New York State Considering Proposals For Establishment of Regulated Bitcoin Exchanges

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The New York State Department of Financial Services (NYDFS) announced on Tuesday that they would be begin considering proposals and applications for the establishment of bitcoin exchanges in the State.

Such establishments would, of course, be subject to regulation. But more importantly, serve to pave the way to efficient (yet effective) oversight of such financial institutions in the nation’s third-most populous state.

“Firms may immediately submit formal proposals and applications to operate virtual currency exchanges in order to help expedite the process of putting in place greater oversight for this industry,” the Department said in a public order.

The NYDFS has noted that it would be proposing regulatory frameworks for digital currencies some time before the end of the second quarter.

“Turning a blind eye and failing to put in place guardrails for virtual currency firms while consumers use that product is simply not a tenable strategy for regulators,” said NYDFS Superintendent Ben Lawksy. “Our overarching goal is to balance creating appropriate regulatory protections without stifling beneficial innovation in the development of new payments platforms.”

New York-based Coinsetter, a bitcoin exchange in private beta, made the following announcement:

“Coinsetter is pleased to announce that we will soon be submitting an application for a BitLicense. If accepted, our regulatory licensing will allow us to offer a fully compliant trading platform with US banking options.”