[2017-07-31]License Required: Poloniex, Bitfinex Will Stop Operations in Washing

[btc_angela]

License Required: Poloniex, Bitfinex Will Stop Operations in Washington

Major cryptocurrency exchanges Bitfinex and Poloniex have announced in March and late July 2017, respectively, that they would stop their operations in the state of Washington following the enactment of Senate Bill 5031 or the Uniform Money Services Act.

Some cryptocurrency exchanges, meanwhile, want to do business in the state despite the new regulation.

Among them is Gemini, which already secured an approval and a license to start operating in the state, allowing its Washington-based customers to buy and sell virtual currencies at the exchange.

Exchanges required to secure license to operate

The law aims to regulate money transmitters and currency exchanges in the state, including virtual currency operators.

According to the two exchanges, the new rules do not seem to support their objectives and their capability to serve their customers effectively.

In March, Bitfinex has already threw in the towel citing the incumbent license requirements and clearly stipulated in their ToS, particularly stating:

“Important: Financing is not allowed where prohibited by applicable law. US Persons may not be Financing Recipients on the Site. Furthermore, New York and Washington state residents are prohibited from depositing to, withdrawing from or trading on the Site.”

https://cointelegraph.com/news/license-required-poloniex-bitfinex-will-stop-operations-in-washington

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[1714931212]

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[CardShare]

Knew this was coming. 

https://bitcointalk.org/index.php?topic=2047405.msg20433955#msg20433955

[CyberKuro]

Poloniex and Bitfinex global trading volume will decrease soon, as many traders come from state of Washington. But, fortunately not all of the United State of America, right? Or maybe they will adopt the same regulations for every crypto trading platform. I can see the motive is to get taxes from all of their citizens who involve in crypto trading as they said any entity or individual who wants to operate a cryptocurrency exchange in the state should apply for a license and should contract with a third party auditor to monitor and inspect their system to ensure its transparency and integrity.
Transparency mean, you should give every details of your money to government and they want tax from it.

[bbc.reporter]

@CyberKuro. No. The decrease in volume will not be so big for everyone to notice. If it was the whole country then yes but banning people only for the state of Washington? 99% of the people there might not have heard of bitcoin and cryptocoins, and might not even care what they are.

[dreamhouse]

Will these exchanges move out of USA or they can operate in other states? I agree there need to be regulations of this space, specially for ICOs.

[iamTom123]

Will these exchanges move out of USA or they can operate in other states? I agree there need to be regulations of this space, specially for ICOs.

There should really be some type and form of regulations as there seems to have no trend to have self-regulation due to the fact that we are actually aiming for decentralization. However, regulations should be in consultation with the industry you are trying to regulate...there should be a meeting of the eyes here otherwise the law can be serving as a warrant for any business to relocate somewhere else.

I am sure that soon there can be fintech related companies which can moving away from the Unites States due to burdensome bureaucratic involvement. I believe that there should have a balance between consumer/investor protection and that of the business the law can be regulating.