Today, January 31, the New York Department of Financial Services (NYDFS) announced it has granted a virtual currency license to Cottonwood Vending LLC, granting the company the right to install cryptocurrency ATMs in the state.
The license – also known as a BitLicense – allows companies to provide services related to digital currency in New York and is notoriously difficult to obtain. In October 2017, a lawsuit was brought before the New York State Supreme Court that claimed the NYDFS did not have the authority to regulate cryptocurrency, arguing that virtual currency is not a financial product or service. The lawsuit was dismissed this year, and the NYDFS continues to regulate the use of crypto within the state.
Cottonwood Vending is one of three companies, the others being Coinsource and LibertyX, that have obtained the license primarily to set up networks of ATMs that offer customers the chance to buy virtual currency. The scope of the BitLicense extends beyond far beyond this one specific application, however.
LibertyX earned its BitLicense just a few days ago, along with Robinhood, which operates an app for trading in crypto.