New York Regulators Officially Rejects Bittrex’s BitLicences Application – Here’s Why


BitLicese rejected

New York Regulators Officially Rejects Bittrex’s BitLicences Application – Here’s Why

A quick letter released by the New York Department of Financial Services (NYDFS) reveals that Bittrex’s application to secure BitLicese is rejected, if it would have approved, the exchange could process trading operation in New York.

BitLicense Rejected

A letter addressing to Bittrex CEO Bill Shihara, published by NYDFS on Wednesday, April 10, 2019, reads that NYDFS has apparently rejected BitLicense application which was submitted in July 2018. The application was declined due to a number of factors which was however essential for every trading platforms intends to operate within New York.

The exchange was, however, operating under the terms of a ‘safe harbor’ a law that permits an exchange to operate within jurisdiction while its application to obtain BitLicense remains in pending status.

Daniel Sangeap, deputy superintendent and deputy counsel at NYDFS says that;

“Throughout Bittrex’s application process, the Department worked steadily with Bittrex to address continued deficiencies and to assist Bittrex in developing appropriate controls and compliance programs commensurate with the evolving nature of the sector,”

But Why?

Reports revealed that the regulators continuously reached Bittrex via several deficiency letters. However, the reason for such rejection comes after regulator’s notice of deficiency towards ‘Bittrex’s anti-money laundering procedures, its coin listing process, exchange’s capital, and Foreign Assets Control compliance. Mentioning these details, regulators specifically adds that;

Exchange’s failure to demonstrate that it will conduct its business honestly, fairly, equitably, carefully, and efficiently.

Beside rejection, NY regulators also ordered Bittrex to close its business in New York within 60 days and thus unauthorized to operate within the jurisdiction. Additionally, regulators highlighted Bittrex’s poor performance in conducting customer’s due diligence, the absence of required tax identification numbers or customer names are a few more factors that led Bittrex’s BitLicense failure. Nevertheless, regulators also point at the ‘obscene terms and phrases’ that many Bittrex accounts were containing – such as ‘Elvis Presley, Give me my money, Donal Duck’.

Following the rejection status, Bittrex, unfortunately, has to wind up its operation in New York, given that it is already having 35000 New York-based users. Sangeap further adds that;

“This was due to the fact that partial files were provided to the examiners, and moreover, actual compliance in certain files could not be established. Sangeap continued, Some tokens were listed despite some applicants refusing to complete the necessary paperwork – “and in one case … there was no application on file at all.”

In a nutshell, Bittrex’s BitLicese application is rejected and is expected to close his New York-based operations within a period of two months (probably within June 10) – however, the exchange has only 14 days to confirm to regulators that it has ceased existing business in New York and put an end to any upcoming business plans for NY residents.

So readers, what’s your view on NYDFS’s move towards rejecting Bittrex’s BitLicense? do you think the exchange deserved it? Let us know in the comment below 

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New York Regulators Officially Rejects Bittrex’s BitLicences Application – Here’s Why
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New York Regulators Officially Rejects Bittrex’s BitLicences Application – Here’s Why
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A quick letter released by the New York Department of Financial Services (NYDFS) reveals that Bittrex’s application to secure BitLicese is rejected, if it would have approved, the exchange could process trading operation in New York.
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Coingape
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Author: Tabassum

Tabassum is a full-time content writer at Coingape. Her passion lies in writing and delivering apt information to users. Currently, she does not hold any form of cryptocurrencies. Follow her on Twitter at @Tabassumnaiz and reach out to her at Tabassum[at]coingape.com

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Tabassum is a full-time content writer at Coingape. Her passion lies in writing and delivering apt information to users. Currently, she does not hold any form of cryptocurrencies. Follow her on Twitter at @Tabassumnaiz and reach out to her at Tabassum[at]coingape.com

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