NEW YORK (Reuters) – New Yorkers can use their cell phones to get Bitcoin or sell for cash at ATMs similar to ATMs in and around New York City after the Treasury Department announced Thursday that it had approved the virtual one has currency license from Coinsource Inc.
Bitcoin ATM operator Coinsource, based in Fort Worth, Texas, has 40 Bitcoin kiosks in New York City, Westchester and Nassau counties. The company enables customers to put cash in and buy Bitcoin and store it in their mobile wallet, or sell Bitcoin for cash by scanning their mobile wallet at the kiosk.
“Today’s approval is another step in the implementation of strong regulatory safeguards and effective risk-based controls while promoting the responsible growth of financial innovations,” said Financial Services Superintendent Maria T. Vullo in a statement Thursday.
The State Department of Financial Services has so far approved 12 charters or licenses for businesses in the virtual currency market.
The New York regulator announced on Thursday that the approval follows an extensive and rigorous review of Coinsource’s application and is subject to significant regulatory conditions.
“In addition to being a hub of global innovation, New York is one of our largest target markets,” said Sheffield Clark, Coinsource’s chief executive officer.
Coinsource was founded in 2015 and operates ATMs in major US population centers. The company has more than 200 vending machines in 19 states, including the District of Columbia.
According to Coinsource, most customers use Bitcoin ATMs as an alternative to online exchanges that require highly technical knowledge, have long transaction delays, high fees, and limited customer service. That being said, the ATM operator said online exchanges are prone to manipulative trading activity and fund hacks.
“Bitcoin is no longer a peripheral currency and will increasingly be adopted by the mainstream in 2018,” said Sheffield.
DFS previously issued virtual licenses to BitFlyer, BitPay, Coinbase, Circle, Genesis Global Trading, XRP II, Square and Xapo. The charters were issued to Gemini Trust Company, Paxos (formerly itBit) and Coinbase Custody Trust Company LLC.
Reporting by Gertrude Chavez-Dreyfuss; Arrangement by David Gregorio