Bittrex’s BitLicense Process Was Rejected, But Exchange Claims Regulator Knew Nothing About Blockchain
It is not easy to start a business in the cryptocurrency and blockchain sector. It may look easy, especially when you consider how easy it was to make a profit during 2017, however, the reality is that when you start a crypto business, you will have the world against you.
The Block Crypto has recently reported on the case of Bittrex, a crypto exchange which got its BitLicense to operate in the state of New York denied. According to the members of the company, the ruling was very unfair.
In fact, the denial was pretty brutal. The New York Department of Financial Services (NYDFS) affirmed that the company was not being responsible and that North Koreans and Iranians used the platform under clearly fake names like Elvis or Donald Duck.
However, according to the Chief Compliance Officer of Bittrex, John Roth, there is “more than what meets the eye” in this case. He affirmed that the NYDFS simply did not know what they were doing. They initially agreed to grant the license three months ago, but they ended up changing their minds at the last second after they did not agree to an unfair deal.
The deal was that they have to clear all future tokens listings via the agency, even the ones that would be outside of their jurisdiction. He affirms this because the state of New York should not be able to restrict how the company deals with people outside of their jurisdiction and they refused to surrender this level of control.
According to sources, the NYDFS was angered when Bittrex did not respond the way they wanted, so they changed their stance on the company.
Roth affirmed that the Iranian Donald Duck and the North Korean Elvis never actually traded on the exchange. They appeared on the records because they tried to create an account, but they never actually traded because they would not be allowed.
The company also said that no North Koreans ever traded on the site. Some Iranians started to, but hey were caught.
In fact, there is the chance that both sides were not actually right about the whole thing, too. This is mainly because sometimes companies fail to read their own data. Mistakes are common since most companies and groups lack total control over who is accessing their services. It is a lot of people, after all.
Roth was probably so angry because he was named in the report and it said that he “lacked the qualification of effectiveness”. His response is that they sent people who did not know anything about the blockchain technology to the company and that they would obviously make a bad report because they did not understand the technology very well.