Could the BitLicense Die Out? – The Basics about Cryptocurrency

New York has always offered sightseers some wonderful things. Between the Empire State Building, the Statue of Liberty and Broadway, all one has to do is stroll into the “city that doesn’t sleep” in order to have a good time.

But New York also has a dark side. A city that was once notorious for crime-ridden dark alleys and filth, New York now offers a whole new form of terror… the BitLicense.

Throughout the year, the document has witnessed growing dislike amongst bitcoin businesses and companies that would delve in digital currency. While former Superintendent Benjamin Lawsky and those currently in charge of cryptocurrency-related regulation would likely swear by the BitLicense’s “methods for correction,” others, particularly those in the bitcoin industry, would cite the document as something that not only halts innovation, but harms customer privacy.

Thus far, a number of businesses ranging from BitFinex to Kraken to LocalBitcoins have packed up and called it quits on the Big Apple, refusing to have anything to do with the limitations the BitLicense allegedly instills. Whether these limitations are in fact realities is quite irrelevant; one has to wonder… With so many companies leaving and so many likely to leave in the coming years, does the BitLicense really have a solid future?

Let’s look at some basic facts. When businesses leave an area, that area’s economy suffers. While New York is a big city, current exit rates are not likely to put it ahead in terms of digital stamina. The city’s traditional financial sector will likely survive, but any contemporary one it currently boasts likely will not, and while it may take time, this is likely to put New York behind in what can be considered a constantly changing and “digitizing” world. Technology and finance continue to fuse, and if New York cannot keep up, it will probably be left in the dust.

Furthermore, as businesses leave, the BitLicense is likely to earn an even harsher reputation than it already has. Right now, one of the main criticisms regarding the document is that companies that deal in bitcoin are being made to not only pay high fees, but provide customer information to regulators that would otherwise be considered private, thusly “putting a hole” in customers’ identities. Up to this point, it has primarily been businesses stemming the major protests, but will we eventually see individual protests coming later? Will bitcoin customers who don’t like being “put on display” come to take action?

What do you guys think? Does the BitLicense really have much of a chance? Post your comments below.