BitLicense

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A BitLicense is the common term used for a business license of virtual currency activities, issued by the New York State Department of Financial Services (NYSDFS) under regulations designed for companies.[1][2][3] The regulations are limited to activities involving New York or a New York resident. Those that reside, are located, have a place of business, or are conducting business in the State of New York count as New York Residents under these regulations.[4]

The regulations define virtual currency business activity as any one of the following types of activities:

  • receiving Virtual Currency for Transmission or Transmitting Virtual Currency, except where the transaction is undertaken for non-financial purposes and does not involve the transfer of more than a nominal amount of Virtual Currency,
  • storing, holding, or maintaining custody or control of Virtual Currency on behalf of others,
  • buying and selling Virtual Currency as a customer business,
  • performing Exchange Services as a customer business, or
  • controlling, administering, or issuing a Virtual Currency.

But, the 2 following activities are excluded from the definition of virtual currency business activity:

  • development and dissemination of software in and of itself,
  • merchants and consumers that utilize Virtual Currency solely for the purchase or sale of goods or services or for investment purposes.[5]


It came into effect on August 8, 2015. Several[quantify] bitcoin companies announced they were stopping all business in New York State because of the new regulations.[6][7] The New York Business Journal called this the "Great Bitcoin Exodus".[6]

In September 2015 the first BitLicense was issued to Circle Internet Financial.[8][9][10][11]

References

[12] [13] [14] [15] [16] [17] [18] [19] [20] [21] [22] [23] [24] [25]

  1. Michael J. Casey (3 June 2015). "NY Financial Regulator Lawsky Releases Final BitLicense Rules for Bitcoin Firms". WSJ.<templatestyles src="Module:Citation/CS1/styles.css"></templatestyles>
  2. "New York lays out requirements for a 'BitLicense'". Fast FT.<templatestyles src="Module:Citation/CS1/styles.css"></templatestyles>
  3. Kaja Whitehouse, USAToday (3 June 2015). "'Bitlicense' rules regulating bitcoin released". USA TODAY.<templatestyles src="Module:Citation/CS1/styles.css"></templatestyles>
  4. "New York BitLicense Application Geographic Limits". NorthBot.com. Retrieved 4 December 2015.<templatestyles src="Module:Citation/CS1/styles.css"></templatestyles>
  5. ""Virtual Currency Business Activity" definition for New York BitLicense application". NorthBot.com. Retrieved 4 December 2015.<templatestyles src="Module:Citation/CS1/styles.css"></templatestyles>
  6. 6.0 6.1 Michael del Castillo (August 12, 2015). "The 'Great Bitcoin Exodus' has totally changed New York's bitcoin ecosystem". New York Business Journal.<templatestyles src="Module:Citation/CS1/styles.css"></templatestyles>
  7. "Bitcoin company ditches New York, blaming new regulations". Fortune. June 11, 2015.<templatestyles src="Module:Citation/CS1/styles.css"></templatestyles>
  8. Paul Vigna (Sep 22, 2015). "Circle Gets First 'BitLicense,' Releases CirclePay, New Service". WSJ.<templatestyles src="Module:Citation/CS1/styles.css"></templatestyles>
  9. Karen Freifeld (September 22, 2015). "NY regulator issues first license for bitcoin company". Reuters.<templatestyles src="Module:Citation/CS1/styles.css"></templatestyles>
  10. Curt Woodward (September 22, 2015). "Circle gets first bitcoin license from New York regulators". betaboston.com.<templatestyles src="Module:Citation/CS1/styles.css"></templatestyles>
  11. NYDFS (September 22, 2015). "Press Release - NYDFS Announces Approval of first BitLicense application from a virtual currency firm". ny.gov.<templatestyles src="Module:Citation/CS1/styles.css"></templatestyles>
  12. Cameron Fuller (31 January 2014). "Bit Licenses: How Will New York Regulate Bitcoins?". International Business Times.<templatestyles src="Module:Citation/CS1/styles.css"></templatestyles>
  13. "Benjamin Lawsky unveils New York's historic BitLicense framework - New York Business Journal". New York Business Journal. 3 June 2015.<templatestyles src="Module:Citation/CS1/styles.css"></templatestyles>
  14. "Fmr New York bitcoin watchdog can't help bitcoin startups get license - Fortune". Fortune. June 11, 2015.<templatestyles src="Module:Citation/CS1/styles.css"></templatestyles>
  15. Ian McKendry (3 June 2015). "After N.Y. Makes 'BitLicense' Official, Focus Moves to Who's Next". American Banker.<templatestyles src="Module:Citation/CS1/styles.css"></templatestyles>
  16. "New York Releases Final BitLicense". CoinDesk.<templatestyles src="Module:Citation/CS1/styles.css"></templatestyles>
  17. Michael Bobelian (8 June 2015). "NY's BitLicense Reveals The Difficult Trade-offs Of Regulating Bitcoin". Forbes.<templatestyles src="Module:Citation/CS1/styles.css"></templatestyles>
  18. "NYDFS BitLicense Draft - Business Insider". Business Insider. 17 July 2014.<templatestyles src="Module:Citation/CS1/styles.css"></templatestyles>
  19. "What BitLicense Regulations Mean for Bitcoin". NASDAQ.com. 10 June 2015.<templatestyles src="Module:Citation/CS1/styles.css"></templatestyles>
  20. "New York Outs Final BitLicense For Bitcoin And Other Digital Currency Companies". Tech Times.<templatestyles src="Module:Citation/CS1/styles.css"></templatestyles>
  21. "New York Regulator Finalizes First-Of-Its-Kind Plan To Govern Virtual Currency With "BitLicense"". Consumerist.<templatestyles src="Module:Citation/CS1/styles.css"></templatestyles>
  22. "UPDATE 2-New York regulator issues final virtual currency rules". Reuters.<templatestyles src="Module:Citation/CS1/styles.css"></templatestyles>
  23. Mariella Moon. "New York sets rules for running Bitcoin exchange businesses". Engadget. AOL.<templatestyles src="Module:Citation/CS1/styles.css"></templatestyles>
  24. "Companies burdened by BitLicenses real cost - EconoTimes". EconoTimes.<templatestyles src="Module:Citation/CS1/styles.css"></templatestyles>
  25. "NYDFS Receives 22 Initial BitLicense Applications". CoinDesk.<templatestyles src="Module:Citation/CS1/styles.css"></templatestyles>

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