Bitcoin exchange wants to become bank

New York state could soon have the first bitcoin exchange regulated as a bank in the U.S., Reuters reported.

The bitcoin company itBit recently filed for a banking license in New York, the state’s top banking regulator confirmed. If itBit’s application is approved, which could happen within weeks, the company would be able to expand its financial service operations.

{mosads}Bitcoin exchanges allow users to swap the digital currency. Various start-ups have been trying to bring more legitimacy to exchanges, which have come under fire after several major outlets fell victim to massive cyber thefts.

Last year, Mt. Gox — the world’s largest bitcoin exchange at the time — went bankrupt, after hackers reportedly made off with nearly half a billion dollars worth of bitcoins. The online currency has also been accused of facilitating widespread money laundering.

“Some highly publicized failures and potentially illegal activity have focused attention on virtual currencies and have highlighted the need for a sound regulatory framework for virtual currencies,” itBit chief executive Charles Cascarilla told New York’s state banking regulator in an October letter, according to Reuters.

ItBit’s exchange operates in Singapore, but the company recently moved its main headquarters to New York City.

Benjamin Lawsky, New York state’s superintendent of financial services, has been a leading advocate of increasing oversight and regulation of digital currencies.

Lawsky is considering additional guidelines and oversight in 2015 that would enhance the reporting requirements and security standards for companies using bitcoin.