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Alaska adds ‘virtual currency’ to its money transmission regulatory regime

By Darius McQuaid

13:03, 21 December 2022

Alaska Anchorage Downtown Skyline
From 1 January 2023, companies dealing in crypto will have to obtain a money transmission licence in Alaska – Photo: Getty Images

The US state of Alaska will add the term “virtual currency” to its money transmission regulations from next year.

This means from 1 January 2023, companies who deal with or are in the crypto space will have to obtain a money transmission licence in the state, according to global law firm Cooley.

The definition also establishes that virtual currencies will be included in “permissible investments”.

BTC to USD 

The Division of Banking and Securities

Prior to adopting the new rule, the Division of Banking and Securities (DBS), which enforces Alaska’s financial services laws, said it “did not have the jurisdiction to regulate virtual currency activity under its money transmission statute”.  

However, companies that were involved in fiat money and virtual currency were “generally required to obtain an Alaska money transmission licence”, and to do this had to enter into a Limited Licensing Agreement (LLA) with the DBS.

From 1 January 2023 the DBS will phase out the LLA requirement, and LLAs in effect will be voided and removed from the Nationwide Multistate Licensing System and Registry.

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BTC/USD

67,351.45 Price
+0.510% 1D Chg, %
Long position overnight fee -0.0616%
Short position overnight fee 0.0137%
Overnight fee time 21:00 (UTC)
Spread 106.00

SOL/USD

174.39 Price
+2.440% 1D Chg, %
Long position overnight fee -0.0753%
Short position overnight fee 0.0069%
Overnight fee time 21:00 (UTC)
Spread 2.2652

XRP/USD

0.60 Price
+3.070% 1D Chg, %
Long position overnight fee -0.0753%
Short position overnight fee 0.0069%
Overnight fee time 21:00 (UTC)
Spread 0.01168

DOGE/USD

0.13 Price
+6.990% 1D Chg, %
Long position overnight fee -0.0753%
Short position overnight fee 0.0069%
Overnight fee time 21:00 (UTC)
Spread 0.0012872

Alaska’s interest in bitcoin

People living in Alaska are interested in investing in bitcoin (BTC) more than any other cryptocurrency, according to Coin Insider research.

The site analysed Google Trends data to establish the cryptocurrency that residents in each state wanted to invest in the most, based on Google searches.  

Coin Insider found that 10 US states, including Alaska, had the greatest interest in BTC.

However, dogecoin (DOGE) was touted as the most searched for crypto in the US, with 23 states searching for DOGE the most on Google.

A spokesperson for Coin Insider said: “This study offers incredible insight into where these investments are coming from across the US, with dogecoin surpassing bitcoin as the most popular cryptocurrency on the internet. It is fascinating to see currencies that may not be the most valuable are still the most sought after.”

Markets in this article

BTC/USD
Bitcoin / USD
67351.45 USD
338.55 +0.510%
DOGE/USD
DogeCoin / USD
0.1340819 USD
0.0087379 +6.990%

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The difference between trading assets and CFDs
The main difference between CFD trading and trading assets, such as commodities and stocks, is that you don’t own the underlying asset when you trade on a CFD.
You can still benefit if the market moves in your favour, or make a loss if it moves against you. However, with traditional trading you enter a contract to exchange the legal ownership of the individual shares or the commodities for money, and you own this until you sell it again.
CFDs are leveraged products, which means that you only need to deposit a percentage of the full value of the CFD trade in order to open a position. But with traditional trading, you buy the assets for the full amount. In the UK, there is no stamp duty on CFD trading, but there is when you buy stocks, for example.
CFDs attract overnight costs to hold the trades (unless you use 1-1 leverage), which makes them more suited to short-term trading opportunities. Stocks and commodities are more normally bought and held for longer. You might also pay a broker commission or fees when buying and selling assets direct and you’d need somewhere to store them safely.
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