One of the strictest cryptocurrency regulatory regimes in the United States has approved proposals from two companies under its oversight to issue cryptocurrency tokens whose values are pegged to the U.S. dollar. NYDFS Approves Two Stablecoins In a statement published Monday, the New York Department of Financial Services (NYDFS), creator of the “BitLicense” framework for
Adoption news keeps flowing this week, from Wall Street to Australia, and now San Francisco. The United States largest cryptocurrency bank, Coinbase, announced it is expanding its commerce section to include Woo Commerce via a plugin downloadable from Github. It could be just what more online merchants need to get comfortable with cryptocurrency.
Coinbase Seeks Online Merchant Crypto Adoption by the Millions
More than a quarter of all online merchants use Woo Commerce. It’s easily one of the most popular payment platforms around. This week, Coinbase announced it is releasing a Woo Commerce plugin as part of its proprietary Coinbase Commerce offering which can be downloaded from Github.
Coinbase Commerce is itself a payment solution focusing on getting more online merchants to use cryptocurrency. Woo Commerce businesses will “have access to cryptocurrency payments from customers around the world,” Coinbase stressed. “This increased access will lead to more widespread adoption, and ultimately, moves us closer to our goal of an open financial system.” At present, ethereum and bitcoin cash (BCH) are still being tested on the platform, but users who hold bitcoin core (BTC) and litecoin can send theirs from Coinbase Commerce. The team is working on building similar functionality for bitcoin cash and ethereum.
Merchants who use the payment button React now have the option of embedding Coinbase functionality as well. The San Francisco-based crypto bank is also incorporating programming languages such as Python, and are said to even be considering Ruby. The idea seems to be keeping merchants happy by not asking them for acceptance payment fees.
These are just a scant few moves Coinbase has been making as a unit this year. They are now involved with institutional financial products, and are launching a crypto index fund, gobbling up licenses such as the Bitlicense, have purchased Paradax exchange, and are plotting a move into Japan. The payment processing market is a giant one. All the proof anyone would need to measure just how huge is, say, the recent announcement by Wall Street and its entrance into all things retail with Bakkt (includes Microsoft and Starbucks). And while the space is getting crowded a bit, Coinbase has a built-in advantage being a relatively early mover in the ecosystem, a very positive brand identification, and a host of lincenses and general trust among weathermen.
Do you think Coinbase’s new plug-in will encourage merchant adoption? Let us know in the comments section below.
Images via Pixabay.
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Cryptocurrency payment processor BitPay has become the eighth firm to receive a “BitLicense” from the New York Department of Financial Services (NYDFS), which oversees what is arguably the most-restrictive state-level framework for the U.S. cryptocurrency industry. The NYDFS announced on Monday that it had approved the Atlanta-based BitPay’s application, following a “comprehensive review” of the
Since the infamous Bitlicense was put into effect, the ecosystem has fought for its removal. It turns out to be much harder in practice than in theory to oust a law once it’s put into effect. The good news is groups like Startup Cities are on the case. They’ve snagged a candidate for governor to champion their cause, and they’re even holding a rally in mid July to help galvanize support for putting down a notoriously bad idea.
Gubernatorial Candidate Larry Sharpe Will Work to Get the Bitlicense Repealed
Three years later, almost to the date, will find New York City once again placed front and center within the cryptocurrency world. At issue is its regional Bitlicense, enacted and formerly attended to by the New York State Department of Financial Services (NYSDFS). While limited to residents of New York, it’s probably not too wild of a statement to insist New York City is the defacto financial capital of the world. What it does usually means other regional professional finance laws are sure to follow.
And the law is comprehensive, so vague it appears to cover every aspect of potential crypto movement: transmission, storing, holding, any kind of custodial arrangement, exchanges, etc., you name it, it’s probably governed under the license. That a company or individual would need such permission has created a perhaps unintended consequential truism: at least a dozen bitcoin-related companies have left the state. Who knows how many potential businesses never even began due to this market entry barrier. It has been dubbed the “Great Bitcoin Exodus” by the New York Business Journal.
Peter Ryan and his Startup Cities organization have had enough. This July 10, he’s bringing in New York candidate for governor Larry Sharpe for a candid discussion about what can be done, including a complete repeal of the Bitlicense. “I don’t want us to vote bitcoin away,” Mr. Sharpe stressed. “I want us to embrace it.” The July 10th event is to be held at Galvanize, 6:30pm to 9pm, and tickets are $20 (get half off by entering: “crypto”), payable in fiat or bitcoin cash.
Ignoring Politics Doesn’t Mean Government Will Ignore You
The law is so difficult to navigate potentially, businesses are relying on former regulators such as Benjamin Lawsky to assist in maintaining compliance. Mr. Lawksy, many will remember, was the principal proponent of the license while on the NYSDFS. After its taking effect, Mr. Lawsky suddenly retired from public service, and began lobbying on behalf of companies seeking compliance in conformity with a law he helped bring about. More recently, last year in fact, Mr. Lawsky joined Ripple as a board member.
Still, there has been tacit embrace of the regulation, and some businesses, citing clarity and the need to enter a lucrative market such as New York City, have applied. Circle was first, Ripple next, Coinbase shortly after, followed by Bitflyer, Genesis Global Trading, Xapo, and Square Inc., just recently.
Startup Cities, the group behind the July 10th gathering, bills itself as “entrepreneurs, economists, and urbanist thinkers [joining] forces to discuss the actions, effects, and impacts of startup methodology for cities.” Startups, and the culture surrounding them, act as a kind of metaphor for decision making: innovative, deliberate. They routinely hold conferences and public discussions, and then “invite our audience to a networking session to chat about entrepreneurship, urbanism, and decentralization. We hope to demystify the concepts of starting new types of societies,” its website claims.
“Larry Sharpe is running for governor to change and innovate the state,” Startup Cities explained further, “leveraging his background as a soldier, businessman, and educator. He is one of the most supportive and forward-thinking politicians on the issue of cryptocurrencies.” The group’s mission “is to create a nexus of information and action. That nexus includes research produced by academics, technology envisioned by entrepreneurs, and support funded by both private and public investors.” The event is also sponsored by Urbanist, Bitcoin Center NYC, Crypto NYC, Galvanize, Ollie, Shapeshift, and Bitcoin.com.
Would a pro-cryptocurrency politician earn your vote? Let us know in the comments.
Images via the Pixabay, Larry Sharpe.
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While everyone is looking for an indication that institutional money is about to flood into bitcoin and revive the market, we just got another conformation that crypto has indeed entered the big leagues. Companies in the industry are now putting former regulators on their payroll, as is common for Wall Street mega banks, government-supported telecom monopolies, competition-stifling tech giants and the like.
Along the announcement of its new $300 million a16z crypto fund, Andreessen Horowitz also revealed it had hired Katie Haun as its newest general partner. While most tech publications hailed the move in the name of diversity and inclusivity, due to her gender, few took note that she is yet another in a string of government lawyers and regulators who joined the ranks of cryptocurrency companies recently.
According to her bio at Stanford, Haun spent over a decade as a federal prosecutor with the U.S. Department of Justice (DOJ), where she focused on fraud, cybercrime, and corporate compliance failures alongside agencies such as the SEC, FBI, and Treasury. She was the DOJ’s first-ever coordinator for digital assets, and led investigations into the Mt. Gox hack and the corrupt agents on the Silk Road task force. As her impressive resume proves, Haun is no doubt a very capable and highly intelligent woman. However, she is a law expert not a venture capital or investment expert, which could raise some questions about her new role.
Free and Fair Market?
As mentioned before, Haun is only the latest regulator to make the move into the crypto industry. In May 2018, Kraken hired Mary Beth Buchanan, the former US Attorney for the Western District of Pennsylvania. In December 2017 Bittrex hired Kiran Raj, a former Deputy General Counsel at the Department of Homeland Security (DHS), as chief strategy officer, as well as John Roth, a DHS Inspector General who spent twenty-five years at the DOJ, as chief compliance and ethics officer. In November 2017, the former New York Superintendent of Financial Services who pushed for the Bitlicense, Ben Lawsky, joined Ripple’s board of directors. And the list goes on and on as far back as in 2015, when Itbit hired former NY DFS General Counsel Daniel Alter as its general counsel and chief compliance officer.
All of this is, of course, not illegal and serves both parties. The crypto companies get people on board that can help them navigate the complex legal system, and the former regulators get to leverage their government experience in the much more lucrative private sector. The main downside is that this practice can potentially hurt end users as it hampers competition by erecting steep barriers for entry. Just imagine you want to open a new US crypto exchange. You might fear that, unless you have the financial resources and right connections to hire a former top government lawyer, you will have a severe disadvantage compared with the established players, and ultimately cancel the plan as a result. Hopefully, at some point some honest lawmakers will notice what is happening and conclude that the regulatory maze is too cumbersome for the good of the market. Until that happens, bitcoin companies will keep hiring people that mix in the right circles and know who to give a call when needed.
Are these developments good for the long term health of the bitcoin ecosystem? Share your thoughts in the comments section below.
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The market valuation of Square, the multi-billion dollar payments company of Twitter CEO Jack Dorsey, surged three percent overnight after the company obtained the BitLicense from the New York Department of Financial Services (NYDFS) to operate as a cryptocurrency platform. BitLicense is Difficult to Obtain New York is considered to have the strictest policies and … Continued
The company Square announced on Monday the firm has been granted the Bitlicense from the New York Department of Financial Services (DFS). The firm and its ‘Cash App’ are now legally allowed to operate and utilize cryptocurrency solutions in the state of New York.
Square, Inc. is a payment processor and financial services provider that was launched in 2010. The San Francisco based company was founded by Jack Dorsey (also the CEO of Twitter) and Jim McKelvey back in 2010 and the firm has been staunch bitcoin supporters for quite some time. Back in November 2017, the company announced it was implementing in-app BTC buy/sell Options for certain select customers. A few months later in February of 2018 Square rolled out the BTC service for all users. Since then the revenue derived from the cryptocurrency in-app services has added around $8Bn USD to Square’s overall valuation according to data collected last May. Now this week, Square has been granted the official Bitlicense money-transmitter approval from the DFS.
“DFS is pleased to approve Square’s application and welcomes them to New York’s expanding and well-regulated virtual currency market,” explained the Financial Services Superintendent Maria T. Vullo during the announcement on Monday.
DFS continues to work in support of a vibrant and competitive virtual currency market that connects and empowers New Yorkers in a global marketplace while ensuring strong state-regulatory oversight is in place.
Square Joins Eight Licensed Cryptocurrency Operations in New York
According to the DFS, the regulators have conducted a review over Square’s business model which includes anti-money laundering guidelines, Know-Your-Customer (KYC), and cybersecurity policies. Moreover, the DFS states the newly licensed Square will be under supervision. The New York regulatory agency has granted the Bitlicense to Circle, Gemini, Coinbase, XRP II, Paxos (formally Itbit), Bitflyer, Xapo, and more recently Genesis Global Trading Inc.
“We are thrilled to now provide New Yorkers with Cash App’s quick and simple way to buy and sell bitcoin,” said Brian Grassadonia, Head of Square’s Cash App service.
Square and the New York State DFS share a vision of empowering people with greater access to the financial system and today’s news is an important step in realizing that goal.
Now New York residents will be able to utilize the Cash App in the state as the region was one of the few states where the cryptocurrency option wasn’t incorporated until today.
What do you think of Square receiving the New York state Bitlicense? Let us know in the comment section below.
Images via Shutterstock, Square, and Pixabay.
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Institutional cryptocurrency exchange and BitLicense recipient itBit has announced that it has received approval from the New York Department of Financial Services (NYDFS) to list four new cryptocurrencies: ethereum (ETH), bitcoin cash (BCH), litecoin (LTC), and stellar (XLM). ItBit, which says it operates the second-largest US bitcoin trading platform by total volume, announced on Thursday
Institutional cryptocurrency exchange and BitLicense charter recipient itBit has announced that it has received approval from the New York Department of Financial Services (NYDFS) to list four new cryptocurrencies: ethereum (ETH), bitcoin cash (BCH), litecoin (LTC), and stellar (XLM). ItBit, which says it operates the second-largest US bitcoin trading platform by total volume, announced on … Continued
Regulated cryptocurrency exchange Itbit announced today that it has received approval from the New York State Department of Financial Services to add more cryptocurrencies to its product offerings. The company will begin offering custody, escrow, OTC trading, and exchange services for BCH, ETH, LTC, and XLM, in addition to its existing BTC offerings.
Itbit announced on Thursday, June 14, that it will start offering several new products based on cryptocurrencies other than BTC. The New York-based company wrote:
Global crypto asset platform Itbit announced today it has received approval from the New York State Department of Financial Services (NYDFS) to offer expanded trading and custody services for bitcoin cash (BCH), ethereum (ETH), litecoin (LTC) and stellar lumens (XLM). Itbit will start immediately offering custody, escrow and OTC trading services for these new assets, with platform exchange trading to follow.
Previously only BTC products were available. Itbit COO Andrew Chang commented, “by gaining this regulatory approval, we are now able to open the doors for individuals and institutions to access crypto assets beyond just bitcoin.”
Itbit became the first bitcoin exchange to be granted a banking license by the NYDFS in May 2015. The license allows the exchange to operate in all 50 U.S. states under the New York banking laws, CEO Chad Cascarilla explained at the time.
Itbit’s Product Offerings
Itbit’s website outlines several services such as crypto exchange, OTC trading, and custody services. “US dollars are FDIC-insured and all fiat and bitcoin customer assets are fully protected and backed by mandatory capital reserves,” the company details. For OTC trading, the minimum investment is 25 BTC.
The exchange also offers escrow transactions. While “Itbit acts as the agent to negotiate a trade between two parties and conducts settlement” in OTC trading, it “acts as a neutral party to settle a trade brought forward by an agent or buyer/seller mandate” in escrow transactions.
At the end of May, Itbit’s operator, Paxos, announced that it had raised $65 million. Part of the funds raised will be used to operate the Itbit exchange and custodian service, CEO and co-founder Charles Cascarilla said at the time.
Last week, the U.S. Commodity Futures Trading Commission (CFTC) reportedly demanded trading data from Itbit and three other crypto exchanges since bitcoin futures provided by CME Group, which it regulates, derive their value from them.
What do you think of Itbit adding BCH, ETH, LTC, and XLM products? Let us know in the comments section below.
Images courtesy of Shutterstock, NYDFS, and Itbit.
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Investigations are all about the crypto ecosystem, but a recent report regarding a US Department of Justice price manipulation crackdown was widely said to be the cause of market caps falling, and by a lot. Fundstrat, the ecosystem’s favorite financial professional crypto bull, is on record as welcoming government regulation, what it calls “adult supervision.”
Legacy media, thanks to a Bloomberg article, ran wild with fear, uncertainty, and doubt (FUD) this week, regarding a supposed US Department of Justice investigation of price manipulation. Weaker hands in response effectively sent bitcoin core (BTC) well below $8K, heading for 7, and the entire crypto market cap slid accordingly.
Debate about regulation in the US and around the world has raged the entirety of cryptocurrency’s near decade-long life. Bitcoin licensing in New York, senate hearings, G20 central bankers urging global crypto laws, the requisite jockeying and lobbying for exclusive access to regulators, taken together, seems to be slouching toward something major coming down from financial minders. And well-publicized recent hacks haven’t helped confidence. There seems to be a new initial coin offering scam daily.
Rumors the DOJ is teaming with US bitcoin futures regulator, the Commodity Futures Trading Commission (CFTC), and possibly patching-in the US Securities and Exchange Commission can spook animal spirits, of course. Anecdotal evidence abounds. Add to that six rather frightening words, when strung together by regulators, that make speculators’ ears perk, “neither confirm nor deny an investigation” becomes all the evidence anyone needs to dump positions. Even large exchange Bitfinex has been subpoenaed by the CFTC.
The ecosystem’s favorite bull, Thomas Lee of Fundstrat, in a client letter, put a finer point on happenings: “These stories have pressured the crypto market, as regulatory action (and related headline risk) reduces risk appetite and also is a further deterrent for near-term inflows from new investors. However, these actions signal that adult supervision is coming to crypto and adding such oversight incrementally improves the structural integrity and legitimacy for crypto-currency investor. In other words, in order for institutional investors to be more actively engaged in crypto markets, such adult supervision is a necessary precondition.”
Regulation is an Anathema to Bitcoin
Prior to welcoming crypto regulation, Mr. Lee ate a giant, warm slice of humble pie following his Consensus conference bump prediction of many thousands in BTC price increase. Just the reverse, of course, happened, and Mr. Lee, to his credit, reappeared on as many shows to take his medicine. He acknowledged getting it badly wrong, but ultimately attributed the decline due to unforeseen regulatory rumors and, ironically, saturation at the conference of hype.
In a slide presentation graphic, Fundstrat continued to use “welcome,” as in crackdowns being “welcome and also widely anticipated.” On price specific manipulation investigations, they urged “this probe is again, a very welcome development.”
To crypto enthusiasts, they are decidedly torn. On the one hand, nearly everyone will agree bitcoin was developed to essentially leave government regulatory environments. Government regulations are not issued out of benevolence toward the hoi polloi. No, rather they’re instead an effort to pick winners and losers in terms of which sector of businesses lobbied the hardest, greasing wheels of states in their direction. Regulations enforce burdens often on startups, insulating more established and connected businesses from too much competition. Corruption, then, can and does become institutional. Present day banking is proof enough. Bitcoin, in Satoshi’s vision, releases adopters from financial cartels, at least in theory. To invite regulators goes against everything crypto stands for.
On the other hand, regulation does seem to be inevitable. And if it is, shouldn’t the ecosystem get out in front? Seems rational enough, and that’s a generous reading of Mr. Lee and Fundstrat’s comments. Nevertheless, the company remains bullish on bitcoin core (BTC). They point to Coinbase in particular and its staggering growth to 20 million customers, and BTC related wallet downloads of more than 3.5 million. They do, however, hold to a degree of caution if headlines remain negative and mining rewards/price reach parity.
Do you think regulation of crypto is inevitable? Let us know what you think in the comments below.
On May 17 the Digital Currency Group initiative and Over-the-Counter (OTC) cryptocurrency service, Genesis Global Trading, announced that Genesis was recently granted the New York state Bitlicense. The company that provides OTC solutions to institutional buyers can now operate freely in New York — A territory that many call, ‘the financial capital of the world,’ as Genesis aims to provide significant BTC, BCH, ETC, LTC, ZEC, XRP, and ETH liquidity in the state.
DCG Backed Genesis Global Trading Granted New York State Bitlicense
Genesis Global Trading has announced the firm has been granted the Bitlicense, and the company will be allowed to operate in New York with other approved businesses such as Coinbase, Circle, and Itbit. The New York Department of Financial Services (DFS) approved the company and provided Genesis with the Bitlicense — which will allow the firm to trade the various digital assets it holds with institutional investors. Before the company was granted the Bitlicense the firm operated under the DFS “safe harbor” provision.
Genesis was launched in 2013 and is backed by the venture capital organization the Digital Currency Group (DCG), a firm founded by Barry Silbert. The company is a regulated cryptocurrency OTC dealer that “provides access to institutional investors and high net worth individuals looking to buy or sell large sums of digital currencies.” Genesis has offered deep pools of liquidity, 24-7 trading, and same-day settlement since the company’s inception.
“We are very pleased that DFS has approved the Genesis Global Trading BitLicense application,” said Michael Moro, CEO, Genesis Global Trading.
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.
Barry Silbert Hopes More Cryptocurrency Businesses Are Approved in NY
To use the Genesis platform, traders have a $75,000 USD minimum deposit, and all users are subject to AML and KYC regulatory guidelines. In addition to being an approved brokerage service that can sell Bitcoin Core (BTC), the DFS has also approved to procure Zcash (ZEC), Ethereum (ETH), Ethereum Classic (ETC), Bitcoin Cash (BCH), Ripple (XRP), and Litecoin (LTC). Genesis also states the firm is also registered with the Securities Exchange Commission (SEC) and Finra as well.
The Digital Currency Group’s founder Barry Silbert was excited for Genesis commenting on the subject over Twitter.
“Congrats to the team at Genesis Trading on being granted a Bitlicense, joining Coinbase Circle, Ripple, Bitflyer USA, and Itbit,” Silbert states.
Hoping to see the NYDFS ramp up their licensing pace so that NY does not continue to fall behind.
What do you think about Genesis Global Trading receiving the Bitlicense? Let us know your thoughts on this subject in the comments below.
Images via Shutterstock, Twitter, and Genesis Global.
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Cryptocurrency brokerage firm Genesis Global Trading has become the latest firm to receive a BitLicense from the state’s financial regulatory. The New York-based Genesis on Thursday announced that the state’s Department of Financial Services (NYDFS) had approved its application, making it one of a handful of firms to receive a BitLicense, which formally allows cryptocurrency … Continued