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Licensed Business Meaning

A company that has received formal permission from a government or regulatory body to operate in a specific industry. In fintech, this usually means having a "Money Transmitter License" (MTL) or a "Banking License." Being licensed is a sign of legitimacy and stability.

It means the company has met strict requirements for capital reserves, security protocols, and "AML/KYC" compliance. It also means that users often have some legal protection (like FDIC insurance in the US) if the company fails.

For a digital asset exchange, getting "Licensed and Regulated" is a double-edged sword.

It allows them to partner with traditional banks and attract institutional investors, but it also means they must collect more data on their users and potentially block transactions from certain "unfriendly" jurisdictions.

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