Staff at California's Department of Business Oversight have concluded that the department has the authority to regulate Bitcoin but are yet to elaborate on just how they intend to do so. The perceived authority to regulate Bitcoin came about after staff at the DBO came to a consensus that the state's laws which govern money transmitters such as Western Union also applies to Bitcoin.
In a telephone interview with Bloomberg, DBO spokesman Tom Dresslar stated:
"The consensus among staff is that the department and commissioner could regulate virtual currency, to some extent, under current state law.. Consumers would be the prime concern of any regulatory structure we build — making sure they are fully aware of the risks associated with virtual currency and providing effective, reasonable safeguards against those risks.
This is not the first time that California's DBO has had concerns for consumers and their use of Bitcoin. In April of this year, they released an advisory titled "What You Should Know About Virtual Currencies" in which they warned consumers that use of Bitcoin risked association with criminal enterprises who use it for illegal drug transactions, arms trading and money laundering.