Cumberland DRW, a prominent digital asset trader and liquidity provider, has been granted a BitLicense by the New York State Department of Financial Services (NYDFS) to allow the company to operate as a virtual currency firm in the state.
The BitLicense is a regulatory framework for cryptocurrency businesses in New York introduced in 2015. Cumberland DRW expressed satisfaction with the NYDFS decision and anticipates developing strong trading relationships with institutional counterparties in New York. As one of the principal trading firms to hold a BitLicense, Cumberland DRW is poised to expand its presence in the New York crypto market.
The BitLicense program has played an important part in the regulation of cryptocurrency. Some argue that it might slow down innovation and thus, slow down economic growth, while others insist that it is necessary for certain regulations and to protect consumers in the cryptocurrency market.
Cumberland DRW’s parent company, DRW, is a Chicago-based high-frequency trading firm. Earlier this year, Fidelity Investments selected Cumberland as one of the trading firms to handle bitcoin transactions for its spot bitcoin exchange-traded fund (ETF).
The NYDFS has been actively working to improve the virtual currency landscape in New York. Recently, the department released new guidance on customer service obligations for virtual currency entities (VCEs) to improve transparency and efficient management of customer inquiries.
According to the adopted standards, to guarantee customers access to multiple options for filing their complaints and requests, VCEs have to introduce relevant changes. They are also supposed to provide status reports and, more importantly, a time frame for expected outcomes.Â
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