New York Awards First-Ever BitLicense to Bitcoin ATM Company

Neutral New York Awards First-Ever BitLicense to Bitcoin ATM Company

Bitcoin teller machine (BTM) operator Coinsource has just become the 12th crypto company to receive a license from the New York State Department of Financial Services (NYDFS).

The firm announced approval of the so-called BitLicense on Thursday, with the firm's general counsel Arnold Spencer noting that it was the first granted to a bitcoin ATM provider to date. The company already has 40 BTMs in the state, having been operating under a provisional license pending full approval.

In a statement, NYDFS superintendent Maria Vullo confirmed the news, saying the license approval is "a further step in implementing strong regulatory safeguards and effective risk-based controls while encouraging the responsible growth of financial innovation."

Receiving the BitLicense, Spencer told CoinDesk, "is a validation of our business model [and] our compliance model."

He explained:

"It's been a long, involved process. The initial application was [in 2015, and] since then what we've seen is a great deal of diligence on NYDFS' part, really pushing us to both explain and in some cases improve our policies and procedures."

These ranged from having a business disaster continuity plan to state-of-the-art cybersecurity measures, Spencer indicated. During the evaluation period, Coinsource grew from being an unaudited firm with three employees and a handful of BTMs to being fully audited and growing to more than 20 employees and over 200 machines.

"We've had 500 percent growth over three consecutive years in terms of machines, and we've had comparable growth in revenue until spring of 2018, when it slowed down substantially," he said.

Compared with traditional exchanges, the firm's BTMs are convenient and offer direct peer-to-peer transactions, Spencer said, adding: "We do our account opening and compliance in real-time."

The machines' speed comes from a proprietary system that Coinsource developed to conduct know-your-customer checks. Where a customer would have to send a crypto exchange bank details and other proof of identification, Coinsource only needs a driver's license, a selfie and a cellphone number.

Coinsource also makes it easier for unbanked individuals to access cryptocurrencies, Spencer said, as they do not need to possess a bank account to purchase bitcoin and can pay with cash.

Going forward

At present, Coinsource customers can only buy or sell bitcoin through the BTMs - they can't actually send funds to other wallets yet.

Spencer explained that this is by design, as allowing that would be facilitating money transmission, so "you have to have a money transmission license in both jurisdictions - where you're starting the transaction and where you're ending the transaction.

However, the company currently has money transmission licenses in 18 states, with pending licenses in another 15. Spencer anticipates that by sometime next year, Coinsource will have be licensed in all 50 states.

"At that point in time, we'd be in a position to have people deposit cash into machines and transfer bitcoin into a third-party wallet, provided both customers were registered," he said.

Outside of the U.S., Coinsource plans to expand operations potentially to Japan, South Africa and Puerto Rico.

Of these, Puerto Rico is likely to happen first, with the company already having a money transmitting license for the territory.

"We have had preliminary discussions with regulators in Japan to use that as a springboard for Asia, and we've had initial conversations with bankers and regulators in South Africa, but that's probably the furthest out in terms of development," Spencer said.

Further, being incorporated in Argentina, Coinsource already has a base for Latin and South American expansion.

The addition of cryptocurrencies other than bitcoin across all the firm's machines is also on the cards in the "near future," but "that's contingent, of course, on regulatory approval," he said.

Bitcoin ATM image courtesy of Coinsource

The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

11/01/2018 / 14:59:09 Source: coindesk

BTC
1 BTC=$5,592.67
XRP
1 XRP=$0.5160
ETH
1 ETH=$175.75
XUC
1 XUC=$3.52
BCH
1 BCH=$337.36
EOS
1 EOS=$4.62

News Feed 50

Financemagnates Neutral - Arizona Bitcoin Fraudster Gets Year and a Half in Jail read more.
11/18/2018 / 16:01:09
Ccn Neutral - Bitcoin Opinion: A Cycle Coming To An End read more.
11/18/2018 / 15:47:27
Cointelegraph Neutral - Canadian House Finance Committee Recommends Crypto Regulation to Prevent Money Laundering read more.
11/18/2018 / 15:35:00
Cryptoglobe Neutral - Estonia's Government Has Issued Over 900 Crypto-related Licenses in Less Than One Year read more.
11/18/2018 / 15:30:19
Cryptopotato Neutral - They Saw Everything We Did For a Year: Exclusive evidence by an ICO maker about the SEC’s Efforts read more.
11/18/2018 / 14:59:28
Financemagnates Neutral - Unlicensed EU Brokers Lose Payment Option, eToro’s Stablecoin: Best of the Week read more.
11/18/2018 / 14:54:52
Newsbtc Negative - Crypto Week In Review: Bitcoin ETP Launches In Switzerland, KuCoin Scores $20M read more.
11/18/2018 / 14:54:34
Cryptoglobe Neutral - #Bitcoin (BTC) Long-term Price Analysis read more.
11/18/2018 / 14:45:41
Themerkle Neutral - BCHSV Price Tanks Again Despite Healthy Network Status read more.
11/18/2018 / 14:41:05
Bitcoin.Com Neutral - Markets Update: Traders Expecting Major BCH Action When Exchanges Open read more.
11/18/2018 / 14:40:43
Ccn Neutral - Christie’s Records $318 Million Art Sale on a Blockchain read more.
11/18/2018 / 14:15:37
Cryptoglobe Neutral - Mining Pool Threatens Bitcoin Gold, Bitcoin Diamond, and Bitcoin Private With Annihilation read more.
11/18/2018 / 14:15:22
Livebitcoinnews Neutral - HODLers May Go Through the Five Stages of Grief read more.
11/18/2018 / 14:00:10
Themerkle Neutral - Bearish Bitcoin Price Pressure Will Resume According to These 3 Predictions read more.
11/18/2018 / 13:44:44
Cryptoglobe Neutral - Host of CNBC's Crypto Trader: ‘Everyone Should Dump BTC and BCH and Just Put All Their Money Into XRP!’ read more.
11/18/2018 / 13:30:30
Ccn Neutral - Thailand’s Main Opposition Party Holds Primary Election on Blockchain read more.
11/18/2018 / 13:20:25
Ccn Neutral - Analyst: Bitcoin Will Likely Reach Bottom in Q2 of 2019, Bearish Short-Term read more.
11/18/2018 / 13:15:27
Ccn Neutral - Ripple Surges 8% as Crypto Market Adds $4 Billion, Can Bitcoin Recover? read more.
11/18/2018 / 13:11:14
Themerkle Positive - XLM Price Retakes $0.25 and Follows XRP’s Upward Trend read more.
11/18/2018 / 12:48:00
Bitcoin.Com Neutral - The Daily: US Bank to Issue Crypto Cards, Coinbase Updates Wallet read more.
11/18/2018 / 12:45:31
Cryptoglobe Neutral - Craig Wright Goes After XRP: 'XRP Is a Security' read more.
11/18/2018 / 12:45:30
Cointelegraph Neutral - Top 5 Crypto Performers Overview: XEM, Ripple, Stellar, Bitcoin, IOTA read more.
11/18/2018 / 12:28:00
Cryptopotato Neutral - Market Watch: Cryptos Recover, Ripple Outstands with a 8% Gains and Surpassing Ethereum read more.
11/18/2018 / 12:15:55
Cointelegraph Neutral - 50% Favor Bitcoin as Long-Term Investment in Former US Rep Ron Paul’s Twitter Surveyм read more.
11/18/2018 / 12:04:00
Coindesk Neutral - Huobi Exchange’s Plans for Russia Go Well Beyond Crypto Trading read more.
11/18/2018 / 12:00:57
Cryptoglobe Neutral - Binance CEO Hinting That He Might Be Willing to Make XRP a Base Currency read more.
11/18/2018 / 12:00:30
Coindesk Neutral - Deloitte Blockchain Chief: Bad Crypto Headlines Are Making Clients ‘Nervous’ read more.
11/18/2018 / 11:30:14
Coinspeaker Neutral - Coinbase Finally Takes RippleLabs’ Coin on Their Custodian Services read more.
11/18/2018 / 11:11:40
Ccn Neutral - Singaporean Crypto Exchange KuCoin Raises $20 Million Series A read more.
11/18/2018 / 11:03:43
Cryptoglobe Neutral - Canada Presents Three Possible Cryptocurrency Regulations In Anti-Money Laundering Committee read more.
11/18/2018 / 11:00:31
Livebitcoinnews Neutral - Nvidia Shares Plummet Due to Cryptocurrency Mining Slowdown read more.
11/18/2018 / 11:00:18
Cryptonewsreview Neutral - Aeternity’s partnering with Dacade to teach blockchain to beginners read more.
11/18/2018 / 10:58:39
Cryptopotato Neutral - #Ethereum Price Analysis Nov.18: Looks like a correction before the next wave read more.
11/18/2018 / 10:44:57
Cryptonewsreview Neutral - 2nd Grand Bahama Tech Summit has bolstered Grand Bahama’s economy by over half a million dollars read more.
11/18/2018 / 10:10:29
Cryptonewsreview Neutral - IMF Managing Director hints at a new central bank cryptocurrency read more.
11/18/2018 / 10:06:01
Cryptonewsreview Neutral - Japanese authorities have arrested eight men for a $68 million Ponzi scheme read more.
11/18/2018 / 10:04:26
Bitcoinist Neutral - Switzerland Approves First Bitcoin-Cryptocurrency ETF with Ticker $HODL read more.
11/18/2018 / 10:00:42
Cryptoglobe Neutral - Bloomberg Intelligence: Bitcoin Price Could Fall as Low As $1,500 read more.
11/18/2018 / 09:48:45
Ccn Neutral - World’s First Crypto ETP Gets Green light in Switzerland read more.
11/18/2018 / 09:37:39
Financemagnates Neutral - Cryptocurrency ETF Gets Swiss Licence, Trading in Zurich read more.
11/18/2018 / 09:20:08
Newsbtc Neutral - Cryptocurrency Market Update: Swiss Crypto ETP Approval Elevates XRP, Stellar Tops EOS read more.
11/18/2018 / 09:00:05
Newsbtc Neutral - #LTC/USD Price Analysis: Institutionalization of Litecoin, Atomic Swaps, Lightning Network Positive for Bulls read more.
11/18/2018 / 08:33:02
Cryptopotato Neutral - #Bitcoin Price Analysis Nov.18: A recess ahead of the storm? read more.
11/18/2018 / 08:29:40
Cointelegraph Neutral - Major Swiss Stock Exchange SIX Lists the World’s First Crypto ETP Amidst Market Collapse read more.
11/18/2018 / 08:08:00
Livebitcoinnews Neutral - Twitter: Elon Musk Bitcoin Scam Due to Third-Party App read more.
11/18/2018 / 08:00:30
Ccn Neutral - Aussie Crypto Startup Power Ledger Brings P2P Energy Trading to Largest US Market read more.
11/18/2018 / 07:50:48
Coinnounce Neutral - Bitcoin ETF: Worlds first Cryptocurrency ETF approved read more.
11/18/2018 / 07:32:01
Financemagnates Neutral - A Glimpse into the Decentralized Future of the Finance Sector read more.
11/18/2018 / 06:56:59
Bitcoin.Com Neutral - Cryptocurrency Exchange-Traded Product Live on Swiss Stock Exchange Next Week read more.
11/18/2018 / 06:55:41
Coinnounce Neutral - #Ethereum Price Analysis: Can ETH cross 200? read more.
11/18/2018 / 06:52:12
Negative
3.6%
Neutral
95.0%
Positive
1.3%
Mixed
0.1%

Latest comments:

4 min
Hey Sam, how is it going? But I must explain to you how all this mistaken idea of denouncing of a pleasure and praising pain was born
3 min
Pretty good. Doing my homework.. No one rejects, dislikes, or avoids pleasure itself, because it is pleasure, but because
2 min
Any chance to go out? To take a trivial example, which of us ever undertakes laborious physical exercise, except to obtain some advantage
2 min
.. Maybe 40-50 mins. I don't know exactly. On the other hand, we denounce with righteous indignation and dislike men who are so beguiled
1 min
Anyway sounds great! These cases are perfectly simple and easy to distinguish.