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New York Grants BitLicense To Payments Firm Square

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The New York Department of Financial Services (NYDFS) has granted BitLicense, the license of virtual currency activities, to mobile payments firm Square, Inc. to offer Bitcoin trading to New Yorkers.

Square said it will "provide New Yorkers with Cash App's quick and simple way to buy and sell bitcoin."

Cash App, an app for sending and receiving fiat currency, had in late January enabled instant buying and selling of Bitcoin to most of its Cash App customers in other US states, excluding for those in New York, Georgia, Hawaii, and Wyoming.

Square already holds a money-transmitter license from NYDFS. It gained the BitLicense after the NYDFS scrutinized the company's anti-money laundering, anti-fraud, capitalization, consumer protection, and cybersecurity policies. The licensee is subject to ongoing supervision by the regulator.

NYDFS Superintendent Maria Vullo said, "DFS continues to work in support of 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."

San Francisco, California-based Square's hardware enables sellers to accept credit card and contactless payments. Twitter CEO Jack Dorsey is also the CEO, Chairman and Cofounder of Square.

The controversial BitLicense regulatory framework, which came into effect on August 8, 2015, is aimed at monitoring and regulating operations of cryptocurrencies such as Bitcoin and cryptocurrency-related products being offered in the State of New York and to New York residents.

The New York regulator has granted the seventh-ever BitLicense to Square, after approving the first BitLicense to industry startup Circle in September 2015. This was followed by approvals for startup Ripple, Coinbase, BitFlyer USA, Genesis Global Trading and recently for Xapo. Prior to these, Gemini Trust Co., itBit trust Co., and Paxos Trust Co. were issued virtual currency charters.

BitLicense is dubbed as one of the most restrictive cryptocurrency regulatory frameworks in North America. More than fifteen digital currency companies left the New York state because of the new regulations, including Vaultoro, Shapeshift, Paxful, Poloniex, Bitfinex, Kraken, and more. This was called as the "Great Bitcoin Exodus."

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