By
Chimamanda U. Martha
April 25th, 2024
Having received BitLicense from the NY Department of Financial Services, Coinsource now has an official approval to operate in New York.
Though traditional ATMs became quite a common thing quite long ago, Bitcoin ATMs still look somehow suspicious in the eyes of regulators. Nevertheless, step-by-step crypto ATMs operators are pushing their way to official recognition.
According to the recently made announcement, the world’s largest Bitcoin ATM company, Coinsource, has received official approval to operate in New York.
The company has become the first Bitcoin ATM operator to be granted the so-called BitLicense from the Department of Financial Services (DFS) and it is now the 12th crypto company to receive such a license in New York State.
Among other prominent companies that hold such an important license are Coinbase, Genesis Global Trading, Xapo and Square.
Coinsource is based in Texas and last year it came to New York. At the current moment, it has 40 Bitcoin ATMs functioning in the state that have been installed under a provisional license while the company was waiting for full approval.
The majority of its machines are two-way ATMs. It means that users have an opportunity to purchase and sell Bitcoin with the help of them.
NYDFS superintendent Maria Vullo confirmed the news and noted that it is an important step for the entire industry. She said:
“Today’s approval is a further step in implementing strong regulatory safeguards and effective risk-based controls while encouraging the responsible growth of financial innovation. New York’s financial services marketplace is thriving with companies committed to complying with DFS’s regulations that ensure the security of transactions, safeguard the industry and protect consumers.”
What It Means for Coinsource
Coinsource started its way from being an unaudited firm with three employees and several BTMs. But now it’s a fully audited company with over 20 employees and more than 200 machines. Over three consecutive years the company has shown a 500 percent growth in terms of machines.
The firm’s general counsel Arnold Spencer said that a received license means for them a validation of their business model and their compliance model. He added:
“It’s been a long, involved process. The initial application was [in 2015, and] since then what we’ve seen is a great deal of diligence on NYDFS’ part, really pushing us to both explain and in some cases improve our policies and procedures.”
The company claims that in comparison with traditional exchanges they offer a much more convenient way of working with crypto. Moreover, their Bitcoin ATMs allow users to enjoy direct peer-to-peer transactions.
The machines speed and performance is a result of the company’s proprietary system that was designed to carry out know-your-customer checks. While usually users need to pass an identification procedure and send bank details to a crypto exchange, users of Coinsource are required to send just a copy of a driver’s license, a selfie or to indicate their phone number.
Being the first and only Bitcoin ATM operator to be granted a full BitLicense, Coinsource has wide opportunities to expand its userbase. Now the firm has money transmission licenses in 18 states and is waiting for approval in another 15 states. According to Spencer, they hope to win licenses in all 50 states by sometime next year.