The New York Department of Financial Services (DFS) announced on Wednesday that it has ratified NYDIG Execution LLC’s cryptocurrency license application.
Such licenses have been coined “BitLicenses” and this is a landmark moment for NYDIG Execution because it has secured the 14th BitLicense issued by the New York Department of Financial Services. New York state law requires companies or businesses to have a BitLicense if they wish to operate any cryptocurrency-related business.
NYDIG Execution LLC has the right to offer virtual currency trade execution services as well as secure custody. The company will get to act as a custodian for numerous cryptocurrencies including Ethereum (ETH), Bitcoin (BTC), Litecoin (LTC), Ripple (XRP) and Bitcoin Cash (BCH).
“Today’s approval further demonstrates that operating within New York’s robust state regulatory system leads to a stronger fintech marketplace,” stated Maria T. Vullo, DFS’ superintendent.
DFS Grants Virtual Currency and Money Transmitter License to NYDIG Execution, LLC https://t.co/arn1NECzlD
— NYDFS (@NYDFS) November 14, 2018
Regulatory compliance an ingredient for proper growth
Vullo also added that the approval demonstrates DFS’ determination to promote compliance and innovation through necessary and proper risk-based controls. He noted that the strong regulatory implementation is necessary especially now that New York’s financial services marketplace is rapidly expanding. He believes that regulation will promote responsible growth.
DFS has also demonstrated its determination to respond rapidly to the financial services market’s needs by licensing money transmitters and their new technology. It provides the licenses to online lenders through the state’s banking law while cryptocurrency exchange licenses are issued as part of New York’s financial services regulations.
DFS has so far issued 14 licenses to crypto-related businesses including the newly announced NYDIG Execution LLC license. New York Digital Investment Group CEO Robert Gutmann stated that his company was excited about receiving the license. He also added that the company will work towards offering transparent and secure liquidity as well as asset management and custodial services to their clients.
BitLicense requirement has been a double-edged sword
NYDIG also thanked the New York-based regulatory authority for providing regulatory clearance and offering a regulatory framework that allows interaction within the cryptocurrency ecosystem. The BitLicense has attracted companies such as NYDIG although it previously made some blockchain and cryptocurrency firms terminate their operations in the state.