Adam Draper: New York BitLicense harms Bitcoin Startups

Boost VC Managing Director Adam Draper has recently launched a petition calling for some changes to the previous New York BitLicense.

The petition calls on regulators to collect less information about Bitcoin startups; to curb double federal and state regulations as they only continue to create hurdles and double costs; and to create a kind of sandbox for new products and services in which new innovations can be tested by people who understand the risk before financial products are made available to the masses, thus requiring a BitLicense.

It would also make it difficult for BitLicense investors to financially support Bitcoin revolution start-ups in their early stages

„The current BitLicense is making it very difficult for new companies in the digital currency industry to get off the ground and is affecting the way we do business. My company is focused on driving technological innovation and over-regulation stops the technology. Bitcoin revolution will not harm existing companies or large funds, but companies that are in the process of being formed or will be formed in the future.“ Here is more about it:

In a video, Draper says these changes are necessary to reduce the cost of new Bitcoin startups in the digital industry. He expects the initial cost of a BitLicense to be up to $2 million. In addition, there are additional annual costs of approximately $1 million.

Draper says these costs include the hiring of an additional compliance officer, the necessary reporting standards, information gathering and AML/KYC (anti-money laundering) expenses and associated legal costs.

Adjustments on the Bitcoin loophole are urgently needed

According to the experts of onlinebetrug, the revised BitLicense is already a significant improvement over the original version. However, there are still too many components that are too costly for Bitcoin loophole startups. Draper’s statements are consistent with those of Fred Wilson (Union Square Ventures) and other critics who have already commented on the current version of BitLicense.

„Reading through the second version of BitLicense, I still have the impression that it will be too costly for new Bitcoin startups,“ Draper said.

Draper says the proposed changes are good for both sides: „I think it’s a good balance between a proper regulatory framework and what businesses need to thrive.“ Draper says.

But he also admits that he missed the end of the second comment period, but still wants to do his part to improve the license. With the petition, he also wants to bring those people into the discussion who have so far shown themselves to be cautious.