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How Are Cryptocurrency Exchanges Regulated

Should Cryptocurrency Exchanges Self-regulate?

Should Cryptocurrency Exchanges Self-regulate?

Should Cryptocurrency Exchanges Self-Regulate? The ever-increasing list of hacks and scandals at bitcoin exchanges have garnered an infamous reputation for the cryptocurrency. Regulation might offer a way out for exchanges to clean up their act. But it will take time as governments around the world grapple with understanding and accommodating crypto behavior within existing legal frameworks. Meanwhile, CFTC commissioner Brian Quintenz has called for cryptocurrency exchanges to regulate themselves. The concept is not new. Establishment of the National Futures Association , a self-regulation agency for the futures industry, has helped spur industry growth. Heres a brief primer on self-regulation. Within the context of cryptocurrencies, self-regulation is the establishment of guidelines and a code of conduct for market participants to operate businesses within the ecosystem. Those guidelines span a broad spectrum, from knowing your customers (KYC) to maintaining transparency to ensuring security against hacks. In a paper , the International Organization of Securities Commissions (IOSCO) has defined a set of elements that comprise self-regulation. These include transparency and accountability, contractual relationships, and coordination and information sharing. (See also: Bitcoin Has A Regulation Problem .) Government regulatory agencies typically oversee self-regulation agencies. For example, major rules promulgated by NFA (the National Futures Association) are approved by the CFTC. At the same time, NFA has the authority to audit and regulate non-clearing Futures Clearing Merchants (FCMs). Will Self-Regulation Bring Order To The CryptoWild West? Bringing order to an unregulated financial ecosystem is typically the task of government regulatory agencies. (See also: Can Go Continue reading >>

Sec Says Cryptocurrency Exchanges Are An Unregulated Mess

Sec Says Cryptocurrency Exchanges Are An Unregulated Mess

The U.S. Securities and Exchange Commission has issued a warning on cryptocurrency exchanges. The SEC says that many exchanges are currently unregulated and can do whatever they want with your money. As an investor, you should be extremely careful. As a company running an exchange, you should expect a crackdown soon. The SEC first assumes that cryptocurrencies and tokens offered through ICOs are securities. As securities, cryptocurrency exchanges should follow the same rules as every exchange. They should register through the SEC as a national securities exchange, an alternative trading system (ATS) or a broker-dealer. But the SEC says that the current situation is a mess. The SEC staff has concerns that many online trading platforms appear to investors as SEC-registered and regulated marketplaces when they are not, the SEC wrote.Many platforms refer to themselves as exchanges, which can give the misimpression to investors that they are regulated or meet the regulatory standards of a national securities exchange. Many exchanges have set up their own rules when it comes to listing new cryptocurrencies, but the SEC has no say in this process and cant guarantee that those are safe investments. Similarly, the SEC never reviews trading tools on cryptocurrency exchanges. For instance, if you submit a limit order on an exchange, you have to trust the exchange that itll strictly follow your order. The exchange could give priority to bigger investors or screw up the order book without any consequence. The SEC also reminded cryptocurrency exchanges that theyre supposed to register as an ATS for example. After Circles acquisition of Poloniex Nathaniel Popper saw a confidential Circle presentation. Circle plans to work with the SEC to register Poloniex: Just got this slide from a Continue reading >>

6 Ways To Regulate Bitcoin, Ethereum And Other Cryptocurrencies Without Destroying Its Future | Wired Uk

6 Ways To Regulate Bitcoin, Ethereum And Other Cryptocurrencies Without Destroying Its Future | Wired Uk

Parody currency Dogecoin is now worth more than $2bn (1.5bn) so wow Cryptocurrencies and blockchains are here to stay, so now more than ever its important governments get ahead and regulate it correctly. Here are six things the UK government can do to protect consumers while not stifling innovation: Blockchains dont work without a token, and tokens need to be traded in and out of fiat (government backed currencies like the US dollar). This means there will always be a chance to profit (in fiat terms), so HMRC needs to clarify its stance. In the US, the 2018 tax law clarified when you should pay capital gains on crypto. One big change: crypto-to-crypto transactions are now taxable events. Amir fought Isis in Syria, now hes enlisting an army of hacker monks to save bitcoin from itself Does that apply in the UK as well? CryptoTax.uk, a UK specific guide , thinks you may be subject to tax on these types of trades; but at the moment its not entirely clear. To be even more forward thinking, with Masternodes in Dash and the introduction of Proof-of-Stake , what happens when you earn a crypto-dividend? Is that taxable? A line in the sand would be nice. Also, did someone say Crypto ISA? Almost all foreign exchange flows through banks or currency houses: what you do with it afterwards is your choice. It should be no different in the crypto-verse. Unless you are a professional trader the sort of person whod self-declare as option four on a list like this all your transactions should run through an exchange that is regulated. Once the flow of fiat to crypto and vice-versa is predominantly through exchanges, it will be easier to combat illicit behaviour and ensure tax is paid. However, for that the happen we first need banks to open accounts for exchanges. At the moment British ban Continue reading >>

Regulation Arrives For Bitcoin Exchanges | Fortune

Regulation Arrives For Bitcoin Exchanges | Fortune

Cameron Winklevoss and Tyler Winklevoss in Austin, Texas in March 2015. The bitcoin exchange that Coinbase launched in January, for trading the controversial digital currency, had great expectations on its shoulders. Its certainly a breakthrough for the space as a whole, said bitcoin evangelist Roger Ver when news broke that the New York Stock Exchange was one of Coinbases backers. (The companys nearly $107 million in venture capital is second only to the $116 million raised by secretive startup 21 .) The Coinbase exchange brings a new level to the bitcoin world, said Daniel Palacio, founder of Authy. But there are even greater expectations for all the exchanges that will come next. Bitcoin exchanges already exist, such as Bitstampwhich has reopened after falling victim to a hack in January Bitfinex, and BTCChina. TeraExchange, launched last October, allows for bitcoin derivatives trading. But Coinbases exchange was hyped as the countrys first regulated bitcoin exchange . (There has been dispute over this label. Coinbase is not yet officially licensed in New York, for example, where the states Department of Financial Services has come up with BitLicense, a set of regulations for digital currency companies.) Now there is widespread excitement over additional regulated exchanges to come, as well as over regulation in general. Last year, the IRS released regulatory guidelines over bitcoin and taxes, and just this month the U.K. Treasury came out with a report about the need to regulate bitcoin, and stating its plan to apply anti-money laundering rules to bitcoin exchanges. We saw a lot of regulation last year, says Authys Palacio. I think we can see that its here to stay. Its no longer a couple of techies using it. The great irony of excitement over regulation is that man Continue reading >>

Cryptocurrency Exchanges, Regulation And Ransomware: How Recent Breaches Will Impact The Future Of Bitcoinwebinar.

Cryptocurrency Exchanges, Regulation And Ransomware: How Recent Breaches Will Impact The Future Of Bitcoinwebinar.

See Also: Addressing the Identity Risk Factor in the Age of 'Need It Now' The blockchain, in effect, is a distributed ledger, shared with hundreds of thousands of automated auditors that verify the authenticity of every transaction, drastically reducing, if not completely eliminating, fraudulent entries. But as recent events have proven, the proverbial weak link in the chain is not the blockchain, but, rather, the cryptocurrency exchanges that manage user accounts. How will recent breaches of those exchanges impact the future of blockchain technology, from a legal and regulatory standpoint? And now that cybercriminals are increasingly requesting that their victims pay in cryptocurrency for ransomware attacks and other cyberschemes, will Bitcoin and other cryptocurrencies' reputations be damaged? Many current transaction mechanisms are vulnerable to fraud. This session will walk through the potential impact of broader blockchain deployment, and the implications recent events are likely to have on blockchain's future. Hear from more industry influencers, earn CPE credits, and network with leaders of technology at our global events. Learn more at our Fraud & Breach Prevention Events site. Continue reading >>

Abu Dhabi Markets Watchdog Mulls Crypto Exchange Regulations

Abu Dhabi Markets Watchdog Mulls Crypto Exchange Regulations

Abu Dhabi Markets Watchdog Mulls Crypto Exchange Regulations Feb 12, 2018 at 10:30 UTC|UpdatedFeb 12, 2018 at 12:49 UTC Abu Dhabi's markets regulator is considering drawing up a supervisory framework for cryptocurrency exchange operations. In an announcement Sunday, the Financial Services Regulatory Authority (FSRA) of the Abu DhabiGlobal Market said it is "reviewing and considering the development of a robust, risk-appropriate regulatory framework to regulate and supervise activities ofvirtual currency exchanges and intermediaries." The FSRA said the move would be an addition to guidance it issued in October 2017 regarding a regulatory approach toward token-based fundraising activities such as initial coin offerings. Given the rising popularity of cryptocurrencies in the region, the FSRA said then that it would applyexisting anti-money laundering and know-your-customer (KYC) rules to token sales, classifying some as securities and others as commodities. The FSRA now notes its concerns over the issues of cryptocurrencies being used inmoney laundering and terrorist financing, as well as the risk of cyberattacks. Like its counterparts in other countries and regions such as Japan, the EU and Singapore, the FSRA said it's also exploring a framework to supervise cryptocurrency exchanges regarding these risks. According to the statement, the agency does plan to include advisory input from industry companies and relevant professional bodies. The FSRA further cautions that before the regulatory framework is in place, investors and exchanges are advised to approach the agency for discussion on proper treatment of cryptocurrency transactions. The news comes just a week after the United Arab Emirates' securities regulator issued a warning to residents on the risk of investing in Continue reading >>

Heres How The U.s. And The World Regulate Bitcoin And Other Cryptocurrencies

Heres How The U.s. And The World Regulate Bitcoin And Other Cryptocurrencies

Heres how the U.S. and the world regulate bitcoin and other cryptocurrencies Regulators all over the world have begun to address the challenges presented by virtual currencies that mostly bypass regulated banks, financial firms, exchanges and central clearinghouses. Digital currencies, token sales and blockchain initiatives of all types have ignited a global phenomenon unlike anything I have ever seen, said J. Dax Hansen, a partner at law firm Perkins Coie who leads its Blockchain Technology & Digital Currency industry group. As the technology underpinning these developments disrupts products and services in nearly every industry, law makers, regulators and law enforcement are scrambling to keep up. Because the current players in virtual currencies including the most popular bitcoin BTCUSD, -1.97% US:BTCF8 largely operate outside of the conventional financial system, regulators are concerned about money laundering, terrorist financing, tax evasion and fraud. And: Bitcoin tumbles 10% as South Korea moves to curb crypto trade In the U.S., the Securities and Exchange Commission and the Commodity Futures Trading Commission have sent out a flurry of announcements in the last few months on the subject, including some strong statements by Jay Clayton, the SEC chairman. Where we see fraud, and where we see people engaging in offerings that are not registered, we are going to pursue them because these types of things have a destabilizing effect on the market, said Clayton at a meeting at the Federal Reserve Bank of New York at the end of November. Heres what U.S. regulators are currently doing: SEC has not approved any exchange-traded products (such as ETFs) holding cryptocurrencies or other assets related to cryptocurrencies for listing or trading. SEC has not registered any i Continue reading >>

Japan Creates Regulatory Body To Prevent Cryptocurrency Exchange Hacks

Japan Creates Regulatory Body To Prevent Cryptocurrency Exchange Hacks

Japan leads the cryptocurrency world both in trading volumes and crypto-friendly regulation. Now, sixteen crypto exchanges in Japan will establish a self-regulatory body to prevent hacks. Regulatory Body For Cryptocurrency Market Japan is the largest cryptocurrency market in the world , boasting 61% of global trading volume for Bitcoin, which is held by 2.7% of the countrys population. Its crypto-friendly regulation has allowed many businesses to emerge, including the firstBitcoin exchange in the world a Bitcoin Market set up in 2010. But where theres money, theres risk. That first Bitcoin Market was quickly brought due to a scam in the same year. As time went by, the crypto market in Japan flourished, as well as scams and hacks. Four years later, the famous Mt. Gox heist was covered by the news media worldwide. The exchange went bankrupt after having approximately 850,000 bitcoins, belonging to customers and the company, stolen. In 2014, the hack was worth $450 million. Those bitcoins are now valued at $9.6 billion. The Mt. Gox scandal led to an amendment to an existing law which required banks as well securities firm from allowing Bitcoin transactions for customer accounts that were unregistered. Coming into effect in April 2017, the amendment also recognized virtual currencies as a method of payment. The amendment, however, didnt keepcriminals from stealing approximately $534 million in NEM tokens, transferred through a total of nineteen accounts. The security breach, in January2018, was caused by the lack of strong security measures of Coincheck. Japans financial watchdog, Financial Services Agency , ordered the exchange to improve its security practices. The company announced itwould repay all 260,000 users affected in Japanese yen using its own capital. After the Continue reading >>

Japan's Cryptocurrency Exchanges Plan Self-regulating Committee

Japan's Cryptocurrency Exchanges Plan Self-regulating Committee

Japan's cryptocurrency exchanges plan self-regulating committee The concept is sound. The execution? Not so much. Government-registered cryptocurrency exchanges in Japan are setting up a self-regulation body in the region. The move, Reuters reports , is an effort to legitimize and establish trust in the area following the $530 million Coincheck theft in January. There isn't a name for the body yet and similarly, there's no word for when all the paperwork will be finalized. It follows Japan's national oversight of the sector last year, and South Korea's crypto regulation in late January. News of the regulatory body's formation started tricking out in late February , with reports that it could be a merger of two existing firms, Japan Cryptocurrency Business Association and Japan Blockchain Association. The plan is to only allow government-approved exchanges, but that rule already seems a bit weak. Specifically, Reuters writes that "the body will later invite other cryptocurrency exchanges whose applications for registration with the government are pending, as well as those that plan to register in the future." So, yeah, about that oversight. Continue reading >>

Indian Bitcoin Exchanges Scramble To Adjust To Regulation

Indian Bitcoin Exchanges Scramble To Adjust To Regulation

Indian Bitcoin Exchanges Scramble to Adjust to Regulation Share on Facebook Share on Twitter Share on Google+ Share on LinkedIn The Indian government recently declared Bitcoin and other cryptocurrencies illegal tender within its borders which has since seen crypto exchanges all over the country scrambling to create a plan of action. To address this issue, Indian crypto exchanges intend to develop a database of users that will become active on the network as they help to record transactions in real time. Citibank India is the latest lender to make it more difficult to buy cryptocurrencies in India. The information of every buyer and seller on each exchange platform will be traceable by using the users Permanent Account Number (PAN) or Aadhaar ID. Additional details such as every individual users total crypto funds and buying patterns will also be made available and managed by the proposed central repository. According to the Internet and Mobile Association of Indias head of the Blockchain and Cryptocurrency Committee (BACC), Ajeet Khurana, the central repository system proposal will be submitted to the government for consideration. The BACC counts seven major cryptocurrency exchanges that operate within Indias borders as members. Khurana stated that the BACC will submit this proposal to the relevant governmental committee before the end of this week. The relevant committee is led by SC Garg who serves as the Economic Affairs Secretary. The committee is then expected to deliver its opinion and other findings by March. In addition, it is expected that the government will appoint a dedicated regulator that will be responsible for the monitoring of cryptocurrencies in India. Arun Jaitley is the Finance Minister of India and believes that the Indian government should do more Continue reading >>

Indian Cryptocurrency Exchanges Make Moves To Self Regulate

Indian Cryptocurrency Exchanges Make Moves To Self Regulate

Indian Cryptocurrency Exchanges Make Moves to Self Regulate In response to the minister of finance naming cryptocurrency as illegal tender Indian exchanges have banded together to create a central repository to maintain a real-timedatabase of traders in a bid at self-regulation. When Finance Minister Arun Jaintlynamed cryptocurrencyillegal tender in his earlyFebruarybudget speechhe set off a rash of panic selling across Indian exchanges. Since then the panic has subsided and exchanges have made moves to self-regulate in order to put off any harsher government intervention. Cryptocurrency traders are required by exchanges to submit both their PAN and Aadhaar number along with banking details in order to open atrading account. Though the proceeds from all transactions are credited to the same accountthe data is not shared as each exchange operates exclusively. Seven cryptocurrency exchanges have come together toform the Blockchain and Cryptocurrency Committee (BACC) of the Internet and Mobile Association of India. This mouthful has tasked itself with collecting and pooling users trading data through PAN cards and making this information available to government agencies. This is one of the proposals we are planning to submit to the government committee which is looking into the issue of cryptocurrency, Indian tax authorities have notified an estimated 100,000 investors asking them to reveal profits earned on cryptocurrency trading for 2017. Industry experts estimate that in 2017 about 10,000 crore (100 billion rupees) trade in cryptocurrency was done by around five million active Indiantraders. The BACC plans to submit its proposal to the government committee headed by economic Affairs secretary SC Garg this week. The government panel will submit its recommendationsby Mar Continue reading >>

Virtual Currency Law In The United States

Virtual Currency Law In The United States

Virtual currency law in the United States This article has multiple issues. Please help improve it or discuss these issues on the talk page . This article relies too much on references to primary sources . Please improve this by adding secondary or tertiary sources . This article is an orphan , as no other articles link to it . Please introduce links to this page from related articles ; try the Find link tool for suggestions. ( Learn how and when to remove this template message ) United States virtual currency law is the area of financial regulation that applies to the buyers, sellers, and users of virtual currency . This regulatory structure consist of tax regulations and FINCEN transparency regulations between financial exchanges and the individuals and corporations with whom they conduct business. The regulatory and market environment[ edit ] The Internal Revenue Service (I.R.S) describes Virtual Currencies (VC)s as a digital representation of value that functions as a medium of exchange, a unit of account, and/or a store of value [and] does not have legal tender status in any jurisdiction. [1] Although, electronic payment systems have been part of American life since at least 1871 when Western Union introduced money transfer through the telegraph [2] and in 1914 introduced the first consumer charge-card," virtual currencies differ from these digital payment structures because unlike traditional digital transfers of value, virtual currencies do not represent a claim on value; rather the virtual currency are the value. The National Automated Clearing House Association (NACHA), through the Automated Clearing House (ACH) moves almost $39 trillion and 22 billion electronic financial transactions each year. [3] These electronic transfers of money through the ACH Network Continue reading >>

How To Choose The Best Bitcoin Or Cryptocurrency Exchange

How To Choose The Best Bitcoin Or Cryptocurrency Exchange

How to choose the best bitcoin or cryptocurrency exchange The value of the global cryptocurrency market is above $700 billion, but the industry is still lightly regulated. New cryptocurrency exchanges are growing rapidly worldwide, and many are at risk for cyberattack. It's crucial that investors look for red flags when choosing a cryptocurrency exchange and do their homework on fees and security safeguards. Pedestrians look at monitors showing the prices of virtual currencies at the Bithumb exchange office in Seoul, South Korea, Feb. 2, 2018. During the bitcoin frenzy at the end of December, Coinbase, one of the premier exchanges, halted trading briefly due to crushing volume as prices plunged. Many of Coinbase's competitors also have suffered growing pains as digital money grows ever more popular, overwhelming systems and encouraging formation of new exchanges that have yet to stand the test of time. And there have been hacks, too. A cryptocurrency exchange in Japan, called Coincheck, is under government scrutiny after hackers stole $530 million from its users in January. If confirmed, it's expected to rank as the biggest such theft on record, eclipsing the estimated $450 million in bitcoin stolen from the Japanese exchange Mt. Gox in 2014. Experienced bitcoin traders recognize that snafus come with the territory in a new and lightly regulated $700 billion market growing so rapidly it's hard to ramp up fast enough. Major bitcoin and cryptocurrency exchanges are springing up globally , including Coinbase and Binance in Japan, Bittrex and Kaken in the United States and Bitfinex in Hong Kong. And the absence of government interference is in fact a big part of the cryptocurrency appeal, though the Securities and Exchange Commission and the Commodity Futures Trading Commi Continue reading >>

Gemini The Next Generation Digital Asset Exchange

Gemini The Next Generation Digital Asset Exchange

All U.S. Dollar deposits are held at FDIC-insured banks. The majority of digital assets are stored offline in our proprietary, state-of-the-art Cold Storage system. All U.S. Dollar deposits are held at FDIC-insured banks. The majority of digital assets are stored offline in our proprietary, state-of-the-art Cold Storage system. Continue reading >>

Best Cryptocurrency Exchanges: The Ultimate Guide

Best Cryptocurrency Exchanges: The Ultimate Guide

Best Cryptocurrency Exchanges: The Ultimate Guide Angel Investors, Startups & Blockchain developers... So you want to start trading cryptocurrencies? Check out this guide to the best cryptocurrency exchanges. Cryptocurrency exchanges are websites where you can buy, sell or exchange cryptocurrencies for other digital currency or traditional currency like US dollars or Euro. For those that want to trade professionally and have access to fancy trading tools, you will likely need to use an exchange that requires you to verify your ID and open an account. If you just want to make the occasional, straightforward trade, there are also platforms that you can use that do not require an account. Trading Platforms These are websites that connect buyers and sellers and take a fee from each transaction. Direct Trading These platforms offer direct person to person trading where individuals from different countries can exchange currency. Direct trading exchanges dont have a fixed market price, instead, each seller sets their own exchange rate. Brokers These are websites that anyone can visit to buy cryptocurrencies at a price set by the broker. Cryptocurrency brokers are similar to foreign exchange dealers. What to look out for before joining an exchange Its important to do a little homework before you start trading. Here are a few things you should check before making your first trade. Reputation The best way to find out about an exchange is to search through reviews from individual users and well-known industry websites. You can ask any questions you might have on forums like BitcoinTalk or Reddit. Fees Most exchanges should have fee-related information on their websites. Before joining, make sure you understand deposit, transaction and withdrawal fees. Fees can differ substantiall Continue reading >>

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