If it achieves a softening, BitGo could start offering its cryptocurrency custody services in yet another region of the United States
The company applied to act as a trust with the New York State Department of Financial Services (NYDFS). The authority is in charge of regulating all products and services related to money that is conducted in the territory, even contemplating cryptocurrency businesses.
BitGo’s board states that its goal is to become an “independent, qualified and regulated” cryptocurrency custodian. In this way, they expect New York authorities to monitor the level of security and operational efficiency of their services. The platform will comply with KYC and AML standards, provide a hedge of $ 100 million in digital assets for its clients, and store all cryptocurrencies cold disconnected from the internet.
BitGO is betting on satisfying the growing demand for cryptocurrencies in the markets of institutional investors, who along with the years have found themselves more and more interested in digital assets. The company forecasts an increase in the purchase of bitcoin and other cryptocurrencies in the traditional market. A prediction that seems to be correct if we take into account that the MicroStrategy company recently bought more than 20,000 bitcoins to protect itself from future dollar inflation, caused by the coronavirus crisis.
The directors of this company assure that the New York authorities were interested in their proposal, which is why they expect a positive response to their request. Although New York is one of the states with the strictest regulations for the cryptocurrency market, recently the financial institutions of this jurisdiction have been talking about decreasing the bureaucratic obstacles imposed to allow the operation of cryptocurrency companies in the territory.
If it achieves a softening, BitGo could start offering its cryptocurrency custody services in yet another region of the United States. By 2018, the company became the first qualified custodian to store digital assets through South Dakota Banking. In this way, the company would be preparing for the cryptocurrency market to continue growing in the coming years.
BitGO bets on a bigger cryptocurrency market
In parallel to the New York plans, BitGo is also trying to fix the processing problems that the Ethereum blockchain currently has. Ethereum transaction fees have risen in recent months, the product of an explosion in popularity in DeFi applications, which is why BitGo is planning to build a sidechain.
The idea of the company is to offer a service that allows transferring tokens at a lower cost and much faster. In this way, the firm will be able to continue working with its token anchored to Bitcoin, the WBTC, without major problems. The company currently owns some 46,000 bitcoins anchored to this ERC-20 contract, which allows them to mobilize and safeguard more than 500 million dollars.
Regarding the United States, this media reported yesterday that the Riot Blockchain Company recently announced the closing of an agreement for 18 million dollars with Bitmain. In this way, they guarantee to acquire 8,000 Antminer S19 miners that will be delivered from January 2021.
By Jenson Nuñez.
