The cost of running a crypto business in New York is about to rise with the state government gearing up to require companies holding a BitLicense to pay assessment fees to ensure they’re complying with regulations.

The rule was included in New York State’s FY2023 budget signed into law on April 9 by Governor Kathy Hochul, giving the state’s Department Of Financial Services (DFS) a “new authority to collect supervisory costs from licensed virtual currency businesses,” according to a statement by the DFS.

DFS superintendent Adrienne Harris said the fees would bring digital currency businesses in line with those already paid by institutions such as banking and insurance companies and added:

“New York was the first to start licensing and supervising virtual currency companies, and we continue to attract more licensees and the most crypto startup funding of any state in the nation.”

The state of New York was the first in the United States to require crypto companies to be licensed with the introduction of the now known “BitLicense.” The application fees for such a permit are currently $5,000 and are subject to vague capital requirements determined by the New York DFS.

The annual assessment fee amount that the DFS will charge crypto firms is currently unknown, but the same fees for other regulated financial institutions can cost tens of thousands of dollars a year.

The DFS states the fees are to assist with paying the operating expenses of regulating crypto firms and “will empower the Department to build staff with the capacity and expertise to best regulate and…

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