Coinsource, a Texas-based firm with 192 Bitcoin ATMs across the United States, has become the first Bitcoin ATM operator to receive the New York Bitlicense. The company had previously been operating 40 Bitcoin ATMs under a provisional license in New York City, Westchester and Long Island.
Genesis Coin also operates numerous Bitcoin ATMs in New York but is still awaiting approval from the New York Department of Financial Services.
The CEO of Coinsource, Sheffield Clark, said, “Coinsource is the first and only company that operates BTMs [Bitcoin ATMs] to receive a New York virtual currency license. All New Yorkers — from the people that are unbanked to the people who own the banks — can use our kiosks in their neighborhood retail locations to buy bitcoin instantly in a convenient and familiar way. Now that Coinsource is a license holder, our customers can buy and sell with confidence that Coinsource meets and exceeds the high standards set by the New York Department of Financial Services. New York represents not just a center of global innovation but also one of our largest target markets. We are extremely proud to be the only BTM operator holding a New York virtual currency license.”
The New York Bitlicense is difficult to obtain and has been controversial since it was implemented in August 2015. Any individual or organization that buys or sells cryptocurrency as a customer business, performs exchange services, controls or issues a cryptocurrency, or stores cryptocurrency on behalf of others is breaking the law unless they have the Bitlicense.
For a period of time, this caused Bitcoin trading in New York to become illegal and to this day, Bitcoin dealing is illegal in New York. In 2017, that problem was alleviated when Coinbase got the Bitlicense. At this time, only 12 companies have received charters or Bitlicenses to operate in New York, including Circle, Ripple, bitFlyer, Coinbase, Genesis Global Trading, BitPay, Square, and Coinsource. Essentially, only the wealthiest and most reputable companies have been able to obtain the Bitlicense. Smaller companies and individuals have not had success applying for the same rights to operate cryptocurrency businesses in New York.
Coinsource’s Bitlicense can be revoked at any time if owners do not follow strict anti-money laundering (AML) protocols, take active steps to prevent the Bitcoin they sell from being used for illegal activity or market manipulation, allow the New York Department of Financial Services to fully monitor their business activities, and properly protect consumers and resolve all customer complaints.
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