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Crypto Regulation: Philippines, Thailand, S. Korea and Japan Make Strides as the U.S Lags Behind

Over the past few weeks since the postponement of a verdict on the CBOE Bitcoin ETF by the SEC, the crypto-verse has generally been focusing on the regulatory happenings in the country of the United States. After the delay of the CBOE ETF, we witnessed the reject of 9 others; after which the SEC stated it would be reviewing them again.

The decline in the crypto market since the delay was announced, shows the amount of influence the American SEC have on the value of the market. As a matter of fact, the latter observation can be pointed out to the authority as a sign that the crypto-verse is looking to them for guidance on a way forward.

At the same time, other countries across the globe have embraced cryptocurrency with both arms. This can be seen with the countries of Malta, Lichtenstein and Venezuela. In the case of the latter, we have seen the government issuing a government backed crypto. There is also news that the cryptocurrency of DASH has become popular in the same country.

Philippines, Thailand, S. Korea and Japan

Shifting attention to Asia, we find the countries of the Philippines, Thailand, South Korea and Japan recognizing the need for early regulation in an ever growing crypto and blockchain industry.

With respect to the Philippines, its Cagayan Economic Zone Authority (CEZA), recently announced that it was issuing 25 licences to crypto exchanges in the country. In the announcement stating the issuance of licenses, the authority had already issued 2 of the 25 to local exchanges.

In the case of The Thai SEC, the authority has recently approved 7 crypto exchanges. In South Korea, the authorities are busy drafting legislation to regulate the industry. The government has also pledged $4.4 Billion towards funding emerging technology companies with a focus on big data and blockchain.

Japan had initially seemed hostile to cryptocurrencies, only for the government to ‘loosen up’ through the Financial Services Agency (FSA). The FSA’s new chief whip has vehemently stated that they have no intention of banning crypto and would rather like to see the industry grow.

The United States and Signs of Hope

In a sense, the recent statement from the SEC that it was reviewing the 9 rejected ETFs could be taken as a sign of progress from the regulatory body. A review means that they are closely monitoring the space. There is also public concern about the ETFs as can be seen through social media and numerous comments on the SEC website.

In conclusion, the countries of Malta, Lichtenstein and Venezuela have embraced crypto fully with the Philippines, Thailand, S. Korea and Japan also warming up to the space. With respect to the United States, the SEC is the sole  authority that will determine if cryptocurrencies become mainstream investment options in the country. Only time will tell if one of the Bitcoin ETFs will be approved some time soon.

Disclaimer: This article is not meant to give financial advice. Any opinion herein should be taken as is. Please carry out your own research before investing in any of the numerous cryptocurrencies available.

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Top Crypto Exchanges Join Hands To Tackle Regulatory Issues

Just weeks ago, the Winklevoss Twins’ Bitcoin ETF proposal was sadly denied by the SEC, with the US regulatory body citing concerns of manipulation and security as primary reasons why such an ETF would not be successful. Following the disappointing turnout for the final verdict, the twins took to Bloomberg to declare that they were not deterred by the SEC’s decision and would continue to trudge forward.

And it seems with a recent announcement that the twins are back, and are seemingly ready to tackle regulatory worries in the crypto community. In late-July, Ethereum World News reported that representatives from Gemini met with the Nasdaq, along with a variety of other firms, to tackle the regulatory development of the crypto industry.

With the arrival of a recent announcement, it seems that Gemini has kept with the theme of pro-regulation in the cryptosphere. As per a press release issued by the so-called “Virtual Commodity Association (VCA) Working Group” will work towards becoming a prominent self-regulatory body for “virtual commodity marketplaces (exchanges).”

The VCA will be initially composed of Bitstamp, BitFlyer, Bittrex, and Gemini, which all are home to a substantially sized American audience.

Representatives from the aforementioned four firms are scheduled to exchange formalities for the first time in September, where they will also flesh out the idea and aspirations of the newly-established VCA.

According to a somewhat pre-established meeting plan, the VCA will first highlight the guidelines for membership of the association. Secondly, exchange representatives will begin to create an outline for industry “best practices” and rules, that will only help to propagate “transparency, liquidity, risk management, and fairness.” Thirdly, member bodies will draw out a series of guidelines to address “member conflicts of interest, client communications, client disclosures, and record keeping.” And last but not least, the VCA members will do its best to establish a strong, dedicated and non-bias team of individuals to run this consortium.

Although this move is somewhat of a jab at governmental-operated bodies, the CFTC expressed its excitement for the VCA. CFTC commissioner Brian Quintez stated:

Given the absence of federal oversight jurisdiction in the crypto market, in February and again in March of this year I called on the crypto platform community to come together and develop a self-regulatory organization-like entity that could develop and enforce rules. Today’s announcement is a positive step towards that realization.

For the time being, this group will be headed by Maria Filipakis, who previously worked for the New York Department of Financial Services, where she was an integral part of the NYDFS’ move to establish the coveted “BitLicense.”

It is widely speculated that the introduction of a self-regulating conglomerate, like the VCA, will hail in another round of institutional interest, as traditional firms may realize that the crypto industry isn’t as rife with anti-regulatory madness as they may think.

Photo by Hunters Race on Unsplash

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Malta Tells Crypto Companies To Step On The Brakes

As nations around the globe roll out crypto regulations and tax schemes, blockchain startups eagerly eye the next crypto-friendly destination. Malta has modeled itself as exactly that and firms have been flocking there in droves. So much so that the government has told them to hold their horses while it rolls out a regulatory framework.

According to local media the Malta Financial Services Authority (MFSA) issued a statement on Friday saying that it was still developing the framework underlying recently passed cryptocurrency laws. It added that operators need to wait for a public announcement from the agency before filing a request for approvals and authorizations.

The Virtual Financial Assets (VFA) Act, passed earlier this month, comprised of three bills, one of which is focused on new regulations for the blockchain sector. The act makes Malta the first country to provide a legal regulatory framework for custom blockchain projects and companies.  The VFA act included the creation of the Malta Digital Innovation Authority, a regulatory body responsible for overseeing the industry. Another law as part of the act was Innovative Technology Arrangement and Services Act which focuses on cryptocurrency exchanges and companies specifically.

Until these frameworks are complete the MFSA notified operators that they would have to wait. In the meantime they should monitor the official webpage for announcements for updates and developments. The announcement noted that the bill will not take effect until “such date as the Minister for Digital Economy may establish by notice in the Government Gazette.” The Authority has been gathering stakeholder opinion on regulations relating to the VFA Act over the past two weeks.

There has been no timeframe given for this limbo period but when over it is expected that the MFSA will start issuing regulations and rules for the VFA Act in preparation for bringing it into force. Then Maltese doors will be officially open to the world’s crypto and blockchain organizations, many of which have already opened offices there in anticipation.

“Blockchain Island” has already attracted huge names in the industry such as Binance which will be working towards the launch of the first Maltese “decentralized and community-owned bank” dubbed the Founders Bank. Just this week OKEx also announced that it was partnering with the Malta Stock Exchange to launch a new securities trading platform called OKMSX.

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You Can Now Have a Say in The CBOE Bitcoin ETF Filing On the SEC Website

Every government authority is mandated to hear the opinion of its citizens on any and all matters that will affect the country. This is usually done through representation in parliament or the senate or congress. There is also the option of getting the opinion directly from the people.

The United States SEC (Securities and Exchange Commission) has just done that and with regards to the recent filing by the CBOE requesting that Bitcoin ETFs be regarded as securities by the regulatory body. Right now, there are a little over 20 comments on the website since the authority opened a section for comments with regards to the filing.

As a member of the crypto-community, Ethereum World News saw it fit to inform crypto-enthusiasts and traders, that they can play a part in determining the future of the crypto-markets.

A vast majority of crypto traders believe that the Bitcoin ETFs will be a gateway for the high net individuals and institutional investors to get into crypto investing. Once the SEC classify BTC ETFs as securities, then it is all systems go for Wallstreet firms and high net individuals to buy crypto. The two categories of investors in the US, have remained on the sidelines of crypto investing waiting for some regulatory direction from the American SEC. The exchange known as Coinbase, has anticipated this event and has recently launched a storage service for digital assets for the said investors. This service has been dubbed Coinbase Custody and is raking in new clients by the day.

So how do you comment on the matter?

There are 3 methods of doing so. Please note that the file number for the BTC ETFs on the SEC website is SR-CboeBZX-2018-040.

  • Online form
  • Comments can be submitted via this online form.
  • Email
  • Send comments to [email protected].
  • The subject line of your message must include the File Number for the rule. This is the number that begins “S7-” or “SR-”.
  • If you attach a document, indicate the format or software used (e.g., PDF, Word Perfect, MS Word, ASCII text, etc.) to create the attachment. Please note that we now accept comment letters in PDF format. DO NOT submit attachments as HTML, GIF, TIFF, PIF, ZIP, or EXE
  • Using the traditional ‘Snail Mail’

    Send 3 copies of your paper comment letter to:

    Brent Fields, Secretary
    Securities and Exchange Commission
    100 F Street, NE
    Washington, DC 20549-0609

    Each copy must list the “File Number” for the rule. This is the number that begins “S7-” or “SR-”.

You can also express your opinion in the comments section of this article.

Thank you in advance.

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Licensing Fees and Taxes: The Upside For Governments Embracing Crypto Regulation

The cryptocurrency and blockchain industries have pretty much stood unregulated ever since the Bitcoin (BTC) ledger was launched back in 2009. This means that for the last 9 years or so years, crypto enthusiasts, exchanges and traders have been enjoying the ride without answering to governments or any laws. This has been a good thing for this is the main point of decentralization through Distributed Ledger Technology.

But as much as John McAfee hates centralized governments, they are a necessary evil to maintain order in the various countries we live in. Whether it be an autocratic or democratic government, its mandate is to provide basic services to its citizens such as security, economic stability and healthcare. Governments achieve this through taxation, levies and fees for specific services.

With more countries embracing Crypto-regulation such as the Philippines, South Korea, Australia, Japan, Malta, Thailand, Kazakhstan and more, the corresponding governments will find a way to get their share of the crypto market action. One form is licensing fees as can be seen in the Philippines. The regulatory body there will rake in a cool $67 Million for issuing the 25 licenses it has set to approve. This means the funds collected can be diverted to other social services in the country.

The country of Australia is also working on taxing crypto profits for its citizens that have been stashed away their crypto loot in foreign jurisdictions. This will involve cooperation between the Australian authorities and other governments they have an agreement with when it comes to such matters of finance. The revenue collected from such individuals will once again probably fund the welfare benefits the country sets to distribute via blockchain technology. The country also aims at being a global leader in blockchain technology, A.I. and quantum computing. All these projects need some sort of funding and it will probably be sourced from taxing crypto trading.

In a nutshell, with cryptocurrencies and crypto-trading, comes a new way for generating revenue for any individual. With any income generated, comes the responsibility of paying taxes to the corresponding jurisdiction we live in. Crypto exchanges are also business entities that must declare profits and pay their dues in licensing fees and taxes accordingly. This is a reality we must embrace no matter how bitter it is to accept.

Besides, one of the unwritten universal laws in being a resident of this Earth, is to leave it a better place than we found it for the coming generations. If their lives will be made better through the schools, hospitals and technology developed from taxing crypto trading, then it is alright.

But the fees and taxes have to be within limits. We all know that one of the dangers of high taxation is a reduction in economic growth. Higher taxes means less individual capital to venture into investments and business enterprises. Therefore, the fees and taxes requested by governments with regards to crypto, have to be reasonable.

Disclaimer: This article is not meant to give financial advice. It is an opinion piece. The opinion herein should be taken as is. Please carry out your own research before investing in any of the numerous cryptocurrencies available.

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More Regulatory Progress as Malta’s PM Confirms Parliament Will Pass 3 Crypto Bills Today

The wonderful country of Malta has earned its place in crypto and blockchain history as being the first country to be progressive in regulating the industry in a positive way. In a press conference just today, June 4th, the country’s Prime Minister, Joseph Muscat confirmed that the country’s parliament will favor and approve 3 cryptocurrency bills that are crypto and blockchain friendly. The P.M added that the bills will pass the third and final reading during today’s evening session to become law.

The Parliamentary Secretary for Digital innovation and Finance, Silvio Schembri, is quoted as saying the following with regards to the bills:

This is the last stage of the legislation that will put Malta on the international map for blockchain and crypto regulation. There is political consensus on this roadmap and we are foreseeing that this area will be the mainstay of our economic growth for the next 4-5 years.

He would later express his excitement via twitter of the new move by his home country.

From a crypto enthusiast point of view, the country of Malta and its legislators deserve a round of applause for their progressive actions. The country has also attracted two prominent crypto exchanges into opening shop in the country. The first one is Binance which plans on seeking banking partners in the Mediterranean country. Binance CEO Changpeng Zhao was enthusiastic about the move when he stated that:

We are very confident we can announce a banking partnership there soon. Malta is very progressive when it comes to crypto and fintech.

The second crypto exchange to be attracted by the friendly regulations in Malta is BitPay. The exchange is the largest in Poland but now seeks friendlier jurisdictions in Malta. This is after banks in its home country refused to offer services to the exchange. The exchange expressed its regrets with regards to local banks not wanting to do business with them in the following statement:

The activity of the BitBay exchange in Poland requires cooperation with Polish bank. Unfortunately, the last Polish bank ready to provide bank services undertook unilateral decision to finish the cooperation with BitBay with the effect at the end of May. In those circumstances, the continuation of providing high-quality services by BitBay exchange in Poland is no longer possible.

In conclusion, Malta has set precedence for all global countries considering cryptocurrency and blockchain regulation. The upside of the country being friendly to crypto and blockchain – besides the added revenue from the new businesses – is the good P.R that will in turn bring crypto tourists into the country. Picture yourself next summer on a beach in Malta during a vacation paid for in BTC or XRP.

[Photo, Malta PM, Joseph Muscat. Source, ccn.com]

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Abu Dhabi Global Market (ADGM) Issues Crypto Regulatory Guidelines

The tide that is crypto-regulation has reached the United Arab Emirates with its Abu Dhabi Global Market (ADGM) issuing crypto regulatory guidelines on the 25th of June this year. In the press release on its official website, ADGM has provided the framework to regulate spot crypto asset activities. These include those undertaken by exchanges, custodians and other intermediaries in ADGM. The current regulatory framework is as a result of public consultations by ADGM’s Financial Services Regulatory Authority (FSRA) on May 28th this year.

The framework will address the risks involved with crypto asset activities such as money laundering, financial crime, consumer protection, technology governance, custody and exchange services. ADGM plans to foster the economic diversification of Adu Dhabi through innovation and sustainable incentives.

Mr Richard Teng, Chief Executive Officer, FSRA of ADGM, is quoted as saying the following to explain the body’s decision to offer a framework for crypto activities:

We are encouraged by the significant global and regional interest from exchanges, custodians, intermediaries and other institutions to our crypto spot regulatory framework. Globally, responsible crypto asset players are seeking a regulatory regime upholding high standards that foster market confidence.

He would also add that:

By introducing a comprehensive and best-in-class regulatory framework, the FSRA is taking a leading role in instilling proper governance, oversight and transparency over crypto asset activities, positioning ADGM as a destination of choice for crypto asset players. Our engagement with fellow global regulators also validated our position that the key risks highlighted have to be addressed for crypto assets to be more widely accepted and institutionalized.

The actions my the ADGM follows those of authorities in the countries of Malta, South Korea, Indonesia and Thailand, who have offered regulatory guidelines in each of the countries.

In conclusion, it seems the regulatory tide is gathering some much needed momentum across the globe. As soon as the major countries of the USA, UK, Australia and Russia give more direction with regards to regulating crypto assets and activities, then the much awaited institutional investors will indeed show their interest in the crypto markets. They will bring in the said trillions of dollars in investment capital.

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One Monumental Regulatory Step Forward: 3 Crypto Bills Approved In Malta

Many hearts were broken when the Azure Window of Malta collapsed back in March 2017. The cause of the collapse was a bunch of serious storms that bombarded the Mediterranean Sea and the Island country. But Malta did not let the tragedy dampen its spirits because the country is now leading the way in terms of giving clear guidelines of cryptocurrency regulation within its jurisdictions.

The Maltese government has passsed three cryptocurrency and blockchain bills at the moment of writing this. The development was announced by the country’s Junior Minister for Financial Services, Digital Economy and Innovation within the Office of the Prime Minister of Malta, Silvio Schembri, and via Twitter.

Malta has taken a major step with the three bills which are as follows:

  1. The Malta Digital Innovation Authority Bill – This first bill establishes the Malta Digital Innovation Authority that will focus on internal governance arrangements through a Board of Governors. The bill will also highlight the duties of the Authority. One of its mandates will be to certify Distributed Ledger Technology (blockchain) platforms to ensure credibility and provide legal certainty to their users
  2. The Technology Arrangements and Services Bill – This second bill deals with the registration of Technology Service Providers and certification of Technology Arrangements. This bill is primarily geared towards the establishing of exchanges in the country and other companies that want to operate in the crypto industry
  3. The Virtual Financial Assets Bill – This third bill deals with the regulatory framework for ICOs in the country

Binance CEO, Changpeng Zhao, was one of the first to congratulate Malta on this achievement via Twitter.

The popular cryptocurrency exchange of Binance, through its CEO, had earlier this month stated its intentions of setting up a bank account in Malta. This act by the exchange led many to speculate that the exchange was soon to offer fiat-to-crypto deposits and withdrawals on its platform. Changpeng Zhao would later confirm that the exchange was moving its headquarters to Malta and would offer the said fiat-to-crypto option in a year’s time.

The country of Malta has now set itself apart from the rest by giving clear guidelines towards crypto regulations as well as living up to its recent nickname of the ‘Blockchain Island’. This in turn means that there will be an influx of exchanges and crypto firms setting up shop in the country with Binance leading the way.

[Photo source, cnn.com]

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South Korean Authorities Knowingly Postponed Crypto Regulation

South Korean government authorities have admitted to knowingly postponing crypto regulation in the country. The officials feared that doing so, would be interpreted by consumers as legitimizing the crypto markets. The South Korean authorities can be excused for having such fears. Cryptocurrencies and blockchain technology are uncharted territories in terms of regulation by governments. Giving guidelines instantly would have caused a frenzy of excitement in the crypto-markets that could have been unhealthy for everyone concerned.

Less than a week ago, South Korean authorities announced that the country will be regulating cryptocurrency exchanges in the same manner they regulate commercial banks in the country. The  Korea Financial Intelligence Unit (KFIU) will be spearheading the efforts together with local financial regulators.

The South Korean authorities have been waiting for a bill to pass that will give the said local authorities the jurisdictional powers needed to regulate cryptocurrency exchanges. The bill was as a result of financial authorities requesting the government back in September, to regulate the crypto markets to protect all investors and increase the security in the space. One needs only to refer to the the hacking of the Coincheck exchange back in March and most recently, Coinrail,to understand their concerns in terms of cyber security.

Similar regulation is expected in different countries such as Russia and the United States. With respect to the latter, the Director of The SEC’s Division of Corporate Finance, William Hinman, has clearly stated that Ethereum is not a security. Mr. Hinman is quoted as referring to Ethereum as follows:

When we think about how Ether today is operating, at least, we see a highly decentralized network, not the type of centralized actor that characterizes securities offerings. In its current state, we don’t see value regulating it.

His direction with respect to Ethereum is some welcome progress for the Crypto-verse. This means that in the next few months, the SEC will formally state its stand on the other numerous cryptocurrencies such as Ripple (XRP), Tron (TRX), IOTA (MIOTA) et al.

The SEC progress is evidently slow, but as has been seen with South Korean authorities, no government agency wants to make a rush decision with respect to cryptocurrency regulation guidelines.

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China Regulations Towards ICO Positive Indicator for NEO (Antshres) – Chinese Ethereum

Chinese Authorities regulations in relation to Initial Coin Offerings or known as ICOs have a high chance of being positive news for NEO – formerly known as Antshares or The Chinese Ethereum.

The Above Mentioned Regulations!

According to the source, the safety-strategy will be putting borders around ICOs, taking notice and supervising tokens and publishing investment risk alerts. In the event of a market risk, the plan concludes with a high-chance of denying and suspending all Initial Coin Offerings.

Another plan to be put on function was confirmed by Caixin yesterday, stating that movements and actions that will be taken related to ICOs will be base don an executive order formed in 1998 by State Counil.

“Illegal financial business activities include: fund-raising targeting not specific objects without legal approval, or other activities that the People’s Bank of China identified as illegal.”

Bullish Market Increase could Await NEO

Keeping in mind that NEO is already functioning under the rules and proposes, makes “The Chinese Ethereum supportive of functionality and quality” while it originates from China – NEO could easily be the countries premier digital platform.

The Community

An in-detail explanation could be noticed by a community commenter with the idea that regulations can not be missed and it will conclude with an overall-market declining phase for all blockchain-assets but the end side will be a more stable market.

“First off, to all the people who think China will ban ICO’s: That’s simply not going to happen. It would make a lot of very rich people angry in China. Let me explain.Having specific rules in place gives the market a sense of permanency and legitimacy. It reassures many investors in China that the Chinese government is watching very closely for cases of fraud, and will react in order to[sic] protect the public. That’s bullish for NEO. Incoming regulations were inevitable. Even if they weren’t, we still don’t want a series of low quality ICO’s clogging up the NEO platform. NEO should be associated with quality and functionality, first and foremost. Like all of you, I look forward to NEO becoming the premier digital platform led by the fine folks in China, and now we are one step closer to that goal.”

Soon Just good marketing and promises will not be enough for ICOs to make their debut.


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