In the recently issued final ruling concerning prepaid accounts, the Bureau of Consumer Financial Protection (CFPB) has stated that virtual currency and related products and services are outside the scope of the new rule.



The final rule will be effective on 01 October 2017. The CFPB stated:



“[A]lthough the Bureau received some comments addressing virtual currency products and services, the Bureau reiterates that application of Regulation E and this final rule to such products and services is outside of the scope of this rulemaking. However, the Bureau notes that as part of its broader administration and enforcement of the enumerated consumer financial protection statutes and title X of the Dodd-Frank Act, the Bureau continues to analyze the nature of products or services tied to virtual currencies.”



The bureau said that it received a number of comments on whether it should regulate virtual currency products and services under this final rule. Commenters included banks, a digital wallet provider, a virtual currency exchange, industry trade associations, consumer advocacy groups, a law firm representing a coalition of prepaid issuers, and a non-governmental virtual currency policy organization.



The Chamber of Digital Commerce, a trade association dedicated to promoting the understanding, acceptance and use of digital assets and blockchain technology, submitted comments to the proposed rule emphasizing that virtual currencies should not be regulated as prepaid financial products. It has welcomed the final ruling and said:



“The Chamber is encouraged that the CFPB has taken its input into account in its new rule, and looks forward to continuing to consider and develop appropriate regulation impacting virtual currencies, digital assets, and blockchain technology with the CFPB and the many other agencies that have taken an interest in the technology.”



Coin Center also filed a comment in this regard asking the CFPB to include a formal exemption of virtual currency products within the final rulemaking. With this new rule, Coin Center pointed out that it doesn’t say that digital currency products are outside the scope of these regulations, adding:



“It [final rule] only says that the question, "are virtual currency products regulated under Regulation E or this final rule?" is outside the scope of this particular rulemaking. So the result is that we still don't know. That's better than an explicit statement that these ill-fitting regulations definitely apply right now to digital currency products, and it allows the CFPB to take more time studying the question (as we asked them to do), but it doesn't provide any certainty for innovators wondering whether their products are covered today, either. We'll have to keep waiting.”