Digital asset trader Cumberland DRW said it secured a virtual currency license called BitLicense from the New York State Department of Financial Services (NYDFS). The license comes after fulfilling all the requirements as stipulated by New York.
Cumberland is the subsidiary of Chicago-based high-frequency trading company DRW. It is reportedly among the few entities that hold a BitLicense in New York.
Also read: Tether launches its own gold-backed synthetic dollar
Cumberland commits to regulatory compliance
Securing BitLicense means the trading platform can now foster strong relationships with its institutional counterparts in the industry.
In a post on X platform, Cumberland also revealed its commitment to work hand in glove with regulators and ensure total compliance with regulatory requirements. “We are pleased that the New York State Department of Financial Services has granted Cumberland New York a BitLicense,” wrote the company.
“As one of the only principal trading firms to hold a BitLicense, we look forward to strong trading relationships with institutional New York counterparts.”
Cumberland.
A BitLicense is a landmark regulation for cryptocurrency-related businesses, which was put in place in 2015 in New York.
While New York seeks to boost investor protection, some critics have felt that the regulatory framework has loopholes such as slow application approvals while others think this might stifle innovation.
We are pleased that the New York State Department of Financial Services has granted Cumberland New York a BitLicense. We are deeply committed to working with regulators to obtain proper, necessary licensing and ensuring our business is compliant and aligned with regulatory…
— Cumberland (@CumberlandSays) June 17, 2024
New York takes a tough stance to protect investors
Crypto-related business has been growing significantly lately worldwide. The growth has come with its fair share of crypto-related scams. New York has also been “at war” with some companies for allegedly defrauding investors.
Also read: BitLicense Oversight Under Scrutiny in New York: A Deep Dive into the Comptroller’s Concerns
Companies like Terraform, Gemini, AWS Mining, and NovaTechFX have been made to pay hefty penalties by the Office of the Attorney General for defrauding unsuspecting investors.
But earlier this year, Cumberland became one of the trading companies chosen by Fidelity Investments to trade bitcoin for Fidelity’s spot bitcoin ETF, which started trading beginning of this year.
Cryptopolitan reporting by Enacy Mapakame