The Leftover Bits 7/5/15: ItBit Gets Money and NYDFS Approval, Isle Of Man Using the Blockchain and FinCEN Isn’t Stopping at Ripple

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ItBit Gets $25M and Lawsky’s Stamp of Approval

ItBit has announced that it has raised USD $25 million in seed money and simultaneously received “charter” approval from the NYDFS (New York Department of Financial Services) to operate an exchange.

The NYDFS stated that this was the first “virtual currency” company to receive a charter to operate an exchange in New York. Superintendent Benjamin Lawsky stated that this is an important step for Bitcoin and other digital currencies.

“We have sought to move quickly but carefully to put in place rules of the road to protect consumers and provide greater regulatory certainty for virtual currency entrepreneurs. The technology behind Bitcoin and other virtual currencies could ultimately hold real promise and it is critical that we set up appropriate rules of the road to help safeguard customer funds. Indeed, we believe that regulation will ultimately be important to the long-term health and development of the virtual currency industry.”

ItBit’s newly announced Board of Directors include former FDIC chairman Sheila Bair and Former New Jersey Senator Bill Bradley.

FinCEN Looking At Other Companies

Fresh off its $700,000 fine of Ripple Labs, FinCEN is letting everyone know that it is taking a hard look at the virtual currency space.

During a speech at the 2015 West-Coast Anti-Money Laundering Forum, FinCEN director Jennifer Calvery stated that virtual currencies companies are indeed money transmitters and have to follow the relevant regulations. After spending some time reviewing (some might say bragging) about the Ripple Labs fine, she explained FinCEN’s future plans for virtual currencies:

“Working closely with our delegated BSA examiners at the Internal Revenue Service (IRS), FinCEN recently launched a series of supervisory examinations of businesses in the virtual currency industry. As with our BSA supervision of other parts of the financial services industry, these exams will help FinCEN determine whether virtual currency exchangers and administrators are meeting their compliance obligations under the applicable rules. Where we identify problems, we will use our supervisory and enforcement authorities to appropriately penalize non-compliance and drive compliance improvements.”

Sounds like companies can expect calls from them soon. Hat tip to CoinDesk for noticing this news first.

Isle of Man Working With Blockchain Technologies

The Isle of Man has always been a Bitcoin hot spot. Today, its government announced that it will be working with blockchain technologies.

Yes, you read that right. According to CoinDesk, the Isle of Man’s Department of Economic Development announced that it will be using a Proof-of-Stake protocol based off of Credits to create a ledger of all virtual currency companies in the space. [It should be noted that we could not independently find said announcement]

While the register will not replace regulation and is strictly being done as an experiment, this could be a step towards more governmental services being performed on the blockchain.

While, again as CoinDesk notes [because we were not able to verify this information before press time] all nodes of the network will be centralized inside the department, but anyone will be able to download the client.