TL;DR– Coinbase, Coinbase Pro, Gemini are the only crypto platforms that are available to New Yorkers. If you want to know if another platform is trading in NY, the default answer is no. To trade other cryptos not listed on these exchanges, you can send your funds to other entities like MetaMask.
It’s no secret that American investors are hungry to get into the crypto space. 40%+ of financial advisers in the past year have noted their clients are asking about crypto investing, compared to a 5% figure a year ago. Unfortunately crypto still carries with it the reputation that it’s full of scammers and is a medium for vice. For this reason and some others, New York has laid down some obstacles for crypto investors. While regulation is actually good for crypto long-term, in the short term it can make things a pain. New Yorkers are tough, resourceful, and surprisingly generous with their time and resources if you’re truly in need of help. I disagree with the state government’s push to make things tougher for residents of The Empire State.
Why are so few exchanges available to New Yorkers? New York exchanges have to apply for the dreaded BitLicense. This is an additional level of regulation that makes markets less efficient. The state’s original motivation for this was consumer protection. It is interesting that NY is also home the to world’s largest finance institutions, to which crypto poses a threat. While there are several crypto exchanges going through the licensure process, Binance has stated it’s not going to bother. US citizens in other states can trade on Binance.US, a stripped-down version of Binance that offers only a fraction of the cryptos. An upside to this is that you’ll be trading crypto on exchanges owned by companies based in the US. Thus you’ll be subject to consumer protections and get customer support if something goes wrong. We’re still very early in the crypto game, and it’s a jungle out there. The returns are awesome, but crypto investing can also be dangerous.
Which cryptos can I buy on exchanges if I live in New York?
The answer to this is: any coins offered on Coinbase or Gemini. Keep in mind this is only where you need to buy coins- there are other places you can trade coins that I’ll point out. While New Yorkers can trade with Gemini, it has a much smaller crypto offering than Coinbase and Coinbase Pro. All cryptos you can buy on Gemini are also offered on Coinbase with the exception of Gemini Dollar (GUSD).
Cryptos available to buy on exchanges in New York:
- USD Coin
- Bitcoin Cash
- Wrapped Bitcoin
- Internet Computer
- Stellar Lumens
- Ethereum Classic
- Axie Infinity
- The Graph
- Shiba Inu
- Terra USD
- OMG Network
- Synthetix Network Token
- Enjin Coin
- Curve Dao Token
- Basic Attention Token
- Paxos Standard
- Bancor Network Token
- Origin Token
- Band Protocol
Cryptos on Coinbase + Coinbase vs. Pro
In my personal experience, trading cryptos on Coinbase is frustrating because of the high fees and lack of crypto selection. Coinbase seems to offer random smaller coins (like Civic and Enzyme), but skips over so many others. Where are Terra, Avalanche, Tron, Theta and Monero? If you’re in New York and you’re limited to these exchanges, you should go with Coinbase Pro unless you’re an absolute beginner. Coinbase’s fees are high, but their UI is simple, fast, and easy. Coinbase Pro may take a bit more time to learn, but it’s well worth it. The main reason you should go with Pro is that regular Coinbase charges a 1.5% fee on crypto purchases with your bank account. If this were the stock brokerage world, these fees would be considered highway robbery. Coinbase is able to get away with this since interest in crypto is so high, crypto has posted amazing gains, and it doesn’t face much competition, especially in New York.
Exchanges without KYC
Needless to say, this can suck pretty hard. If you’re a New Yorker you’re locked out of a good number of alt coins and smaller projects that can sometimes return epic gains. However, BitLicensed exchanges are only where you need to purchase your coins. Once you have your coins, you can send them to other platforms that don’t require KYC. For instance, a few other things you can do are:
- Use the peer-to-peer way to use fiat to buy crypto on localcryptos.com
- Set up a MetaMask wallet and send Ethereum to it, then get on Uniswap to get access to hundreds of ERC-20 tokens. This includes some solid projects including Luna, Celcius, and Occam.Fi.
- Set up an account with Kucoin, then send your BTC, ETH, or USDT to Kucoin. This is going to be your best bet as far as getting access to thousands of altcoins.
Set up a MetaMask wallet and trade on Uniswap or other exchanges
MetaMask is a browser-based crypto wallet that you can easily hook up to an exchange like Uniswap. Metamask can hold any tokens based on the Ethereum or Binance blockchains. Uniswap fields hundreds of smaller projects and coins that could bring some fat yields. FollowChain has some good guides for setting up a MetaMask wallet and using BNB with a MetaMask wallet.
Ways to get access to more altcoins if you live in New York
Send your coins to decentralized exchanges
Based on my experience I’ve found KuCoin to be the best platform for this. For some reason, they don’t require KYC- no driver’s license, pictures of your passport or bills, or snapshots of your face. If you’re familiar with the user interface on Binance, KuCoin’s UI is near identical. Just set up an account with KuCoin and send crypto to your KuCoin wallet, and start trading. After you’ve made gains and you want to cash out, convert back to ETH, USDT, or Bitcoin. Then send these to your Coinbase or Gemini account and cash out.
Regardless of which exchange you choose to use, I recommend enabling two-factor authentication. I have the DUO app on my phone and use it to receive my 2FA codes from Coinbase, Binance, KuCoin, Metamask, Axie Infinity and more. Since KuCoin and others are not companies incorporated in the US, they won’t be subject to the same consumer protection laws that make things safer for you. Say Coinbase gets hacked and your coins are stolen- you’d be protected by US and NY laws and could probably sue and get your money back. With KuCoin, this wouldn’t be the case. This is one of the many reasons why I recommend moving your coins to a hardware wallet once you buy on an exchange. Using 2FA is an extra step that makes a hack or identity theft far less likely.
Decentralized Exchanges (DEX)
There are thousands of these, and they will accept tokens that you have purchased on Coinbase or Gemini, usually Ethereum. Be extra careful with these and do your own research. Many of these projects are tiny and thus next-level risky. Keep in mind that smaller cap coins are more volatile. Many decentralized exchanges offer Liquidity Provider (LP) tokens like on PancakeSwap. These can be staked and can earn you some fantastic APYs. This may not last forever- the SEC’s Gary Gensler has said the SEC would like to go after these decentralized exchanges and apply regulations. This is one of the many dark clouds hanging over the crypto space.
Unfortunately, many US states have followed states like New York and California when it comes to past laws and regulations. Let’s hope that it still stays legal to trade Binance.US, Voyager Crypto, and other exchanges in the rest of the US. If not, we could face a situation like in South Korea where Hodlers end up paying the “Kimchi Premium” on all their coins. This is because South Korea does not allow any new Bitcoin to flow into the country (check this). Of positive note is that crypto attracts more investors each year, and investors prefer to have as many options for trading as possible. This will likely put pressure on state and federal congresses to ease up on crypto regulation.