Crypto Regulation News: Crypto advocates push back against FinCEN’s plan to track crypto…

Vol. 59, 29th December — 12th January

US representatives ask Mnuchin to extend comment period for proposed wallet rule to traditional 60 days.
US regulator: Federally chartered banks can facilitate stablecoin payments, issue their own.
FinCEN is now interested in offshore crypto holdings, proposes new regulation.
A16z, Coinbase intend to challenge FinCEN’s proposed crypto wallet rules in court should it become law.
Square says new FinCEN wallet proposal will inhibit crypto adoption and hinder law enforcement efforts.
U.S. Securities and Exchange Commission (SEC) Commissioner Hester Peirce is vocalizing her preference for clearer crypto regulations in the United States.
Brian Brooks, the acting head of the U.S. Office of the Comptroller of the Currency and former chief legal officer to Coinbase, has warned against the Consumer Financial Protection Bureau receiving the right to grant “Fintech Charters.”
Stuart Alderoty, Ripple’s general counsel, says the U.S. Securities and Exchange Commission (SEC) has acknowledged XRP’s use as fuel for cross-border payments.
Ripple CEO Brad Garlinghouse responds to questions surrounding the SEC lawsuit.
24,000 crypto investors petition White House to declare XRP a virtual currency.
A growing list of crypto platforms are rescinding support for XRP as Ripple prepares for a legal battle with the U.S. Securities and Exchange Commission.
VanEck refiles with SEC for bitcoin ETF.
Coinbase Ventures, PayPal Ventures and Winkelvoss Capital have all invested in cryptocurrency tax automation software provider TaxBit.
Trump bans Chinese payment apps, including AliPay and WeChat Pay.
BAKKT is about to go public.
CME Group to launch Ether futures on February 8, 2021.
The Diem Association’s rebrand from Libra was supposed to herald a new day for the project, but a touted 2021 launch may not go as planned.
The UK’s ban on crypto derivatives went into effect last Wednesday.
Her Majesty’s (HM) Treasury, the U.K.’s finance ministry, has opened a consultation on regulating crypto-assets and stablecoins to support innovation and protect consumers.
The Financial Conduct Authority, the UK financial services regulator, has issued a stern warning about the “very high risks” faced by consumers who choose to invest in cryptocurrency.
The custody-focused arm of Genesis, a crypto firm offering services to institutional traders, has been added to the UK regulator’s interim register.
South Korea to introduce a 20% tax on crypto trading profits in 2023.
Softbank’s telecoms arm is set to become the latest member of the Japanese Security Token Association.
Tokyo-based tech conglomerate GMO Internet Group has just been authorized by the New York State Department of Financial Services (DFS) to issue stablecoins pegged to the U.S. dollar and Japanese yen.
Singapore-based Propine emerged from the MAS regulatory sandbox with a Capital Markets Services License and an authorization to begin offering digital-asset services to institutions.
Ukraine taps Stellar to develop digital asset infrastructure, including CBDC framework.
Russia’s Central Bank tries to stem the tide of rubles leaving bank accounts.
Kyrgyzstan has proposed its first regulatory framework for crypto.
Crypto transactions in Kenya now attract a 1.5% tax.
Crypto users donate $400K to Julian Assange defense as Mexico proposes asylum.
The largest manufacturer of slot machines in the world IGT has just received a patent that would allow customers to access crypto payments for gambling.
And more!

Hester Peirce Says Enforcement From the SEC Not the Best Way To Provide Crypto Clarity: U.S. Securities and Exchange Commission (SEC) Commissioner Hester Peirce is vocalizing her preference for clearer crypto regulations in the United States. In an interview with forkast, Peirce criticizes the SEC’s tendency to regulate the crypto sector by handing down charges rather than providing clear guidelines for actors in the space.

“The SEC hasn’t done a fantastic job in getting out in front and setting clear lines for crypto and other countries have been much faster to do that. Enforcement actions can indeed provide clarity, but it’s not the right way to do it from my perspective.”

‘Two cops on the beat’: Regulator wants sole authority to charter fintech firms: The OCC’s acting head is pushing against the Consumer Financial Protection Bureau’s intention to charter non-depository fintech firms.

Jack Dorsey warns that FinCEN regulations will drive crypto users offshore: Major U.S crypto firms are united in opposition to new AML laws proposed by FinCEN, warning they could drive users away from regulated platforms and stifle innovation.

IRS to transition from ‘education to enforcement,’ says former division chief: A former top investigator is warning that the IRS might be shifting crypto tax payment enforcement into high gear.

Economist Alex Krüger Predicts Banks Will Hold Bitcoin As Reserve Asset: Crypto analyst and economist Alex Krüger says the world’s major central banks will inevitably go on to hold Bitcoin as a reserve asset.

In a tweetstorm, Krüger looks at the central banks’ demand for gold.

Regulators dial up the heat: Dash, ZEC and Monero reach boiling point? Can privacy coins be better managed to satisfy both law enforcement interests and those who like the greater anonymity they provide?

US regulator: Federally chartered banks can facilitate stablecoin payments, issue their own: National banks and federal savings associations can use public blockchains and stablecoins for settlement, The Office of the Comptroller of the Currency (OCC) said in an interpretive letter published last Monday. The letter indicates that banks and savings associations can now run crypto nodes and utilize associated stablecoins for “permissible payment activities.” This means banks can use public blockchains to validate, store, record and settle payment transactions as long as they’re compliant with existing laws.

FinCEN is now interested in offshore crypto holdings, proposes new regulation: Eleventh-hour note announces the intention to propose a change in Foreign Bank and Financial Accounts regulations.

Rep. Soto seeks to create office to ‘coordinate’ federal use of blockchain tech: The dedicated office would oversee “all non-defense related deployment and activities related to blockchain technology within the Federal Government.”

US Lawmakers Say ‘Rushed Process’ Threatens Legitimacy of FinCEN’s Push To Monitor Cryptocurrency Transactions: A bipartisan group of US lawmakers is asking the US Treasury to reconsider a proposed rule that would change how cryptocurrency transactions are monitored.

The rule would require crypto companies to report when their customers move $10,000 or more in cryptocurrency in a 24-hour period. The identity and address of the crypto recipient must also be shared directly with the Financial Crimes Enforcement Network (FinCEN), an agency of the US Treasury Department. Additionally, the legislation would force companies to maintain a record of all transactions sent to privately-held crypto wallets if the transaction is worth $3,000 or more.

Nine lawmakers have sent a letter to Treasury Secretary Steve Mnuchin, asking him to extend the 15-day comment period for the proposed rule, which is shorter than the 60-day period typically given for rule changes.

Lawmakers are also asking that companies be given more time to implement the rules if and when they go into effect.

“We request the following from the Treasury Department and FinCEN:

• Extend the review period for the Notice of Proposed Rulemaking (NPRM) from 15 days to 60 days so that stakeholders have a meaningful opportunity to evaluate how the proposed rule will impact their businesses and customers; and

• Consider an extension of implementation of this proposed rule by an appropriate timeframe (potentially six months), so that stakeholders may carefully consider and develop the technological solutions that will be required to implement any final rule, should it go into effect.”

The proposed rule is one of two major regulatory pushes from FinCEN. The agency has also announced plans to require Americans to report whether they are holding $10,000 or more in cryptocurrency in offshore accounts.

A16z, Coinbase intend to challenge FinCEN’s proposed crypto wallet rules in court should it become law: Venture capital firm a16z and exchange operator Coinbase intend to challenge Financial Crimes Enforcement Network’s (FinCEN’s) proposed crypto wallet rules in court should it become law.

US crypto firms invest in tax solutions as IRS updates reporting forms: Coinbase Ventures, PayPal Ventures and Winkelvoss Capital have all invested in cryptocurrency tax automation software provider TaxBit.

Square says new FinCEN wallet proposal will inhibit crypto adoption and hinder law enforcement efforts: Square is the latest company to go public with its opposition to proposed rulemaking from the U.S. Financial Crimes Enforcement Network (FinCEN).

VanEck refiles with SEC for bitcoin ETF: Asset manager VanEck is taking another crack at approval for a bitcoin exchange-traded fund (ETF). If approved, it would be the first ETF to achieve approval from the U.S. Securities and Exchange Commission.

SEC Acknowledges XRP’s Use As Fuel for Cross-Border Payments, Says Ripple General Counsel: Stuart Alderoty, Ripple’s general counsel, says the U.S. Securities and Exchange Commission has acknowledged XRP’s use as fuel for cross-border payments.

The section of the lawsuit in question reads,

“ODL involves a transaction in which a money transmitter in a sender’s jurisdiction converts fiat currency into XRP, transfers the XRP to a recipient’s jurisdiction, and converts the XRP into the fiat currency of that locale. Typically, instead of holding XRP directly, money transmitters who may use ODL would rely on market makers in the sender’s and recipient’s jurisdictions to trade in and out of XRP in about ninety seconds or less.”

In a recent tweet, Alderoty refers to the segment as a “key point to keep in mind” going forward as Ripple prepares its case.

Ripple CEO Brad Garlinghouse responds to questions surrounding the SEC lawsuit: In a new thread of tweets, Brad Garlinghouse addressed questions surrounding the SEC’s unregistered securities offering lawsuit against the firm.

24,000 Crypto Investors Petition White House To Declare XRP a Virtual Currency: Ardent Ripple supporters are petitioning the federal government to halt the U.S. Securities and Exchange Commission’s (SEC) lawsuit against Ripple. Following the SEC’s move to charge Ripple for the sale of an unregistered security, an unidentified member of the Ripple community named, J.W. filed a petition with the White House on December 29th, calling for the termination of the SEC’s lawsuit.

26 Crypto Platforms Drop Support for XRP in Wake of SEC’s Ripple Lawsuit: A growing list of crypto platforms are rescinding support for XRP as Ripple prepares for a legal battle with the U.S. Securities and Exchange Commission (SEC). Analyst Leonidas Hadjiloizou has compiled a list of 26 companies that have changed their policies surrounding XRP in response to allegations that the asset may be an unregistered security.

Trump bans Chinese payment apps, including AliPay and WeChat Pay: The trade war with China homes in on the country’s thriving digital payments industry.

UK’s finance ministry opens consultation on regulating crypto and stablecoins: Her Majesty’s (HM) Treasury, the U.K.’s finance ministry, has opened a consultation on regulating crypto-assets and stablecoins to support innovation and protect consumers.

The UK’s ban on crypto derivatives went into effect last Wednesday: The ban on the sale of crypto derivatives and exchange-traded notes (ETNs) came into force in the UK.

UK crypto community reacts as FCA derivatives ban goes into effect: The ban placed by financial regulators in the United Kingdom on the sale of crypto derivatives to retail traders is now in force.

FCA issues warning over high returns offered by crypto firms: The Financial Conduct Authority, the UK financial services regulator, has issued a stern warning about the “very high risks” faced by consumers who choose to invest in cryptocurrency. The warning comes as bitcoin fell from all-time highs of more than $40,000 to less than $33,000 overnight.

Genesis Custody added to FCA’s temporary crypto register: The custody-focused arm of Genesis, a crypto firm offering services to institutional traders, has been added to the UK regulator’s interim register.

South Korea to introduce a 20% tax on crypto trading profits in 2023: After several delays, the South Korean government is going ahead with a plan to tax cryptocurrency holders.

Japanese telecoms giant Softbank Corp joins crypto regulatory group JSTA: Softbank’s telecoms arm is set to become the latest member of the Japanese Security Token Association.

Japanese Tech Giant Earns Crypto License in New York for Yen-Pegged Stablecoin: Tokyo-based tech conglomerate GMO Internet Group has just been authorized by the New York State Department of Financial Services (DFS) to issue stablecoins pegged to the U.S. dollar and Japanese yen. Joining 27 companies that have been granted BitLicenses by the DFS, GMO can now launch its USD-pegged (ZUSD) and JPY-pegged (GYEN) stablecoins, after fulfilling stringent requirements and meeting federal standards for anti-money laundering.

Crypto custody firm graduates Singapore Monetary Authority’s regulatory sandbox: Singapore-based Propine emerged from the MAS regulatory sandbox with a Capital Markets Services License and an authorization to begin offering digital-asset services to institutions.

New Zealand’s Financial Watchdog Warns on Crypto Investment Risks : The warning comes a day after the regulator’s U.K. counterpart, the Financial Conduct Authority, also raised similar concerns.

Russia’s Central Bank tries to stem the tide of rubles leaving bank accounts: With the declared intent of reducing risk, the moves look to cut new investors off from opportunities to get out of the ruble.

Ukraine taps Stellar to develop digital asset infrastructure, including CBDC framework: Stellar’s development arm will work with the Ukrainian government on several digital asset initiatives.

Kyrgyzstan has proposed its first regulatory framework for crypto: Kyrgyzstan’s central bank wants to regulate cryptocurrency — licensing exchanges and barring its use in payments.

Kenyan crypto firms on notice as digital tax law takes effect: Crypto transactions in Kenya now attract a 1.5% tax.

New name, old problems? Libra’s rebrand to Diem still faces challenges: The Diem Association’s rebrand from Libra was supposed to herald a new day for the project, but a touted 2021 launch may not go as planned.

Crypto users donate $400K to Julian Assange defense as Mexico proposes asylum: A U.K. judge ruled against extraditing the WikiLeaks founder to the U.S. in response to his legal team arguing he would have a “high risk of serious depression leading to suicide.”

Slot machine manufacturer gets patent for crypto payment options: Many gamblers may no longer need to use Bitcoin ATMs in casinos, as they could transfer their crypto directly to casino gaming accounts.

Following delisting, Dash pushes back against ‘privacy coin’ label: Despite past claims, Dash insists that it’s no more private than Bitcoin.

2020’s 5 countries friendliest to crypto and blockchain: These five countries have led the way in driving cryptocurrency and blockchain adoption in 2020.

Cointelegraph predictions for the first 5 CBDCs of 2021–2022: 2021 & 2022 touted to be the most important years for the development of CBDCs.

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