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Square, Inc. Branches into the World of Cryptocurrency

Bitcoin and Blockchain

Square Inc., the San Francisco based fintech payment firm founded by Twitter Inc., has acquired a license to buy and sell bitcoin in New York on its own platform, Cash App. Square, known for its product that makes it easy to accept credit card and contactless payments using phones and tablets, is branching out into the world of cryptocurrency. Square’s peer-to-peer phone application, Cash App, allows people to send and accept money, transfer the balance into bank their accounts, and now purchase bitcoin in seconds.

Square was granted a BitLicense by the New York Department of Financial Services (DFS), which companies are required to obtain in order to transmit, store, perform exchange services, and maintain custody or control of virtual currencies. In order to obtain the license, companies must demonstrate that they have adequate cyber security and anti-money laundering programs in place and agree to permit an examination at least every two years to assess the company’s financial status, policies, and determine whether it has complied with relevant laws and regulations. In a press release, DFS disclosed Square’s review also included an examination of the company’s anti-fraud, capitalization, consumer protection systems.[1]

New York has been reluctant to grant BitLicenses, and is known for being particularly strict in regards to regulating companies providing platforms to buy and sell cryptocurrencies. Square is the ninth successful company to obtain a BitLicense.[2] Other companies that have been approved by the DFS include Coinbase Inc., Xapo, Inc., Genesis Global Trading Inc and Circle Internet Financial.[3] Financial Services Superintendent Maria T. Vullo announced that ““DFS is pleased to approve Square’s application and welcomes them to New York’s expanding and well-regulated virtual currency market … DFS continues to work in support of a vibrant and competitive virtual currency market that connects and empowers New Yorkers in a global marketplace while ensuring strong state-regulatory oversight is in place.”[4]

Jack Dorsey, the cofounder and CEO of Twitter and Square, has been a vocal advocate of bitcoin and was eager for the company to branch into the cryptocurrency market. Brain Grassadonia, the head of Cash App, noted that being granted this license will help create “greater access to the financial system” and provide customers with easy access to buy and sell bitcoin. As of June, New York residents may use Cash App for bitcoin transactions in New York State.

[1] Department of Financial Services Press Release. (June 18, 2018) “DFS Grants Virtual Currency License to Square, Inc.” Available at: Accessed on July 6, 2018.

[2] Irrera, A. (June 18, 2018) “Square Obtains NY State Cryptocurrency License.” Reuters. Available at: Accessed on July 6, 2018.

[3] Op. Cit. n1.

[4] Op. Cit. n1.

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