The New York Department of Financial Services (NYDFS) said on Wednesday it has rejected Seattle-based Bitcoin exchange Bittrex\u2019s application for a BitLicense.<\/p>\n
In a statement<\/a>, the NYDFS said it denied Bittrex\u2019s application due to deficiencies in the exchange\u2019s capital, as well as anti-money laundering, requirements. The regulator also cited Bittrex\u2019s \u201cfailure to demonstrate that it will conduct its business honestly, fairly, equitably, carefully, and efficiently,\u201d ordering the exchange\u00a0to cease operating in the state of New York and wind down its business within 60 days.<\/p>\n In a separate\u00a0letter to Bill Shihara<\/a>, CEO of Bittrex, who along with a group of security professionals founded Bittrex in 2013, NYDFS said it had issued several deficiency letters to the exchange, covering such issues as anti-money laundering, due diligence, and capital requirements.<\/p>\n It noted Bittrex\u2019s inadequate customer due diligence, with a large number of transactions missing required tax identification numbers or customer names.<\/p>\n \u201cThroughout Bittrex\u2019s application process, the Department worked steadily with Bittrex to address continued deficiencies and to assist Bittrex in developing appropriate controls and compliance programs commensurate with the evolving nature of the sector,\u201d<\/strong> wrote<\/a> Daniel Sangeap, deputy superintendent and deputy counsel at NYDFS.<\/p><\/blockquote>\n NYDFS examiners also found a substantial number of aliases such as \u201cGive me my money\u201d, \u201cElvis Presley\u201d, \u201cDonald Duck\u201d, as well as what the regulator described as \u201cobscene terms and phrases\u201d that are used in identifying accounts at Bittrex.<\/p>\n Overall, the regulator found Bittrex\u2019s compliance program deficient given that it has a customer base of about 1.67 million users across multiple countries, including 35,000 New York-based users, offers 212 cryptocurrencies and processed more than 100 million transactions annually in 2017 and 2018.<\/p>\n The New York regulator also ordered Bittrex to cease operating in the state of New York and wind down its business within 60 days.<\/p>\n In a statement, Bittrex disputed the regulator\u2019s findings and said it has already begun addressing many of these concerns.<\/p>\n Statement on the New York Department of Financial Services (NYDFS) Decision. Learn more: https:\/\/t.co\/BZzwCOWqOd<\/a> pic.twitter.com\/Fths61aiI7<\/a><\/p>\n \u2014 Bittrex (@BittrexExchange) April 10, 2019<\/a><\/p><\/blockquote>\n\n