NEW BRUNSWICK, N.J. Citing regulatory concerns, Internet Archive FCU here now says it will not be able to service accounts for customers of Tradehill, Inc., an exchange for virtual currencies such as Bitcoin.
The move may have contributed to an announcement from Tradehill that it has “made the decision to temporarily suspend trading on the Tradehill platform, due to banking and regulatory issues.”
On his blog, IAFCU CEO Jordan Modell said plans to provide services to Bitcoin users are on hold.
“Starting three months ago we have enjoyed serving some individuals and companies involved in bitcoin that are within our field of membership,” Modell wrote. “While exciting, this has also been during a period of increased interest from the press, regulators, and other financial services entities that make up the financial community. In doing this, certain operational and regulatory issues came up including some that apply to new credit unions such as ours.”
In an earlier report, Tradehill had told Bloomberg News that its goal was to make it easier to complete transactions and to win more business from investors and financial institutions that trade in Bitcoin, a four-year-old virtual currency that can be used to buy and sell a broad range of items. Tradehill also made the move as part of an effort to comply with regulatory requirements.
“Our credit union has worked within the evolving regulatory environment, which has not always been easy,” Modell said in his blog post. “This is a long not a short road and sometimes with detours. Until we have further clarity, we are unable to service some of our corporate members. On a positive note, we are finding all involved are interested in a stable environment for bitcoin and other innovative technologies.”
Of its decision to suspend operations, Tradehill said on its website, “This decision has not been made lightly and we regret having to take such action. However, we embrace the silver lining of our situation and plan to take this opportunity to upgrade, improve, and polish our trading platform.
“Tradehill registered with FinCEN in August 2013 and is actively engaging with banks and regulators to continue development of future business products and practices.”
