Coinbase Exchange not licensed to operate in New York

Coinbase said Monday it had opened the first regulated Bitcoin exchange in several US states, including New York.

But a spokesman for New York State Department of Financial Services (NYDFS) Superintendent Benjamin Lawsky said Coinbase did not have the licenses necessary to operate Coinbase Exchange in the state, reported the New York Times.

“We are working with several companies, including Coinbase, on licensing and will continue to move forward expeditiously,” said spokesman Matthew Anderson. “That said, we have not yet issued any licenses to virtual currency firms.”

The Times reported that the understanding at the NYDFS is that in order to run as a Bitcoin exchange or broker, a company would require a money transmission license and would, in the future, require a specialized BitLicense, which the NYDFS is slated to unveil soon, according to an individual briefed on the matter who was not authorized to speak about the department’s views publicly.

The Times reported that in a statement, Coinbase co-founder Fred Ehrsam said his company “will continue to work” with the NYDFS “on all Bitcoin matters involving consumers, merchants and the recently launched Coinbase Exchange. We also look forward to continuing to work together on the completion of New York’s BitLicense.”

The newspaper said there is no indication that Coinbase faces any penalty for working with New York residents. However, any tension between the company and regulators could set back carefully orchestrated attempts in the industry to boost Bitcoin’s reputation with the authorities following previous thefts and scandals.

Reaction from the NYDFS on Coinbase Exchange followed comment from the California Department of Business Oversight, which stated Tuesday that the exchange is not regulated or licensed by California.

Image courtesy of Coinbase