Bittrex has announced that it will allow some of its clients to exchange their digital currencies for fiat currencies. The service will only be made available to a segment of the exchange’s customers initially and will enable Bittrex to take the battle to Coinbase. The move represents a significant step ahead for crypto exchanges, which have long been shunned by mainstream financial institutions. The service will only be available to Bittrex clients in New York, Washington, Montana and California, as well as qualified international clients, the exchange announced in a press release.
Are Banks Finally Coming Around?
Banks and other financial institutions have shied away from crypto-related businesses for long, and understandably so. With the financial services industry being among the most strictly regulated, banks have sought to avoid trouble with regulators. The crypto industry has long operated under an ambiguous regulatory framework, with governments struggling to play catch-up with the fast-moving industry. This ambiguity and vagueness has made associating with crypto-related businesses risky for banks.
Initially, fiat trading markets will include Bitcoin, TrueUSD (TUSD), and Tether (USDT), the exchange revealed. It will be limited to corporate clients at first, but as the regulatory requirements are worked out, it will be made available to retail clients as well. Customers will be subject to the standard registration requirements as well as “other specific fiat terms and conditions”. Bittrex views this as the first step in its local and global expansion by offering new services and strategic partnerships that will set it apart from other exchanges. According to Bloomberg, Bittrex partnered with Signature Bank, a New York-based bank, to provide the service.
Bill Shihara, the founder and CEO of Bittrex, expressed his confidence that the new trading pairs will drive the adoption of cryptos and blockchain technology.
Expanding fiat markets to the top digital currencies on our exchange should further drive adoption of this revolutionary technology by providing customers even more options for purchasing and trading digital currencies in a secure, robust and reliable environment with high liquidity.
Bittrex Carries Out Comprehensive Due Diligence
And in an interview with CNBC’s “Fast Money”, Shihara assured the Bittrex community that the exchange carries out a very rigorous review process for every altcoin it lists. While ensuring that the technology and the business models are innovative, the exchange also vets the founders and the principles behind projects before they are listed.
Shihara further stated that Bittrex welcomes regulations in the crypto exchange industry and that it has a commitment to compliance.
We think that solving the regulatory puzzle in the United States really unlocks a lot of capital that really can’t trade on a foreign exchange that doesn’t have proper AML/KYC control and proper compliance. So, we think we can actually add tremendous amounts of value as we are working with the regulatory agencies in the United States.
So, does Bittrex consider XRP to be a security or a token? Shihara shied away from the question, stating that as an exchange, Bittrex tries to remain market neutral. With XRP undergoing extensive review and scrutiny, all that Bittrex can do is wait for the verdict.