<p>Twelve cryptocurrency firms including ErisX, bitFlyer USA, and Gemini are now servicing Hawaii residents.</p> <p>The firms have been <a href="https://www.htdc.org/programs/#dcil-section">approved</a> by the state’s regulatory sandbox called Digital Currency Innovation Lab — the initiative between the Hawaii Department of Financial Institutions and Hawaii Technology Development Corporation (HTDC), an agency for the State of Hawaii.</p> <p>The sandbox program <a href="https://governor.hawaii.gov/newsroom/latest-news/dcca-news-release-hawaii-launches-first-sandbox-for-digital-currency/">was launched</a> in March of this year and <a href="http://www.htdc.org/programs/#:~:text=The%20Digital%20Currency%20Innovation%20Lab%20is%20a%20pilot%20program%20by,a%20state%20money%20transmitter%20license.">allows</a> crypto firms to apply for approval to do business in Hawaii without obtaining a state money transmitter license for two years.</p> <p>Hawaii previously had more restrictive crypto licensing regimes compared to some states. In 2017, the Hawaii Division of Financial Institutions asked crypto exchanges to hold cash reserves equal to crypto-denominated funds held for its customers. This <a href="https://blog.coinbase.com/how-bad-policy-harms-coinbase-customers-in-hawaii-ac9970d49b34">"bad" policy</a> led Coinbase to stop serving in Hawaii, and today the exchange remains <a href="https://help.coinbase.com/en/coinbase/trading-and-funding/other/what-countries-and-us-states-are-supported-for-coinbase-and-the-usd-wallet">unavailable</a> in the state.</p> <p>Binance.US also doesn’t serve Hawaii, according to its <a href="https://support.binance.us/hc/en-us/articles/360046786914-States-That-Binance-US-Does-Not-Currently-Support">website</a>. BitFlyer USA said the sandbox initiative marks the return of crypto exchanges to Hawaii and could result in exchanges receiving full licenses in the future. </p> <p><em><strong>Editor's Note</strong>: This story has been updated to include additional firms that have been approved by Hawaii's regulatory sandbox</em></p>