Rapid bitcoin trading platform BitQuick.co, is following the exodus of bitcoin firms from New York as the dreaded BitLicense comes into affect.
The company indicated the move was a direct result of the extensive regulations introduced by the recent implementation of the BitLicense. The BitLicense imposes a $5,000 fee to all applicants, alongside various regulatory requirements that would need to be continually met.
BitQuick joins a continuing trend of Bitcoin companies to pull their services from New York. To better inform consumers of the situation at hand, New York customers are being redirected to PleaseProtectConsumers.org. ShapeShift.io was one of the first to take such action in June 15, 2015, followed shortly by GoCoin, according to their press release. Over the weekend, two of the largest bitcoin exchanges, Bitfinex and Kraken, announced that they were also halting services in New York.
BitQuick.co Founder Jad Mubaslat added:
$5,000 for a new startup is a deep expense. When you’re talking about many companies who are in pre-seed stages, they don’t even stand a chance to try. New York isn’t a problem now; we’ll have to wait for them to come around. But if other states followed suit, there would be a serious chokehold on innovation. Innovators would flee to unrestricted states or territories. Not to mention the state by state regulatory framework in place right now is a mess to begin with.
BitQuick stated that the regulation is overbearing relative to the size of the Bitcoin industry, and indiscriminate towards small and large startups. They state that this can also put consumers at risk by requiring various companies to maintain in depth records of their customers. Sensitive financial databases are routinely cracked.
However, there are still some exchanges that will remain and comply with New York regulation. Unreleased Gemini exchange, created by the Winklevoss twins, Bitstamp and itBit are applying for the BitLicense.