Financial regulators in New York approved Stellar Lumens for trading on the itBit exchange.
Stellar Lumens = The Investment-Class Coin
Designed exclusively for institutional investors, itBit initially offered Bitcoin trading only. Over time, it added Litecoin, Ethereum, and Bitcoin Cash. Notably, the NYDFS granted itBit a banking charter, a more compliance-laden option than New York’s BitLicense program.
Stellar Lumens is usually sitting on “Top 10 most Valuable Cryptocurrencies” lists and enjoys a market cap of over US $4.3 billion. Despite its vaunted status, the approval is big news and indicates that regulators don’t see the coin as a security, in and of itself. If authorities had slapped Lumens with a securities label, then the coin would have had to register as a broker/dealer with the Securities and Exchange Commission.
Chad Cascarilla, co-founder and CEO Paxos, itBit’s parent company, recently told Fortune “That’s why we’ve added them to the exchange, if they were security, you’d have to go through a different process.”
Stellar Lumens On The Rise
Lumens will benefit from the decision.
Jeb McCaleb founded Stellar in 2014; he also launched Ripple and the now-shuttered Mt.Gox.
Startups and large companies (think IBM), alike, have adopted Stellar’s technology.
After an early week sell-off, Stellar Lumens climbed over 5% on the heels of the itBit news.
Stellar Looking Forward
Of the other four cryptocurrencies on the platform, Cascarilla explained: “These were the ones we heard from our customers they wanted the most.” ItBit is now looking into adding more coins to their exchange including the currently beleaguered Ripple.
“We clearly want to get to the top 10, top 20 assets over time,” Cascarilla presaged.
For the time being, however, itBit will continue to serve the top-tier institutional market centered on hedge funds, investors, and private equity firms.
Wall Street investors have been looking for compliant ways to invest in digital asset market; itBit is looking to fill this void. And hot on its market share heels is Coinbase; the exchange will soon be rolling out a custodian service for large volume clients. Let the high-end coin investment games begin!
“The interest and the adoption from institutions and large firms that have a lot of credibility is very real, that might not be reflected in the price today, but from what I see, will certainly be changing the landscape over the next six to 12 months,” Mr. Cascarilla said.
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Gordon Law Group maintains a cryptocurrency practice that assists both investors and blockchain businesses. If you have token-related legal questions, don’t hesitate to give us a call.
