N.Y. Comp. Codes R. & Regs. tit. 23 § 200.2

Current through Register Vol. 46, No. 51, December 18, 2024

Section 200.2 - Definitions

For purposes of this Part only, the following definitions shall apply:

(a)Affiliate means any Person that directly or indirectly controls, is controlled by, or is under common control with, another Person;

(b)Cyber Security Event means any act or attempt, successful or unsuccessful, to gain unauthorized access to, disrupt, or misuse a Licensee's electronic systems or information stored on such systems;

(c)Department means the New York State Department of Financial Services;

(d)Exchange Service means the conversion or exchange of Fiat Currency or other value into Virtual Currency, the conversion or exchange of Virtual Currency into Fiat Currency or other value, or the conversion or exchange of one form of Virtual Currency into another form of Virtual Currency;

(e)Fiat Currency means government-issued currency that is designated as legal tender in its country of issuance through government decree, regulation, or law;

(f)Licensee means any Person duly licensed by the superintendent pursuant to this Part;

(g)New York means the State of New York;

(h)New York Resident means any Person that resides, is located, has a place of business, or is conducting business in New York;

(i)Person means an individual, partnership, corporation, association, joint stock association, trust, or other entity, however organized;

(j)Prepaid Card means an electronic payment device that:

(i) is usable at a single merchant or an affiliated group of merchants that share the same name, mark, or logo, or is usable at multiple, unaffiliated merchants or service providers;

(ii) is issued in and for a specified amount of Fiat Currency;

(iii) can be reloaded in and for only Fiat Currency, if at all;

(iv) is issued and/or reloaded on a prepaid basis for the future purchase or delivery of goods or services;

(v) is honored upon presentation; and

(vi) can be redeemed in and for only Fiat Currency, if at all;

(k)Principal Officer means an executive officer of an entity, including, but not limited to, the chief executive, financial, operating, and compliance officers, president, general counsel, managing partner, general partner, controlling partner, and trustee, as applicable;

(l)Principal Stockholder means any Person that directly or indirectly owns, controls, or holds with power to vote ten percent or more of any class of outstanding capital stock or other equity interest of an entity or possesses the power to direct or cause the direction of the management or policies of the entity;

(m)Principal Beneficiary means any Person entitled to ten percent or more of the benefits of a trust;

(n)Qualified Custodian means a bank, trust company, national bank, savings bank, savings and loan association, federal savings association, credit union, or federal credit union in the State of New York, subject to the prior approval of the superintendent. To the extent applicable, terms used in this definition shall have the meaning ascribed by the Banking Law;

(o)Transmission means the transfer, by or through a third party, of Virtual Currency from a Person to a Person, including the transfer from the account or storage repository of a Person to the account or storage repository of a Person;

(p)Virtual Currency means any type of digital unit that is used as a medium of exchange or a form ofdigitally stored value. Virtual Currency shall be broadly construed to include digital units of exchange that (i) have a centralized repository or administrator; (ii) are decentralized and have no centralized repository or administrator; or (iii) may be created or obtained by computing or manufacturing effort. Virtual Currency shall not be construed to include any of the following:

(1) digital units that (i) are used solely within online gaming platforms, (ii) have no market or application outside of those gaming platforms, (iii) cannot be converted into, or redeemed for, Fiat Currency or Virtual Currency, and (iv) may or may not be redeemable for real-world goods, services, discounts, or purchases.

(2) digital units that can be redeemed for goods, services, discounts, or purchases as part of a customer affinity or rewards program with the issuer and/or other designated merchants or can be redeemed for digital units in another customer affinity or rewards program, but cannot be converted into, or redeemed for, Fiat Currency or Virtual Currency; or

(3) digital units used as part of Prepaid Cards;

(q)Virtual Currency Business Activity means the conduct of any one of the following types of activities involving New York or a New York Resident:

(1) receiving Virtual Currency for Transmission or Transmitting Virtual Currency, except where the transaction is undertaken for non-financial purposes and does not involve the transfer of more than a nominal amount of Virtual Currency;

(2) storing, holding, or maintaining custody or control of Virtual Currency on behalf of others;

(3) buying and selling Virtual Currency as a customer business;

(4) performing Exchange Services as a customer business; or

(5) controlling, administering, or issuing a Virtual Currency.

The development and dissemination of software in and of itself does not constitute Virtual Currency Business Activity.

N.Y. Comp. Codes R. & Regs. Tit. 23 § 200.2

Adopted New York State Register June 24, 2015/Volume XXXVII, Issue 25, eff.6/24/2015