October 5, 2015
Contact: Matt Anderson, 212-709-1691
NYDFS GRANTS CHARTER TO “GEMINI” BITCOIN EXCHANGE FOUNDED BY CAMERON AND TYLER WINKLEVOSS
Three Virtual Currency Firms Have Now Received Charters or Licenses from NYDFS – Gemini, Circle, itBit
Anthony J. Albanese, Acting Superintendent of Financial Services, today announced that the New York State Department of Financial Services (NYDFS) has granted a charter under the New York Banking Law to Gemini Trust Company, LLC (“Gemini”) – a Bitcoin exchange that is based in New York City and founded by Cameron and Tyler Winklevoss.
Acting Superintendent Albanese said: “In New York, we are continuing to move forward on licensing and chartering virtual currency firms. Smart, targeted regulation that helps protect consumers and prevent illicit activity is vital to the long-term future of this industry.”
In light of the demonstrated need for stronger oversight of virtual currency exchanges after the Mt. Gox collapse, NYDFS issued a March 2014 public order initiating a process for accepting charter applications for virtual currency exchanges under the existing New York Banking Law. As previously noted in the NYDFS announcement of that order, those exchanges are also expected to meet the full requirements of the NYDFS BitLicense regulatory framework – which was finalized in June 2015 – as a condition of licensure.
Gemini applied to NYDFS for a charter to operate as a trust under that process for virtual currency exchanges in July 2015. NYDFS conducted a rigorous review of that application, including but not limited to the company’s anti-money laundering, capitalization, consumer protection, and cyber security standards. As a chartered limited purpose trust company with fiduciary powers under the Banking Law, Gemini can begin operating immediately and is subject to ongoing supervision by the NYDFS.
In May 2015, DFS granted the first charter to a New York virtual currency firm, itBit Trust Company. In September, 2015 DFS granted the first BitLicense application to a virtual currency firm, Circle Internet Financial. To date, NYDFS has received 25 BitLicense applications. NYDFS is continuing to review and accept applications and proposals from other virtual currency companies.
Additional Background/Timeline on the NYDFS Virtual Currency Regulation
- In August 2013, NYDFS launched an inquiry into the appropriate regulatory guidelines for virtual currencies.
- In January 2014, NYDFS held public hearings on that virtual currency regulation.
- In July 2014, NYDFS issued its proposed BitLicense regulatory framework for public comment.
- In December 2014, NYDFS outlined an updated BitLicense framework that incorporated feedback from the first round of public comments. The updated proposal contained a series of changes and clarifications, including the creation of a two-year transitional BitLicense to assist start ups. NYDFS also invited public comments on the updated framework.
- In May 2015, NYDFS granted the first charter under the New York Banking Law to virtual currency company itBit Trust Company, LLC – a commercial Bitcoin exchange.
- In June 2015, NYDFS published its final BitLicense rules and invited applications from virtual currency firms.
- In September 2015, NYDFS approved the first BitLicense application (Circle Internet Financial).