NY Regulator Drops Crypto Guide as She Steps Down

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In the quiet, stubborn light of a city that keeps its ledgers like old dogs keep their bones, Adrienne Harris stood at the doorway of the New York Department of Financial Services and spoke of a map that might change if a crypto company should stumble. Then she stepped away from the podium, as if stepping away from a long, tired road that never quite reaches the horizon.

In a Tuesday notice, Harris said the NYDFS had updated guidance first announced in January 2023 to better protect users “in the event of an insolvency or similar proceeding.” The document itself looked simple enough, a ledger kept honest: clarifying what were “acceptable sub-custodians,” guardrails for crypto custody, and “permissible uses of customer assets.” A dry wind, but with teeth.

“As we see the use of more sub-custodial relationships in the digital asset space, this guidance provides additional clarity on how those relationships should be governed,” Harris said, as if explaining to a stubborn mule how to count coins. 😂

Harris announced the updates less than 24 hours after New York Governor Kathy Hochul said the NYDFS superintendent would step down on Oct. 18, having served at the department for about four years. Kaitlin Asrow, an executive deputy superintendent, would replace Harris as acting superintendent, presumably until a permanent head could be found. The news came on the wind of change, a whisper that the city itself seemed to carry in its bones.

Guidance for crypto users

Among the NYDFS’ updates to the 2023 guidance were that custodians were required to keep users’ crypto in “separate onchain wallets” or “one or more omnibus onchain wallets” with internal ledger accounts. The language read like a ledger’s own confession, plain and unglamorous.

It added that custodians should not use customers’ crypto as their own, e.g., to secure credit. No borrowing against someone else’s dreams, no turning the coins to light a cigarette in the dark.

As New York’s financial regulator, the NYDFS is responsible for overseeing crypto companies operating in the state or offering products or services to residents. The department launched its BitLicense program in 2015, which is required for any digital asset business in the state. The city wears that license like a badge that has learned to bend with the wind but not break.

Change in New York leadership

In addition to Harris’ impending departure, New York City Mayor Eric Adams announced on Sunday that he would not be seeking reelection in 2025. Adams, who was elected in 2021 after campaigning on receiving his first three paychecks in Bitcoin, has been outspoken on policies favorable to the crypto industry. He has criticized the BitLicense program, proposed that New York adopt BTC-backed municipal bonds, and hosted a crypto summit in May at the city’s mayoral residence. The city, it seems, marches to the clink of coins and the glow of screens, a place where hope and skepticism glare at each other across the same table. 🗽💰

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2025-09-30 20:56