Tag: Cryptocurrency Regulations

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BaFin, The German Financial Market Authority, Debated Blockchain And Cryptocurrency Regulations

The German Financial Market Authority BaFin praised the revolutionary potential of blockchain technology in the first issue of its new “Perspectives” publication series published in July. On more than 30 pages, BaFin has numerous experts from the private sector explain technical aspects of distributed ledger technology. In a separate chapter on the subject of cryptocurrency regulation, BaFin makes its own contribution.

BaFin sees the blockchain technology’s confidence-building effect on the economy as positive

The intermediaries previously required in many transactions, such as banks and central securities depositories, could be partially replaced by blockchain technology applications, resulting in lower transaction costs and more efficient markets.

Blockchain technology can help to minimize the necessary trust and thus transaction costs between the parties involved in the transaction, for example by reducing dependence on intermediaries.

BaFin

Blockchain technology could, therefore, create a new type of decentralized ecosystem, which BaFin calls the “blockchain economy,” which will primarily affect the financial services industry. Their subscriber-supported infrastructure cannot only significantly change business processes but also massively shift the strategy of the companies working with them.

The German Financial Market Authority BaFin also debated cryptocurrency regulations

According to BaFin, it is “always guided by the principle of technological neutrality” and follows the credo “same business, same risk, same regulation,” which means that it is based on the “principles of proportionality and equal treatment under the rule of law.”

BaFin also rejects the view that cryptocurrencies are not regulated.

Cryptocurrencies are not unregulated per se, but are subject to the existing financial market regulations, depending on their concrete form in individual cases. They are therefore not regulated across the board, but specifically and technology-neutrally according to material facts that are subject to legal interpretation and can therefore also cover new types of facts.

BaFin

In the document, BaFin also describes in detail the principles it uses to evaluate crypto tokens and initial coin offerings (ICOs), which are based on the delimitation of payment tokens or virtual currencies of utility tokens and securities tokens.

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Blockchain Technology Companies In Malta Should Wait Before Applying For New Authorizations And Approvals

The Malta Financial Services Authority (MFSA) stated in a press release that blockchain companies must now wait until a freshly adopted legal framework is in place prior to applying for authorizations and approvals, as the Times of Malta noted.

In a declaration recently released, the MFSA announced that it is currently working on a new framework that will back up newly enacted blockchain regulations so that operators should wait until the agency announces a public notice before applying for permits and authorizations.

The Virtual Financial Assets Act (VFAA), which the Parliament of Malta approved on July 5th, will govern general Distributed Ledger Technology (DLT). With this new regulation, Malta is the first nation in the world to provide legal security for blockchain businesses.

The Times of Malta reports that in the last few weeks the MSFA has been reviewing stakeholders’ views on the proposed new blockchain regulations, and examining a number of concerns regarding the VFAA, ranging from fees to management penalties.

Malta to become the world’s first blockchain technology nation

Also, MFSA is allegedly conducting inquiries into a so-called law book of standards for the newly adopted legislation, the first of which is open through the end of July. The MFSA will subsequently release two additional sections, which will cover the issuers and service suppliers of the VFAA. By the end of the period of consultation, MFSA will issue the final blockchain regulations and guidelines for the VFAA to allow for the implementation of the new rules.

Malta now aims to establish a crypto-friendly environment and develop into a “blockchain island.” A number of crypto and blockchain businesses have been set up in Malta, such as the cryptocurrency exchanges and wallets Binance, OKex, and BitBay.

Binance, at the beginning of this month, reported its intention to launch a bank built on a token-owned blockchain. The forthcoming Founders Bank is to be the property of digital token investors and is to be headquartered in Malta and aims to be the world’s first decentralized, community-owned bank.

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Sberbank CEO Said Governments Will Maintain Centralized Role Instead Of Accepting Cryptocurrency

The CEO of Russia’s largest state-owned bank, Sberbank, Herman Gref, said he still could not foresee that governments would “give up their centralised role” in creating fiat currency as part of their comments on cryptocurrency.

During the Astana Finance Day conference, Sberbank CEO said he doesn’t believe the governments will give up fiat money

Talking to journalists during the international Astana Finance Days conference in Kazakhstan’s capital on July 4th, Herman Gref Sberbank repeated the comments he has made many times about the future role of cryptocurrency in the economy.

“Do I see a perspective of the global use of cryptocurrency as an alternative to fiduciary money? I don’t see it, and I said it many times,” said Herman Gref. “I don’t think the state is willing to cede its centralized role in issuing fiat currency to other decentralized institutions,” he added.

New cryptocurrency regulations in Russia will classify cryptos as separate digital assets

Gref’s words broadly reflect the ongoing metamorphosis of the regulatory status of cryptocurrency within Russia. This week is the deadline for new cryptocurrency regulation to become laws that will consolidate cryptos as a separate digital assets class devoid of legal tender status.

However, Sberbank has begun to increase its interactions with the cryptocurrencies market in the run-up to the new cryptocurrency regulation era, revealing last month its plans to launch a cryptocurrency-based mutual fund previous month.

Sberbank CEO compared cryptocurrency investments with gambling in a statement last week

A week earlier, however, Herman Gref, Sberbank CEO, had gone into the bass, telling local news station Kommersant that he “wouldn’t recommend [buying cryptocurrency] to anyone who didn’t like to play in a casino,” comparing cryptocurrency investments with gambling.

This vision of the Russian Sberbank CEO regarding the cryptocurrency is another evidence that cryptos are not doing very well in Russia.

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Crypto

HitBTC Cryptocurrency Exchange Platform Shuts Down Its Operations in Japan

HitBTC cryptocurrency exchange platform has suspended its services for investors residing in Japan. This decision was taken in order to avoid any problems with the country’s cryptocurrency regulation. Indeed, the latter did not authorize HitBTC to operate in Japan and users with Japanese IP addresses will be asked to provide information about their residence as part of the customer identification procedure (KYC). This will also identify investors who do not live in Japan.

HitBTC services shut down its operations in Japan

HitBTC, the 8th largest cryptocurrency exchange platform in the world, according to CoinMarketCap, has announced the suspension of its services for Japanese residents.

On its website, the Hong Kong-based company has added a new section entitled “Restriction of Services”, under the “Terms of Use” section.

For example, there can be read that “you must not use our services and immediately stop using them if you are a resident of a country where HitBTC is not authorized to operate.”

The company said that if the platform detects the use of its services from an IP address registered in Japan it will be asked to confirm if the user does not reside in Japan. Another publication was made by the company confirming the suspension of its services in Japan.

The decision came in respect with the cryptocurrency regulations adopted by Japan

The Japanese payment services law regarding the cryptocurrency regulations, which caused HitBTC cryptocurrency exchange platform to end its services on the Asian country’s territory, came into force in April.

This regulation legalizes cryptocurrencies but it also requires that all cryptocurrency exchange or trading companies operating in Japan to be registered with the country’s financial authority, the FSA.

To date, 16 platforms for the cryptocurrency exchange activities have received an operating license. They were thus authorized to operate in Japan.

The Japanese financial regulator has also warned some companies that continue to operate in Japan without such authorization, and HitBTC was one of them.

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China Might Eventually Give In To Pressure And Lift The Cryptocurrency Ban

Just 8 months after China was featured in a discussion involving its ban on cryptocurrency trading, rumors are mounting regarding the second-largest economy in the world, one that could ditch the cryptocurrency ban and make a 180-degree twist. According to a Chinese newspaper, the Chinese people stated that the crypto ban is too strict and a cryptocurrency regulation on the models already adopted by the US or the European Union might be more appropriate.

There is a growing belief that simply saying no to Bitcoin will not be the final solution to the problem of cryptocurrency. A more fundamental approach would be to adopt the new technology without compromising the country’s financial system.

The naming of a new Central Bank of China Governor, which happened in March, raised questions about softening the country’s official position regarding the cryptocurrencies market.

China has been an important asset in the cryptocurrencies world and, hopefully, it will return to that status

Before March, however, some rumors were talking that, upon a discussion between China’s Central Bank and Huobi, Chinese official started to rethink their approach regarding cryptocurrency exchange, indicating that these operations with cryptocurrencies might be reopened in China, eventually.

Although many people in China are actually very inventive in bypassing the cryptocurrency ban, China is in a tricky situation because on the one hand, it would like to take advantage of this new technology but, on the other hand, it would like to see cryptos implementation to be done following the China’s principles, namely, nationalism and protectionism.

Many cryptocurrencies networks were created as China has always been a very significant player in the crypto-verse until this country turned around and eventually compromised the success of many.

Even more, more and more people, even outside of China, are saying that the Chinese cryptocurrency ban is an insult to all those people who contributed to the technological gains China registered in the last decade, which include blockchain and cryptocurrencies.

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