Under its ongoing VOLT initiative to strengthen the oversight of virtual currencies, the New York State Department of Financial Services (NYDFS) announced a set of guidelines for supporting cryptocurrency companies to draft policies for listing and delisting tokens.

The department needs state-registered crypto firms to submit new policies for listing and delisting tokens. The common public is open to comment, until Oct.20, 2023, on the proposed legislation.

The three main aspects of the framework issued today are as follows:

1. Governance of the listing process
2. Risk assessment of tokens
3. Procedures for monitoring tokens

Delisting policies, first among the new guidance, require companies to provide detailed explanations on how they decide to delist tokens, including causes that may lead to delisting and the execution plan like notifying customers in advance and conducting impact analysis.

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What Harris Highlights: NYDFS Superintendent Adrienne Harris highlighted that the new framework is highly important to make standards around coin offerings more robust.

Under her leadership in the past two years, the Department has imposed more than $132 million in penalties against virtual currency companies which include exchange Coinbase (NASDAQ:COIN) and online trading platform Robinhood’s (NASDAQ:HOOD) crypto unit. The department has also added 60 experts in its virtual currency unit to oversee licensing and strengthen supervision.

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Broader VOLT Initiative: Under the VOLT initiative, eight pieces of innovative industry regulatory guidance were issued. This included the first-ever regulatory guidance setting foundational criteria for USD-backed stablecoins issued by DFS-regulated entities, guidance to better protect customers in the event of a virtual currency insolvency or similar proceeding, and guidance for establishing the use of blockchain analytics tools to prevent and manage financial risks and suspicious activities.

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