Its official now, the New York State BitLicense has been very successful in driving away most of the digital currency based businesses from the state. According to reports, there are at least 20 digital currency businesses who have left the state in the past 3 months and more planning to leave the place.
The whole concept of Bitcoin originated around the idea of having a currency system that is free from the involvement of financial institutions as trusted third parties. The decentralized network with its participants acts as a trust network by itself and blockchain technology used to verify and keep record of the transactions enables it. However, the introduction of new laws are increasing government involvement in bitcoin stands against what bitcoin really wanted to be.
These 20 companies that moved out of New York State are the ones who still believe in the concept and there are many other similar startups who would rather follow the suit and move out of New York instead of complying with the regulations put forth by the New York Department of Financial Services to run their business.
Some of the companies that left New York State following BitLicense fiasco includes ShapeShift.io, Eobot, Kraken, LocalBitcoins among others. However, on the other side of the spectrum there are other kind of companies like itBit, Circle who have applied for and received BitLicense. Even Gemini, the newly floated bitcoin exchange and institutional trading platform has declared its conformation with the applicable laws to operate as a Limited Liability Trust Company.
According to a statement by Meltem Demirors, the community manager at Digital Currency Group published on the website- International Business Times these companies are interested in developing on the socially and economically disruptive elements of bitcoin to create an alternative financial without the involvement of traditional financial banks and institutions. BitLicense will be detrimental to such attempts and these companies will not be willing to sign up for that.