The New York State Department of Financial Services (DFS) announced today that it has approved the application of Ripple Labs’ affiliate, XRP II, LLC, for a virtual currency license – commonly known as a BitLicense. The regulators say this comes after they conducted a rigorous review of Ripple’s application, including the company’s anti-money laundering, capitalization, consumer protection, and cyber security standards.
“DFS is pleased to continue to foster the growth of the New York virtual currency marketplace and industry through thoughtful and appropriate regulation,” said Acting Department of Financial Services Superintendent Maria T. Vullo. “DFS will continue to progress on licensing virtual currency firms while acting in the best interests of New York consumers.”
“Earning the BitLicense is an incredible validation of the institutional use of digital assets by DFS, one of the most influential state regulators,” said Ripple co-founder and CEO Chris Larsen. “With the BitLicense in hand, we look forward to working with our New York bank customers seeking to use XRP for liquidity and cost savings.”
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The BitLicense regulations govern how businesses engaged in virtual currency can operate in the state. They mandate the rough equivalent of the rules applied to money transmission businesses, but also contain additional cryptocurrency-specific provisions. Many in the industry have criticized the rules as overly burdensome and liable to stifle innovation.
The rules were finalized and came into effect back in June 2015. The DFS has received 26 BitLicense applications, and has only approved four so far. It also recently denied two applications for a BitLicense. The two companies who where ordered to stop any New York operations were Snapcard Inc. and OKLink PTE. LTD.