NYDIG Gains NY Virtual Currency License11.14.2018
The New York State Department of Financial Services (DFS) has approved the application of NYDIG Execution LLC, a subsidiary of NYDIG LLC, for a virtual currency license and a money transmission license. Additionally, NYDIG Trust Company LLC, a subsidiary of NYDIG LLC, has been authorized to operate as a limited purpose trust company.
“As the financial services marketplace continues to expand and evolve in New York, the implementation of strong regulatory safeguards that encourage the responsible growth of the industry, while first and foremost protecting consumers remains critical,” said Superintendent Maria T. Vullo. “Today’s approval further demonstrates that operating within New York’s robust state regulatory system leads to a stronger fintech marketplace and promotes innovation and necessary compliance with effective risk-based controls.”
DFS has authorized NYDIG to offer secure custody and trade execution services providing consumers with several options for the custody of the digital assets: engaging in self-custody, contracting with a third party for custodial services, or contracting with NYDIG Execution or NYDIG Trust for custody services. DFS authorized NYDIG to offer defined services to operate as a custodian for virtual currencies, including Bitcoin, Bitcoin Cash, Ether, XRP and Litecoin.
DFS continues to rapidly and responsibly respond to financial services market innovations by licensing technology-based money transmitters under New York’s money transmitter law; online lenders under New York’s banking law; and virtual currency exchanges under New York’s financial services law. To date, DFS has approved fourteen charters or licenses for companies in the virtual currency marketplace.
“NYDIG is pleased to receive these regulatory approvals and we look forward to providing secure and transparent liquidity, custodial and asset management services to the institutional market. We want to express our gratitude to the NYDFS for providing a clear and comprehensive regulatory framework for investors, providers and users alike to engage with the burgeoning digital asset ecosystem,” said Robert Gutmann, CEO of New York Digital Investment Group.
Regulators are likely to separate custody from other crypto exchange activities.
Technology does not change the need for transparency in corporate structures, governance, audit and controls.
Exchange group’s crypto suite has had consistent volume and open interest growth.
The asset manager said its digital asset products are designed to provide secure, transparent crypto access.
Courts will have to consider the treatment of crypto assets in custody.