BitLicense Refugees: Kraken, ShapeShift CEOs Talk Escape from New York

If you wanted to hear red-meat rhetoric about New York State's regulatory approach, a fireside chat Tuesday between two of the cryptocurrency industry's most outspoken leaders delivered.

The audience at Consensus 2018 in New York City cheered when ShapeShift CEO Erik Voorhees invoked a local icon to make the case that the state's BitLicense was a case of regulatory overreach.

Jesse Powell, the CEO of Kraken, got some laughs at the expense of former New York Attorney General Eric Schneiderman.

When Scheniderman's office sent a request for information to Kraken earlier this year - three years after his company stopped doing business in New York - it felt like "a slap in the face," Powell said.

In the case of the BitLicense, he said, Kraken would have had to "Disclose all the information about our entire global client base to the state of New York.".

"To service New York today, what we'd have to do is create a special purpose entity just to service New York and completely firewall off" all the exchange's other users to protect their privacy, he said.

Despite using the phrase "Statist oppression" early in the conversation to describe his feelings about New York when the BitLicense was created, Voorhees later clarified that he thinks regulators generally have good intentions.

"The crypto industry and regulators can find common ground in realizing that this incredible new technology can achieve many of the noble goals of the regulators such as protecting consumers," Voorhees said.

Users need not always move to another place, use a VPN to mask their IP address or even break the law to get around restrictions; Powell shared a tip for New York residents who feel deprived because of the way the BitLicense has limited their cryptocurrency trading options.

"If you're here stuck in New York and you can't trade how you want to trade, set up a Wyoming LLC and you can trade through that and have your business trade for you," he said.