New York Crypto Laws
Cryptocurrencies and other blockchain-based products such as Non-Fungible Tokens (NFTs) have taken the internet and investing world by storm in recent years. These technologies can potentially change how companies across the globe do business, invest capital, and verify ownership and other requirements in complex financial transactions.
Warren Law Group is on the cutting edge of blockchain technology and cryptocurrencies. Currently, we serve FinTech and Crypto-based ventures supporting and managing various aspects of their blockchain-based operations. Cryptocurrency will undoubtedly become a universally accessible and accepted payment method in the coming years, and Warren Law Group is one of the first law firms currently accepting certain cryptocurrencies as payment.
Our experience and expertise in the securities industry provide the foundation for our robust practice group. We offer a spectrum of services related to transactions, regulatory investigations, and litigation. Whether you are contemplating an initial coin offering, are in dispute over a Non-Fungible Token (NFT) or have received a subpoena from the SEC or CFTC, we can provide expert legal counsel. We recognize that blockchain technology and cryptocurrencies are rapidly growing and believe they will drive the global economy going forward. Warren Law Group attorneys are up to date on the latest crypto developments in government oversight and regulation. Our aim is to help our clients leverage the opportunities they see in the market while remaining in compliance with the latest rules and regulations as promulgated by the SEC and CFTC.
Our legal team’s blockchain practice focuses on cryptocurrency offerings, escrow for off-exchange private crypto-transactions, Bitlicense registration/compliance, and performing due diligence for crypto-investors on various crypto-opportunities. Our services also include providing sound business advice and guidance to players in the cryptocurrency industry. Warren Law Group's attorneys can assist cryptocurrency startups in the Initial Coin Offering (ICO) process by keeping their offerings compliant with SEC and FINRA rules and regulations. For instance, there is a significant difference between the SEC's treatment of a true "utility token" from a cryptocurrency-in-disguise. Whether your coin is considered a utility token or a cryptocurrency depends on how your smart contract is structured. Bottom line, the professionals at the Warren Law Group can help mitigate unnecessary regulatory risk so you can focus on expanding your business.
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Frequently Asked Questions
- Blockchain is a decentralized software application that tracks data by validating and storing data in blocks that are strung and linked together chronologically in an immutable chain. The data blocks are linked together through the use cryptographic “hash” of the previous block, a timestamp, and transaction data.
- “Hashing” is method that uses algorithms to both mathematically encrypt the data blocks and connect and string them into a chain.
- The data commonly consists of transactional information recorded in ledgers, such as cryptocurrency exchanges, property purchases, health records, credentials, and many others. The ledgers are distributed across many individual computer servers (called nodes) through a peer to peer (P2P) network.
- All nodes across the blockchain ecosystem receive the same continuous stream of data and updates simultaneously, which can be transmitted privately and anonymously. The network does not use a third-party intermediary to manage, monitor, or interfere with transactions. There is no central authority to approve transactions.
- The blockchain system is self-regulating due to the P2P computer network of nodes which all verify incoming data and distribute copies of the data across the network. Once all the nodes verify and agree on the data, only then does the data become recorded into blocks and linked into a chain.
- The data chain is immutable and irreversible due to the hash encryptions, and because all activity on the chain is public across the network and seen by all the nodes. Altering a block of data is virtually impossible because doing so would necessitate, publicly across the P2P network, cracking the encryptions of all subsequent blocks of data on the chain to get to the block one wants to alter.
- Blockchain technology was created to allow for the existence of cryptocurrency like Bitcoin. But Blockchain technology transcends crypto currencies and has applications for all types of data storage.
- Cryptocurrency “coins” are digital currencies that are powered and secured by blockchain technology, rather than a centralized government authority. These coins are essentially packets of immutable math code that a blockchain P2P network of computer servers (nodes) allows to be distributed, bought, and sold on the network.
- Transactions on the blockchain are only recorded after unanimous validation by all the nodes in the network. Transactions are validated securely and publicly on the blockchain. At the inception of a blockchain’s creation, irreversible rules are set regarding how many coins there ever will be and how to create new coins (mining).
- Miners are networks of computer servers that validate coin transactions to enable their recording on the blockchain. Build into a blockchain’s software are rules that encourage miners to validate these transactions. Miners that solve certain mathematical problems fast enough will then link the next block of data onto the chain and receive a coin as a reward. Often the number of coins that can ever be available is finite; therefore, over time the blockchain software makes the mathematical problems harder for miners to solve.
- There are hundreds of different types of cryptocurrencies. Some of the most well-known include:
Advantages of using crypto:
- No central government authority to create excess coins / Protection from Inflation
- Secure and private
- Removes the middle man aka a bank, hence cost effective
- Greater liquidity
- Widely and universally used
- High transaction speeds with low costs
- No refund and cancellation policy for incorrect transactions
- Risk of data loss
- Hard for government to track illegal transactions and theft
- High risk and high volatility
- More vulnerable to scams and hackers
- High energy consumption due to miners
Like cryptocurrencies, they are immutable code, cryptographic assets, transacted and recorded on a blockchain. They differ from cryptocurrencies in that they are non-fungible; in other words, they are not identical. A unique encrypted identification code and metadata distinguish one NFT from other NFTs. Bitcoin for example is fungible; if you trade one Bitcoin for another Bitcoin, you'll get exactly the same thing. A one dollar bill is fungible because any particular one dollar bill in your pocket is no different from any other one dollar bill circulating. It is this very fungibility which allows dollars, other fiat currencies, and cryptocurrencies to be mediums of exchange in commerce. On the other hand, a famous Picasso is non-fungible as it is unique.
Meet Our Blockchain Offerings, Cryptocurrency Defense and Investigations Attorneys
Click on the photos below to see the WLG team members who can assist in resolving your matter.
Christopher D. Warren - Managing Partner
Todd P. Kulkin - Of Counsel
Jon-Jorge Aras - Partner
David Szalyga - Associate
Why Choose Us?
Blockchain and Web3 are the future, and if you are involved in this emerging industry, it is critical that you have legal counsel well versed in the complexities of securities law and how tokenization and the blockchain function. Our attorneys serve as legal counsel to various crypto-based projects, including DAOs, in fintech, proptech, and legaltech. Our attorneys are not only excellent at their craft, but they have a passion for the possibilities of the future in blockchain, which allows them to provide superb service and counsel to our clients.