Square Receives Key Crypto Regulatory Approval; BTC Moves Higher on the News
New York’s DFS grants Square its prestigious BitLicense so it can trade Bitcoin in the state.
Square’s quest to be a leader in the crypto space continues to come to fruition, with the latest happening being so significant that it seemed to push Bitcoin’s and other cryptos’ prices higher.Square’s quest to be a leader in the crypto space continues to come to fruition, with the latest happening being so significant that it seemed to push Bitcoin’s and other cryptos’ prices higher.
The happening entails the payments processor receiving permission from the New York State Department of Financial Services (DFS) for its customers to be able to buy and sell Bitcoin in the Empire State.
On release of the news, Bitcoin’s price moved higher. At the time of writing Monday afternoon, it was higher by about $211, and was trading at $6,720.
The license that brings legitimacy, prestige
The license granted to Square is referred to as BitLicense. Observers note that it is extremely difficult to secure due to the strict restrictions the DFS has in place.
Noting that Square currently holds a money-transmitter license from DFS, the DFS’s Superintendent, Maria Vullo, said the following:
“DFS is pleased to approve Square’s application and welcomes them to New York’s expanding and well-regulated virtual currency market. DFS continues to work in support of a vibrant and competitive virtual currency market that connects and empowers New Yorkers in a global marketplace while ensuring strong state-regulatory oversight is in place.”
The BitLicense club
Square is just the ninth firm to be approved for the license and be able to trade cryptos in New York. Others that have secured the prestigious license include Coinbase and Circle. Gemini Trust and Paxos have been granted charters by DFS.
DFS has also granted licenses to Xapo, Genesis Global Trading, bitFlyer USA, and XRP II.It’s granted charters to Gemini Trust Company and Paxos (formerly itBit Trust Company).In reviewing Square’s application, DFS applied the same review standards as it did the other applications it’s approved. That included reviewing Square’s policies for anti-money laundering, anti-fraud, capitalization, consumer protection, and cybersecurity.
As with the other firms, Square’s new licensee is subject to ongoing supervision by DFS.
Cash app paying off
On Twitter, Square’s Cash app officials immediately posted the news of the approval.
“Our customers in New York State can now buy and sell Bitcoin instantly with Cash App!” https://twitter.com/CashApp/status/1008726031438635009?ref_src=twsrc%5Etfw&ref_url=https%3A%2F%2Fwww.cnbc.com%2F2018%2F06%2F18%2Fsquare-customers-can-now-trade-cryptocurrency-in-new-york.html
Brian Grassadonia, Head of the Cash App, said:
“We are thrilled to now provide New Yorkers with Cash App’s quick and simple way to buy and sell Bitcoin. Square and the New York State DFS share a vision of empowering people with greater access to the financial system and today’s news is an important step in realizing that goal.”
Square’s on the move
We reported to you last month about how Square had taken the finance community by storm. Its easy payment tools have helped small businesses greatly. So it was a natural fit for it to embrace cryptos and facilitate online payment options in the space.
Square already had approval to trade cryptos in most states, but New York was by far the biggest one where they couldn't trade Bitcoin, observers point out.
"That was one of the missing pieces in their puzzle," Nomura Instinet analyst Dan Dolev told CNBC.
Cash App was rolled out to select users last year, but now the number of users has been expanded to include most of its customers. It’s estimated that there are roughly seven million users of the App.