The New York State Department of Financial Services (NYDFS) has approved the listing of 10 cryptocurrencies for trading and the provision of custody services within the state.
In a release recently issued, the New York State Department of Financial Services, known as NYDFS for its acronym in English, announced the approval of 8 cryptocurrencies, with which trading operations can be carried out, in addition to another 10 cryptocurrencies that can now be used to provide storage and custody services within its territory.
The NYDFS issued a green list with the names of all cryptocurrencies approved for trading or custody operations mentioned above. The regulator also noted that it is necessary for a company or business licensed to provide services with cryptocurrencies to inform the DFS in advance about the inclusion of some of these digital assets, before using them in their products and services.
Cryptocurrencies approved for trading include: Bitcoin (BTC), Ethereum (ETH) Bitcoin Cash (BCH), Litecoin (LTC) Binance USD (BUSD), Gemini Dollar (GUSD), PaxGold (PAXG), and Paxo's standard token (PAX). Similarly, the regulator approved the same cryptocurrencies for storage and custody services, as well as Ripple (XRP) and Ethereum Classic (ETC).
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NYDFS listing excludes privacy cryptocurrencies
In the NYDFS publication, the accepted and pre-approved cryptocurrencies are Bitcoin, the main cryptocurrency in the markets and the one with the largest market capitalization; Ethereum, the cryptocurrency with a network blockchain to smart contracts and decentralized applications (dApps) and Ripple, the cryptocurrency of commercial banks. There are also some highly regulated cryptocurrencies backed 1:1 by the US dollar (USD), such as Binance USD, Gemini Dollar and Paxos Standard Token.
Among the NYDFS listing there are no cryptocurrencies such as Dash (DASH) or Monero (XMR), which are focused on guaranteeing and maintaining the privacy of users, so the regulator cannot certify, approve or admit them in its listing, because these cryptocurrencies hide the identity of users and can be used to promote illicit activities.
With this initiative, the New York State Department of Financial Services recognizes and confirms that Bitcoin is not the cryptocurrency of criminals as many tend to believe, but quite the opposite. Transactions and operations carried out with bitcoins from anywhere in the world are easily traceable within its blockchain; a blockchain that is public, transparent, immutable and trustworthy.
NYDFS Authorizes Cryptocurrency Services
Entities, businesses and organizations approved by the New York State Department of Financial Services will be able to use cryptocurrencies approved on the regulator's green list to provide and offer their financial services.
A license is required to obtain NYDFS approval. BitLicense, a business license that allows regulated access to the virtual currency market in New York and that defines and delimits the products and services that companies and organizations can provide within the New York territory. This license is subject to the internal regulations and policies of the New York regulatory body, so the NYDFS has full power and control over the approval, issuance, suspension or cancellation of licenses; as with the approved cryptocurrencies, which can be maintained or suspended from the list when necessary.
For its part, the regulator notes that it has issued a total of 25 BitLicense licenses and several virtual currency statutes as a way of guaranteeing the New York population the availability of a safe, regulated, innovative and forward-looking digital market. Likewise, the regulator indicates that since it began granting these licenses, there have been many requests that aim to expand the list of approved virtual currencies, hence the recent update that now includes 10 cryptocurrencies.
“In the five years since DFS began authorizing BitLicense and virtual currency trust companies (collectively, “VC Entities”), some of these companies have applied to list new virtual currencies (“coins”) in addition to those included in their initial DFS applications. During that time, there has been exponential growth in the number of coins.”
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