Coinbase, a cryptocurrency startup based in San Francisco, has launched a licensed bitcoin exchange in the United States. Coinbase has claimed that this new exchange is the first compliant to U.S market regulations and backed by the New York Stock Exchange but this assertion has been already challenged by those knowledgeable of cryptocurrency.
Coinbase currently offers services in nineteen other nations others than the United States but represents one of several companies recently attempting to become compliant with regulators. Cyrptocurrencies and the companies that open exchanges have been plagued with breaches of security, subsequent theft and market volatility. Commentators claim that cryptocurrency operators are attempting to gain access to the stock market and becoming complaint with regulators in order to gain legitimacy in a financial sector still considered in its infancy. The Winklevoss Twins, known for their involvement in the creation of Facebook, have recently launched a bitcoin exchange called Gemini. The Gemini exchange according to a blog post is within U.S regulation and backed by the New York Stock Exchange. According to TechCrunch the New York State government requires a specific license for cryptocurrency operators before being allowed to enter the market. The license requires strict knowledge of the proprietors and forfeit of stored bitcoins to the New York State Department of Finance should an account become “abandoned” after five years.
According to Wired the company is contracted by nearly 40,000 businesses. Coinbase was previously a wallet service that allowed traders to store or spend bitcoin. Coinbase has received $75 million dollars of investment funds after a round of fundraising on the New York Stock Exchange. According to the Wall Street Journal Coinbase now has approval to operate in half of the states and following a massive investment by venture-capital firms the company hopes to find success as the first licensed operator in the United States. Bitcoin services are available in the urban centers of New York and California but cryptocurrency is still unknown for those outside of major cities.