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How Are Cryptocurrency Exchanges Regulated

Abu Dhabi To Regulate Cryptocurrency Exchanges, Framework Upcoming

Abu Dhabi To Regulate Cryptocurrency Exchanges, Framework Upcoming

Abu Dhabi Global Market (ADGM) published a press release regarding the regulation of cryptocurrency exchanges on its website yesterday. The Financial Services Regulatory Authority (FSRA) plans to help the crypto community in the UAE by creating a a robust, risk-appropriate regulatory framework to regulate and supervise activities of virtual currency exchanges and intermediaries. No date or roadmap was specified for the upcoming project, however, the release mentioned that FSRA will be getting help from industry participants and relevant professional bodies. The FSRA previously submitted a guidance on supervising ICOs and cryptocurrencies in October of last year. According to the document, cryptocurrencies are commodities which are regulated under Financial Services and Market Regulations (FSMR) only as derivatives. Mining, spot trading and spot transactions are unregulated. Tokens issued in ICOs are considered as securities, and the entire ICO is regulated by FSMR. The announcement comes a few days after Securities and Authorities Commodity announced that ICO investors are on their own as the UAE doesnt recognize, regulate or supervise ICOs. The FSRA elaborated on the topic, The FSRA notes that virtual currencies, although not legal tender, are gaining interests globally as a medium of exchange for goods and services. However, there are risks and concerns. Given the anonymous and cross-border nature of virtual currency transactions, they are particularly vulnerable to money laundering and terrorist financing risks, as well as other financial crimes. Furthermore, cyber crimes and hacks on cryptocurrencies have also raised concerns among governments and crypto users alike. Under these circumstances, a flexible regulatory framework will provide safety and security for cry Continue reading >>

Japan's Crypto Exchanges Self-regulate In Wake Of $500 Million Hack

Japan's Crypto Exchanges Self-regulate In Wake Of $500 Million Hack

Japan's Crypto Exchanges Self-Regulate In Wake of $500 Million Hack Sixteen cryptocurrency exchanges in Japan have formed a new self-regulatory organization, an effort that comes in the wake of the $500 million theft in January. According to a report from Nikkei , the new initiative will see the group of licensed cryptocurrency exchanges, represented by two trade organizations in Japan, working towards rolling out standards in April for the country's Financial Services Agency (FSA) in an effort to improve security measures among them.The group will also work toward developing standards for activities around initial coin offerings. The new organization's formation, the name of which has yet to be determined, came after the two trade groups - the Japan Cryptocurrency Business Association (JCBA) andJapan Blockchain Association (JBA) - reached an agreement last week. Taizen Okuyama, president of foreign exchange trading firm Money Partners Group and chairman of the JCBA, andYuzo Kano, CEO of exchange startup bitFlyer and the head of the JBA, will serve as the chairman and vice chairman of the new group, respectively. The move confirms previous reports about an effort to develop an SRO for Japan's cryptocurrency exchange ecosystem. The idea was put forward as a way to shore up public confidence in the wake of a hack that resulted in the theft $500 million worth of the NEM token from Coincheck, one of the Japanese exchanges that have yet to be fully approved by the FSA. As previously reported, Coincheck hasn't been approved yet by the financial regulator because of security issues, which the FSA said it had alerted Coincheck about prior to the heist. Disclosure:CoinDesk is a subsidiary of Digital Currency Group, which has an ownership stake in bitFlyer. The leader in blockch 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 >>

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 >>

Hong Kong Demands Regulation From Crypto Exchanges

Hong Kong Demands Regulation From Crypto Exchanges

CEO at StartEngine and co-founder at Activision/Blizzard. Join us for the StartEngine ICO 2.0 Summit on April 20th. Learn more here: www.startenginesummit.com Hong Kong Demands Regulation From Crypto Exchanges No one should be surprised by this latest turn for cryptocurrency exchanges. On Friday, Hong Kongs Securities and Futures Commission (SFC) announced that it sent seven letters to different cryptocurrency exchanges, warning that certain tokens listed on their exchanges could be securities, as defined by Hong Kongs Securities and Futures Ordinance (SFO), and that these tokens should not be traded without a license. The SFC did not disclose which exchanges they contacted, but they did indicate that these exchanges are located in or connected to Hong Kong. In response, most exchanges stated that they did not trade the tokens in question or removed them from their exchange. Alongside these letters to exchanges, the SFC warned seven ICO issuers that their tokens were seen as securities. Similarly, most confirmed compliance or ceased token sales to Hong Kong residents. Those that didnt respond to the SFC should be wary: it is likely that the SFC will take further action should their warning be ignored, and those consequences will surely be far more severe. The SFC will not tolerate securities laws violations in Hong Kong. What does this latest warning mean? Which coins will no longer be accepted on Hong Kong exchanges? No tokens were named, but it is likely that the majority of altcoins will be removed from these exchanges, leaving only those used for payment like Bitcoin and Ether. In a statement, the SFCs Chief Executive Officer Ashley Alder said, [the SFC] will continue to police the market and enforce when necessary, but we are also urging market professionals to do 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 >>

Bitcoin Exchange Regulation

Bitcoin Exchange Regulation

Though the use of Bitcoins has many advantages, some states are now considering regulating it. If a company wants to operate with the use of Bitcoins, some states may now have to ask them to submit a formal application. This move is done after the collapse of a recent Bitcoin bank that has been hacked and the users lost a considerable amount of Bitcoins. As of now, the government is paralyzed because the Bitcoin software is not under its jurisdiction. In as much as the government wants to intercede, it does not have the capacity to protect the Bitcoin users. The Central Bank is keen on regulating the Bitcoin software in order to thwart any suspicious financial transactions. It specifically targets the vending machines or the automated teller machines that dispense Bitcoins. The consumers are attracted to the Bitcoin software because the government is not part of the picture, hence, their money will not be taxed. However, by not involving the government, the Bitcoin users become vulnerable to the sudden fluctuations of the Bitcoin exchange rates. Plus, just like in the case of the Flexcoin Bank and the Mt. Gox where the Bitcoin users had no one to turn to but just accept the fact that they have lost their investments in Bitcoins. The government cannot help them bring back their lost investment, since those Bitcoins have no insurance. In Singapore, Bitcoin exchange might also be regulated by the government. This move by the government is to prevent the potential use of Bitcoins in money laundering and terrorist activities. It is very easy to transfer funds from one to the other with the use of Bitcoins. Add to that the fact that there is no limit when it comes to sending and receiving Bitcoins. In Singapore, the identities of the users will have to be verified before fin Continue reading >>

What We Can Expect From Future Cryptocurrency Regulation Worldwide

What We Can Expect From Future Cryptocurrency Regulation Worldwide

What we can expect from future cryptocurrency regulation worldwide Experts explore the current global regulatory landscape and how the cryptocurrency craze is impacting traditional finance. The cryptocurrency market is in constant flux, regulators worldwide are grappling with ways to control trading, and traditional banking systems are far from isolated from the global phenomenon. Cryptocurrency, developed through the backbone of Blockchain technology, was once only associated with sales in the underbelly of the Internet. By design, it is difficult -- although not impossible -- to track transactions made through Bitcoin (BTC), Ethereum (ETH), and other popular virtual currencies. IBM, Visa partner to make the Internet of things commerce friendly In direct opposition to traditional financial systems, cryptocurrencies do not rely on central authorities to govern transactions and regulate exchanges. While this makes transactions and investments anonymized to a degree, this also means that investors in cryptocurrency and those participating in Initial Coin Offerings (ICOs) will have little protection should their digital wallets be compromised, cyberattackers steal funds from trading posts, or exit scams occur. It is estimated that cyberattackers managed to steal close to $400 million from investors participating in ICOs since 2015. With exchange after exchange becoming compromised due to lax security and the operators of fraudulent startups touting non-existent Blockchain solutions and scam ICOs being unmasked on a monthly basis, the marketplace is risky business. Cryptocurrency is beginning to indirectly impact traditional exchanges, too. Interest in cryptocurrency and the Blockchain is high enough that any mention of these technologies can cause a surge in share price . 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 >>

Cryptocurrency Regulation In 2018: Where The World Stands Right Now

Cryptocurrency Regulation In 2018: Where The World Stands Right Now

Cryptocurrency Regulation in 2018: Where the World Stands Right Now If 2017 was the year of the ICO, it seems as if 2018 is destined to become the year of regulatory reckoning. Things have already begun to heat up as countries around the world grapple with cryptocurrencies and try to determine how they are going to treat them. Some are welcoming, others are cautious. And some countries are downright antagonistic. Here is a brief overview of how 15 countries/unions from various regions are treating cryptocurrency regulations. The United States, at the time of this writing, has no coherent direction on its cryptocurrency regulation other than that there will be some soon . The Securities and Exchange Commission (SEC) has warned investors of cryptocurrency investing risks, halted several ICOs and hinted at the need for greater cryptocurrency regulation. The Commodity Futures Trading Commission (CFTC) became the first U.S. regulator to allow for cryptocurrency derivatives to trade publicly, then organized meetings to talk about possibly changing the rules for cryptocurrency derivatives clearing (one of the meetings was postponed due to the federal government shutdown). Secretary of the Treasury Steve Mnuchin has indicated a preference for minted fiat currency over cryptocurrency. Speaking on January 12, 2018, at the Economic Club in Washington, D.C., Secretary Mnuchin warned those in attendance that he and other regulators were looking into the possibility that cryptocurrency could be used in money-laundering activities. The secretary then announced to the group that the Financial Stability Oversight Council (FSOC) had formed a working group to explore the cryptocurrency marketplace and that he hoped to work with the G20 to prevent bitcoin from becoming a digital equivalen 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 >>

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 >>

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 >>

Cryptocurrency Exchanges Will Regulate Themselves

Cryptocurrency Exchanges Will Regulate Themselves

Cryptocurrency exchanges will regulate themselves By Nigel Green March 8, 2018 12:54 AM (UTC+8) Japans thriving cryptocurrency market will have a new self-regulatory body next month a move that must be welcomed by all fit and proper industry leaders and also by the wider public. This new agency will see the licensed cryptocurrency exchanges, represented by two trade organisations in the country, introducing and implementing standards in April for the countrys Financial Services Agency (FSA), in an effort to improve security and compliance procedures among them.It will also develop standards for initial coin offerings (ICOs), the cryptocurrency equivalent of IPOs. Must-reads from across Asia - directly to your inbox The regulatory body, the name of which is yet to be announced, is the result of the two trade groups the Japan Cryptocurrency Business Association (JCBA) andJapan Blockchain Association (JBA) reaching an agreement last week. This move in Japan is the latest important development towards what I believe will ultimately result in regulation on a global level for cryptocurrencies. Of course, each jurisdiction is looking at this issue differently. For instance, Japan is heading for self-regulation, whereas the official financial regulator of South Korea, another major Asian crypto market, last week promised normalization in cryptocurrency trade and signalled a willingness to help promote blockchain technology. In whatever form it comes, a progressive regulatory environment in this area should be welcomed for many reasons. Cryptocurrencies are here to stay the genie has been let out of the bottle, with an increasing number of people and institutions investing in the likes of Bitcoin, Ethereum, Ripple, Litecoin and Dash Firstly, cryptocurrencies are here to stay th Continue reading >>

Massive Cryptocurrency Heist Spurs Call For More Regulation

Massive Cryptocurrency Heist Spurs Call For More Regulation

Bloomberg the Company & Its Products Bloomberg Anywhere Remote LoginBloomberg Anywhere Login Bloomberg Terminal Demo Request Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world. Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world. Massive Cryptocurrency Heist Spurs Call for More Regulation Coincheck says it was hacked, will reimburse customers Regulators are grappling with booming crypto markets Tokyo-based Coincheck was hacked and lost almost $500 million. Bloombergs James Mayger reports. At 2:57 a.m. on Friday morning in Tokyo, someone hacked into the digital wallet of Japanese cryptocurrency exchange Coincheck Inc. and pulled off one of the biggest heists in history. Three days later, the theft of nearly $500 million in digital tokens is still reverberating through virtual currency markets and policy circles around the world. The episode, disclosed by Coincheck executives at a hastily arranged press conference on Friday night, has heightened calls for stricter oversight at a time when many governments are struggling to formulate a response to the digital-asset boom. Japanese finance ministry officials said on Monday that the country will conduct on-site inspections of exchanges and that cryptocurrencies would likely become an issue at the next G-20 meeting. While Bitcoin and its ilk have rebounded from their selloff on Friday -- thanks in part to Coinchecks assurances over the weekend that customers would be partially reimbursed -- market observers said concerns over security lapses are Continue reading >>

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