New York’s Best Crypto Exchanges Revealed

New York has the strictest crypto regulation in the country — which means that only a few exchanges are available for investors. In this guide, we’ll explore the pros and cons of the best New York exchanges and answer common questions about trading crypto in the Empire State.

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Best for Beginners

Coinbase

Regulated and licensed in New York, Coinbase stands out for its user-friendly experience. While it has higher fees than other exchanges, it’s the most popular choice for beginner investors.

Pros & Cons

• 
  Fully licensed and compliant with New York regulations.
• 
  Wide selection of state-approved cryptocurrencies.
• 
  Beginner-friendly interface.

• 
  Customers have complained that fees (0.05 - 0.60% on Coinbase Advanced) can be higher than stated based on market conditions.
• 
  Limited advanced trading features for experienced traders.

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Best for Low Fees

Kraken

Kraken was licensed in New York in 2022. It’s a great choice for advanced traders looking for low fees.

Pros & Cons

• 
  Approved by the New York Department of Financial Services (NYDFS).
• 
  Offers industry-leading fees (0-0.40% on Kraken Pro).
• 
  Advanced trading tools for experienced investors.

• 
  Limited selection of coins available for New York residents.
• 
  More complex interface, making it less beginner-friendly.

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Best for Regulatory Compliance

Gemini

Gemini is one of the only exchanges available in all 50 states. The company is focused on regulatory compliance — though it offers higher fees and fewer cryptocurrencies compared to the other alternatives mentioned.

Pros & Cons

• 
  Established in New York, fully compliant with local regulations.
• 
  Strong security and institutional-grade custody solutions.
• 
  Beginner-friendly.
• 
  0-0.40% fees on Gemini ActiveTrader, 1.49% fees on most transactions on the standard platform.

• 
  Smaller selection of cryptocurrencies compared to other exchanges.
• 
  ActiveTrader not available on mobile.

Is trading crypto in New York legal?

Yes, cryptocurrency trading is legal in New York, but exchanges must comply with stringent New York Department of Financial Services (NYDFS) regulations and obtain a BitLicense. 

BitLicense requirements:

• Exchanges must obtain approval from NYDFS to operate. The application process costs more than $100,000 — with additional fees related to legal and compliance costs. 
• Robust anti-money laundering and Know Your Customer policies are required. 
• Businesses must maintain capital reserves and undergo audits regularly.

BitLicense has been criticized heavily within the crypto community. Many have claimed that the application process makes it difficult for startups to enter the market, and that even established exchanges have trouble complying with requirements. 

What coins can I trade on New York exchanges?

New York's exchanges offer a more limited selection of coins than other states. In 2023, NYDFS introduced strict rules for listing and delisting coins. 

Key points:

• Only Bitcoin, Ethereum, and six stablecoins are pre-approved for trading.
• Tokens must meet strict criteria to be listed. No coin can be listed if its circulating supply is below 35% of its total supply.
• Tokens for other exchanges, like BNB or FTX’s FTT, are disallowed.
• Bridged tokens are not permitted.

Why is New York so unfriendly to crypto?

New York is considered the most anti-crypto state in America from a regulatory perspective. 

New York legislators claim that its crypto policies are meant to protect investors and maintain the state’s status as a global financial hub.

The New York Attorney General’s Office has actively pursued legal action against the crypto industry, including shutting down the exchange CoinSeed and suing KuCoin for violating local laws.

New York has also banned cryptocurrency mining using fossil fuels. 

Can I use a VPN in New York to access crypto exchanges?

Using a VPN to access crypto exchanges outside of New York may seem tempting, but it’s not recommended. 

Using a VPN can violate the exchange’s terms of service, potentially leading to your account being closed and your holdings being lost. 

Can I use decentralized exchanges in New York?

Decentralized exchanges (DEXs) like Uniswap operate in a legal gray area within New York. DEXs don’t take custody of user assets, making them exempt from the BitLicense framework. 

NYDFS regulations do not address decentralized exchanges directly. That means it’s reasonable to assume that as of today, decentralized exchanges can be used by New York residents. 

However,  New York’s Attorney General recently issued subpoenas against Uniswap Labs and its investors — suggesting that the state may take action against decentralized exchanges in the future.

If you’re based in New York, you should stay up-to-date on regulatory developments related to decentralized exchanges. 

Do I have to pay taxes on crypto in New York? 

No matter what state you are based in, cryptocurrency is subject to income tax and capital gains tax in the United States.

If you want to get started tracking your tax bill, try crypto tax software like CoinLedger. The platform allows you to plug in your wallets and exchanges, find tax-saving opportunities, and generate a complete crypto tax report with the click of a button. 

Final Thoughts

While trading crypto in New York can be more restrictive than in other states, exchanges like Coinbase, Kraken, and Gemini are still available. Remember to do your own research, exercise caution when investing, and stay aware of regulatory updates.