Cryptocurrency Exchange License Checker
Determine Your U.S. Exchange License Requirements
Answer a few questions about your business to identify which licenses you need to operate legally in the United States.
Required Licenses
Note: This tool provides general guidance. Always consult with legal counsel before making business decisions related to regulatory compliance.
Running a cryptocurrency exchange in the U.S. in 2025 isn’t just about building a good website or adding the latest coins. It’s a legal marathon with checkpoints at the federal level, in every state you serve, and sometimes even in your own office. If you think getting a business license is tough, try juggling 50 different licenses, millions in capital, and regulators who don’t always agree on what a cryptocurrency even is.
Federal Licensing: The Three Pillars
Every crypto exchange that touches U.S. dollars must register with FinCEN as a Money Services Business (MSB). This isn’t optional. About 92% of exchanges handle fiat, and FinCEN requires them to have a full Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT) program. That means verifying every customer’s identity, monitoring transactions in real time, flagging suspicious activity, and training staff every year. Systems need to handle at least 10,000 transactions per second with 99.9% accuracy. Failure? Fines, shutdowns, or worse. If you trade security tokens - like tokens that promise profit from a project or company - you’re under the SEC’s watch. You must register as a broker-dealer or an Alternative Trading System (ATS). That means a minimum of $1 million in net capital, strict recordkeeping, and daily compliance checks. The SEC has been aggressive in 2025, charging two major exchanges for listing unregistered security tokens. They’re not bluffing. For derivatives - futures, options, leveraged trading - you need to register with the CFTC as a Futures Commission Merchant (FCM) or Swap Dealer. That’s a $20 million minimum capital requirement, plus membership in the National Futures Association (NFA). The CFTC also just released new interim rules: stablecoins must be 1:1 backed by cash or equivalents, and customer funds can’t be mixed with company money. No more using your users’ crypto to stake or lend without explicit consent.State Licenses: The Real Nightmare
Federal rules are just the start. Forty-seven states require a Money Transmitter License (MTL) for any business moving crypto to or from fiat. Each state has its own rules. California demands a minimum net worth of $250,000 and a surety bond between $50,000 and $500,000, depending on your volume. Texas wants $1 million in net worth. Illinois doesn’t require an MTL if you only trade crypto-to-crypto - but only if you don’t touch fiat. Then there’s New York’s BitLicense. It’s the gold standard for strictness. You need at least $500,000 in capital, either as a surety bond or in a trust account. Every single coin you list must be approved by the New York Department of Financial Services (DFS). As of November 2025, only 47 cryptocurrencies made the DFS Greenlist. That’s not because they’re safer - it’s because they met New York’s operational, security, and transparency standards. If you want to list Solana or Polygon, you need DFS approval. No exceptions. California’s new Digital Financial Assets Law (DFAL), effective July 1, 2026, adds another layer. If you serve even one California resident, you need a new license. Capital requirements aren’t fixed - the Department of Financial Protection and Innovation (DFPI) will decide based on your risk profile. Estimates range from $250,000 to $1 million. Kiosk operators have until July 2026 to comply. That’s a lot of small businesses suddenly needing a legal team.The CLARITY Act: A Glimmer of Hope?
In mid-2025, the U.S. House passed the CLARITY Act. It’s the biggest shift in crypto regulation since 2013. The Act draws a clear line: if a blockchain is mature enough, its native tokens become digital commodities - not securities. That means they can trade on CFTC-regulated exchanges without SEC approval. It’s a path out of regulatory chaos. The Act also creates a new category: qualified digital asset custodians. These are firms approved by the CFTC to hold customer assets securely. And for the first time, customer assets can’t be used for staking or lending unless the user gives written consent. That’s huge. It shuts down the shady practice of rehypothecating user funds. But here’s the catch: the CLARITY Act doesn’t override state laws. New York still needs its BitLicense. California still needs DFAL. The CFTC and SEC are still working out joint rules on mixed transactions - like when a token starts as a security and becomes a commodity. That transition period could last until 2026. So while the Act helps large exchanges, it doesn’t make life easier for small ones.
Costs and Time: What It Really Takes
Getting licensed isn’t cheap. Legal and compliance costs for a nationwide exchange? Between $500,000 and $2 million. The process takes 12 to 18 months. You’ll need at least three to five full-time compliance staff just to keep up. Basic AML software costs $100,000 to $500,000 a year. Enterprise systems? Over $1 million. And 65% of initial applications get rejected. Why? Three main reasons: not enough capital (28%), weak AML programs (35%), and messy organizational structures (22%). One exchange in Texas applied with a $900,000 net worth - they needed $1 million. Denied. Another had an AML system that flagged transactions too slowly. Denied. Another didn’t have a documented chain of command. Denied.Who’s Leaving the Market?
The cost of compliance is forcing consolidation. In 2022, there were 217 licensed U.S. exchanges. By November 2025, that number dropped to 142. Smaller players - those processing under $10 million a month - are walking away. They can’t afford the lawyers, the software, or the capital. Meanwhile, the big players are betting on the U.S. market. There are 112 million U.S. adults who own crypto - 43% of the population. That’s the biggest market in the world. Seventy-eight percent of exchanges processing over $100 million monthly say they’ll expand if the CLARITY Act becomes law. But the smaller ones? They’re looking overseas.
How It Compares to the Rest of the World
In the European Union, the MiCA law lets one license cover all 27 member states. In Singapore, you get one license from MAS and you’re good. In the U.S.? You need 47 state licenses, plus federal ones. That’s three to five times more paperwork than anywhere else. That’s why some exchanges are moving their headquarters to Switzerland, Dubai, or Singapore - even if they still serve U.S. customers. They’re building offshore entities to handle compliance, then routing U.S. traffic through them. It’s not perfect, but it’s cheaper than fighting 50 regulators at once.What You Need to Do Right Now
If you’re starting an exchange:- Map out every state you plan to serve. Don’t assume you can skip one.
- Calculate your capital needs. Don’t guess. Use the highest requirement among your target states.
- Build your AML system before you launch. Test it with real transaction volumes.
- Document everything - your org chart, your policies, your training logs.
- Don’t list any token unless you’ve confirmed its regulatory status with legal counsel.
- Review your licenses. Are you still compliant in every state?
- Check if any coins you list are on the DFS Greenlist. If not, you’re at risk in New York.
- Separate customer assets from company funds. The CFTC is watching.
- Prepare for DFAL in California. Even if it’s not active until 2026, start gathering documents now.
What’s Next?
By 2027, the U.S. will likely have a three-tiered system: federal oversight for commodities (CFTC), federal oversight for securities (SEC), and state-level consumer protection rules. It won’t be simple. But it might be predictable. For now, the message is clear: if you want to operate a crypto exchange in the U.S., you’re not just a tech company. You’re a financial institution. And the rules are written in blood, ink, and compliance fees.Do I need a license if I only trade crypto-to-crypto?
It depends. At the federal level, if you’re transmitting value - even crypto-to-crypto - you may still need FinCEN registration. At the state level, Illinois exempts pure crypto-to-crypto exchanges from Money Transmitter Licenses, but New York and California don’t. Always check your state’s rules. If you’re serving residents in states with strict laws, you’ll likely need a license regardless of whether you handle fiat.
How long does the licensing process take?
On average, it takes 12 to 18 months to get all federal and state licenses in place. Some states like New York can take 9 months just for the BitLicense application. The timeline depends on how complete your documentation is, whether your AML system meets standards, and if you have enough capital. Delays happen often - especially if regulators ask for revisions.
Can I operate without a license if I’m small?
No. There’s no small business exemption. Even if you only serve 50 customers, if you handle fiat or transmit value, you’re legally required to register. The SEC and FinCEN don’t care about your size. They care about whether you’re moving money. Enforcement actions have been taken against exchanges with under $1 million in monthly volume.
What happens if I get caught operating without a license?
You’ll face civil penalties, fines up to $1 million per violation, and possible criminal charges. Your platform could be shut down. Customers’ funds may be frozen. The SEC and FinCEN have been actively targeting unlicensed exchanges since 2023. In 2025 alone, they filed over 30 enforcement actions against crypto platforms operating without proper registration.
Is the CLARITY Act going to fix everything?
It helps, but it doesn’t fix everything. The CLARITY Act clarifies federal rules for mature digital commodities, which reduces SEC overlap. But it doesn’t touch state-level Money Transmitter Licenses. New York’s BitLicense, California’s DFAL, and Texas’s rules still apply. So you’ll still need those. The Act makes it easier to list certain coins and operate derivatives legally, but compliance is still complex and expensive.
Do I need a separate license for each cryptocurrency I list?
Only in New York. Under the BitLicense, each coin must be approved individually by the DFS. Other states don’t require pre-approval for specific coins - but you still need to ensure none of them are classified as securities by the SEC. If you list a token that later gets deemed a security, you could be fined even if you didn’t need pre-approval.
How much does it cost to maintain a license annually?
For a mid-sized exchange, annual compliance costs range from $500,000 to $1.5 million. This includes AML software, legal fees, compliance staff salaries, audit fees, state renewal fees, and capital reserve requirements. Some states charge annual renewal fees of $5,000 to $25,000 per license. The biggest cost isn’t the fee - it’s the full-time team you need to keep everything running.
Can I use a third-party compliance provider to handle licensing?
Yes, but it’s not a magic solution. Companies like Sumsub, Chainalysis, and ComplyAdvantage can help with AML screening, transaction monitoring, and reporting. But they can’t apply for your licenses, hold your capital, or sign off on your business plan. You still need legal counsel and internal compliance officers. Third-party tools reduce workload - they don’t replace responsibility.
Layla Hu
Just read this and felt my soul leave my body. I thought I was prepared. Turns out I’m not even close. This isn’t a startup-it’s a full-time compliance job with a website attached.
Good luck to anyone trying to build this from scratch.
Also… why does the US make everything so complicated?
:(
Bhoomika Agarwal
Oh sweet jesus. You people actually think you can regulate crypto like it’s a bank? You’re trying to nail jelly to a wall with a sledgehammer.
Meanwhile, India’s just letting people trade on Binance and calling it a day. At least we’re not wasting $2M on lawyers while our devs sit around waiting for approval.
Y’all need to chill. Or move to Singapore.
😂
Greer Dauphin
So… if I run a tiny kiosk in Ohio that swaps BTC for cash, and I make $500 a month… I still need a $250k bond and a full AML team?
Wait wait wait-let me get this straight. The guy who runs a Bitcoin ATM in his garage gets fined more than a hedge fund that just laundered crypto through a shell company in the Caymans?
Is this a joke? Or just capitalism being extra?
Also typo: ‘CFTC and SEC are still working out joint rules on mixed transactions’ - should be ‘mixing’? 😅
Katherine Alva
It’s like the government looked at crypto and said ‘I don’t understand it, so let’s make it expensive and slow.’
They’re not protecting consumers-they’re protecting legacy finance.
And honestly? The fact that New York has a ‘Greenlist’ of approved coins feels like a crypto version of a school lunch menu. ‘Today’s approved token: Bitcoin. Tomorrow’s: Ethereum. Solana? Nope. Not enough paperwork.’
We’re turning innovation into bureaucracy.
💔
Nelia Mcquiston
I’ve spent 18 months trying to get licensed in three states. The process is a labyrinth designed by someone who hates innovation.
Every form asks for something you don’t have. Every regulator wants a different version of the same document. The software costs more than my car. And I still can’t get a straight answer on whether my token is a security or a commodity.
It’s not regulation. It’s performance art.
And yet… I keep going. Because if we can survive this, maybe the next generation won’t have to.
Mark Stoehr
92% of exchanges handle fiat so they need AML? So what? You think criminals are gonna use licensed exchanges? They use mixers, P2P, DeFi, and Telegram bots. You’re chasing ghosts while the real players laugh.
And now you want me to pay $2M to prove I’m not a criminal? I’m not even a criminal and I’m broke.
Who’s really getting hurt here? Not the bad guys. The small guys. The ones who actually care.
Pathetic
Shari Heglin
The CLARITY Act does not, in fact, resolve the jurisdictional conflict between federal and state authorities. It merely creates a new federal classification for digital commodities, leaving state Money Transmitter Licenses fully intact. The assertion that it ‘helps large exchanges’ is accurate, but misleading. It does not reduce regulatory burden-it redistributes it.
Furthermore, the CFTC’s interim rules on stablecoins are not ‘new’; they are a codification of existing industry best practices. The language of the Act is deliberately vague on transitional mechanisms, creating legal uncertainty for hybrid assets.
Conclusion: Incrementalism, not reform.
Murray Dejarnette
Bro. I just launched a crypto kiosk. I’m 23. I got $80k saved. I thought I could do this. Now I’m reading this and I feel like I just got kicked in the teeth by a donkey.
But you know what? I’m not quitting.
I’m gonna hire a lawyer, I’m gonna grind, I’m gonna learn every single state’s rules like it’s my final exam.
And when I finally get licensed? I’m gonna throw a party with free coffee and Bitcoin.
Who’s in? 🤝
Sarah Locke
TO EVERYONE WHO THINKS THIS IS TOO HARD: YOU’RE RIGHT. IT IS.
But listen-I’ve mentored 17 crypto founders in the last year. Every single one of them thought they could wing it. Every single one of them got crushed.
But the ones who came in with a checklist, a compliance plan, and a therapist? They’re still here.
You don’t need to be a genius. You just need to be stubborn.
And maybe get a really good accountant.
💖 You got this.
Mani Kumar
U.S. regulatory framework is archaic. Comparable jurisdictions have unified frameworks. Here, we have 50 regulatory fiefdoms. This is not innovation. This is institutional inertia dressed as compliance.
Capital requirements are disproportionate. Licensing timelines are irrational.
Result: Talent and capital flee. The U.S. loses its competitive edge.
Simple.
Tatiana Rodriguez
I remember when I first started in crypto in 2017. We’d just code, launch, and hope for the best. No lawyers, no licenses, no problem. People thought we were crazy.
Now? We’re the ones being told we’re the problem.
And honestly? I get it. The wild west had a lot of scams. A lot of people lost money. A lot of people got hurt.
But now we’re building a fortress around the whole thing. And the people who built the castle? The ones who showed up with nothing but a laptop and a dream? They’re locked out.
I don’t know if this is progress. I just know it hurts.
And I miss the old days.
Even if they were messy.
Even if they were dangerous.
Even if they were stupid.
I miss them.
Philip Mirchin
Y’all in the U.S. are acting like crypto is a new thing. It’s been 15 years. We’ve seen booms, busts, scams, and breakthroughs.
Meanwhile, in Nigeria, my cousin runs a crypto exchange from his bedroom. He uses Telegram for KYC, pays his compliance guy $200/month, and serves 20k users.
He doesn’t have a $500k bond. He doesn’t have a CFTC license.
But he’s helping people send money home, buy food, pay school fees.
Who’s the real villain here?
Just saying.
Britney Power
The entire U.S. regulatory apparatus is a grotesque parody of financial oversight. The SEC’s enforcement actions are performative theater. The CFTC’s rules are reactive and inconsistent. State-level licensing is a bureaucratic cancer.
And yet, the same regulators who demand $20 million in capital for derivatives are perfectly fine with banks laundering money through shell companies in Delaware.
The hypocrisy is not merely systemic-it is intentional.
Let me be clear: this is not regulation. It is rent-seeking disguised as public protection.
And you are all complicit.
Lawal Ayomide
Why you all so serious? In Lagos, we just use crypto to survive. No licenses. No lawyers. Just WhatsApp and trust.
But you? You want to build a palace for every Bitcoin transaction.
It’s not about safety. It’s about control.
And you’re scared.
😂
justin allen
Wait wait wait. So the CLARITY Act says mature tokens are commodities… but New York still needs a BitLicense? So what? I just list Bitcoin and Ethereum and ignore the rest? That’s it? That’s the whole plan?
Why not just make a ‘U.S. Crypto License’ and be done with it?
Oh right. Because politicians need to look busy.
And because lawyers make bank on this mess.
Classic America.
ashi chopra
I’m from India. We don’t have a lot here. But we have heart.
I read this and I cried. Not because I’m scared. But because I see myself in every small operator trying to make it.
You’re not just building a business. You’re building hope.
For the guy who wants to send money to his sister.
For the student who wants to buy a laptop.
For the grandma who wants to save in something that won’t crash.
Don’t give up.
We’re rooting for you.
❤️
Darlene Johnson
Did you know the SEC has a secret list of tokens they’ve already decided are securities? They don’t tell you. They just show up one day and shut you down.
And the CFTC? They’re just waiting for you to slip up so they can fine you $1M for ‘misrepresenting your risk controls’.
And the states? They’re all in cahoots.
This isn’t regulation.
This is a racket.
And you’re the mark.
Ivanna Faith
So basically if I want to run a crypto exchange I need to be a lawyer, a banker, a coder, and a saint?
And if I mess up once? Poof. Gone.
Meanwhile, my uncle runs a Ponzi scheme on Instagram and he’s in Bali.
So… what’s the point?
Just saying 🤷♀️
Akash Kumar Yadav
U.S. is not a market. It’s a bureaucracy with Wi-Fi.
India has 100M crypto users. We don’t need 50 licenses. We need common sense.
Why are you wasting time on paperwork when the world is moving?
Clarity? You don’t have it.
You have chaos dressed in a suit.
Catherine Williams
To everyone saying ‘just move overseas’-I get it. But this is home.
I want to build something here. For my neighbors. For my parents. For the kid who just got his first Bitcoin as a birthday gift.
So yeah, I’ll spend $1.2M. I’ll spend 18 months. I’ll cry in the shower.
But I’ll do it.
Because if we don’t fight for this, who will?
And if we don’t fix it… who will fix it for the next generation?
Marsha Enright
Hey, new founder reading this? You’re not alone.
I’ve been where you are.
Here’s what I did:
- Got a free compliance checklist from Coin Center
- Hired a part-time compliance consultant ($50/hr on Upwork)
- Used Chainalysis for AML (saved $300k vs enterprise)
- Started with just 3 states: CA, TX, NY
You don’t need to do it all at once.
Just start.
One step. One day. One license.
You’ve got this 💪
Nora Colombie
Let me be clear: if you’re a U.S. citizen and you’re complaining about crypto regulation, you’re not a victim-you’re a coward.
Other countries have harder rules. They don’t whine. They adapt.
We have the best legal system in the world. Use it. Build it. Own it.
Stop crying about the cost. Start building the solution.
Or get out of the way.
🇺🇸
Reggie Herbert
Just one sentence: I’m shutting down my exchange tomorrow. No license. No lawyers. No regrets.