A BitLicense is a regulatory framework established in New York for companies operating with virtual currencies. Introduced in 2015 by the New York State Department of Financial Services (NYDFS), it aims to provide consumer protection and ensure the integrity of financial services in the virtual currency sector.

To obtain a BitLicense, businesses must meet strict requirements, including demonstrating adequate security measures, anti-money laundering procedures, and risk management practices. They also need to provide detailed information about their operations, including financial stability and potential risks to consumers.

The BitLicense has faced criticism for being overly burdensome, which some argue stifles innovation and drives businesses away from New York. However, supporters contend that it enhances consumer protection and fosters a more transparent market. Overall, the BitLicense represents an effort to regulate how virtual currencies are used and to establish a standard for compliance, ensuring that both consumers and businesses operate within a safe and reliable framework.