid criticisms.

“Although BitLicense has received mixed criticism, it has attracted the attention of regulators in places like California, Illinois, Nebraska, and even the European Union and Singapore. “States and countries are trying to develop their own approaches, inspired by this regulation,” he said.

Harris also emphasized the importance of cooperation between federal and state regulators, stating that both parties should maintain their supervisory roles over digital assets and cryptocurrencies.

He said that states should improve regulations on crypto assets, benefiting from their own experiences. The rapidly changing dynamics of cryptocurrencies require regulators to constantly review their strategies in this area, he said.

“Providing greater regulatory clarity around cryptocurrencies will both increase the credibility of the industry and strengthen consumer protection,” Harris said. He pointed out that states have a critical importance in ensuring innovation and consumer protection by creating a healthy balance in the sector with their own regulations.

In this context, he underlined that in the event of federal laws being enacted, the existing control powers of the states should be preserved. Today, when crypto currencies are growing and developing rapidly, such collaborations will both increase the effectiveness of regulations and create more trust in the market.