Bitcoin of America, a provider of cryptocurrency and Bitcoin ATMs has agreed with the Connecticut Department of Banking to cease its operations due to the absence of proper licensing.
Bitcoin of America did not obtain the required license to operate Bitcoin ATM kiosks in Connecticut, as stated by the Department of Banking. Following a scam where four consumers lost significant amounts of money, a consent order was issued, leading to the cessation of operations.
Commissioner Jorge Perez issued a warning regarding unlicensed crypto kiosks, cautioning investors who are frequently persuaded to deposit cash and transfer an equivalent amount of cryptocurrencies to scammers.
Bitcoin of America’s business model, involving the transfer of funds to third parties, necessitated a money transmitter license. To address the broader issue, the Department of Banking and Connecticut State Police jointly proposed HB 6752, requiring virtual currency kiosks to be licensed as money transmitters in the state.
Global geopolitical instability and increased enforcement against unlicensed operations negatively impacted the Bitcoin ATM network. Government Agency’s Plan for Establishing a Regulatory Framework for Cryptocurrencies.
While the process of the regulatory framework is in the pipeline, the crypto space is taking a lot of enforcement hit from the regulatory bodies, which is building unwanted panic and skepticism towards crypto.