NY Grants Fifth-Ever BitLicense to Genesis Global Trading

The license is has come in for intense criticism, in part because so few firms have been granted one.

AccessTimeIconMay 17, 2018 at 4:00 p.m. UTC
Updated Dec 10, 2022 at 9:28 p.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global hub for everything crypto, blockchain and Web3.Register Now

Genesis Global Trading has obtained a BitLicense from the state Department of Financial Services (DFS), making it only the fifth firm in three years to receive the controversial license.

The cryptocurrency market maker, based in New York City, and DFS announced the news in separate press releaseshttps://www.dfs.ny.gov/about/press/pr1805171.htm Thursday.

In the regulator's release, New York financial services superintendent Maria Vullo said, "New York continues to lead the nation in regulating the growing fintech industry."

But the BitLicense has come in for intense criticism from cryptocurrency entrepreneurs. Speaking at CoinDesk's Consensus 2018 conference Tuesday, ShapeShift CEO Erik Voorhees called the regulation an "absolute failure" that "should be removed." He said it was "pathetic" that only a handful of firms had received BitLicenses after three years. "That's the rate of innovation in New York."

Several exchanges have stopped operating in the state, including ShapeShift and Kraken.

Despite lacking a BitLicense prior to this week, Genesis Trading has been operating in New York under a safe harbor provision.

The market maker caters to high net worth and institutional investors and offers round-the-clock trading in bitcoin, bitcoin cash, ether, ethereum classic, XRP, litecoin and zcash.

Separately, the DFS also authorized Paxos Trust Company, formerly known as itBit, to operate "a permissioned, blockchain-based post-trade platform settlement service" for precious metals, called Bankchain.

Paxos holds a limited-purpose trust company charter from DFS, as does Gemini Trust Company, a cryptocurrency exchange.

New York became the first state to craft a regulatory structure specifically for cryptocurrencies in 2014, and finalized the BitLicense in August 2015.

The other four firms to receive the license are Circle, in 2015; XRP II, a Ripple subsidiary that sells XRP, the following year; and Coinbase and bitFlyer in 2017.

Correction: An earlier version of this article misdescribed Genesis' business model. It is a market maker, not an exchange.

Disclosure

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.


Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.