Leading Devs Speak Out Against NY's BitLicense Proposal

One element of the BitLicense proposal that has proved controversial is how it could be interpreted as applying to the developers of the more than 400 alternative digital currencies currently in circulation.

With this in mind, CoinDesk reached out to a number of leading altcoin developers and communities for comment on how they view the proposal and how they believe they would be affected by the laws.

Criticism widespread. While many developers had their own insights into the scope of the regulatory framework, nearly all agreed on two points - that the cost pressures that could arise from the BitLicense would be magnified for alt projects, and that it will be nearly impossible for New York to regulate an open-source process.

Notably, all the altcoin developers CoinDesk spoke with said that regulators would be unable to stop altcoin projects from operating within New York regardless of whether they applied for a BitLicense.

Altcoin developers suggested that if the BitLicense is applied to altcoin projects, it would reflect what feathercoin developer 'mnstrcck' called "a misunderstanding of what the technology is at its roots, and what it means".

Bryce Weiner, altcoin developer and director of cryptoeconomy engineering for Blockchain Technology Group, said that on a broader level, the BitLicense framework ignores the potential application of block chain technology to use cases beyond finance.

When asked if the altcoin market needs broader consumer protections - ostensibly the goal of any BitLicense or similar framework applied to that space, developers were split on the need for such rules.

Vertcoin's Adam suggested that regulators should focus regulation on the bad actors in the space rather than developers who are trying to create legitimate block chain networks and build out services.

Many developers said that a more appropriate alternative to a centralized regulatory framework like the BitLicense would be for the community to come together to develop a series of standards by which project development could operate.

As many developers told CoinDesk, the diverse nature of the altcoin ecosystem makes it difficult to apply what is largely a financial services framework.