Day: July 11, 2023

“The US Senate Finance Committee has sought input from the digital asset community on tax challenges linked to cryptocurrencies.The senators expressed concerns about unclear classifications under the Internal Revenue Code for cryptocurrencies, leading to taxation challenges. The letter highlights concerns including “wash sales” in volatile crypto markets.”

“Almost 20% of all Ether tokens are now locked in staking contracts, signaling a significant turning point. However, initial inflows have slowed, perhaps due to investors’ concern about potential regulatory issues. The U.S. Securities and Exchange Commission’s lawsuits against major ETH staking service providers have led to a drop in net inflow into ETH staking.”

The BISIH report submitted to the G20 finance ministers and central bank governors offers contrasting views on cryptocurrencies and central bank digital currencies (CBDCs), highlighting the structural flaws and risks of the crypto ecosystem, while championing CBDCs as the future monetary system. The BISIH posits that cryptocurrencies’ inherent weaknesses limit their significant impact on the monetary system, whereas CBDCs promise stability. It emphasizes not only the binary nature but the complexity of these phenomena, underscoring the challenge in achieving a balance between regulation and innovation.

“Sui Chung, CEO of CF Benchmarks, discussed his optimism for the approval of a spot Bitcoin exchange-traded fund by the U.S Securities and Exchange Commission. His opinion highlights the SEC’s desire for strict safeguards for information-sharing between ETF and crypto exchanges.”

“The UK Treasury plans to exclude ‘unbacked’ tokens from its regulatory sandbox, aiming to balance innovation and consumer safety. Existing regulations are deemed sufficient for volatile assets like Bitcoin and Ethereum, whose regulatory future remains uncertain due to evolving rules for such cryptocurrencies.”

“The US authorities are investigating former FTX executive, Ryan Salame, for alleged violations of campaign finance law. The probe explores financial linkages between Salame and Michelle Bond’s congressional campaign, and the potential exceeding of federal contribution limits. This investigation raises concerns about the intersection of cryptocurrencies and campaign finance laws.”

BlackRock’s application for a spot bitcoin ETF includes a Surveillance-Sharing Agreement (SSA), allowing suspicious trade alerts to be shared with authorities. It includes data access for regulators and ETF providers on specific trades or traders, potentially even personal identifiable information (PII). This new addition has sparked privacy concerns among crypto traders.

“Former FTX executive, Ryan Salame, is under investigation by Manhattan federal prosecutors for potential violations of campaign finance law. The inquiry concerns Salame’s contributions to Michelle Bond’s congressional campaign, arousing suspicion of federal limits evasion. This case could influence regulatory frameworks for digital asset markets.”

“Crypto regulation remains a hot topic with structural flaws and potential benefits. The Bank for International Settlements criticizes crypto’s viability in the monetary system, while the UK Treasury suggests a five-year regulatory reprieve could benefit digital assets. However, controversies arise with technological advancements and perceived threats to decentralization principles by some pilots of Central Bank Digital Currency. Meanwhile, jurisdiction disputes in crypto markets begin.”

In outlining plans for the metaverse, the European Commission expressed optimism for Europe’s potential to lead the technological transition. Predicted worth for global virtual worlds, likely backed by blockchain, could reach 800 billion euros by 2030. However, concerns have been raised regarding aspects such as legal status of avatars, copyright protection, and managing virtual crime. EU legislator Axel Voss also has called for an overhaul of existing laws like the General Data Protection Regulation.