NYDFS Gives Swifter Replies to BitLicense Applications

In 3 years, the New York Department of Financial Services (NYDFS) has replied to only a quarter of 36 total BitLicense applications submitted to them. Of all these applications, five have been rejected with only four receiving approval. The remaining 27 applications have been in a state of awaiting response.

Response to the Verbal Attack

After listening to a speech made by Erik Voorhees in which the Coinapult co-founder attacked the New York State’s regulatory approach to digital currency, a writer at Fortune, Robert Hackett gained curiosity as to the rate of response given to cryptocurrency BitLicense applications by the NYDFS. The ex-Director of Marketing at BitInstant further added that a mere four companies had received approval by the regulatory body and said they were ‘an absolute failure.’
Erik Voorhees made the claims at the 2018 Consensus Conference in May this year, and it was found out that another six applications have been approved since then. Some companies, including Voorhees’ cryptocurrency exchange, ShapeShift made a choice to forfeit the right to do business in New York State rather than fill out a request to continue with their business. Kraken was another popular exchange that left and in the process, stated what it felt about the regulatory efforts.
The State of New York has one of the highest populations and houses the financial centre of the US: Wall Street. A BitLicense is needed for a business to continue or startup digital currency activities. Since every cryptocurrency startup requires it, blockchain firms cannot do business without it. The slow response to applications has now slowed down activities in the blockchain industry in the state. Crypto firms experience a lot of obstacles which include confusing taxes, volatile exchange rates and the addition of the BitLicense issue has proved to be overwhelming for cryptocurrency businesses.
The Fortune writer, Hackett, averaged in his research that if the average number of 6 businesses approved is maintained, then approval could hit another 12 businesses in the next year to commence business. Pending the approval, there have been several uptrends and downtrends in the crypto market.

Response to BitLicense Applications

The snail-like response to the BitLicense applications has dumbfounded many, and no one has been able to fathom why the process is so slow and almost quasi-static. Ben Lawsky, its architect, has left the agency and joined Ripple, the company with the most valuable token in terms of market capitalization in the crypto market.
In the long period it takes to get a BitLicense approved, a firm could be accepted in another jurisdiction. It has been evident that New York is not by any means a crypto-friendly environment, nor does it support blockchain startups. The statements made by Erik Vorhees and Kraken’s Jess Powell have shown that. It is quite ironical that government approval should be what is slowing down blockchain development.

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