Rhode Island Cryptocurrency Laws
Chapter 19-14.3 Sale of Checks and Electronic Money Transfers
“Money Transmitter” Definition
“Electronic money transfer” means receiving money for transmission within the United States or to locations abroad by any means including, but not limited to, wire, facsimile, or other electronic transfer system. 19-14-1
No license to sell checks or engage in the business of electronic money transfers shall be required of any: (1) Regulated institution, bank, or credit union organized under the laws of the United States, or subject to written notice with a designated Rhode Island agent for service of process in the form prescribed by the director, or the director’s designee, of any other state within the United States if the laws of the other state in which such bank or credit union is organized authorizes under conditions not substantially more restrictive than those imposed by the laws of this state, as determined by the director, or the director’s designee, a financial institution or credit union to engage in the business of selling checks or electronic money transfers in the other state; no bank or credit union duly organized under the laws of any other state within the United States may receive deposits, pay checks or lend money from any location within this state unless such bank or credit union has received approval from the director, or the director’s designee, for the establishment of an interstate branch office pursuant to chapter 7 of title 19; (2) Natural person employee who is employed by a licensee when acting on the licensee’s behalf; or (3) Agents any licensee shall designate or appoint. No sale of check or electronic money transfer licensee shall be required to obtain a branch office license pursuant to § 19-14-12, or shall be subject to the provisions of § 19-14-24, or shall be required to obtain a license pursuant to chapter 14.4 of this title for check-cashing services incidental to the sale of checks and electronic money transfers and the person charges not more than fifty cents ($.50) per check cashed. 19-14.3-1
$360 Annual fee for electronic transfer license
Bond and Insurance Requirements
(a) An applicant for any license shall file with the director, or the director’s designee, a bond to be approved by him or her in which the applicant shall be the obligor. (b) The amount of the bond shall be as follows: (4) Sale of checks and electronic money transfer licensees, the sum of fifty thousand dollars ($50,000) subject to a maximum of one hundred and fifty thousand dollars ($150,000) when aggregated with agent locations. 19-14-6
Bond Alternatives and Additional Insurance Requirements
In lieu of the required surety bond or bonds, or of any portion as required by chapter 14, the applicant may deposit with the director, or the director’s designee, with the financial institutions, credit unions, or national banks in this state that the applicant may designate and the director, or the director’s designee, may approve, United States government/agency obligation or state obligations, to an aggregate amount, based upon principal amount or market value, whichever is lower, of not less than the amount of the required surety bond. The securities shall be deposited and held to secure the same obligations as would the surety bond, but the licensee shall be entitled to receive all interest and dividends thereon, shall have the right, with the approval of the director, or the director’s designee, to substitute other securities for those deposited, and shall be required to substitute securities on the written order of the director, or the director’s designee. 19-14.3-2
Each licensee, licensed pursuant to an application for license filed after June 30, 1995, shall maintain the following minimum-net worth to be evidenced in accordance with regulations promulgated by the director, or the director’s designee. (4) Sale of checks, the sum of fifty thousand dollars ($50,000). 19-14-5
Money Transmission License Required for Crypto Exchange?
State Comments or Statements
Money or payment instrument is not defined. When money is not defined, there is a reasonable assumption that virtual currencies are deemed money or otherwise used as medium of exchange. Until such time that the State or the courts of Rhode Island opine on this subject matter, we consider this to be a state that would likely require a money transmitter license.