McDermott Will & Schulte, a global law firm

International law firm McDermott Will & Emery assisted Atomyze LLC in obtaining a legal interpretive opinion from the State of California’s Department of Financial Protection and Innovation (DFPI) deciding that Atomyze can launch its blockchain business in California without obtaining a California money transmitter license.

DFPI concluded that Atomyze, a progressive digital asset company, does not need to obtain a money transmitter license under the California Money Transmission Act. Atomyze can now launch in the key jurisdiction of California.

Atomyze assists owners of large amounts of metal, primarily palladium and platinum, by creating groundbreaking digital assets—“Metal Asset Backed Tokens” or “Metal ABTs”—that represent interests in those metals. The metals backing the Metal ABTs are stored in secured vaults, and owners of Metal ABTs maintain the right to redeem those Metal ABTs for the actual physical delivery of the underlying metals. Atomyze facilitates the purchase and trading of Metal ABTs on its platform.

DPFI concluded that:

• Providing technical services to assist in the creation of a Metal ABT . . . and issuing a digital wallet holding the Metal ABT does not require licensure.
• The fiat currency-related services facilitating the sale of Metal ABTs . . . does not require licensure.
• The Department does not require licensure under the MTA for Atomyze to facilitate the sale of Metal ABTs.

McDermott Partner John T. Lutz said the following: “We are proud partners with Atomyze. Atomyze will revolutionize trading in precious metals.”

“It is a rarity in this industry to bridge the gap between the physical world, and blockchain and Atomyze present a real use case that could alter the way an entire asset class trades,” said McDermott Partner Joseph B. Evans.

The McDermott team’s primary task on behalf of Atomyze was to roll out Atomyze nationwide by obtaining state money transmitter licenses from each jurisdiction that required a license for Atomyze’s blockchain business activities. McDermott is seeking money transmitter licenses in all of the necessary jurisdictions, along with “no action” and similar relief in other jurisdictions where the money transmitter regulatory regime is unclear for blockchain and digital asset companies.

The McDermott team is led by John T. Lutz, Joseph B. Evans and Alexandra Scheibe with assistance from Leon Jun, Tony Koulotouros and Matthew Stern.

McDermott’s cross-disciplinary FinTech and Blockchain team understands the complex legal and business challenges that face industry participants. This team includes lawyers from across the Firm’s major practice areas, including corporate, finance, global privacy and cybersecurity, government and lobbying, intellectual property, litigation, technology and commercial transactions, and white-collar and securities defense. McDermott has been a leader in cryptocurrency and blockchain-related laws for years and has been regularly breaking new ground in decisions from regulators and in some of the industry’s most prominent litigations.

McDermott Will & Emery partners with leaders around the world to fuel missions, knock down barriers and shape markets. Our team works seamlessly across practices, industries and more than 20 locations to deliver highly effective—and often unexpected—solutions that propel success. More than 1,200 lawyers strong, we bring our personal passion and legal prowess to bear in every matter for our clients and the people they serve.