New York subpoenas Bitcoin companies

The state's Department of Financial Services is considering regulating the digital currency

The digital currency Bitcoin, created four years ago, has come to the attention of New York's Department of Financial Services (DFS). The currency can be exchanged virtually, via computer or smartphone, without any intermediary institution.

The DFS is worried that, for that reason, Bitcoin will be an attractive way to engage in criminal activity, like buying and selling narcotics. As a result, they subpoenaed several service providers and investors in Bitcoin, including Winklevoss Capital Management, a name you may remember from its twin owners' legendary squabble with Facebook.

“If virtual currencies remain a virtual Wild West for narco-traffickers and other criminals, that would not only threaten our country’s national security, but also the very existence of the virtual currency industry as a legitimate business enterprise,” said DFS Superintendent Benjamin Lawsky in a statement. Lawsky and his department are concerned with the speed of Bitcoin transactions, among other things.

Based on the information the DFS learns from these subpoenas, it will consider whether it should impose regulations on the burgeoning currency.

 

Read more at Bloomberg.

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