Gate US said that it got licences to work in “several” U.S. states and a licence from FinCEN to be a money service business before it opened in the U.S.
Gate US is the United States branch of Gate.io, which is the fourth largest cryptocurrency exchange by trading volume. It says it has received operating licences in “several” states, which brings it closer to launching services in the country.
In a Dec. 19 statement, Dr. Lin Han, the founder and president of Gate.io and its U.S. branch, said that Gate US is now registered as a money services business with the Financial Crimes Enforcement Network (FinCEN), the country’s watchdog for money laundering and financial crimes.
He also said that the exchange “got some money transfer licences or something similar to be able to work, and is now working to get more.”
Gate US didn’t say which states had given it licences, but it did say that it wasn’t taking users from the country yet. Its terms of service, however, say that people in New York, Hawaii, and Puerto Rico will not be able to use it.
Cointelegraph tried to get a comment from Gate.io, but did not hear back right away.
When it opens to U.S. customers, the exchange will offer services to both individual and business customers.
It joins the likes of Coinbase, Kraken, Binance US, and Gemini, which are also among the top exchanges in the U.S. in terms of volume. When FTX.US, the U.S. branch of FTX, filed for bankruptcy at the beginning of November, it left a hole in the market.
Han said that it had voluntarily registered as a money services business because it is “committed to regulatory compliance.”
In a blog post on December 20, the parent company Gate.io predicted that regulatory frameworks would be “inevitable” by 2023. They did this by pointing to the failure of the Terra ecosystem and the failure of crypto platforms Celsius, BlockFi, and FTX.
In early December, a U.S. lawmaker introduced bills that would require exchanges to show the Securities and Exchange Commission proof that they have reserves.
If the laws are passed, it could be bad for Gate.io because the accounting firm it worked with for its proof of reserve attestation, Armanino, quietly stopped doing crypto audits on December 15.