Search Results for: Digital Asset

“The director of the Consumer Financial Protection Bureau, Rohit Chopra, recently shared that the bureau is contemplating applying the Electronic Fund Transfer Act (EFTA) to digital assets. This approach could minimize high losses often experienced from unauthorized crypto transactions and aim to establish safer environment for investors.”

“A staunch crypto advocate, Representative Patrick McHenry, has provisionally stepped into the role of US House Speaker. McHenry has shown appreciation for the significance of American innovation and advocated for stablecoin regulation. These transitions bring opportunities and challenges for digital currencies and their regulation.”

The World Federation of Exchanges (WFE) proposed six measures to ensure the safety and sustainability of digital asset markets. These include clear segregation of market infrastructure functions and establishing systems to manage user risks. The WFE also emphasized the need for crypto exchanges to demonstrate full backing of user assets and be sufficiently regulated.

“The threat of a US government shutdown could influence the future of digital assets. Crypto-focused bills like the FIT, Blockchain Regulatory Certainty Act, and Keep Your Coins Act risk being delayed. Any shutdown could stall these bills’ progress until government funding is secured for the next fiscal year.”

Senators Kirsten Gillibrand and Cynthia Lummis have introduced a new crypto bill, the Responsible Financial Innovation Act, aimed at addressing regulatory ambiguity in the US cryptocurrency industry. This legislation could shift the oversight of most digital assets from SEC to the Commodity Futures Trading Commission.

The rapid transformation in technology and finance is due to the expanding incorporation of blockchain technology and digital assets. While this revolution brings significant advantages, it also comes with regulatory complexities. For instance, the recent verdict of the Delaware bankruptcy court granting FTX the right to sell their digital assets highlights control issues contrary to blockchain’s decentralized nature.

Judge John Dorsey has permitted FTX, a bankrupt crypto exchange, to sell and invest its $3.4 billion crypto assets to pay off creditors. FTX’s strategy involves hedging its assets to lower risk and staking digital assets for low risk returns. They also aim to leverage expert knowledge in navigating the volatile crypto market.

“The newly formed Crypto Freedom Alliance of Texas, comprising key crypto entities, aims to promote clear regulations for digital assets in Texas through education. The initiative emphasizes the challenges of legal jurisdiction for Decentralized Autonomous Organizations (DAOs) and advocates for crypto-friendly tax laws and reshaped banking regulations.”

The Blockchain Association, a U.S-based crypto advocacy group, submitted legislation proposals for equal taxation of crypto and non-crypto assets. The recommendations support the Keep Innovation in America Act, which aims to revise reporting standards for cryptocurrency transactions. Concerns arise around potential tax evasion and proposed digital asset mining excise tax.

MicroStrategy is expected to report its bitcoin holdings without disclosing impairment losses, thanks to a new amendment by the Financial Accounting Standards Board (FASB). This could potentially erase MicroStrategy’s cumulative impairment losses of $2.23 billion since the start of its bitcoin strategy in 2020.

Japan’s top financial regulator, the Financial Services Agency (FSA), has proposed changes to the country’s tax laws regarding digital asset profits. This move aims to better align Japan’s stance on cryptocurrencies with global standards, reduce financial burdens on local businesses, and foster innovation within the blockchain industry.

South Korea’s KEB Hana Bank partners with BitGo, a leader in crypto custody and security, to offer digital asset custody services from 2024. The partnership is expected to enhance consumer protection and trust in South Korea’s digital asset market and improve the quality of Hana Bank’s digital asset custody operations. The collaboration also aims to capitalize on blockchain security technology, backed by BitGo’s recent funding of $100 million.

The US IRS has issued draft guidelines on reporting rules for digital asset brokers. Aimed at regulating the digital asset industry, this regulation intends to streamline tax reporting and prevent fraud, proposing to raise $28 billion in fresh tax over a decade. Critics label it as “misguided” and “an attack on the digital asset ecosystem.”

“The South Korean city of Cheongju is planning to confiscate digital currencies from local tax evaders. Governments worldwide are concerned about the misuse of digital currencies for tax evasion. However, applying standard tax structures to decentralized currencies has received criticism from crypto enthusiasts.”

The Digital Energy Council, a group dedicated to cryptocurrency miners, has been introduced as a crucial intermediary for discussions about crypto mining sustainability, and policy advancement with Washington-based policymakers. This initiative prioritizes miners’ interests while ensuring compliance with U.S. energy laws, aiming to promote responsible energy development and national security.

“The FIT Act marks the premiere of crypto-focused legislative efforts gaining traction in U.S. Congress. This signals mutual agreement about the significance of the digital assets sector, addressing the inadequacy of the current regulatory system, and fostering innovation. Policymakers are establishing a suitable framework for the rapidly evolving crypto industry.”

“A significant episode in China underlined the persistent uncertainty around cryptocurrency’s legal status. A man lending Bitcoin faced an unsympathetic legal system when the borrower defaulted. The court ruled Bitcoin, as a digital commodity, doesn’t hold the same legal status as fiat currencies, therefore, can’t be subject to legal enforcement or compensation.”

Hong Kong’s new virtual asset trading platform licensing regime could cost crypto platforms up to $20 million, potentially pushing smaller market players out of the race. However, it may benefit larger players like Hex Trust, which meet the required criteria. The regime is part of Hong Kong’s effort to become a digital asset hub, inviting global exchanges to apply for licenses. Critics, though, suggest the system’s complex requirements may be challenging.