Coinbase has announced the launch of its cryptocurrency services in Hawaii, marking a return to the state after a years-long absence. Residents of Hawaii can now buy, sell, and manage their cryptocurrencies through Coinbase, as well as stake assets and transfer funds internationally.
The expansion follows recent regulatory adjustments made by the Hawaii Department of Commerce and Consumer Affairs Division of Financial Institutions, which have clarified the operating framework for cryptocurrency firms in the state. Coinbase highlighted these regulatory changes as a key factor in its decision to re-enter the Hawaiian market.
Previously, Coinbase exited Hawaii in 2017 due to stringent state regulations that required companies to maintain one-to-one cash reserves for Bitcoin holdings, a policy that Coinbase’s then-Head of Legal, Juan Suarez, described as “impossible” for the exchange to comply with.
The landscape began to shift in 2020 when Hawaii’s Department of Financial Institutions and the Hawaii Technology Development Corporation launched the Hawaii Digital Currency Innovation Lab. This regulatory sandbox allowed selected crypto firms, including Coinbase and the crypto exchange Gemini, to operate in the state without a state money transmitter license for a two-year period.
The Digital Currency Innovation Lab concluded on June 30, 2023. Despite its conclusion, crypto companies can continue operating in Hawaii under federal regulations, although state-specific licenses are no longer a prerequisite.
In July, Coinbase reported nearly $64 billion in crypto trading volume, reflecting its significant presence in the cryptocurrency market. The company’s return to Hawaii signals a renewed commitment to expanding its services in regions with evolving regulatory environments.
