New York State Permits SoFi to Sell Cryptocurrencies

Empire State residents will now have another option for trading cryptocurrencies. This week the New York State Department of Financial Services approved FinTech lender turned jack-of-all-trades SoFi for a BitLicense. The move means that users in the state will now be able to buy and sell crypto on the SoFi Invest platform.

In a press release announcing the decision, SoFi’s CEO Anthony Noto remarked, “Putting our members’ interests first is our top priority at SoFi. That includes both offering individuals the products they want, like cryptocurrency within SoFi Invest, as well as protecting them, through a solid regulatory framework like that created by the New York State Department of Financial Services.” He added, “We’re thrilled to now be able to offer the trading of cryptocurrency, in addition to active and automated investing, as part of SoFi Invest in New York State, in addition to the full suite of SoFi products that help our members borrow, save, spend, invest, and protect their money.”

As Noto mentions, SoFi has been on a product expansion streak over the past several months. This includes launching a hybrid cash management account called SoFi Money that offers high-yield savings as well as free ATM access via their debit card. Additionally the company has two versions of its SoFi Invest accounts: an Active account that allows users to trade stocks and ETFs commission-free and an Automated account that functions as a roboadvisor. Of course their crypto platform is an extension of SoFi Invest, currently supporting trading of Bitcoin, Ethereum, and Litecoin.

Also alluded to in Noto’s statement is the fact that New York has been one of the strictest states when it comes to oversight of cryptocurrencies. Notably SoFi’s BitLicense comes nearly 18 months after Square celebrated its ability to offer Bitcoin on its Cash app. At the time, the company was only the ninth to gain such approval. A couple of months later Square also passed regulatory muster in Wyoming, Georgia, and Hawaii, enabling BTC trades for Cash users in all 50 states.

Meanwhile SoFi’s news comes as Bitcoin is experiencing a mini-rally (or trying to). Today the price against the U.S. dollar soared from around $7,200 to nearly $7,800 in a short period of time. However, as of this writing, it’s settled for the midground, hovering between $7,450 and $7,500.

Ultimately SoFi’s New York approval is unlikely to be Earth-shattering for the FinTech or for Bitcoin. At the same time, the more company’s that go through this type of regulatory scrutiny and come out the other side, the more cryptocurrencies are legitimized. Thus it’s fair to count this as a small victory in an otherwise ho-hum year.

Author

Jonathan Dyer

I'm a small town guy living in Los Angeles looking to make solid financial decisions. I write for a number of finance websites, including HuffingtonPost and Business2Community. I founded DyerNews.com in 2015 to focus on personal finance and the emerging FinTech markets.

Other Articles by Jonathan Dyer

Robinhood Reveals More Details on Upcoming Retirement Account

After officially announcing plans for retirement accounts during an earnings call last month, Robinhood has now revealed more details about the upcoming feature and opened a waitlist for customers. First, Robinhood Retirement will offer both Roth and Traditional IRAs to users. With these accounts, customers will be able to invest in stocks and ETFs. Additionally, accountholders will be able to craft a custom portfolio and will be able to view...

Discover Announces 5% Bonus Categories for First Quarter of 2023

The popular Discover It card — which features 1% on all purchases as well as a slate of bonus rotating categories each quarter — has revealed what purchases will earn cardholders that 5% bonus starting January 1st. For the first quarter of 2023, Discover It cardholders can earn 5% back on grocery store, drug store, and select streaming service purchases. However, there are a few asterisks to note with this offer....

AllWork Raises $4.9 Million From FINTOP Capital 

A FinTech focused on freelancer payroll has closed a significant early-round investment. This week, AllWork announced that it had raised a $4.8 million round. The Series A was led by Nashville-based FINTOP Capital with no other participants. As a result of the transaction, FINTOP's Chris Haley and Rick Holton will join AllWork's board of directors. Previously, AllWork closed a $3.8 million seed round in 2019, bringing their to-date funding total to $8.7...