While “Not an Issue Yet,” BoE Deputy Gov Sees Growing Appetite for Crypto Among Both Retail and Institutions

While “Not an Issue Yet,” BoE Deputy Governor Sees Growing “Appetite” for Crypto Among Both Retail and Institutions

While not wanting to stop firms from doing things that make commercial sense, Sam Woods calls for a “very conservative view” on capital measures.

The Bank of England Deputy Governor doesn’t want the banks to have big exposure to crypto-assets not backed by sufficient capital, and for that, if they would have to front-run global rules, he would.

Sam Woods said on Thursday that Britain’s banks at the point “don’t have material exposures to crypto” but added that there is certainly “an investor appetite and not just retail, also institutional investor appetite to have a little bit of this stuff.”

He further noted that some of the banks have announced their plans to provide ancillary services “that may be OK but as that develops and if it develops into something big, we are going to need to make sure the capital treatment is pretty robust,” Woods told Reuters.

The Basel Committee on Banking Supervision (BIS), which is a global banking supervisory authority, has already laid down capital requirements for banks that hold crypto assets. The committee has proposed punitive charges for not meeting them that lenders said would make their involvement in the cryptocurrency sector prohibitive.

According to Woods, Basel’s proposals were “quite sensible,” and that the regulatory community was starting to get a better grip on the cryptocurrency sector.

Still, it can take years to adopt norms that would need to be implemented by members like the European Union, the US, and Britain.

“We would not want to stop firms doing things that make commercial sense, but we would take a very conservative view on capital treatment, and if necessary, we would therefore front run, maybe not exactly in the same way, but we would put some capital measures in place,” Woods said. “It’s not an issue yet.”

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Author: AnTy

Digital Assets “Not Regulated by the CFTC,” Even if They Are A Commodity: CFTC Commissioner

Digital Assets “Not Regulated by the CFTC,” Even if They Are A Commodity: CFTC Commissioner

One of the Commissioners of Commodity Futures Trading Commission (CFTC), Dawn D. Stump, released a statement on Monday detailing the agency’s regulatory authority over digital assets. She said,

“The CFTC’s regulatory oversight authority, as well as the application of our enforcement authority, must be well understood by the public. Only then can proper regulatory compliance be demanded.”

With the growth in cryptos’ popularity raising the question of how this new financial asset class is regulated in the US, Stump said, “there has often been a grossly inaccurate oversimplification,” regarding either categorizing them as securities regulated by the SEC or commodities regulated by the CFTC.

This misunderstanding about “US regulatory delineations has grown to a point” that Stump believes it now requires correction. In response, she has laid out ten points as to how and what the CFTC regulates.

These basics by Stump covers that commodity’s definition under CFTC is “extremely broad” and does not regulate cash commodities. So, “Even if a digital asset is a commodity, it is not regulated by the CFTC,” however, the CFTC does regulate derivatives on digital assets, it said.

She further states that when it comes to CFTC’s regulatory authority concerning crypto-assets, instead of considering whether a cryptocurrency is a commodity or security, the focus should be on whether a futures contract or other derivatives product is involved.

“The CFTC does not regulate commodities (regardless of whether or not they are securities); rather, it regulates derivatives—and this is true for digital assets just as for any other asset class.”

CFTC Chair Brian Quintez, a notable crypto advocate meanwhile, is preparing to spend August 31st as his last day in the office. In his statement upon departure, he said,

“During my term, the CFTC has overseen the listing of Bitcoin futures contracts; the custody of digital assets within the traditional clearing infrastructure; the proliferation of blockchain technology; the creation of cryptographic, tokenized commodities; and the rapid expansion of decentralized finance (DeFi), which purports to realize the ultimate transparency-competition-innovation-reward dynamic of a true free market.”

US president Joe Biden is reportedly planning to nominate acting CFTC Chair Rostim Behnem to serve as the full chairman.

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Author: AnTy

FCA’s Crackdown Hits Another One After Binance, Which Has ‘Not’ Seen Institutional Activity Slowdown

FCA’s Crackdown Hits Another One After Binance, Which Has ‘Not’ Seen Institutional Activity Slowdown

Rather, this continued interest from institutional investors is coming not only from crypto native firms but also from traditional finance institutions. Meanwhile, in the US, DeFi is on regulators’ radar where with no intermediary, the question is, “who do we put this on?”

Britain’s Financial Conduct Authority (FCA) said that crypto broker CoinBurp is not fully authorized to have its initial token offering and the launch of its BURP token planned for Monday.

However, the company can start a business under its temporary registration, the FCA added, as long as it has the controls in place.

Last week, the project raised $6 million to build a non-fungible tokens (NFTs) marketplace. Last week, in a press statement, CoinBurp claimed to be a “regulated broker” and said that all the NFTs listed on its market could be sold to investors.

Although CoinBurp is listed on the watchdog’s temporary registration register, this status only allows them to trade. The watchdog said the company isn’t yet assessed as “fit and proper” or entitled to claim to be authorized by the FCA as the regular has yet to determine their application for the money laundering regulations. The UK regulator said in its statement,

“The firm does not yet hold full FCA registration under the money laundering, terrorist financing, and transfer of funds (information on the payer) regulations … but has submitted an application for the FCA for registration.”

For some time now, FCA’s crackdown has been going on with Binance, which has no headquarters, particularly bearing the brunt of it. This has resulted in several big UK banks such as Barclays, Santander, and NatWest banning retail customers from sending money to the exchange.

Due to this, several hedge funds, according to the Financial Times, have also curbed trading on Binance as a regulatory crackdown on it continues to grow.

However, Binance told FTX that it has “not seen a slowdown in institutional activity. On the contrary, we have seen continued interest in our institutional offering from not only crypto native firms but also traditional financial institutions that have entered the crypto space.”

Amidst this, on Monday, Binance reduced the leverage from previously 125x to now 20x.

Meanwhile, DeFi is on US regulators’ radar, with CFTC Commissioner Dan Berkovitz saying in an interview,

“I’m very concerned there’s none of the reporting, none of the normal pricing and regulatory limits. The bottom line is there’s no free lunch anywhere in the economic system.”

As we saw last week, Uniswap Labs delisted several tokens from the exchange. With no intermediaries in decentralized finance, which has grown to become $110 billion in total value locked (TVL) and $85 billion in total market cap, the question is, “who do we put this on?” said Alabama Securities Commission Director Joseph Borg.

While Sen. Elizabeth Warren is urging regulators to rein in DeFi activities, Borg said, SEC and CFTC would have to come together to assess the potential possibilities and potential risks. OCC spokesperson Bryan Hubbard said,

“While DeFi, by definition, is decentralized and does not necessarily rely on the banking system, there are linkages, which are part of our review through the lens of responsible innovation, cognizant of the potential benefits of new technologies while focused on understanding the potential risks and use cases.”

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Author: AnTy

Monetary Authority of Singapore Warns: Crypto is ‘Highly Risky’ & ‘Not Suitable for Retail Investors’

Monetary Authority of Singapore (MAS) Warns: Crypto is ‘Highly Risky’ & ‘Not Suitable for Retail Investors’

Singapore is warning the public about the risks of trading cryptocurrencies. Tharman Shanmugaratnam, the chairman of the Monetary Authority of Singapore, in response to a parliamentary question on Monday said,

“Cryptocurrencies can be highly volatile, as their value is typically not related to any economic fundamentals.”

“They are hence highly risky as investment products, and certainly not suitable for retail investors.”

Crypto funds are not authorized for sale to retail investors, he added.

Tharman, a senior minister and coordinating minister for social policies, said the MAS has powers to impose additional measures on digital asset service providers, under which crypto exchanges are regulated, as needed.

At the beginning of the last year, Singapore introduced new payments legislation, The Payment Services Act, which allows the global crypto firms to expand their operations in the country by applying for operating licenses.

MAS Chairman’s comments came as the total cryptocurrency market cap surged past $2 trillion amidst the rising prices while BTC continues to trade around $58,500. While crypto trading in the country surged significantly over the past year, it remains small compared to traditional markets.

The combined peak daily trading volumes of Bitcoin, Ether, and XRP accounted for just 2% of the average daily trading volume of securities on the main stock exchange last year, said Tharman.

Amidst all this, authorities have stepped up efforts to combat money-laundering and terrorism financing risks associated with crypto assets, he said. In similar news, Singapore-based crypto trading platform Torque is shutting down after at least 70 police reports were lodged against it as investors claimed to lose millions in cryptos.

For this, MAS is raising awareness on the risks of investing in crypto and has increased surveillance of the sector to identify suspicious networks and higher-risk activities that may need further scrutiny, Tharman said.

“The crypto-assets space is constantly evolving.”

“MAS has been closely monitoring developments and will continue to adapt its rules as needed to ensure that regulation remains effective and commensurate with the risks posed. Investors, on their part, should exercise extreme caution when trading cryptocurrencies.”

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Author: AnTy

European Central Bank (ECB) Member: ‘Not Sure Why People Invest’ in Crypto Assets

European Central Bank (ECB) Member: ‘Not Sure Why People Invest’ in Crypto Assets

Central bank members are back with their warnings regarding Bitcoin and cryptocurrencies.

Much like any other time, the warnings remain the same — be prepared to “lose all their money” for crypto investors.

This time the warning came from European Central Bank governing council member Gabriel Makhlouf.

The latest warning from a central banker on the cryptocurrency on Friday when Makhlouf, who is also governor of Ireland’s central bank, said, “Personally, I’m not sure why people invest in those sorts of assets, but they see them as assets clearly.”

“Our role is to make sure that consumers are protected,” he added.

Makhlouf doesn’t see any “financial stability issues at the moment arising from Bitcoin itself” but said the concern is more about the consumer “making the right choices.”

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Author: AnTy

United Nations Affiliate ‘World Sports Alliance’ Pres. Pleads ‘Not Guilty’ To Selling Fake Crypto

Asa Saint Clair, the President of the UN affiliate World Sports Alliance has pleaded “not guilty” in the fraud case of selling cryptocurrency.

The man has been put on household arrest after he bought a one-way plane ticket to Madagascar while being investigated. He was caught at the airport, when he was trying to leave. The prosecutors accuse him of defrauding at least 3 investors by claiming that World Sports Alliance is helping third-world countries to gain access to food and water, also to build sporting facilities.

Saint Clair Sold IGOBIT, a Fake Cryptocurrency

The indictment against Saint Clair claims he had falsely guaranteed investors that they’ll receive returns if they buy IGOBIT, a fake World Sports Alliance’s blockchain digital token. Prosecutors have noted before that there was never an IGOBIT, in spite of Saint Clair saying that he raised the money to launch the digital token.

Investors’ Money Spent on Meals and Plane Tickets

Saint Clair never used investors’ money to launch the IGOBIT. Instead, he spent it all in Manhattan restaurants, on plane tickets and personal expenses for himself and other employees at World Sports Alliance. The US government called the World Sports Alliance a “sham affiliate of the United Nations.”

The Accused Was Talking of Pace and a Better World

US special agent Peter Fitzhugh said that, trying to make investors believe him, Saint Clair told them his sham company promotes the values of sports and is trying to create a better world. Instead, he used their money to live in luxury. Responding to the allegations that he was scamming people since 2017, he denied everything. His attorneys argued that he was World Sports Alliance President for only 6 months and that he travels a lot, this being the reason why he was leaving for Madagascar.

Furthermore, they claimed that it’s common for business people like Saint Clair to buy one-way tickets to countries in Africa because the governments there aren’t “schedule oriented”. Another hearing will be held in March, after the prosecutors finish investigating 6 TB of data confiscated from Saint Clair, at his apartment in New York.

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Author: Oana Ularu

CoinExchange.io Becomes Latest Crypto Trading Platform to Shut Down

Not every crypto exchange is successful. Coinexchange.io, a crypto trading platform focused on altcoin trading, has just announced that its site would be shut down because of financial difficulties. According to the official announcement, the reasons for shutting down were purely financial and completely unrelated to security breaches.

At the moment, the exchange has a daily volume of around $700,000 USD. As Coinexchange.io profits from trading fees, the company is struggling to get money. Also, the low liquidity scares investors, which increases the issue over time.

One of the main reasons why the profits of the company decreased so much is that the altcoin market is becoming considerably weaker since the end of 2017. Bitcoin and other major tokens may have recovered, but most altcoins did not.

The platform affirms that providing its services is no longer a viable idea because they spend too much money in order to provide good services and end up without enough revenue.

Trading will continue until October 15, when it will be suspended. Traders will need to halt their activities until then and all remaining orders will be canceled. Withdrawals will remain active for a longer period of time, however. People will be able to withdraw their assets until December 1. After that, the company will no longer be responsible for the remaining funds.

The large time frame for the withdrawal, around two full months, was possibly decided to prevent the company from being accused of an exit scam, as it happens when companies give a short time frame. Coinexchange.io also affirmed that the company may return in the future if the market conditions change eventually.

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Author: Gabriel Machado

Developer Enables People to Put Personal Files on XRP Ledger And Ripple Rushes To Fix Situation

Developer Enables People to Put Personal Files on XRP Ledger And Ripple Rushes To Fix Situation

Not all ideas are very well-received in the blockchain community. Just look at hard forks. People at Bitcoin, Bitcoin Cash and then Bitcoin SV simply could not agree.

Now imagine that someone can simply make an app that will cause a lot of controversy without actually needing anyone’s permission. That would cause a lot of trouble, right? Well, this is the situation at the XRP Ledger now.

An anonymous developer created a program called “Indestructible Immutable Infinite File Storage (IndImm)”. The name is pretty self-explanatory.

The tool exploits a memo field that all XRP transactions have, so they did not need any consensus change for this “upgrade”. You can just upload whatever you want there. Great idea, right? Well, not according to Ripple and most of the XRP community.

Ripple Rushes To Fix The Issue

As reported by Decrypt, Ripple is actually working on a fix right now. The reason for that is that spammers could simply upload a bunch of heavy files on the system and this would drastically slow down transactions, as well to make them more expensive.

Since Ripple has several products based on the XRP Ledger, this is very dangerous for its plans, so the company is already rushing in to save (its own) day.

Blockchains are not made to store infinite data, which is why some, such as the Bitcoin network, have a cap on how much data you can upload. Even with this, the full BTC network is already 226 GB right now.

Spammers could store a lot of information there easily and completely break the network. The only point that could actually end up stopping them is that it would be very expensive to do it. So it will hardly be done as a prank. It costs around $11 USD to send 1 MB to the network.

Unfortunately, some groups are already reported to be planning to take down the network. Decrypt found a group on Discord that was trying to coordinate an attack. Fortunately, though, the attack was not successful so far.

The reaction of the community was also not positive. Witse Wind, the dev who created the XRP Tipbot, affirmed that you “can’t have enough development in this ecosystem”, however, he affirmed that he was pretty worried because this could hurt the network.

Another problem that was pointed out by Wind is that someone could upload child pornography or other kinds of illegal material on the network, which would render it illegal and cause even more problems to the network.

The CTO of Ripple, David Schwartz, affirmed that there is no serious threat of attacks soon. To him, the main danger is that spammers and trolls can make the network harder to run over time if the app is not shut down.

The Opinion of the Controversial Developer

A crypto media outlet called The Block Crypto was able to reach out to the anonymous developer who created the app and interview it. This is interesting since it provides another take on the whole situation.

The dev behind the project describes himself as “not an expert” in the blockchain tech, especially Ripple. According to him, the reason for creating the app is because 99% of the crypto world is being used for speculation. Because of this, his idea was to form a large and relevant market in which users could have a real use case.

The use case? Fight censorship. By uploading files in an immutable way, they could store them forever online. This, he affirmed, would make crypto really useful.

He also argued that the app could lead to high usage of the network, which could limit the volatility and even end up helping Ripple, which is the opposite of what most people believe right now. Ripple was chosen because it has low transaction fees and a solid track record, as well as a great API that is pretty easy to use. Basically, it was simple, recognizable and served the purpose marvelously.

According to the developer, the reaction to the app is not really overall negative, too. To him, it is like 75% positive and only 25% negative, something that you would not believe by hearing the fierce criticism of the opposition.

The developer ended by affirming that it was not true that he was working in order to destroy Ripple. To him, the fees make it too prohibitive that people will simply upload stuff enough to destroy the network.

However, he announced that the future of the project is uncertain due to the negative criticism and that stopping development is an option if the community feel as if the network is being harmed.

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Author: Gabriel Machado

Cyprus’ Finance Minister Says Blockchain and Crypto Asset Regulations Coming This Year

Cyprus-Finance-Minister-Says-Blockchain-and-Crypto-Asset-Regulations-Coming-This-Year

Not too long ago, the blockchain industry worldwide suffered from a severe lack of regulation that made it difficult to do business in several parts of the world and also stifled the growth of the industry altogether. As such, there was a period in which various players within the industry had to step around laws and work with whatever they were given in a bid to continue in their line of work.

Fortunately, the blockchain industry has grown significantly in the last few years and as a result of this many, world governments can no longer ignore the industry or refused to give it concrete laws, especially as its application has been found even within government-related activities.

Countries such as Malta and others within Europe led the way in terms of regulations and now other countries are starting to catch up with them and create concrete blockchain-related regulations for the good of all.

Blockchain comes to Cyprus

One of the latest countries to go this route is Cyprus as it was announced on July 4, 2019, that the finance minister Harris Georgiades has stated that the country’s blockchain regulation draft will be ready this year.

Georgiades has described blockchain technology as a new technological revolution that is similar to that of the internet and confirmed that regulation for the technology is greatly needed.

This does draw parallels to the internet age as in the early 2000 and previously, when the internet was not as big of a phenomenon as it is now, they were certain grey areas that existed because the laws had not been created with regards to things such as cybercrime, e-business and so on. But as the internet grew into the irreplaceable aspect of life that it is now, laws were created and it seems the same thing will be happening with crypto and blockchain.

Demetris Syllouris, the house speaker, also praised the potential of blockchain during a recent event.

“Full implementation of this technology across the public and private sector is expected to radically change the structures of modern societies, the way they are organized and their operation,” he said.

He also stated that the national strategy will aim to sustain Cyprus’ digital innovation as well as creating the necessary framework and roadmap to properly explore blockchain technology in a safe and controlled environment across various industries while mitigating the risk associated with it.

The national blockchain programs that are in the works involve the Department of Lands and surveys as well as the Department of customs and excise and the department and the national betting authority. From all indications, Cyprus intends to go head-first into blockchain and apply it at various governmental levels and this is a good sign for the regulation that is to come as this will likely trickle down to the private sector as well.

This also shows yet another country that sees the benefits of blockchain and is not trying to stifle the industry but rather embrace it and look for how best to benefit from the technology for its citizens.

In February 2019, the Cyprus securities and exchange commission did co-op for the transposition of European Union’s fifth anti-money laundering directive into national law which brought local regulation of cryptos under its provisions.

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Author: Tokoni Uti