Bitcoin Lending Platform BTCJam Stops Taking New US Customers
Does this mean a sticky end for BTCJam? We aren’t entirely sure. While obviously very lucrative, the US is a notoriously difficult place to do business for bitcoin start-ups. Due to the differing rules been between all of the US states, it’s a legal minefield which is extremely expensive to navigate. The result is that many companies simply choose to avoid the hassle, and possible regulatory sanctions, by not accepting US business.
How does it affect the (bitcoin) industry?
At CoinCorner, we get many US citizens who would like to open an account with us, but unfortunately we simply aren’t able to accept them. We had hoped that BitLicence would help clarify the situation to such an extent that we would at least be able to accept residents of the Big Apple, but alas, the outcome seems to have been greater confusion and more expense.
As mentioned by CoinDesk recently, more than 6 months after the deadline for applications, only one licence has been issued with a further 21 applications still waiting. It doesn’t exactly seem to have created a level playing field. The most noticeable outcome would appear to have been bitcoin businesses leaving the state. They numbered 15 at the last count and included names such as Kraken, Bitfinex and LakeBTC.
There is another option to tackling the US market of course. Rather than applying for the appropriate licence in each state, ItBit recently secured something of a coup by successfully achieving a charter under New York banking law. This effectively allows them to operate across the US rather than having to apply for approval on a state by state basis. Quite how legally robust this route is, remains to be seen.
How does it affect CoinCorner?
So, where does this leave CoinCorner? While our focus remains on servicing are UK and European clients, it’s doubtful we’ll be entering the US market any time soon.
Disclaimer: The views and opinions expressed here represent those of the contributor, not necessarily those of CoinCorner.
What do you think of BTCJam’s decision to stop accepting new US customers? Let us know your thoughts in the comments below…