On October 1, NYDFS and the Wyoming Division of Banking announced a memorandum of understanding (MOU) to facilitate coordinated oversight of entities engaged in virtual currency and digital asset activities in the two states. According to the announcement, the regulators intend to cooperate on examinations, enforcement, licensing and supervision. Under the MOU, when an entity licensed or chartered by one regulator applies to the other, the existing regulator will share information on request to help with the prospective regulator’s review, and will confer to align their licensing decisions where possible. The MOU also provides a mechanism for expedited review for licensed entities where: (i) the applicant has operated under the existing regulator’s oversight for at least three years; (ii) it is not under an enforcement action; and (iii) its proposed business models in the two states are sufficiently similar. Expedited review depends on the existing regulator providing all requested historical examination information, and the prospective regulator will aim to provide a decision within six months of the later of the application date or the date the existing regulator sends the requested information.

For entities licensed or chartered in both states, the regulators will seek to coordinate examination schedules and undertake joint examinations “to the greatest extent practicable.” They will also share examination and supervisory reports and notify each other when a dually licensed entity is reasonably believed to be facing an enforcement action, which may be brought jointly, in coordination, or separately. Information shared under the MOU is treated as confidential “Non-Public Information” that remains the property of the providing regulator and may be used only for regulatory purposes and not disclosed to third parties without consent, except as required by law. The MOU does not create enforceable rights or limit either regulator’s authority to act against any person, and either party may terminate it with 30 days’ written notice.