After conducting a review of digital currency’s potential benefits as a central bank-issued currency, the Bank of Korea (BOK) has determined that it will not issue its own. Citing concerns about societal costs and the potential moral hazard, a recent BOK report suggested that the central bank should continue to have total control over the issuance of Korean currency.
Japan’s cryptocurrency self-regulatory body, the Japan Virtual Currency Exchange Association (JVCEA), has agreed to a set of new regulations for the industry, according to a report from Nikkei Asian Review. The association plans to hold a vote on its proposed rules on June 27. The rules are designed to ban insider trading and prevent trades involving cryptocurrencies that are designed to be difficult to track.
The Commodity Futures Trading Commission (CFTC) has asked a judge to rule that cryptocurrency My Big Coin is a commodity subject to the agency’s regulation, according to a recent report from Reuters. The agency is currently pursuing legal action against My Big Coin (MBC) and MBC creator Randall Carter for fraud.
SEC Director of the Division of Corporation Finance William Hinman used a speech on Thursday to offer a fairly detailed assessment of the agency’s standards for determining when a cryptocurrency or ICO can be defined as a security. In his remarks to attendees at the Yahoo All Markets Summit: Crypto Conference, Hinman said that the agency’s assessment depends on the way a coin or token is being sold and what investors expect to get from their purchase.
During remarks at the United Nations BFI Summit in New York this week, CFTC Commissioner Rostin Benham suggested that cryptocurrencies like Bitcoin are here to stay. During a speech focused on the regulatory challenges confronting the CFTC as it tries to address issues related to the emerging cryptocurrency industry, the commissioner asserted that the technology is something that will impact all nations:
Regulators at the Commodity Futures Trading Commission (CFTC) have reportedly ordered several cryptocurrency exchanges to turn over trading data the agency wants to see as part of its investigation into potential price manipulation in the Bitcoin markets, according to a Wall Street Journal report on Friday.
The provincial government of Quebec has announced that it is temporarily halting all energy approvals for cryptocurrency mining operations, according to a report from Reuters. The decision was made in response to a request from state-run energy company Hydro Quebec that asked regulators to reassess energy fees and place limits on the amount of power miners can access.
U.S. Securities and Exchange Commission Chairman Jay Clayton tried to clarify the agency’s view on cryptocurrencies and securities on Wednesday and said that regulators won’t change their definition just to accommodate digital currencies. In remarks to CNBC, Clayton noted that the current approach to defining securities means that cryptocurrencies like Bitcoin fall outside that definition.
The Baltic country of Estonia has reportedly given up on its ambitious plans for a national digital currency pegged to the euro and available for all its citizens, according to Bloomberg. Estonian officials have scaled back those plans after receiving sharp criticism from European Central Bank President Mario Draghi and other banking officials.
Hong Kong officials have confirmed that the Hong Kong Monetary Authority is not currently considering any plans to issue a central bank digital currency, or CBDC. Acting secretary for financial services and the treasure Joseph Chan told legislators that the Monetary Authority’s research of the issue concluded that the technology would not be a clear improvement over Hong Kong’s existing payment infrastructure:
South Korean legislators have formally proposed an end to the country’s ban on initial coin offerings (ICOs), according to a report from BusinessKorea. The National Assembly has reportedly suggested that ICOs be allowed as long as the country takes steps to provide stronger protection for investors.
The UK’s Financial Conduct Authority (FCA) has confirmed that it has launched 24 investigations of “unauthorized” cryptocurrency companies, to assess whether they are engaged in activities that are subject to FCA regulatory authority, according to a May 25 report from news outlet CityWire. The regulators also reportedly confirmed that they have opened seven whistleblower cases since the beginning of the year.
The United States Department of Justice has launched a criminal probe to determine whether digital currency prices have been manipulated by crypto traders, according to reports from Bloomberg and other media outlets. The probe reportedly involves an investigation into possible spoofing and wash trading, both of which are considered illicit trading activities that could influence trading prices.
While many crypto investors are keeping an anxious eye on the blockchain bubble, there is another area of concern that they should also be watching: the regulatory front. Even now, state and national governments around the world are stepping up their efforts to bring some sense of regulatory order to the cryptocurrency ecosystem. And while it’s true that digital currencies were originally developed as a way of getting around invasive financial controls, there should be little doubt that the industry must eventually make peace with the idea of sound regulation if it wants to ever achieve true mass acceptance and adoption.
More than one thousand Australians were victimized by various cryptocurrency scams in 2017, according to a recently released report from the Australian Competition and Consumer Commission (ACCC). Victims lost a total of AU $2.1 million to scams involving fake ICOs, assorted pyramid schemes, and even non-crypto schemes where the scammers simply required victims to use crypto as payment.
The Wall Street Journal reported on Friday that Coinbase met with regulatory officials early in 2018 to discuss possible acquisition of a banking license. The meeting was reportedly conducted with the U.S. Office of the Comptroller of the Currency, according to an unnamed “person familiar with the matter.”
A week before the Consensus cryptocurrency conference got underway in Manhattan, Fundstrat Global Advisors research head Tom Lee predicted that the gathering in Manhattan would spark a rally in Bitcoin’s price. Instead, cryptocurrency prices declined throughout the event, falling roughly ten percent.
Switzerland’s Federal Council has formally requested that the Finance Ministry conduct a study of the risks and potential benefits of a government-backed cryptocurrency, according to a Thursday report from Reuters. The request was made at the urging of the vice president of Switzerland’s Social Democratic Party, Cedric Wermuth, and now moves to the lower house of parliament for approval.
The New York Department of Financial Services has granted approval to the Gemini Trust Co to begin providing support for Zcash trading. The exchange, founded by Cameron and Tyler Winklevoss, will also receive approval to provide custody and trade services for Bitcoin Cash and Litecoin, according to a report from Reuters.
The Reserve Bank of Zimbabwe has reportedly ordered the nation’s financial institutions to stop all transactions related to cryptocurrencies, according to local media reports. NewsDay reported this weekend that RBZ Director and Registrar of Banking Institutions Norman Mataruka issued the directive on May 11 and has given Zimbabwe’s banks 60 days to comply.