Coinsource, the operator of the ATM Bitcoin machine (BTM), has just become the 12th encryption company to receive a license from the New York State Department of Financial Services (NYDFS).
The company announced approval of the BitLicense call on Thursday, and the company's attorney general, Arnold Spencer, said it was the first to be granted to a bitcoins supplier for ATMs to date. The company already has 40 BTMs in the state, having operated under a provisional license until full approval.
In a statement, NYDFS superintendent Maria Vullo confirmed the news and said licensing is "one more step in the implementation of sound regulatory safeguards and effective risk-based controls while encouraging the responsible growth of financial innovation."
Spencer told Criptomonedaeico that "receiving BitLicense" is a validation of our business model [and] Our Model of Compliance ".
"It was a long and complicated process. [in 2015, and] Since then, what we have seen is a lot of diligence on the part of NYDFS, which really leads us to explain and, in some cases, improve our policies and procedures. "
These ranged from having a business disaster continuity plan to cutting-edge cyber security measures, Spencer said. During the evaluation period, Coinsource ceased to be a non-audited company with three employees and a handful of BTM to be fully audited and grew to more than 20 employees and more than 200 machines.
"We had 500% growth for three consecutive years in terms of machines, and we had comparable revenue growth through the spring of 2018, when it slowed substantially," he said.
Compared to traditional stock exchanges, the company's BTMs are convenient and offer direct peer-to-peer transactions, Spencer said, adding: "We have opened and fulfilled our account in real time."
The speed of the machines comes from a proprietary system that Coinsource has developed to carry out the checks to get to know your customer. When a customer would have to send the data from a cryptographic exchange bank and another identification test, Coinsource only needs a driver's license, a selfie, and a cell phone number.
Spinser also makes it easy for people without a bank to have access to crypto coins, since they do not need a bank account to buy bitcoins and can pay cash.
Currently, Coinsource customers can only buy or sell bitcoins through BTM; They still can not send funds to other portfolios.
Spencer explained that this is intentional, since allowing this would facilitate the transmission of money, so "you must have a money transfer license in both jurisdictions where the transaction begins and where the transaction ends.
However, the company currently has money transfer licenses in 18 states, with licenses pending at another 15. Spencer anticipates that by next year, Coinsource will be licensed in all 50 states.
"At that time, we could have people depositing money into the machines and transferring bitcoins to a third-party portfolio, as long as both customers were registered," he said.
Outside the US, Coinsource plans to potentially expand operations to Japan, South Africa and Puerto Rico.
Of these, Puerto Rico is likely to occur first, since the company already has a license to transmit money to the territory.
"We had preliminary talks with regulators in Japan to use this as a springboard for Asia, and we had initial talks with bankers and regulators in South Africa, but that's probably the furthest thing in terms of development," Spencer said.
In addition, being incorporated in Argentina, Coinsource already has a base for the expansion of Latin America and South America.
The addition of criptomoedas in addition to Bitcoin on all of the company's machines is also at stake in the "near future," but "this is contingent, of course, on regulatory approval," he said.
Image of Bitcoin ATM courtesy of Coinsource
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