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Should the Bitcoin Gambling Sector Be Troubled of BitLicense?

Chris in Uncategorized published on 22, August 2014

BitLicense

The future state of the Bitcoin gambling industry continues to be in peril due to the recent developments in regulating Bitcoin and its use in the business sector. The latest culprit is New York’s BitLicense proposal, which not only affects its local market, but also that of the overseas.

According to the proposed rules and regulations drafted by the New York Department of Financial Services (NYDFS), all Bitcoin businesses that deal with virtual currencies, including its conversion and sale, for its customers must be licensed in order to operate in New York.

BitLicense faced criticisms from the Bitcoin community, but NYDFS Superintendent Benjamin Lawsky reasoned that the proposal’s main goals are to protect the consumers and to impose logical rules.

Although the department is open for feedback, which in fact has been recently extended from a period of 45 days to 90 days, the community is rather dubious as to whether its true sentiments about BitLicense will ever cause NYDFS to change the main core of the drafted rules and regulations.

Several organizations have already expressed their opposition; the three Bitcoin exchanges based in China—BTC China, Huobi, and OKCoin—are the recent entities to voice out their concerns, fearing that New York’s proposal will also immensely affect their business, especially their expansion across the US.

There is a common understanding that BitLicense will likely influence future regulations in other jurisdictions, and this troubles many Bitcoin businesses, specifically the Chinese online exchanges, because it may just simply spell trouble for them.

In the event that BitLicense will take effect in the future and become the model of succeeding Bitcoin regulations, the progress of Bitcoin is believed to be hampered, with various sectors and fields absorbing the potentially negative effects.

Bitcoin gambling, for one, is perceived to experience significant changes once this scenario becomes a reality. Further restrictive virtual currency regulations will only take a toll on the sector that actively pushes for Bitcoin’s existence as it comprises more than half of the global Bitcoin usage.

There may also be an evident decline in the number of online Bitcoin exchange and gambling platforms that are allowed to render services in key markets worldwide.

Despite the fact that such event is based on speculations as of present, it is rather difficult to ignore the possibility, and this notion is shared by other organizations like Circle and the Digital Chamber of Commerce, as well as a team of two research fellows from George Mason University.

While the approval of BitLicense is still pending, the Bitcoin community, as well as the circle of Bitcoin gambling enthusiasts, can still submit their comments and only hope for a miracle.

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