In run-up to bitcoin regulations, New York issues trust company charter to itBit

With its trust company charter, itBit is subject to the same government oversight as other financial institutions

A few weeks before New York officials are expected to issue a final regulatory framework for bitcoin, the state has issued a trust company charter to virtual currency exchange itBit.

Obtaining a trust company charter subjects itBit to the same state and federal regulations that apply to other financial services firms, according to the New York State Department of Financial Services. For example, deposits made to itBit must be fully insured. To offer this guarantee, itBit teamed up with an unnamed U.S. bank to insure client accounts up to US$250,000.

Qualifying for the charter, which itBit applied for in February, means the exchange's cybersecurity, consumer protection and capitalization plans, among other areas, were reviewed by the New York financial services department.

New York State Department of Financial Services Superintendent Benjamin Lawsky began looking into regulating bitcoin exchanges in 2013 and is expected to release a final set of regulations later this month. He issued draft proposals for bitcoin regulations for public comment last year.

Regulation can help the virtual currency industry grow while protecting customer funds, Lawsky's office said in a press release Thursday.

ItBit operates in New York and Singapore and targets large investors. Knowing that itBit complies with U.S. financial laws will help assure customers that their deposits are secure, the New York City startup said in a blog post Thursday.

Hackers have targeted bitcoin exchanges in recent years and made off with bitcoins worth millions of dollars. Mt. Gox was the world's most prominent exchange until it folded last year after attackers stole $474 million worth of bitcoins. This past January, Bitstamp lost $5 million worth of bitcoins in an attack.

Fred O'Connor writes about IT careers and health IT for The IDG News Service. Follow Fred on Twitter at @fredjoconnor. Fred's e-mail address is fred_o'connor@idg.com

Join the newsletter!

Error: Please check your email address.
Rocket to Success - Your 10 Tips for Smarter ERP System Selection

Tags itBitregulationgovernment

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Fred O'Connor

IDG News Service
Show Comments

Father’s Day Gift Guide

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

David Coyle

Brother PocketJet PJ-773 A4 Portable Thermal Printer

I rate the printer as a 5 out of 5 stars as it has been able to fit seamlessly into my busy and mobile lifestyle.

Kurt Hegetschweiler

Brother PocketJet PJ-773 A4 Portable Thermal Printer

It’s perfect for mobile workers. Just take it out — it’s small enough to sit anywhere — turn it on, load a sheet of paper, and start printing.

Matthew Stivala

HP OfficeJet 250 Mobile Printer

The HP OfficeJet 250 Mobile Printer is a great device that fits perfectly into my fast paced and mobile lifestyle. My first impression of the printer itself was how incredibly compact and sleek the device was.

Armand Abogado

HP OfficeJet 250 Mobile Printer

Wireless printing from my iPhone was also a handy feature, the whole experience was quick and seamless with no setup requirements - accessed through the default iOS printing menu options.

Azadeh Williams

HP OfficeJet Pro 8730

A smarter way to print for busy small business owners, combining speedy printing with scanning and copying, making it easier to produce high quality documents and images at a touch of a button.

Andrew Grant

HP OfficeJet Pro 8730

I've had a multifunction printer in the office going on 10 years now. It was a neat bit of kit back in the day -- print, copy, scan, fax -- when printing over WiFi felt a bit like magic. It’s seen better days though and an upgrade’s well overdue. This HP OfficeJet Pro 8730 looks like it ticks all the same boxes: print, copy, scan, and fax. (Really? Does anyone fax anything any more? I guess it's good to know the facility’s there, just in case.) Printing over WiFi is more-or- less standard these days.

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?