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Bittrex Global gets cleared to run crypto exchange from Bermuda

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Crypto exchange Bittrex Global received the green light from Bermuda’s financial watchdog to run its operations under the supervision of local authorities.

According to the official announcement, the company got a full “Class F Digital Assets Business Act” license from the Bermuda Monetary Authority, which will allow them to offer crypto services such as futures, subject to further approval by the watchdog.

Bermuda’s positive regulatory stance toward crypto comes within the context of the Digital Assets Business Act approved in 2018. This established the first legal framework for crypto companies that want to run their businesses from the island. It included provisions for digital asset issuance, exchange operations and custodial services.

Commenting on the approval, Stephen Stonberg, chief financial officer and chief operating officer at Bittrex Global’s Bermuda subsidiary, said:

“The Bermuda Government’s concierge service has made the process of setting up our operations in Bermuda seamless. Having a single point of contact within the Government to manage interactions was a refreshing change of pace.”

David Burt, Bermuda’s crypto-friendly premier, said that the approval granted to Bittrex Global was proof that the island offers “the ideal regulatory clarity and flexibility” to allow exchanges to innovate “quickly.”

The government of Bermuda recently announced its partnership with stablecoin platform Stablehouse. Together, they hope to roll out a pilot program for a digital “stimulus” token, targeting both residents and merchants within the islands.

The Bermuda government will also use the tokens to distribute payments to those who qualify for coronavirus-related financial aid.



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Regulation

New York authorizes first Yen stablecoin operator in the US

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New York has given the first authorization to a stablecoin backed by the Japanese Yen to operate in the U.S.

Per a Dec. 29 announcement, the New York Department of Financial Services has granted Japanese firm GMO-Z.com a charter to handle U.S.D. and Yen-backed stablecoins in New York. 

Given New York’s status as a global center, the NYDFS is the most prominent state financial regulator in the U.S. It is also one of the most aggressive. A pass to operate in New York often opens up the rest of the country. 

GMO’s charter is as a limited liability trust company rather than a full bank, the principle difference being in authorization to handle deposits. While a stablecoin operator typically needs the ability to hold reserves of the pegged asset, GMO’s charter limits its rights to hold other kinds of deposits not central to its ability “to issue, administer, and redeem” its stablecoins. 

The right to issue such non-depository charters has been a bone of contention between state regulators like the NYDFS and national banking regulators in the U.S. 

GMO president and CEO Ken Nakamura said: “We’re breaking ground with our move to issue the first regulated JPY-pegged stablecoin, which many see as a safe haven asset.” 

The NYDFS recently made changes to its famous BitLicense, including a conditional format that buddies up newly licensed firms with existing licensees. The first conditional BitLicense went to PayPal, facilitating the launch of its new crypto services earlier this fall with the help of longstanding licensee Paxos.