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New York Reportedly Readies Bitcoin Licenses for Coinbase and Ripple Labs

Last Updated March 4, 2021 4:48 PM
Lester Coleman
Last Updated March 4, 2021 4:48 PM

Coinbase and Ripple Labs Inc. are close to receiving bitcoin licenses to offer their virtual currency services in New York State, according to Reuters . Both companies have provided applications to the state’s Department of Financial Services (NYSDFS), according to a notice on the department’s website.

The notices usually post following completion of the paperwork, according to sources who wished to remain unnamed.

The precise times of the license approvals are uncertain. Both companies are based in San Francisco, Calif.

BitLicense A Pioneer Reg

New York last year issued the most extensive regulations for operating a virtual currency company. The regulations, which require obtaining a license called a BitLicense to operate a virtual currency business, are designed to protect consumers and prevent money laundering. The law prohibits the sale of bitcoin without a license.

The licenses will support the growth of digital currency in New York State.

A Ripple spokesperson said the company plans to comply with all state and federal laws.

Coinbase did not wish to comment on the status of its application. CCN.com reported Coinbase submitted a BitLicense application in August.

Coinbase And Ripple: Big Players

Coinbase is one of the largest U.S.-based bitcoin companies. Backers include venture capital firms Ribbit Capital and Andreessen Horowitz, as well as USAA, a financial services provider. The company markets services to merchants and consumers.

Ripple filed for its BitLicense under the corporate name XRP II LLC. The company’s backers also include Andreessen Horowitz, in addition to IDG Capital Partners and Google Ventures. Ripple’s service and currency, called XRP, serves companies and financial institutions that provide liquidity to foreign exchanges.

Circle Internet Financial Ltd., a Boston, Mass.-based startup backed by Goldman Sachs Group, became the first company to receive a BitLicense in September, CCN.com reported.

Also read: Coinbase: We have applied for a New York BitLicense

New York Approves Gemini

On Thursday, the NYSDFS approved the BitLicense application of Gemini Trust Company, founded by Cameron and Tyler Winklevoss. The license allows the company to trade the ether digital currency on its bitcoin exchange.

The Gemini Trust approval makes it the first licensed ether exchange in the world, Gemini noted on its website . Gemini further noted the NYSDFS is the first regulatory agency in the world to supervise ether.

The granting of licenses marks the acceptance of the BitLicense by the virtual currency community. Bitcoin companies opposed the regulation when it was first announced.

Some companies, like GoCoin, a cryptocurrency payment processor, decided to “geofence” New York State, meaning they won’t operate there. LocalBitcoins, BitFinex, Kraken, Eobot and ShapeShift also left the state due to the regulations.

Featured image from Shutterstock.