Maryland’s Regulations on Cryptocurrency
Maryland has taken steps to regulate cryptocurrency, but there is still a lot of uncertainty surrounding its legality. As of October 1, 2021, the definition of “money transmission” in Md. Code, Fin. Inst. ยง 12-401(n)(1) includes “currency or value that substitutes for currency,” which provides for digital currency. Companies that deal with virtual currencies must register with the Maryland Commissioner of Financial Regulation and comply with anti-money laundering (AML) and know-your-customer (KYC) regulations.
Baltimore’s Regulations on Cryptocurrency
As part of Maryland, Baltimore follows the state’s cryptocurrency regulations. Therefore, companies that deal with virtual currencies in Baltimore must also register with the Maryland Commissioner of Financial Regulation and comply with AML and KYC regulations.
Federal Regulations on Cryptocurrency
In addition to state regulations, the federal government has also taken steps to regulate cryptocurrency. The Financial Crimes Enforcement Network (FinCEN) issued guidance in 2013 stating that virtual currencies, including Bitcoin, are considered money transmitters and are subject to the same regulations as traditional money transmitters. The Internal Revenue Service (IRS) issued guidance in 2015 stating that virtual currencies are treated as property for tax purposes. The Securities and Exchange Commission (SEC) issued a statement in 2018 that some cryptocurrencies may be considered securities and would therefore be subject to federal securities laws. The Commodity Futures Trading Commission (CFTC) issued guidance in 2019 stating that virtual currencies are commodities and are subject to the same regulations as other commodities, such as oil or gold.
Conclusion:
In conclusion, while cryptocurrency is not illegal in Baltimore, it is subject to various regulations by different government agencies. Companies that deal with virtual currencies must register with the Maryland Commissioner of Financial Regulation, comply with AML and KYC regulations, and may be subject to federal laws by FinCEN, the IRS, the SEC, and the CFTC. Individuals and companies in Baltimore must stay informed about the latest regulations and comply with them to avoid any legal issues related to cryptocurrency.
