itBit Raises $25 Million, Granted Charter by NYDFS to Operate Nationwide with FDIC Insurance
Today, international bitcoin exchange itBit announced it had been granted a trust charter by the New York Department of Financial Services (NYFDS) under New York State banking law. This is the first such charter granted to a digital currency company by the NYDFS. ItBit also announced the successful completion of a $25 million Series A funding round and the expansion of their board of directors.
Under the charter granted to itBit by the NYFDS, itBit is now able to accept customers from all 50 U.S. states in full compliance with state and federal law.
“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,” said Benjamin Lawsky, superintendent of the NYDFS, in a statement.
ItBit applied to NYDFS for a charter beginning in February 2015. According to the NYDFS, it conducted a thorough review of itBit’s anti-money laundering, capitalization, consumer protection and cyber security standards.
“Our mission at itBit has always been to create a trusted, institutional-grade exchange, and regulatory compliance is an important pillar of that mission,” said itBit CEO and co-founder Charles Cascarilla in a statement. “Regulatory approval from the NYDFS allows us to serve as a custodian for our clients’ assets and expand our services to U.S. customers – the largest market of bitcoin traders in the world – and allows us to do so with the highest standard of care afforded by any Bitcoin company.”
In addition, itBit has partnered with a U.S. FDIC-insured banking institution to be able to offer FDIC insurance on all fiat balances held by U.S. clients. itBit has also confirmed the immediate availability of their exchange platform to all U.S. retail and institutional bitcoin traders.
The funds itBit has raised in its $25 million Series A round will be used to scale operations as it begins to onboard U.S. clients. Previous investors RRE Ventures, Liberty City Ventures and Jay W. Jordan II participated in the round, along with new participant Raptor Capital management chairman James Pallotta.
Coinciding with the raising of funds, itBit has added three new members to its board of directors: former Sen. Bill Bradley, former FDIC Chairman Sheila C. Bair and former FASB Chairman Robert H. Herz. Bradley served as a U.S. Senator representing New Jersey from 1979 to 1997 and was a member of the Senate Finance Committee. Bair served as Chairman of the FDIC from 2006 to 2011 and was named one of Time’s 100 Most Influential People. Herz was previously the Chairman of the Financial Accounting Standards Board (FASB) and is on the boards of Morgan Stanley and Fannie Mae.
This announcement from itBit sets a new standard for regulatory compliance for digital currency companies.
This is a developing story and Bitcoin Magazine will continue to update it.