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 firm’s
anti-money laundering, anti-fraud, capitalization, consumer protection,
and cybersecurity policies.
“DFS welcomes BitPay to New York’s expanding and well-regulated
virtual currency market,” said Financial Services Superintendent Maria
T. Vullo. “We continue to work to support 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.”
Beginning today,
BitPay can
process cryptocurrency payments for New York merchants and residents,
and the license also authorizes the company to issue
cryptocurrency-funded debit cards in the state. At present, the company,
which was founded in 2011, supports bitcoin and bitcoin cash.
BitPay is the first standalone cryptocurrency payment processor to receive a BitLicense.
Coinbase, which received its virtual currency license in 2017, also
operates a merchant platform, but its core business revolves around
cryptocurrency trading.
“New York state has one of the strictest policies around businesses
involved in cryptocurrency and working through the approval processes to
obtain a License was important to BitPay,” said Stephen Pair, CEO of
BitPay. “We believe this hard work will pay off as New York presents
significant business opportunities for BitPay.”
BitPay is just the eighth firm to receive a full BitLicense, despite
the fact that the framework has been in force since 2015. However, the
NYDFS has approved half of those applications in the past three months, perhaps suggesting that the agency is
becoming more comfortable with the nascent but maturing industry.
Other NYDFS virtual currency license recipients include Square, Xapo,
Genesis Global Trading, bitFlyer USA, Coinbase, Ripple (through a
subsidiary called XRP II), and Circle. Gemini and Paxos (formerly itBit)
have received NYDFS charters but not full licensure.
