The New York State Department of Financial Services (NYDFS) has granted cryptocurrency trading firm Cumberland a BitLicense, officially authorizing it to operate as a virtual currency company.
Cumberland’s New BitLicense
In a June 17 announcement, Cumberland revealed its plans to leverage the BitLicense to establish robust trading relationships with institutional counterparties in New York. The firm joins a select group of only 33 companies listed on the NYDFS website that hold this license. Cumberland claims to be one of the few principal trading firms to achieve this status.
BitLicense Requirements and Criticism
Since 2015, cryptocurrency firms operating in New York have been required to obtain a BitLicense to offer their products and services. While the BitLicense aims to regulate the crypto market and protect consumers, it has faced criticism for potentially stifling innovation and economic growth. New York City Mayor Eric Adams has even suggested that the program should be scrapped.
Also Read: Coinbase Resumes Ripple (XRP) Trading in New York After SEC Lawsuit
Regulatory Actions in New York
New York authorities are currently pursuing legal action against Genesis Global Trading and crypto firm Gemini. The companies are accused of defrauding investors through the Gemini Earn program. In January, Genesis agreed to pay $8 million and surrender its BitLicense as part of a settlement with the NYDFS. Additionally, the New York Attorney General’s office reached a settlement with both Genesis and Gemini, banning them from operating in the state and prohibiting Gemini from running a crypto lending service.
Cumberland’s Role in Crypto Trading
Cumberland’s new BitLicense enhances its position in the cryptocurrency market. Before the U.S. Securities and Exchange Commission approved the listing and trading of a spot Bitcoin exchange-traded fund (ETF) on exchanges in January, Fidelity selected Cumberland as one of the firms to trade BTC for the investment vehicle. Cumberland operates across North America, Europe, and Asia, strengthening its global presence in crypto trading.
