Rhode Island Currency Transmission Act Virtual Currency Amendments

The amendments replaced the older “sale of checks and electronic money transfers” framing for Chapter 19-14.3 with a broader “Currency Transmissions” structure. In the amended definition, currency transmission includes receiving money or monetary value for transmission or holding funds incidental to transmission, and the statutory text adds that this includes maintaining control of virtual currency or transactions in virtual currency on behalf of others.

The framework is administered through the Rhode Island Department of Business Regulation, Division of Banking. The bill text defines the department for Chapter 19-14.3 purposes and uses the Nationwide Multistate Licensing System for license and reciprocity functions. A person is treated as engaged in currency transmission in Rhode Island when the person enters into a transaction with someone physically located in or resident in Rhode Island at the time the transaction is initiated.

The amendments define several virtual currency concepts for licensing and consumer-facing obligations. “Control” includes the power to execute unilaterally or prevent indefinitely a virtual currency transaction. “Exchange” covers assuming control of virtual currency from or on behalf of a resident to sell, trade, or convert virtual currency for legal tender, bank credit, or another form of virtual currency. “Store” means maintaining control of virtual currency on behalf of a resident by a person other than the resident, while “transfer” includes crediting, moving, or relinquishing virtual currency after assuming control from or on behalf of a resident.

• Licensing trigger: persons engaged in currency transmission in Rhode Island generally need a license unless an exemption applies.
• Virtual currency business activity: the statute covers exchanging, transferring, or storing virtual currency, including activity performed through a control-services vendor.
• Disclosures: licensees engaged in virtual currency business activity must provide required disclosures to residents using their virtual currency products or services.
• Transaction confirmations: after a virtual currency transaction, the licensee must provide a record with contact information, transaction details, and fees.
• Safekeeping rule: a licensee controlling virtual currency for one or more persons must maintain enough of each type of virtual currency to satisfy aggregate customer entitlements.

The amendments combine licensing with disclosure, custody, and compliance provisions. Required disclosures include information about fees, insurance or guarantee coverage, transfer irrevocability, liability for unauthorized or mistaken transfers, and the fact that virtual currency is not legal tender. The custody provision states that controlled virtual currency is held for the persons entitled to it, is not property of the licensee, and is not subject to claims of the licensee’s creditors.

The law also requires policies and procedures for information security, operational security, business continuity, disaster recovery, anti-fraud, anti-money-laundering, and related programs. Prohibited acts include failing to comply with the Bank Secrecy Act and FinCEN registration requirements, failing to safeguard identifying information, using false or misleading advertising, and engaging in unfair, deceptive, or fraudulent practices.

H 5847 completed legislative action when it was signed by the governor on July 15, 2019. The act itself provides an effective date of January 1, 2020. Later Rhode Island amendments, including 2025 provisions for virtual currency kiosk operators, added more detailed kiosk registration, anti-fraud, and transaction requirements to the same statutory chapter. This profile focuses on the baseline virtual currency money-transmission amendments rather than the later kiosk-specific overlay.

The law should be read as a state licensing and regulatory perimeter profile, not as legal, tax, investment, or trading advice. Businesses and readers should consult the current Rhode Island General Laws and regulator materials for the operative statutory text and any subsequent amendments.