The Bitlicense, issued by the State of New York is one of the most prestigious trading permits in the US. Genesis Global Trading has now become the fifth cryptocurrency platform to be granted the BitLicense. This license, granted by the New York Department of Financial Services (NYDFS) allows cryptocurrency businesses to formally operate from the state of New York.
Genesis Global Trading is an Over-The-Counter (OTC) digital currency trader which offers BTC, BCH, ETC, LTC, ZEC, XRP, and ETH to institutionalized investors. The company had started off in 2013 and has been backed by Barry Silbert’s Digital Currency Group (DCG). The company announced this news via an official press statement. Michael Moro, the CEO of Genesis Global Trading commented:
"We are very pleased that DFS has approved the Genesis Global Trading BitLicense application. Although we have operated under a safe harbor provision in recent years, today's decision is an important step forward and reaffirms the robust compliance measures we have enacted as an established trading partner."
BitLicense: A Rare Honor
The BitLicense was started off in 2015 and has since held some very high standards, approving only 5 companies to operate in the state over the past three years.
While Genesis Global Trading becomes the latest name in the list of companies which have this distinction to operate in the state of New York, other names which hold the BitLicense are Coinbase, bitFlyer USA, Ripple subsidiary XRP II, and Circle Internet Financial. In addition to these names, the Gemini Trust Company owned by the Winklevoss-twins, as well as Paxos have been granted NYDFS charters, but are still awaiting the BitLicense.
Announcing the grant of the BitLicense to Genesis Global Trading, the NYDFS stated in a press statement quoting Financial Services Superintendent Vullo, saying:
“New York continues to lead the nation in regulating the growing fintech industry. These approvals demonstrate DFS’s commitment to protecting consumers and the virtual currency market while encouraging innovation, such as the expanded use of blockchain, and providing strong regulatory oversight to new and existing market participants.”
BitLicense: A Controversial Regulation?
The strict regulations around the Bitlicense have earned it the ire of the cryptocurrency industry as many major names have said that it is an unneeded requirement. Names such as Kraken and ShapeShift have stopped operating in the state since the BitLicense regulations came around.
Even during the recently concluded Consensus 2018 event (check out our coverage of the event: Day 1, Day 2, Day 3), there were some comments against the BitLicense that surfaced. ShapeShift CEO in particular has been leading this fight against the regulation, stating that it is an absolute failure and should be removed. He pointed out that only 5 firms had been approved in the past 3 years - which is a really slow rate of approval.
New York, which is often known as the financial capital of the world - has been a state where innovation has always been given a high priority. However, with the regulators clamping down on crypto-companies with the BitLicense, many have thought of it as anti-innovation and regressive for the crypto community. The controversy around the BitLicense continues.