Menu
In run-up to bitcoin regulations, New York issues trust company charter to itBit

In run-up to bitcoin regulations, New York issues trust company charter to itBit

With its trust company charter, itBit is subject to the same government oversight as other financial institutions

A few weeks before New York officials are expected to issue a final regulatory framework for bitcoin, the state has issued a trust company charter to virtual currency exchange itBit.

Obtaining a trust company charter subjects itBit to the same state and federal regulations that apply to other financial services firms, according to the New York State Department of Financial Services. For example, deposits made to itBit must be fully insured. To offer this guarantee, itBit teamed up with an unnamed U.S. bank to insure client accounts up to US$250,000.

Qualifying for the charter, which itBit applied for in February, means the exchange's cybersecurity, consumer protection and capitalization plans, among other areas, were reviewed by the New York financial services department.

New York State Department of Financial Services Superintendent Benjamin Lawsky began looking into regulating bitcoin exchanges in 2013 and is expected to release a final set of regulations later this month. He issued draft proposals for bitcoin regulations for public comment last year.

Regulation can help the virtual currency industry grow while protecting customer funds, Lawsky's office said in a press release Thursday.

ItBit operates in New York and Singapore and targets large investors. Knowing that itBit complies with U.S. financial laws will help assure customers that their deposits are secure, the New York City startup said in a blog post Thursday.

Hackers have targeted bitcoin exchanges in recent years and made off with bitcoins worth millions of dollars. Mt. Gox was the world's most prominent exchange until it folded last year after attackers stole $474 million worth of bitcoins. This past January, Bitstamp lost $5 million worth of bitcoins in an attack.

Fred O'Connor writes about IT careers and health IT for The IDG News Service. Follow Fred on Twitter at @fredjoconnor. Fred's e-mail address is fred_o'connor@idg.com

Follow Us

Join the New Zealand Reseller News newsletter!

Error: Please check your email address.

Tags itBitregulationgovernment

Slideshows

Top 50 defining moments of the New Zealand channel in 2016

Top 50 defining moments of the New Zealand channel in 2016

Reseller News looks back on a tumultuous 12 months for the New Zealand channel, assessing the fallout from a year of sizeable industry change. Whether it be local or global mergers and acquisitions, distribution deals or job changes, the channel that started the year differs somewhat to the one set to finish it - Reseller News assesses the key moments that made 2016.​

Top 50 defining moments of the New Zealand channel in 2016
​Hewlett Packard Enterprise honours high achieving NZ channel

​Hewlett Packard Enterprise honours high achieving NZ channel

Hewlett Packard Enterprise honoured its top performing Kiwi partners at the second running of its HPE Partner Awards in New Zealand, held at a glitzy ceremony in Auckland. Recognising excellence across eight categories - from distributors to resellers - the tech giant celebrated its first year as a standalone company, following its official split from HP in 2015.

​Hewlett Packard Enterprise honours high achieving NZ channel
Nutanix treats channel partners to Christmas cruise

Nutanix treats channel partners to Christmas cruise

Nutanix recently took to the seas for a Christmas Cruise around Sydney Harbour with its Australia and New Zealand staff, customers and partners to celebrate a stellar year for the vendor. With the sun out, they were all smiles and mingled over drinks and food.

Nutanix treats channel partners to Christmas cruise
Show Comments