With the mission to offer bank-level security to its customers and to better regulate operations, US Bitcoin exchange company “itBit” has filed for a banking license in New York and is waiting for an approval. The company’s application for a banking license is part of its plan to expand its business into different financial services. If approved, itBit will be the first Bitcoin exchange to be regulated as a bank in the United States. itBit’s application for the banking license is in line with the industry trend to be fully compliant with anti-money laundering (AML) and know your customer (KYC) requirements.
As per itBit’s website, “itBit is institutional-grade and 100 percent compliant within every jurisdiction it operates. The company’s stringent compliance program ensures the highest level of customer security and protection”.
The website also states that, “itBit is building next-gen digital currency products and services by combining Silicon Valley innovation with Wall Street expertise”.
itBit is a global exchange which offers institutional and retail investors a platform to buy and sell bitcoin. The company was founded in 2012 by Charles Cascarilla and has offices in New York and Singapore. The company has so far received $3.3 million funding in the seed round and is backed by venture capitalists, Canaan Partners, RRE Ventures and Liberty City Ventures.
Paymium, formerly Bitcoin-Central is another Bitcoin exchange which has already received approval to operate as a bank under the French law. The company currently enjoys the privilege of a licensed payment service provider in partnership with payment processor, “Acoba” and “Credit Mutuel bank”. The banking approval has facilitated the company to have direct access to the banking networks and allows the company to automate the incoming and outgoing transfers.
The approval has allowed the users to order Paymium's debit card which allows withdrawing cash based on their euro and bitcoin balances. It has also provided for the funds to be held under the user’s name in Credit Mutuel bank instead of the exchange’s name. The user accounts are insured by “Garantie des dépôts” which is similar to the Federal Deposit Insurance Corporation (FDIC) in the US.