The New York State Department of Financial Services has offered Bitcoin exchange Coinbase a special license to do commercial enterprise in the country. Although Coinbase has been allowed to serve New York clients under a secure-harbor provision even as the software technique was being conducted, the formal award of the BitLicense solidifies the exchange’s working status.
Coming at a time while the Bitcoin exchange has been waging what may be a costly criminal battle with the IRS to protect its client information, the license is being defined as a validation of Coinbase’s goal to be compliant with regulatory considerations.
Coinbase CEO, Brian Armstrong stated:
“At Coinbase, our first priority is to be sure that we work with the most safe and compliant digital Bitcoin and other cryptocurrency exchange in the world. We’re pleased to have received the BitLicense and hope to increase our business in New York.”
The license was granted after a complete assessment of Coinbase’s anti-money laundering, capitalization, customer safety and cyber security policies, according to the New York State Department of Financial Services. The organization can be subject to ongoing supervision by the regulator.
Coinbase, Bitcoin exchange based in San Francisco, is one of the most closely funded startups in the business, having raised $117 million in venture capital. Officially launched in June 2015, the BitLicense was designed to offer a framework for organizations trying to custody bitcoin and different cryptocurrencies for their clients or trade the cryptocurrency.
However, after an initial 22 programs were dispatched in, the debatable license proved too costly for many startups. In reality, that is just the 1/3 BitLicense to be offered nowadays, with multiple apps have been denied. In September 2015, Circle based in Boston was granted the primary BitLicense, although by December 2016 the organization had pivoted away from its bitcoin exchange to focus more on cryptocurrency payments.
In July, Ripple based in San Francisco was offered the second BitLicense. The New York State Department of Financial Services has granted banking charters to bitcoin startups Gemini trust organization and itBit trust organization.
Financial services Superintendent Vullo said:
“New York is dedicated to fostering and encouraging the long-term increase of latest industries in the country while implementing all essential safeguards to protect our markets and clients.”