Tag: Cryptocurrency Regulations

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Ukraine Government Reveals Its Strategy To Adopt Friendly Cryptocurrency Regulations

The Ministry of Economic Development and Trade of Ukraine recently announced that the country is preparing to adopt “the concept” of cryptocurrency. The complete legalization of cryptos across Ukraine is scheduled by 2021. According to local news portals, the strategy of including the cryptocurrency ecosystem into the country’s legal framework will occur in two phases.

The first will focus on determining the legal status of digital assets and crypto exchange activities in Ukraine, while in the second phase, the Ministry of Economic Development will publish a draft of the provisions to be applied for the cryptocurrency regulation. In this way, Ukraine would finally turn crypto trading into a legal and regulated activity.

So far, in Ukraine, there is no clear legislation regarding cryptocurrency. However, the Ukrainian Parliament announced that in the last quarter of this year, or the first months of 2019, they would introduce a law recognizing cryptos as financial assets. This law has been in preparation since August 2018.

Ukraine government paves the way to new initiatives related to cryptocurrency and blockchain technology

Also, since March of this year, the State Monitoring Service established that the country would adhere to the guidelines of the Financial Action Task Force against Money Laundering. The provisions of the before-mentioned entity differentiate between “virtual currencies” and “electronic money,” with virtual currencies being understood as a “digital representation of a value that can be traded digitally,” while electronic money is the “digital representation of a fiat currency.”

On the other hand, a month ago the National Bank of Ukraine proposed the creation of a digital version of the country’s fiat currency, using a decentralized blockchain. According to the banking authority, the so-called e-Grivna would be part of a strategy designed to reduce the circulation of cash.

In conclusion, the Ukrainian government is developing a strategy that paves the way to new initiatives related to cryptocurrency and blockchain technology, similar to the measures adopted by Malta.

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The US Congress Demanded The SEC To Clarify The Cryptocurrency Regulations Situation

On September 28th, a group of US congressmen sent a letter to the president of the Securities and Exchange Commission (SEC), Jay Clayton, asking him to clarify the regulatory framework surrounding cryptocurrency. The message, presented by more than a dozen congressmen, is a step for the securities laws to be modified to include cryptos.

The document was sent a few days after a meeting between representatives of the cryptocurrency ecosystem, congressmen and traditional market investors. Congressmen highlighted the lack of clarity regarding the SEC decisional process regarding whether a crypto token is a security or not.

Additionally, in the letter, they asked the SEC to clarify whether a token could be analyzed separately from the purchase contract, which in turn could become an offer of value. If so, they question whether the resulting token would be treated as a value.

The SEC keeps alive the dilemma surrounding the crypto tokens issued via ICOs

The SEC has cataloged Bitcoin (BTC) and Ethereum (ETH) as commodities, so their regulation is not related to the SEC, but to the CFTC. In the case of other cryptos, such as tokens, the SEC has indicated so far that it will use the Howey test to determine whether they are values or not. But this instrument does not cover the variety of characteristics crypto tokens sum up.

The US Congress also questioned the SEC chief if he agrees with the past statements of the director of corporate finance, William Hinman, who pointed out that the cryptos coming from Initial Coin Offerings (ICOs) should be regulated as securities, a measure that until now is not contemplated by the cryptocurrency regulations.

Also, on September 25th, a meeting was held in Washington DC between Wall Street investors, US congressmen and representatives of the cryptocurrency ecosystem, in which they discussed aspects to prepare a draft law for more explicit cryptocurrency regulations. On that occasion, cryptocurrency companies stressed that, without a clear regulatory framework, the US would lose its advantage in this industry.

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French Financial Authority Blacklisted More Cryptocurrency Sites

On September 26th, the Autorite Des Marches Financiers (AMF – the French Financial Markets Authority) published a list of new websites that are not authorized for cryptocurrency trading, including some offering “atypical investment” options, as reported.

Dozens of new crypto-related sites pop up in France without complying with the recently adopted cryptocurrency regulations

The French financial authority warned the public about websites such as www.goodcoin.fr, www.cryptofrance.info, and www.achat-bitcoin.co. Also, it was reported that the list is made up of 21 recently detected websites. They also stressed that it is not exhaustive since more and more Internet sites are appearing that do not comply with the newly-adopted French cryptocurrency regulations.

This blacklist complements AMF’s existing lists of websites that offer investment opportunities in digital assets, such as cryptocurrencies, and which also provide derivatives based on cryptos.

Also, France adopted new ICO regulations, recently

Recently, France’s Minister of Economy, Bruno Le Maire, issued a legal framework for Initial Currency Offers (ICOs), a corporate financing methodology used by a large number of cryptocurrency-related projects.

On that occasion, it was indicated that the AMF would be the institution in charge of granting or denying authorization to carry out ICOs.

French officials see cryptocurrencies as movable property

According to its website, “the AMF is an independent public authority responsible for ensuring that savings invested in financial products are protected, that investors receive adequate information and supervise the orderly functioning of markets.”

Also, in April this year, the French Council of State established that cryptocurrencies would be considered as movable property, which implied a reduction in the taxes applied on the profits obtained from them, from 45% to 19%. That decision was welcomed by the country’s cryptocurrency enthusiasts, as well as by the crypto- and blockchain-related companies that operate across the European country.

Now, the AMF decided to place some renowned crypto-related sites in its blacklist because they do not comply with the new regulations.

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US Government Invested About $6 Million In Analyzing Cryptocurrencies and Blockchain Transactions

US government authorities have just invested $5.7 million on commercial contracts with specialized companies to analyze cryptocurrencies and blockchain transactions.

These contracted firms have offered services to the US government, according to a Diar study, to improve the fight against tax evasion, money laundering, financing of terrorism, and arms and drug trafficking in the Dark Internet markets, as well as other illegal activities that involved cryptocurrencies and blockchain transactions.

According to the research of this publication, the demand from government agencies for analyzing blockchain networks has increased along with the growth of Bitcoin (BTC) popularity and the volume of transactions confirmed on that network. Additionally, government agencies have been demanding blockchain transactions analysis services to link people’s identities to their Bitcoin (BTC) addresses.

The cryptocurrencies and blockchain enthusiasts are not happy with the US government’s decision to analyze crypto transactions

The contracted investigative firms could be tracking transactions in cryptocurrency exchange platforms or services related to cryptos to link them directly to the identity of a suspect of financial crimes.

The pseudo-anonymity of crypto coins allows intelligence agencies to follow a trail, which can often be decrypted by US government-contracted companies

On the other hand, the Diar research states that the Initial Coin Offerings (ICOs) have raised in 2018 only the total of what they did last year, but the popularity of this fundraising scheme seems to be migrating to more specific and select projects. According to the data collected, 70% of the crypto tokens have a lower price than during their ICO.

According to information from TokenData, cited by Diar, by August 2018 there were only 17 projects that completed a round of funding, the minimum in one year. According to projections by Ricky Tan, founder of TokenData, it is unlikely that ICOs and pre-sales of tokens will accelerate during the remainder of the year.

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The UK Parliament Demands Cryptocurrency Regulations For The First Time

The UK Parliament demanded that the country’s financial regulatory authorities take measures to regulate the commercial activity of cryptocurrencies, as so far they claim that they function outside the law.

Members of the Treasury Committee of the House of Commons in Parliament urged the UK’s Financial Conduct Authority (FCA) to impose cryptocurrency regulations that can protect users from the risks associated with trading in digital assets.

The demand was made by Nicky Morgan, chairman of the Treasury Committee, who assured that “it is unsustainable” to continue issuing “weak warnings to investors and refrain from acting.”

Morgan told the BBC that the problem of poor user protection must be tackled first, while solutions are being studied to control price volatility, the risks of cyber attacks, while anti-money laundering policies are being implemented.

The UK Parliament demands stricter cryptocurrency regulations

During this quarter of the year, the FCA is expected to publish a Discussion Paper worked with the Bank of England and the Treasury Department. This publication promises to establish which is the “political thinking” regarding the cryptocurrencies. For its part, CryptoUK, created as a self-regulating entity, said it received the statements of the UK Treasury Committee in good terms.

“Regulatory oversight is essential for consumer safety, protecting consumers against malpractice and providing much more clarity to a rapidly maturing industry,” Iqbal Gandham, director of CryptoUK said.

That is the first time the UK Parliament has raised the issue of cryptocurrency regulations, after initiating an investigation into the risks and opportunities of implementing crypto and blockchain technologies in the country’s public and private sectors.

Also, in January of this year, Theresa May, Prime Minister of the United Kingdom, commented this year that “cryptocurrencies such as Bitcoin (BTC)” should be “very seriously observed, precisely because of the way in which criminals can use them.”

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