Bitcoin platforms working out of New York State are going to get costlier. Thanks to the BitLicense introduced earlier this year by the New York State Department of Financial Services, bitcoin platforms are now trying to recover the licensing fees from their customers. Leading the trend is Coinsetter, a bitcoin exchange which has introduced an exorbitant monthly user fee of $65.
The introduction of monthly user fee goes against the principle of bitcoin, which was intended to make transactions and remittance cheaper. Coinsetter will start charging its customers from next month. A reddit user going by the username KryptosBit has posted a mail that he allegedly received from Coinsetter informing him about the new user monthly fees. The email states that all funded accounts on the platform will be forced to pay a monthly fee of $65. The company also mentions that the new few structure is necessary for Coinsetter to compensate for the costs associated with holding its customers’ bitcoin/funds on the platform.
The same mail also offers a solution to those who do not wish to pay the monthly fees. In such cases, Coinsetter advises its customers to withdraw funds from the platform to personal wallets like Xapo, Armory etc. Customers are advised to make necessary changes to their account and withdraw any funds currently parked in it before next month to avoid the user fee.
BitLicense is now necessary for cryptocurrency businesses to operate in the State of New York. The ones who apply for BitLicense are expected to make their platforms BitLicense compliant by introducing, AML/KYC procedures and maintain records of all the transactions happening over the platform. These companies are also expected to submit regular reports to NYSDFS. All these comes at a cost which is quite high. While the setup is similar to those required of banking and financial institutions across United States, the bitcoin companies do not charge transaction and maintenance fees on par with such institutions. This makes them suffer losses unless they pass on the costs to their customers.