Bitcoin exchange itBit announced a $25m series A funding round in addition to regulatory approval from the New York Department of Financial Services (NYDFS) under New York State banking law. This approval allows itBit to take on customers in all 50 states in full compliance with federal and state law. itBit also secured FDIC insurance for fiat accounts for all US customers.
Raptor Capital Management chairman James Pallotta joins as a new investor along with RRE Ventures, Liberty City Ventures and Jay W. Jordan II for this $25m series A round. itBit also brought on board three new members to its board of directors: former Sen. Bill Bradley, former FASB Chairman Robert H. Herz, and former FDIC Chairman Sheila C. Bair.
In a statement, itBit co-founder and CEO Charles Cascarilla said that “Regulatory approval from the NYDFS allows us to serve as a custodian for our clients’ assets and expand our services to U.S. customers – the largest market of bitcoin traders in the world – and allows us to do so with the highest standard of care afforded by any Bitcoin company.”
The announcement of the fully compliant exchange comes as a surprise while the Bitcoin community is awaiting NYDFS Superintendent Benjamin Lawsky’s final release of the regulatory guidelines for digital currency companies.
Lawsky’s regulatory proposal would include a “Bitlicense” that Bitcoin exchange businesses would need to obtain in order to work with New York customers. The regulatory proposal for the state of New York may set a precedent for how other states approach companies that exchange digital currency.
Lawsky said in a statement that “We have sought to move quickly but carefully to put in place rules of the road to protect consumers and provide greater regulatory certainty for virtual currency entrepreneurs.”