New Zealand Tax Authority Tells Crypto Firms to Disclose Traders Info & Transaction History

  • New Zealand’s tax authorities dialing down on cryptocurrency users and transactions in the country.

In a statement obtained by the local radio news station, Radio New Zealand (RNZ), New Zealand-based crypto firms must submit their customer’s crypto transaction information to the country’s top taxation authority, Inland Revenue Department (IRD).

According to the report, all companies dealing with crypto assets must “pass on customers’ personal details as well as the type and value of their crypto assets.” This is in a bid for the tax authorities to keep up with the virtual asset industry and formulate a policy that will best help New Zealanders report their crypto tax obligations.

Global tax regulators are heavily hitting on the crypto asset world. Recently, the U.S. Internal Revenue Service (IRS) introduced crypto laws on its 2020 tax laws, altering form 1040 to make it harder for crypto users and traders to escape their tax obligations.

However, Janine Grainger, chief executive of Easy Crypto, a New Zealand based crypto firm, said the latest effort by the IRD goes against the fundamentals of crypto – privacy. Terming the new rules as “heartbreaking,” Grainger said she would comply but questioned the law.

“Privacy is really important to us… one of the tenets [of] cryptocurrency in general is around having freedom and autonomy and privacy,” she said.

“[..]the point of privacy isn’t to aid people who have something to hide, it’s to ensure we have a fair, open and free society”.

Russia recently introduced an amendment that would see cryptocurrency miners forego their mining rewards and a law that forces crypto traders to disclose their crypto transactions or face criminal charges.

Related Global Crypto Tax News:

Read: Israeli Draft Bill Proposes Bitcoin be Defined as Currency to Cut Down the Hefty Capital Gain Tax

Also Read: Switzerland’s Canton to Allow its Citizens to Pay Taxes in Bitcoin & Ether Starting 2021

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Author: Lujan Odera

Russia’s New Amendment On Crypto Laws Could See Bitcoin Miners Lose All Their Rewards

  • New reports from Russia confirm amendments in the country’s crypto laws that could ban Bitcoin (BTC) miners from receiving mining rewards.
  • The amendment is yet to be finalized, but experts argue if the law is passed, it could have a drastic impact on the overall use of crypto assets in the country.

As first reported by a Russian news outlet, Izvestia, the Ministry of Finance in Russia, is proposing an amendment to the federal law on digital financial assets (DFA) that could see Bitcoin miners receive no rewards on their efforts. According to the letter, the amendment allows Bitcoin mining using Russian infrastructure, but miners are not allowed to receive rewards in crypto.

The amendment further bans all transactions using virtual currencies in the country with three main exceptions. However, the amendment to DFA is yet to be finalized. The letter has been sent out for interdepartmental coordination and approval across different government departments.

A Closed Mining Cycle

The new amendment raises several questions on the implementation and wording of the document. As stated above, Bitcoin, Ethereum, and other crypto miners will be allowed to mine their tokens but will be stripped of its financial value as miners cannot receive BTC or ETH.

Several experts have since condemned the amendment as a “revenue loss” for the country, calling for revisions on the bill. Speaking on the issue, Dmitry Zakharov, CEO of Moscow Digital School, stated the “wording does not bode well for miners” as no other alternative has been offered on how to receive mining rewards. He added,

“Perhaps experts will try to come up with some interesting legal constructions, but all of them will be fraught with significant risks of bringing to administrative and criminal liability.”

If the amendment passes, then Russia could lose a share of its revenues, another expert on the matter said. According to Anton Babenko, partner of the Padva and Epstein law office, prohibiting receiving crypto could lead to more people not reporting their revenues, leading to tax losses.

A Leeway? Or Not?

Russia implemented a total crypto ban last year causing a public outcry that caused the parliament to shut down the ban. The latest amendments stipulate a similar ban – prohibiting any individuals, companies, or entrepreneurs from performing any transactions with virtual money. However, the amendments stipulate three exceptions to the rule – an inheritance of crypto assets, enforcement proceedings, and if a debtor goes bankrupt.

Any use of crypto in the country could lead to legal and criminal liability on the user with a 100 thousand rubles fine on individuals or five to seven years prison time and up to 1 million in fines for legal entities.

The new rules aim at tightening the use of cryptocurrencies in Russia in a bid to stop illicit items and illegal activities using Bitcoin and crypto in Russia. According to a law expert, the new amendment constitutes a “total ban on cryptocurrencies” which could have a severe impact on the countries crypto space.

The country’s policies on crypto could be a missed opportunity for the country, economist, Vladislav Ginko said earlier this month even as Russia extends its efforts in hoarding physical gold.

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Author: Lujan Odera

NYDIG Sold $140M in A Previously Unknown Bitcoin Fund Last Week, Just Ahead of BTC Halving

New York Digital Investment Group (NYDIG) revealed this week that it sold just shy of $140 million in a bitcoin fund, that was previously unknown.

It became public after the fund was revealed in a Form D filing for an exemption to the US SEC on Tuesday, reported Forbes.

Formerly named NYDIG Bitcoin Yield Enhancement Fund LP, this pooled investment fund started selling on May 5 with a number of investors contributing to the capital raise.

Back in November 2018, NYDIG’s subsidiary, NYDIG Execution received BitLicense allowing it to legally operate a crypto-related business — be a crypto custodian for five cryptos viz. Bitcoin (BTC), Ethereum (ETH), Ripple (XRP), Bitcoin Cash (BCH), and Litecoin (LTC), and to conduct money transmissions.

Interestingly, BitLicense was created by Ben Lawsky who had ties with Stone Ridge Asset Management, an advisor to NYDIG’s Bitcoin Strategy Fund. Lawsky also sits on the Board of Directors of Ripple, San Francisco-based fintech company.

In December, Bitcoin Strategy Fund received a green light from the SEC to offer the shares of its new bitcoin fund to institutional investors. This was a portfolio fund in the Stone Ridge Trust VI for cash-settled futures contracts.

Lawsky, the “Sheriff of Wall Street,” as he has been referred too after he issued close to $6 billion in fines to institutions while he was New York State’s Superintendent of Financial Services from May 2011 to June 2015.

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Author: AnTy

NY Judge Grants Blockchain Association ‘Amicus Curiae’ Despite SEC’s Opposition in Kik Case

New York court judge accepts Washington D.C blockchain advocacy group, Blockchain Association filing “amicus curiae”, a friend of the court, in the case between Kik and U.S. Securities and Exchange Commission (SEC). The court accepted these briefs dismissing the complaints by the SEC claiming BA is not an independent observant in the case.

A ruling by Southern New York District Court, by Judge Alvin K. Hellerstein, signed off Blockchain Association briefs as “amicus curiae” granting the association leeway to advise the court in the SEC vs Kik case on digital securities. The SEC on Monday asked for the court to deny BA its request as the association has financial interests in Kik and the blockchain field.

However, the advocacy group claims it acts similar to any trade association aiming to educate regulators and improve the overall policymaking in the blockchain industry. While the company cannot comment on the ongoing filing from the SEC, Graham Newhall, BA’s communications advisor addressed the issue claiming,

“It’s a little strange to treat the Blockchain Association different from other trade associations.”

The filing by Blockchain Association’s, Executive Director Kristin Smith claims it was proud to file the filing to guide the court in its ruling in the case. Smith claims SEC’s description of BA’s involvement as “not neutral” was false as BA aims to help the court understand the blockchain field better.

The statement reads,

“The court system benefits from amicus briefs like ours that place the parties’ evidence and arguments in their broader context, a role played every day by associations, non-governmental organizations and advocacy groups in courts across America.”

Over the course of 2019, the SEC and Kik have been entangled in a fierce battle with the securities authority. SEC claims the token sale by Kik in 2018, Kin, were subject to securities regulations but Kik claims the ICO was strictly legal.

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Author: Lujan Odera

Ex-Wall Street Team Builds ExOne Platform To Battle The ‘Fragmented’ Crypto Market

  • New liquidity solution unveiled to reduce the discrepancies and inefficiencies in the crypto trading market.
  • Former trading gurus at NASDAQ, Visa and Morgan Stanley, are developing a similar product to the ‘best bid and offer’ in traditional markets.

On Wednesday this week, XRP perpetual contracts on BitMEX experienced a flash crash causing an outrage from users, some complaining that their whole account was wiped out. For a relatively big exchange like BitMEX flash crashes should be rare but happens all the time due to liquidity issues as the crypto market continues to mature.

Well, Apifiny, a trading tech development firm, announced a possible solution to the increasing market inefficiencies in the market leading with a liquidity solution, ExOne. According to the official website, the back-end tool introduces traditional market solutions in non-traditional markets such as digital assets trading offering a wide range of advantages.

According to the former vice chair of NASDAQ and Co-Chairman at Apifiny, the fragmented market in the crypto industry and inefficiencies are the main issues ExOne will be trying to solve in the coming days. He said,

“These marketplaces are highly fragmented and remarkably inefficient. If an investor goes to one marketplace the bid that he sees in that one marketplace may be wildly different than it is in another venue.”

The team consists of a number of former professional traders including Ashu Swami, former VP of Program trading at Morgan Stanley; Head of Product Connie Wong, former Design Lead at Kraken, and CEO of Retail Product Ben Rab, formerly Visa’s head of Global Network Product Support.

A “Best Bid and Offer” solution

Traders in traditional markets are used to a stable quote rate as the data is consolidated before it’s broadcasted on trading platforms. However in the crypto world, the markets are fragmented hence the need for a similar best bid and offer as traditional markets to secure the most optimal bid for retail clients.

The product is still in development with official launch dates set to be released soon. Co-Chairman David Wield, a former vice chair of NASDAQ said,

“This is what we’re looking to do in the digital asset space, broadly defined and globally.”

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Author: Lujan Odera

New York State Gov Andrew Cuomo Wants BitLicense Creator NYDFS to Have More Power

New York’s governor Andrew Cuomo wants the Department of Financial Services (NYDFS) to have more power when it comes to regulating licensed entities, cryptocurrency startups included.

Presenting his “state of the state” plan for 2020 on Wednesday, he published 321 pages of proposals that include a new perspective on existing exemptions some consumer financial services and products have.

NYDFS Can Execute Action Towards Unlicensed Entities

NYDFS, which is the creator of BitLicense has the power already, but there are entities declaring they’re not bound to its regulations because they’re not selling their goods straight to the purchasers. Banking and insurance laws are giving NYFDS the right to collect valuation costs, yet companies that operate within the Financial Services Law aren’t precisely bound to pay out. This is what the NYDFS document reads as far as this issue goes:

“Entities licensed under the FSL (e.g. virtual currency entities) are not required to pay such assessments, despite being subject to similar examination and oversight requirements.”

According to the same document, Cuomo is looking to revise the law that closes all these loopholes.

NYDFS Regulating Cryptocurrency Startups Since 2014

NYDFS is regulating new crypto enterprises with its digital currency license ever since 2014, through BitLicense. Last October, NYDFS superintendent Linda Lacewell said the agency is making reviews in the sector and cited the crypto industry’s evolution since BitLicense was proposed for the first time. Including a coin listings model framework for exchanges and a listing cryptocurrencies approval process, the changes proposed by NYDFS are open to public comments until January 27.

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Author: Oana Ularu

Ethereum is still the “Unshakable” Leader of the Smart Contract Platform Industry – Report

  • Ethereum leads with 72% followed by EOS, Cardano, and Tron
  • Market in need for “new hotspots” as the smart contract platform sector declines
  • Staking “not conducive to the healthy and stable development of the industry.

Ethereum is still leading the smart contract platforms, accounting for 72% of market share despite the market capitalization of these platforms in Q3 of 2019.

The market cap of smart contract platform in the industry has fallen from 14.9% to 9.8% but still occupies the second place in the industry, reports TokenInsight in its research.

Other prominent projects in this race are EOS (11%), Cardano (4%) and Tron (3%). NEO, Cosmos, Tezos, Ontology, and Ethereum Classic each account for 2% of the share while VeChain only has 1%.

The return of each of these platforms has been negative in 3Q19, registering a sharp decline.

Market performance

These numbers indicate the disappointment of the market with the “smoke and mirrors” since 2017. The market the report states needs “new hotspots.” Development in the market has also been “difficult” because of the worse than expected fierce competition.

The growth momentum of the secondary market changed in Q2 and started adjusting, now this downtrend is further expected to continue in Q4.

Future Prospect

When it comes to development activity, EOS and Tron is leading in terms of commits, as per GitHub data.

Interestingly, Cosmos saw a high degree of code development as well, which has been comparable to Ethereum and higher than most of the platforms. This indicates developers are more interested in the blockchain operability.

Cross-chain and multi-layer architecture became a hotspot in Q3 2019 with sharding making “great” progress as well. Polkadot testnet is already launched and Cosmos’s IBC will be coming at the end of this year.

Development of leading projects

Ethereum also has the best ecosystem of decentralized applications (DApps) in the market and serves as a decentralized infrastructure of the future of open finance, reads the report. Ethereum’s 2,396 Dapps are followed by 634 of EOS and Tron’s 618.

Gambling and gaming are still dominating the Dapps. However, while gaming and gambling account for the majority of Dapps EOS and Tron, types of dapps on Ethereum are much more diverse. This is because of the stability and security of the Ethereum network.

As such, Ethereum has an “unshakable” leading position in the smart contract platform whether it is about financial innovation, lending platform’s lock-up value, or trading volume of a decentralized exchange.

EOS has the highest number of active users but both EOS and Tron active users are on a downtrend.

In Q3 2019, the market expectations from the smart contract platform dropped but sharding technology, cross-chain, multilayer technology, and staking has brought new ideas of the sector.

However, the report cautions that staking is getting much attention from the industry but it is “not conducive to the healthy and stable development of the industry.” While the idea that everyone can be a node may bring new challenges, the unfair distribution of tokens may widen the gap between the rich and the poor.

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Author: AnTy

MoneyGram to Open New Corridors for Ripple’s XRP-using ODL Before the Year Ends

  • New corridors coming – MoneyGram reveals in its Q3 2019 earnings call
  • Ripple partnership makes MoneyGram the first company to utilize blockchain capabilities at scale
  • Ripple Partnership will be a competitive differentiator in the months and years ahead

Ripple’s latest partner MoneyGram in its Q3 2019 financial results revealed its expansion plan regarding Ripple.

As the report stated, it was the first company to utilize blockchain capabilities at scale through its strategic partnership with Ripple.

“Our third-quarter results reflect the continued transformation of our business as we increasingly focus on customer experience improvements, cross-border digital growth and industry-leading innovation through our strategic partnership with Ripple,”

said Alex Holmes Chairman and CEO.

The company reported a loss of $0.03 per share in Q3 of 2019 and its revenues fell 6% to $325 million, less than the expected $334 million. The company earned $285 million in revenue in money transfer while total digital transactions represented 20% of money transfer transactions.

Not just in its the US but non-US businesses of the company also recorded growth, shared Holmes.

He added:

“While the US market, which continues to be our primary challenge, showed signs of improvement on a sequential basis, we are very pleased that our non-US business achieved year-over-year growth for the quarter.”

Ripple Partnership will be a “Competitive Differentiator in the Months and Years Ahead”

Now, the company is planning to expand its partnership with Ripple, for which it utilizes its product On-Demand Liquidity (ODL), formerly known as xRapid that leverages digital assets XRP for transactions.

Asheesh Birla, SVP of Product Ripple shard this news on Twitter and what adds to this good news is these new corridors will be coming before 2019 ends which is in less than two months.

However, it came as no surprise, as last week during the 3rd annual DC Fintech Week, as we reported, Ripple CEO Brad Garlinghouse shared that MoneyGram CEO Holmes is actually upset with Ripple because they are “not moving fast enough.”

“He wants us to launch ODL, formerly knowns as Xrapid on more markets, more quickly because they’re having such a good experience with Mexico,”

he added.

As we have seen in Q4, XRP/MXN volume has been making new records, driven by MoneyGram which has been expecting to see the result and “influence in Q4.”

XRP meanwhile is trading at $0.289 with 24 hours loss of 1.24%, a per Coincodex.

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Author: AnTy

DataTrek Market Researcher: Bitcoin Can Be A Turmoil Indicator in Geopolitical Affairs

New studies about Bitcoin are uncovering some very interesting truths behind the most famous cryptocurrency of the world. For instance, a new study made by DataTrek Research appoints that Bitcoin can be used as a way to determine geopolitical turmoil.

Nicholas Colas, the co-founder of the company, has recently spoken to CNBC and affirmed that Bitcoin could be used in order to find indications of political unrest. He used the local price rise of the token in Hong Kong as an example of that.

According to him, the price of the asset could be used to predict that Hong Kong would suffer a capital flight during the political tensions which are happening there right now.

He also affirmed that Bitcoin can definitely be seen as a safe haven asset right now. Crypto investors affirmed this for a long time, but this is becoming each time more undeniable right now. According to Colas, BTC was one of the few stable assets during the turmoil because it was not linked to the country in any way.

Peter Tchir, a Forbes contributor, was also responsible for affirming recently that Bitcoin was a major indicator of financial turmoil and political crisis.

However, it should be noted that BTC is still a very volatile asset and that betting everything on it might not be the most secure idea during troubled times. There are no guarantees that the prices will not go down again before they go up.

Because of this, investing everything in BTC is a much more sensible decision in complete chaotic situations such as Venezuela and not so much in situations in which there is a small risk. In this case, a more diversified portfolio can be considered more secure.

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Author: Bitcoin Exchange Guide News Team

Judge Gives 90-Day Extension for NYAG’s Bitfinex and Tether Investigation

Judge-Gives-90-Day-Extension-for-NYAGs-Bitfinex-and-Tether-Investigation

New York Supreme Court Judge, Joel M. Cohen has recently given a 90-day extension on an investigation involving both crypto exchanges, Bitfinex, and Tether report Coin Desk. Such decision was made because Cohen still needed some time to finalize his concluding say. More specifically, he was quoted saying:

“I will extend the injunction […] If I dismiss the case, then obviously the injunction goes with it. If I don’t dismiss the case, the injunction will be extended.”

With the given extension, operations on both Bitfinex and Tether’s end do not need to be halted, however, both involved parties trust that the NYAG shouldn’t be getting involved in the first place. Before emphasizing on the latter, here’s what happened:

Tracing Back Past Events

According to the claims made, Bitfinex incurred $850 million in losses, and as a way to conceal the missing funds, the crypto exchange supposedly took the exact amounts from the Tether reserve. Since both parties have mutual executives involved, Tether had approved a $900 million line of credit to Bitfinex.

NYAG Letitia James was the one to have revealed the news regarding said court filing back in April reports Coin Telegraph, in which it was noted that those involved in Bitfinex and Tether have violated the New York law.

As for the NYAG office, they claim that they have “sufficient jurisdiction,” as it such activities can pose a risk to New York residents. Coin Desk referenced The Block, which gave an example of a New Yorker who was able to sign up with Bitfinex in “early 2019”. This was allegedly confirmed by the latter.

iFinex, the sole operator of Bitfinex supposedly applied to have the case closed, as it is believed that New York regulators lack authority to take on this role. In particular, the argument made is that Bitfinex wasn’t operating in New York when the loss was incurred.

Here’s a statement that lawyers on Bitfinex and Tether’s side released:

“For purposes of personal jurisdiction, OAG cannot show Respondents engaged in any busy activity purposefully directed at New York. OAG tries to confuse matters by referring to isolated instances where Respondents’ foreign customers have shareholders […] in New York. But in those circumstances, Respondents’ counterparties […] are the foreign entities.”

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Author: Nirmala Velupillai