US Subsidiary of Bitstamp Receives BitLicense from NY Regulator
Bitstamp USA, the United States subsidiary of leading Luxembourg-based cryptocurrency exchange Bitstamp, has been awarded a BitLicense from New York State’s financial regulator. This news comes via a press release from the New York Department of Financial Services (NYDFS) earlier today.
“BitLicense” is the colloquial term for the business license required to conduct virtual currency activities in New York State. People or companies who do business in New York are subject to this regulation. The license was originally designed by Benjamin Lawsky, New York’s first Superintendent of Financial Services, in July 2014. However, soon after, Lawsky announced he would be stepping down to found his own legal and consulting firm, later named the Lawsky Group, that would assist companies navigate the regulation he himself created only months earlier. This move seemed transparent to many in the cryptocurrency community, who accused Lawsky of creating the BitLicense to then exploit it for his own personal gain, while in the process creating unnecessary legal hurdles for crypto and blockchain development to thrive in New York.
According to the press release, Bitstamp USA is the nineteenth company to be awarded a BitLicense. The license will allow Bitstamp to establish services that allow customers to buy, sell, and trade Bitcoin (BTC) with US Dollars (USD), as well as other cryptocurrencies that were not specified.
Additionally, Bitstamp USA is licensed to “facilitate transfers of funds onto the Ripple Network, issuing Ripple Balances in USD, other virtual currencies, and select fiat currencies, including the Australian Dollar, British Pound, Euro, Swiss Franc, and Japanese Yen.”
After this regulatory approval, Bitstamp joins the ranks of other large crypto companies to receive a BitLicense, namely Coinbase, Square, Genesis Global Trading, and Circle Internet Financial.
In order to receive a BitLicense, companies must undergo a vigorous examination into their Anti-Money Laundering (AML) and Know Your Customer (KYC) compliance, in addition to their anti-fraud and cybersecurity practices.