One of the pioneers in secure cryptocurrency payments, Xapo, has been granted a virtual currency license by the New York Department of Financial Services. The company which is aiming to bridge the gap between fiat and digital currencies and is advised by the former Secretary of the Treasury, Lawrence Summers, has received the green light earlier today.
The new license for Xapo comes alongside a permit for Paxos Trust Company LLC, which is also known as itBit. The firm offers exchange and custody services for Ether, Litecoin, Stellar Lumens and Bitcoin Cash. The service also aims at emerging cryptocurrencies, by using its own virtual currency exchange.
The move by the New York-based regulator is in line with the ongoing establishment of cryptocurrency services as a parallel to the traditional financial system. As part of the ongoing effort by the US government to reign in crypto trading and ICOs, the licensing of the operations of different service providers is an essential part of the evolution of the asset class.
“Today’s actions represent New York’s continued commitment to creating a thriving, global fintech marketplace,” said Department of Financial Services Superintendent Maria T. Vullo.
A Thorough Review
The DFS thoroughly scanned Xapo’s application for appropriate anti-money laundering and anti-fraud procedures, alongside capitalization, consumer protection, and cybersecurity policies. Xapo will be subjected to regular supervision on the part of the New York-based regulator.
Xapo has been granted a permit to provide a digital wallet and a vault service. At the same time, the DFS allowed the itBit exchange, to offer services for buying, selling, sending, receiving, and storing currencies beyond Bitcoin.
Xapo’s President Ted Rogers said that the efforts of Xapo’s personnel had been complimented by the DFS and its staff.
“It is an important milestone for itBit as we create a broader platform for crypto asset investors. We are committed to the growth and evolution of this ecosystem and DFS approval allows us to offer more trading and custody services across a wider range of crypto assets,” said Chad Cascarilla, CEO of itBit.
Xapo is the eighth company which holds virtual currency charters or licenses.