“Let’s call the BitLicense what it is—an absolute failure.”

That’s how Erik Voorhees, the CEO of cryptocurrency exchange ShapeShift, described the reigning regulatory regime for New York’s Bitcoin industry last week during Manhattan’s Consensus conference. Voorhees had pulled his company out of New York when the state established the BitLicense in June 2015. In the nearly three years since, only four companies had managed to secure a license from the New York State Department of Financial Services (NYDFS), Voorhees noted. “Get rid of the BitLicense,” he urged.

Two days after Voorhees’s comments, the NYDFS, as though in retort, granted the fifth BitLicense to Genesis Global Trading. It joins Circle, Ripple, Coinbase and BitFlyer in the exclusive club of BitLicense holders.

Still, Genesis had waited nearly three years to be approved, having submitted its application in August 2015. Its approval also followed a six-month dry spell since the previous BitLicense was granted; the NYDFS has gone up to 11 months without pushing out a new BitLicense—roughly equal to the gestation period of a humpback whale.

One theory for the glacial pace of BitLicense approvals is that the regulators have simply been inundated with new applications, creating a backlog. Square, for example, the publicly-traded payments company that began offering Bitcoin trading earlier this year, confirmed to Fortune that its BitLicense application is currently pending the agency’s review. Robinhood, which now offers crypto trading in 15 states, and eToro, a London-based trading platform that’s entering the U.S. market, are also planning to apply for a BitLicense, if they haven’t already. Add to the list Goldman Sachs, which told the New York Times that it’s considering trading “actual Bitcoins” (in addition to Bitcoin derivatives) “if it can get regulatory approval”—ostensibly meaning a BitLicense.

Yet despite the fresh class of applicants, several industry experts say the line is not as long as it seems. “What I have heard is that there may be far fewer active applications than New York would like people to believe,” says Alex Kern, a research analyst at Fundstrat Global Advisors who covers cryptocurrency and macro equity. He and others estimate that there are as few as 15 BitLicense applications currently pending before NYDFS—maybe less—factoring in rejections and application withdrawals.

That’s down from the 26 applications NYDFS said it had received by June 2016—the last time the NYDFS disclosed application numbers. When I asked the agency for updated statistics, the NYDFS press office declined to provide it, instead instructing me to submit a Freedom of Information Law request to obtain the data. (I will report back on any response I receive.) When I asked whether there had been an increase or decrease in applications, the NYDFS told me the “information is unavailable” entirely.

In light of a shrinking applicant pool, the NYDFS’s progress on its BitLicense approval pipeline looks even more dismal. At this rate of five approvals per three-year period, the NYDFS won’t get through the estimated 15 pending applicants until 2027.

“It can’t be a three-year process,” says Arnold Spencer, general counsel for Coinsource, the largest operator of Bitcoin ATMs, which applied for a BitLicense back in summer 2015. “So you need to either speed up that process, or you need to lower the bar.”

There are some hints that the bottleneck may be clearing, though, with companies including BitPay, Coinsource, and BitStamp anticipating that their applications could be approved imminently. For more on that—and on the reasons for the holdup—read the rest of this article here.

Jen Wieczner
@jenwieczner
jen.wieczner@fortune.com

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