NYDFS instructs crypto companies to create COVID-19 contingency plans

The New York Department of Financial Services (NYDFS) has announced that the sanctioned cryptocurrency businesses within the state have to deliver detailed coronavirus contingency plans. While the virus itself poses a serious threat to public health, it also holds the potential to severely damage the financial industry.

The NYDFS detailed its request in a letter sent out this Tuesday, requesting detailed employee protection strategies, disaster communication plans, increased cyber-risk mitigation, and other procedures that would ensure the safety and continued functioning of critical operations. These are all minimum requirements, and the regulator also requested point-on-point plans in case of the snowballing outbreak.

The NYDFS also expressed particular concern regarding potential hacking attacks, as hackers are known to exploit any opportunity caused by fear and confusion to steal money and information. To that extent, it urged companies to consider adding more robust security measures that would detect under-the-radar hacks and suspicious behavior.

The agency went even further, pointing out that remote workers might endanger custodied assets, as the funds get moved between cold and hot storages. The companies were given 30 days to come up with such plans and submit them for review, although the regulator noted that this should be done as soon as possible.

The outlook on the coronavirus outbreak in New York changes severely

By the time the request was published, the state of New York was already days into the state of emergency, triggered by the virus. However, numerous businesses kept working as usual, while debating what, if anything, should be done in response to the crisis.

However, the dynamic started to change in the second half of the week, as the officials started reacting with new instructions. The state governor, Andrew Cuomo, soon declared a moratorium on major gatherings. Simultaneously, the New York City mayor, Bill de Blasio, declared a state of emergency within the city. He warned that the coronavirus could easily become a 6-month crisis.

The business realities, public opinion, and even the government outlook on the situation have seen a drastic shift across this week, as plans that were recently only preventive suddenly became vital for the day-to-day life in the city.