It's a limited-purpose trust company - it can only accept assets as trustee and cannot hold cash as a customer deposit. Because depositors' funds aren't at risk

It's a limited-purpose trust company - it can only accept assets as trustee and cannot hold cash as a customer deposit. Because depositors' funds aren't at risk, these entities don't have to join the FDIC and are exempt from some other regulations. I guess because itBit acts as a custodian for Bitcoins and not just a transmitter, the DFS thought it was a closer fit than a money transmitter license.