New York's demanding approach to regulating digital assets, long a source of complaint in the crypto industry, is increasingly held up elsewhere as a template. The state's licensing regime forces firms to meet capital, custody, and disclosure standards that many jurisdictions lack.

Companies that once threatened to leave are instead building compliance teams to stay. The fictional exchange Empire Digital says operating under New York's rules has become a selling point with cautious institutional clients.

Critics argue the strict regime stifles innovation and pushes startups to friendlier states. But after years of high-profile blowups elsewhere, New York's regulators contend their caution has been vindicated — and firms that want the city's customers are learning to live with it.