New York Denies US-based Crypto Exchange Bittrex BitLicense Application
The New York Department of Financial Services (NYDFS) has denied leading United States-based cryptocurrency exchange Bittrex a BitLicense. This news comes via a letter published on the NYDFS’ official website earlier today.
In the letter, addressed to Bittrex CEO Bill Shihara, the NYDFS explained that exchange had insufficient policies pertaining to Anti-Money Laundering (AML), Know Your Customer (KYC), and Office of Foregin Assets Control (OFAC) standards. Per the NYDFS, the agency had already issued multiple compliance letters to Bittrex “to address continued deficiencies and to assist Bittrex in developing appropriate controls and compliance programs commensurate with the evolving nature of the sector.”
Bittrex originally applied for its BitLicense more than three and a half years ago, in August 2015. Had the exchange been granted a BitLicense, it would have been able to conduct crypto-related business in New York City. However, now that it has been rejected, New Yorkers will continue to be blocked from trading on Bittrex. The exchange had been operating under the terms of a “safe harbor” allowed by the NYDFS while it was considering its application. Now, however, Bittrex has been ordered to discontinue all business operations in New York State by tomorrow, and must submit a letter to the NYDFS that it has done so, within the next two weeks.
Ironically, this news comes only one day after a subsidiary Belgium-based crypto exchange, Bitstamp, received a BitLicense, as Cryptos reported. And perhaps even more ironically, just yesterday, two members of the United States House of Representatives reintroduced the Token Taxonomy Act, which would not only exempt cryptocurrency from securities law, but include provisions that would supercede regulations like New York’s BitLicense, which the lawmakers called “heavy-handed” and “onerous.” The general goal of the act is to encourage crypto and blockchain innovation in the United States by creating a more friendly environment in which to operate.