Lawsky's Bitlicence driving firms off to Isle of Man

Chris Hamblin

Clearview Publishing

11 November 2014

Julia Tourianski, the director of the 'Bitcoin independence' project that emphasises the virtual currency's worth to individual freedom, reports that the New York Department of Financial Services' Bitlicence is failing to attract takers. She recently told the press: “The regulatory agencies in New York want to introduce the licence. They gave themselves 45 days to review and submit corrections to the proposed licence. As I was saying before they brought it up, it's a choke-hold on the start-ups and anyone willing to deal in Bitcoin in New York.”

When asked why she thought that the New York regulators worked for the banks, she said: “Because the banks are exempted from the Bitlicence. I think Coinbase is one of the only companies that's staying and complying with it. Everyone else is off to the Isle of Man...they're leaving. New York is going to be isolated, not only are all the businesses going to leave but the businesses that do leave will not be able to interact with anybody in New York in regard to Bitcoin because they'll be held liable - that's how far-reaching the law is. So they're going to reject customers from New York.”

Whereas New York's regulation of Bitcoin is stifling, the Isle of Man's is 'light touch,' aimed only at providing 'legal certainty.' Other nations, such as Bangladesh and Bolivia, have banned it.

An Isle of Man company called TGBEX Ltd, which claims to be the world’s first and only producer of high-quality physical bitcoins, has just launched its business in the United Kingdom.

Co-founder John Middleton, a committee member of the Manx Digital Currency Association and the Isle of Man Branch of the Institute of Chartered Secretaries & Administrators, a director of the Isle of Man Fiduciary Freeport Trust Company and also the CEO of Garigus Limited, the first company in the world with shares funded in Bitcoin, said: “Our coins are produced by generating private keys offline and by engraving the keys onto the coins, which are then secured, loaded with bitcoin and all records of private keys destroyed. Security of the bitcoin keys is paramount to our customers, so each coin is engraved via a CAM process to reduce the likelihood of human error and each coin is checked and signed off on the certificate and order form. The whole process is overseen and we have procedures in place to prevent the theft, or loss of private keys.

“The Isle of Man is an ideal location. The ability to have a chat (and a coffee!) with the data protection department, or meet the FSC at a week’s notice, just wouldn’t be possible anywhere else.”

TGBEX engrave public and private keys onto the obverse of the coins, with the private key covered by a holographic security sticker in an undisclosed location. Their website is atwww.tgbex.com