NY hands out first-in-the-nation license to digital currency firm

A Boston financial concern becomes the first of 25 digital currency companies to receive New York State's BitLicense. 

|
Mark Blinch/Reuters
A Bitcoin sign is seen in a window in Toronto.

A Boston financial services startup, Circle Internet Financial, received the nation’s first license Tuesday to allow the exchange of digital currency like Bitcoin through its applications.

The “BitLicense” from the New York Department of Financial Services became available in June, when the state introduced digital currency regulations that relate to consumer protection, anti-money laundering compliance, and cyber security guidelines.

“Putting in place rules of the road that help protect consumers from loss or theft and root out illicit activity is vital to building trust in this new financial technology,” said Anthony J. Albanese, acting superintendent of financial services at NYDFS, in Tuesday’s announcement. 

This is a notable milestone in the legitimization of “cryptocurrency,” which is an online, global currency, not backed by any banks. The currency is digitally encrypted to make it somewhat anonymous, fast, and to allow it to be exchanged mostly without fees. Cryptocurrency exchanges, which are run by the people who use them, have operated mostly in the margins of the law.

Circle, which allows people to use its apps to exchange traditional money and bitcoins, in May landed a $50 million investment from Goldman Sachs and IDG Capital Partners, a Chinese firm, among other investors. It had already raised $26 million in 2013 and 2014.

The Los Angeles Times has reported that Goldman Sachs in a recent report said that cryptocurrencies are part of the technological revolution upending the $1.7-trillion global payments industry. Bitcoins can be exchanged into traditional money. The report also said that 80 percent of all bitcoin volume is exchanged into and out of Chinese yuan.

“This is something tech folks in Silicon Valley have realized is really disruptive and can change a lot of industries, and Wall Street is finally waking up to that reality,” Jerry Brito, director of an independent nonprofit research center called Coin Center, and an adjunct law professor at George Mason University in Virginia told the LA Times.

The Goldman Sachs report estimates that more than 100,000 merchants worldwide, like Overstock, Microsoft, and Expedia, accept bitcoins as payment.

Since the BitLicense was introduced in New York State, 25 firms have paid the $5,000 non-refundable application fee to receive it.

You've read  of  free articles. Subscribe to continue.
Real news can be honest, hopeful, credible, constructive.
What is the Monitor difference? Tackling the tough headlines – with humanity. Listening to sources – with respect. Seeing the story that others are missing by reporting what so often gets overlooked: the values that connect us. That’s Monitor reporting – news that changes how you see the world.

Dear Reader,

About a year ago, I happened upon this statement about the Monitor in the Harvard Business Review – under the charming heading of “do things that don’t interest you”:

“Many things that end up” being meaningful, writes social scientist Joseph Grenny, “have come from conference workshops, articles, or online videos that began as a chore and ended with an insight. My work in Kenya, for example, was heavily influenced by a Christian Science Monitor article I had forced myself to read 10 years earlier. Sometimes, we call things ‘boring’ simply because they lie outside the box we are currently in.”

If you were to come up with a punchline to a joke about the Monitor, that would probably be it. We’re seen as being global, fair, insightful, and perhaps a bit too earnest. We’re the bran muffin of journalism.

But you know what? We change lives. And I’m going to argue that we change lives precisely because we force open that too-small box that most human beings think they live in.

The Monitor is a peculiar little publication that’s hard for the world to figure out. We’re run by a church, but we’re not only for church members and we’re not about converting people. We’re known as being fair even as the world becomes as polarized as at any time since the newspaper’s founding in 1908.

We have a mission beyond circulation, we want to bridge divides. We’re about kicking down the door of thought everywhere and saying, “You are bigger and more capable than you realize. And we can prove it.”

If you’re looking for bran muffin journalism, you can subscribe to the Monitor for $15. You’ll get the Monitor Weekly magazine, the Monitor Daily email, and unlimited access to CSMonitor.com.

QR Code to NY hands out first-in-the-nation license to digital currency firm
Read this article in
https://www.csmonitor.com/Business/2015/0923/NY-hands-out-first-in-the-nation-license-to-digital-currency-firm
QR Code to Subscription page
Start your subscription today
https://www.csmonitor.com/subscribe