BitPay, a long-standing cryptocurrency payment processor, has been granted the rare BitLicense by the New York State Department of Financial Services (NYDFS).
The regulatory approval means that the global processor can now serve businesses in NY, one of the most important markets in the USA.
The news about NYDFS’ decision to grant BitPay the license hits the market at the same time as that of Blackrock’s interest in Bitcoin and Coinbase’s approval as a fully regulated securities broker-dealer.
It is a confluence of great news for cryptocurrency that helped to send Bitcoin (BTC) prices past $7,300 on Monday.
The license was given after the SEC conducted an extensive review of BitPay’s compliance. It included examining their anti-money laundering (AML), anti-fraud, and capitalization policies. The DFS also looked into the company’s consumer protection mechanisms as well as its cybersecurity policies.
NYDFS, through its Superintendent Maria Vullo, said that the “DFS welcomes BitPay to New York’s expanding and well-regulated virtual currency market.” She added that:
“We continue to work to support a vibrant and competitive virtual currency market that connects and empowers New Yorkers in a global marketplace while ensuring strong state-regulatory oversight is in place.”
What is BitPay?
BitPay was founded in May 2011 and has its headquarters in Atlanta Georgia. It is a leading crypto-payment processor whose services enable users to easily and conveniently pay or accept payment for goods and services using Bitcoin and alternative currency Bitcoin Cash (BCH).
Its range of products continues to make it easy for businesses to complete cross-border transactions that involve sending and receiving payments. It also enables its users to manage virtual currencies via the BitPay Wallet, as well as converting these assets into fiat via its BitPay Prepaid Visa cards.
At the moment, BitPay is the number one processor in the space by payment volume. The company serves over 20,000 businesses in more than 160 countries around the world.
Commenting on the recent development, BitPay said on Twitter that it is the first blockchain-based payment processor to be granted a virtual currency license by the New York regulators.
Overall, it becomes the eighth crypto-based company to be licensed by the New York State, following approvals of:
- XRP II;
- bitFlyer USA;
- Genesis Global Trading; and
- Circle Internet Financial Ltd.
NYDFS has also issued service charters to Gemini exchange and Paxos.
Why is this important to the crypto industry?
The relevance of acquiring a BitLicense can’t be overemphasized for BitPay and the entire crypto industry. For one, it is a direct route towards increased acceptability and use of Bitcoin by businesses in one of the largest markets in America.
The license allows BitPay to take a leading role in facilitating crypto payments for merchants and consumers in one of the US’ most stringent states. If New York sets the precedent, other jurisdictions will follow suit, helping push forth more acceptability.
The approval means that now any business in New York can legally accept Bitcoin (BTC) and Bitcoin Cash (BCH) payments from anywhere in the world using the BitPay platform. It also means that anybody with Bitcoin and Bitcoin Cash now has the freedom to use the platform to pay for goods and services.
The payment processor understands the value of this development, leading its CEO Stephen Pair to express the following:
“This is an important milestone for BitPay to secure the virtual currency license from the New York Department of Financial Services and be the first non-exchange to do so. We believe this gives businesses not only in New York but across the country confidence that blockchain technology offers clear benefits to businesses engaged in e-commerce and cross-border transfers.”
International payments and remittance
For instance, BitPay forged a partnership with Bithumb, South Korea’s largest cryptocurrency exchange, in March 2018. The idea was to enable the two to penetrate the global payments and remittances market.
According to BitPay CCO Sonny Singh, businesses would benefit by being able to easily convert their invoices to Bitcoin. As a result, it would be cheaper and use less time-consuming when settling such payments compared to the higher costs and delays witnessed when using traditional payment channels that rely on banks.
BitPay recently explained how they helped one Fortune 500 company to complete transactions involving another company in Nigeria. It turned out successful and earned praise. On its Medium page, BitPay has said that:
“Right now, companies are using cross-border blockchain payments through BitPay to make international business easier, faster, and more efficient.”
Even more important is the fact that it gives BitPay a link to its subsidiaries located in the U.K, Brazil, the Netherlands, and Canada. The growing need to use crypto assets has seen several businesses and multinational sign up with the company.
Microsoft, the tech giant, has recently joined companies like Newegg, Gyft, Takeaway, Namecheap, and Virgin Galactic that are already accepting Bitcoin using BitPay.
Crypto assets supported by BitPay
BitPay currently supports Bitcoin (BTC) and Bitcoin Cash (BCH) only. Businesses and companies that accept BTC and BCH on the payment platform have the added advantage of enabling crypto transactions via a computer or mobile device.
Payments via BitPay are made on the respective blockchains of Bitcoin and Bitcoin Cash and usually arrive in minutes. Confirmation is then completed within an hour.
Along with other great news over the weekend and earlier this week, things are shaping up for Bitcoin. it might be the beginning for what would end up the basis for mainstream adoption.