Broker Dealer comes with its own rule sets for compliance. You start needing a backroom team to handle KYC / AML / maintenance of registration / reporting functions etc.
It's not something to take on lightly.
Topic: 2014-01-20 contrariancompliance: What Would a BitLicense Look Like? (Read 1053 times)
January 23, 2014, 05:50:12 AM
January 23, 2014, 02:18:28 AM
There's an another option: get licensed as a broker/dealer with the SEC. Every broker in the US does that. Then you can deal in any tradeable security or commodity. There are exams, financial requirements, insurance, and audits. Each customer gets $500,000 in insurance against broker fraud and theft from the SIPC. (They paid off Madoff's customers up to that limit, for example.) Brokers pay the premium for this.
The SEC also licenses exchanges. I once asked Tradehill if they had SEC licensing. They disappeared shortly thereafter.
There are big advantages to being a licensed broker/dealer. Banks will deal with you at the wholesale level. You can get connected to ACH and even SWIFT and do your own wire transfers.
Yes, there are crooked brokers, and FINRA is there to go after them. FINRA fines brokers several hundred million dollars a year on average.
The SEC also licenses exchanges. I once asked Tradehill if they had SEC licensing. They disappeared shortly thereafter.
There are big advantages to being a licensed broker/dealer. Banks will deal with you at the wholesale level. You can get connected to ACH and even SWIFT and do your own wire transfers.
Yes, there are crooked brokers, and FINRA is there to go after them. FINRA fines brokers several hundred million dollars a year on average.
January 21, 2014, 08:01:40 AM
Why is New York so OTT re: financial regulation compared with other states in the USA?
Probably because it's the financial centre of the US.
January 20, 2014, 09:46:01 PM
Why is New York so OTT re: financial regulation compared with other states in the USA?
Jump to: