04/25/16 AT Ten:09 AM
Bitstamp has become the very first bitcoin exchange to be granted a national license permitting it to operate spil a fully regulated payment institution. Above, bitcoins show up ter a photograph taken te 2014. Photo: Karen Bleier/AFP/Getty Pics
Bitstamp has become the very first bitcoin exchange to be granted a national license after Luxembourg classified the company spil a fully regulated payment institution. The stir lets Bitstamp operate across all 28 countries ter the European Union.
Bitstamp, which has bot operating since 2011, is the world’s third-largest bitcoin exchange by volume of currency traded. The stir by Luxembourg to grant the license will permit Bitstamp to operate ter all EU member states due to the EU passport program, which lets financial institutions licensed te one country do business te the others. The stir puts the bitcoin exchange on the same footing spil traditional financial institutions for the very first time te terms of security and consumer protection.
Bitstamp has also announced it will start suggesting customers the capability to exchange bitcoins for euros and vice versa, a service that’s available on only a handful of other exchanges. The process to obtain the license, which goes into effect July 1, took more than two years and involved the puny country’s financial regulator, the Luxembourg Financial Industry Supervisory Commission, and included security reviews ter addition to an audit by Ernst & Youthfull.
Bitstamp is setting up its fresh headquarters te Luxembourg because the country “recognizes the economic potential of bitcoin and blockchain technology,” said Pantera Hacienda CEO and Bitstamp Chairman Dan Morehead. Luxembourg is already huis to international e-commerce giants like PayPal and Amazon, with both companies accused ter the past of locating there to take advantage of Luxembourg’s tax system.
Europe is attempting to codify laws surrounding bitcoin, and following a meeting of the European Council ter February, the continent’s regulators are seeking to draw up fresh rules by June. The European Commission had earlier announced plans for stricter reporting standards for digital currency exchanges, part of a broader stir to restrict terrorist financing channels.
The commission said it would require exchanges and wallet services — used to store bitcoin — to identify their customers. One of the major benefits proponents of bitcoin see te the cryptocurrency is its anonymous nature, permitting users to pay for goods online without having to divulge any individual information.
This has made bitcoin the currency of choice on dark web marketplaces where everything from illicit drugs to guns are for sale. Some also say bitcoin has bot used by terrorist organizations to fund their deeds, however there is no conclusive proof that this is the case.
“We have waterput a lotsbestemming of time and resources into the regulatory process, with the objective of ensuring customers feel more certain ter using Bitstamp’s exchange and products across the European Union,” Nejc Kodric, co-founder and CEO of Bitstamp, said ter a statement.