LocalBitcoins Bids Farewell to New York Due to BitLicense

LocalBitcoins, a global marketplace facilitating the in-person trade of bitcoins, has joined several other major industry players to call it quits in New York.

This week marks the end of a 45-day grace period for businesses dealing in virtual currency to either apply for the BitLicense or close shop in the state. Some of the larger, well-capitalized companies like Coinbase have applied, while itBit is exempt by virtue of its qualifications as a banking institution.

Many crypto businesses, however, have decided to no longer market their services to New York residents. They cite the licensing requirements and/or applications process as overly burdensome, not worth the return on investment. This week saw both Bitfinex and Kraken withdraw from the state.

On its blog, LocalBitcoins expresses regret for withdrawing from another region “due to regulators.” Last year, it halted service in Germany after being contacted by BaFin (Bundesanstalt für Finanzdienstleistungsaufsicht), the country’s financial supervisory authority, also apparently on the matter of licensing. On New York, the company writes:

“We’re sad to say that due to regulators another region has had to be blocked from LocalBitcoins. From today onwards users from New York are no longer allowed to use LocalBitcoins because of the legislation known as the BitLicense (23 NYCRR 200) which makes it a federal offense to sell virtual currency to people living in New York unless you have applied for the license.”

It referred to the BitLicense as "time consuming, expensive and difficult to obtain for anything but large companies."

US residents will get a one-time pop-up inquiring if they live in New York State.

It ends off expressing future hope that "Regulation Regulation Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Read this Term will in the future accommodate small time Bitcoin Bitcoin While some may still be wondering what is Bitcoin, who created Bitcoin, or how does Bitcoin work, one thing is certain: Bitcoin has changed the world.No one can remain indifferent to this revolutionary, decentralized, digital asset nor to its blockchain technology.In fact, we’ve gone a long way ever since a Florida resident Laszlo Hanyecz made BTC’s first official commercial transaction with a real company by trading 10,000 Bitcoins for 2 pizzas at his local Papa John’s.One could now argue that While some may still be wondering what is Bitcoin, who created Bitcoin, or how does Bitcoin work, one thing is certain: Bitcoin has changed the world.No one can remain indifferent to this revolutionary, decentralized, digital asset nor to its blockchain technology.In fact, we’ve gone a long way ever since a Florida resident Laszlo Hanyecz made BTC’s first official commercial transaction with a real company by trading 10,000 Bitcoins for 2 pizzas at his local Papa John’s.One could now argue that Read this Term sellers who do not have the possibility to comply with regulations made for big financial institutions."

Most bitcoin commerce facilitated by LocalBitcoins is simply through advertisements, where users make offers, meet in person and settle the transaction themselves. For this, no licensing is required. However, it also provides an escrow service whereby it does transmit funds.