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NY’s Native Coin Hit by BitLicense Snag, Citizens Barred to Trade

By:
Sujha Sundararajan
Updated: Mar 1, 2022, 15:11 GMT+00:00

New York's namesake CityCoin - NYCCoin - is not listed in any of the crypto exchanges that has procured BitLicense, thus not allowing citizens to trade it.

New York City

Key Insights:

  • NY residents are only permitted to mine NYCCoin and can’t trade with it.
  • The BitLicense requirements have barred residents from accessing the token.
  • Unlike the people of NY, Miami residents have the complete freedom to buy and sell MiamiCoin.

Bloomberg reports that New York residents are barred from trading their own city’s digital token dubbed NYCCoin.

The city’s citizens can only mine the native coin and not buy and sell, as NYCCoin does not comply with the existing BitLisense regulations. This is because none of the exchanges that had procured BitLicense had listed New York Metropolis’s native crypto.

Because of this, New Yorkers can create coins through the mining process, but they can’t trade them on an exchange.

According to the developer of CityCoins, Patrick Stanley, BitLicense features “limits innovation.” He further told Bloomberg:

“The City of New York is reviewing how they could accept and use the funds, but if there’s a lack of imagination, Miami is the model.”

What Is BitLicense Requirement?

New York’s BitLicense regulatory regime is the most demanding in the United States. The requirements, introduced in 2015 and touted as a nationwide model, have failed spectacularly.

Digital currency firms in New York currently have to apply for a BitLicense, which can take years to process.

In other words, any digital asset-related activity, like receiving cryptos for transmission, storing and holding cryptos, buying and selling cryptos, or performing exchange services, falls under BitLicense regulations.

Due to this, many crypto-related companies have decided to move out of New York than submit to BitLicense. 

For instance, ShapeShift.io became the first digital currency company to announce its decision to move out of the city for moral and ethical reasons than share customer details with the government.

Also, some of the biggest crypto exchanges in the country, including Binance.US,  Crypto.com, Kraken, and FTX, do not have the right to operate in the city of New York.

How Is MiamiCoin Different From NYCCoin?

Miami has been seriously angling to become a leading crypto hub. As a result, the city mayor Francis Suarez has gone all-in on Bitcoin and blockchain. He said crypto is “incredibly important” to the city’s future.

Launched in August 2021, MiamiCoin (MIA) is based on Stacks (STX), an open-source network of decentralized applications and smart contracts built close to the Bitcoin blockchain.

Mayor Suarez later announced that every Miami resident with a digital wallet would receive a Bitcoin dividend. However, CityCoins is an independent community, and the City of Miami does not own or hold MiamiCoin.

MiamiCoin will allow citizens to mint NFTs, build applications, and provide crypto payments. New Yorkers have no compliant way to buy tokens since the coin isn’t available on any exchanges that carry the BitLicense required for crypto purchases within the city.

New York residents unable to buy and sell their CityCoin is a setback for the city, trying to rival Miami as the major crypto hub in the U.S.

About the Author

Sujha Sundararajan is a writer-journalist with 7+ years of experience in Blockchain, Cryptocurrency and in general, FinTech news reporting. Her articles have featured in multiple journals such as CoinDesk, Protos, Bitcoin Magazine, CCN, Asia Blockchain Review, BeInCrypto and EconoTimes to name a few. She holds a Master’s in Journalism from the Indian Institute of Journalism and New Media and is also an accomplished Indian classical singer.

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