New York Endures Bitcoin Backlog
No doubt, new regulations can cause backlogs, inefficiencies and stalling. This may be the case for New York bitcoin regulation and exchange.
In June 2015, Benjamin Lawsky was heading up New York’s Department of Financial Services (DFS), when it developed rules for virtual currency firms by mandating that they get a ‘BitLicense’ for holding customer funds and exchanging between currencies and bitcoin. The BitLicense launched after the collapse of Mt. Gox, the Tokyo-based exchange which lost nearly $560 million worth of bitcoin. Lawsky’s plan was to have New York become a global hub for innovation, specifically bitcoin, with its market now worth more than $10.7 billion. He was considered someone taking a risk ahead of other states.
The appeal of New York’s BitLicense? To offer a clear legal framework. However, more recently, this is driving some companies away. Just to file for the license costs $5,000, and after that, the application can run up to 500 pages and includes extensive background on the business, its leaders and even their fingerprints.
This post was published at Pymnts on November 1, 2016.