The Head of MIT Digital Lab digital currency initiative and former senior advisor for mobile innovations at White House, Brian Forde criticized BitLicense 2.0 for making investment into bitcoin companies more problematic. Forde suggested his readers should voice their concerns to Benjamin Lawsky on Twitter.

Brian Forde published his stance on BitLicense 2.0 in the blog on Medium. He starts his analysis with a lengthy explanation of present state of bitcoin and summarizes his critic against BitLicernse 2.0 in the last few paragraphs.

“My goal in writing this post is to share with Superintendent Lawsky, his hardworking staff, and the public, what I believe to be the four critical flaws of the BitLicense and the unintended consequences the regulation will likely create.”

The first critical flaw is the point in BitLicense 2.0. that demands bitcoin companies to check every new update with the regulator. Forde goes as far as saying that this makes NY “backwater of bitcoin in US”.

The second flaw is the problematic investment procedure demanded by BitLicense. According to the text the firms had to register investment round with the regulator. “This will force companies to raise money with at least 12 months of runway as they wait for 50 state approvals, if all states adopt this requirement.”

The third flaw is in the point that requires bitcoin companies to register for two licenses – money transmitter licenses and separate BitLicense. According to Forde, no one likes double dip and not so many companies would like to face this challenge.

The fourth flaw is the demand to register users who use bitcoin wallets. Brian Forde states that in the case of suspected criminal activity law enforcement officials should work with Internet Service Provider and not with the creators of the wallet. “This is wrong leverage point,” states Forde.

At the end of his text, former senior advisor for mobile innovations at White House suggests that people should voice their concerns to superintendent @BenjaminLawsky on Twitter. 

Brian Forde has a long interest in bitcoin. He was involved in Nicaragua where he was Peace Corps volunteer and later founded local phone service provider. After some time he became White House senior advisor for mobile and data innovation. “At the White House he was responsible for determining how the Obama administration would leverage open data and emerging technologies to address the president's national priorities,” says official site of MIT where Forde currently works as Media Lab director for digital currency. 

Four points of Brian Forde look very similar to another four flaws in BitLicense. At the beginning of May, bitcoin wallet provider Coinbase also criticized double licensing, complex investment procedure and bulky system of update regulation. As opposed to Brian Forde Coinbase did not complain against regulation of bitcoin wallets per se, but advised to focus the regulation on bitcoin exchanges. Wallet service also advised their users to use Twitter to reach Benjamin Lawsky.


Roman Korizky