Schlagwort: blockchain regulation

• IMF’s Georgieva urges global readiness for CBDCs at Singapore FinTech Festival.
• CBDCs are a potential cash replacement, enhancing resilience, and promoting financial inclusion.
• IMF introduces CBDC handbook and acknowledges BIS’s role in global digital finance experiments.

In a compelling address at the Singapore FinTech Festival, International Monetary Fund (IMF) Managing Director Kristalina Georgieva urged nations to ready themselves for the eventual deployment of central bank digital currencies (CBDCs).

Georgieva expressed optimism despite acknowledging that the widespread adoption of CBDCs is still on the horizon, with approximately 60% of countries currently exploring these digital currencies in some capacity.

CBDCs as a replacement for Cash

Georgieva underscored the potential of CBDCs to replace traditional cash, offering heightened resilience in advanced economies and fostering financial inclusion in underbanked communities. According to her, CBDCs can coexist with private money, as a secure and cost-effective alternative.

The IMF head emphasized the crucial role of technological infrastructure in CBDC projects, emphasizing personal data protection and considering the integration of artificial intelligence (AI) to enhance national digital currencies. She particularly stressed the importance of CBDCs being designed to facilitate cross-border payments, addressing the current issues of expense, slowness, and limited accessibility. 

Georgieva’s argument comes amid fears that CBDCs risk attracting money launderers and cyber criminals.

IMF’s CBDC virtual handbook and collaborative efforts with BIS

During the event, Kristalina Georgieva introduced the IMF’s CBDC virtual handbook, marking a milestone in the ongoing discourse around the global adoption of digital currencies. She also acknowledged the pivotal role of the Bank for International Settlements (BIS) in supporting the public sector’s experimentation with digital money.

In recent initiatives, the IMF has actively engaged in analysing necessary crypto regulations, presenting a crypto-risk assessment matrix (C-RAM) aimed at helping countries identify potential risks in the cryptocurrency sector.

The collaborative effort of the IMF and BIS, as exemplified in the Synthesis paper, was unanimously endorsed by the G20 Finance Ministers and Central Bank Governors Communique in October, indicating growing global interest and commitment in shaping the future of digital finance.

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• Ripple says approval allows licensed firms to incorporate XRP into their crypto asset services.
• CEO Brad Garlinghouse notes that Dubai continues to grow as a global leader in crypto regulation and innovation.
• Other cryptocurrencies allowed under the DFSA virtual asset regime are BTC, ETH and LTC.

Ripple has announced that the Dubai Financial Services Authority (DFSA) has officially approved the XRP cryptocurrency token under the regulator’s virtual assets regime. 

The approval allows licensed firms in the Dubai International Financial Centre (DIFC) to integrate XRP into their virtual asset services, the blockchain company noted in a press release.

XRP joins BTC, ETH and LTC on DFSA’s list

DFSA’s approval of XRP brings the number of digital assets allowed under the regulator’s virtual assets regime to four, with the Ripple token joining Bitcoin (BTC), Ethereum (ETH) and Litecoin (LTC).

According to Ripple, the development could see XRP benefit from DIFC’s legal and regulatory clarity. The company also believes this has the “potential to unlock new regional payments and other virtual asset use cases on the XRP Ledger.”

Today’s announcement comes a few days after Ripple inked a strategic partnership with crypto exchange Uphold as it seeks to bolster its cross-border payments infrastructure. It also comes ahead of Ripple Swell, a flagship event set for Dubai on November 8-9, with headline speakers including Alya Al Zarouni, COO of DIFC; and Hensen Orser, the CEO of VARA.

Ripple CEO Brad Garlinghouse, commenting on the XRP listing, lauded Dubai’s continued approach to the regulation of digital assets, noting its role in “nurturing innovation.”

“It’s refreshing to see the DFSA encourage the adoption and use of digital assets such as XRP to position Dubai as a leading financial services hub intent on attracting foreign investment and accelerating economic growth. Ripple will continue to double down on its presence in Dubai and we look forward to continuing to work closely with regulators to realize crypto’s full potential,” Garlinghouse added.

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• Turkey is preparing a new law on crypto regulation, according to Finance Minister Mehmet Simsek.
• The legislation looks to toughen approach to money laundering and terrorism financing to bring Turkey into compliance with Financial Action Task Force (FATF) requirements.

Turkey is looking to toughen its approach to cryptocurrency regulation, according to a statement made by the country’s finance minister.

Reuters reported on Wednesday, November 1 that Turkey’s quest for new legislation aims at clear regulation for crypto-assets as a route to getting an upgrade in its money laundering and terrorist financing outlook.

Turkey seeks to comply with FATF requirements

Specifically, Turkey hopes the new law will persuade the Financial Action Task Force (FATF) to remove the country from a “grey list” that includes countries whose anti-money laundering (AML) and terrorism financing crackdown is insufficient. 

The global watchdog added Turkey to this list of countries in 2021.

Turkey’s Finance Minister Mehmet Simsek, in an address delivered to a parliamentary commission on October 31, noted that the country was nearing full technical compliance with FATF’s 40 standards. “Work related to crypto assets” was the only issue now.

According to Simsek, the ministry is set to submit to parliament a crypto asset law proposal. Legislative approval of this proposal should see Turkey removed from the “grey list”, unless there are issues – like political considerations.

Reuters says Simsek did not give any other details regarding the expected regulatory step.

The Turkish government’s quest to align with FATF requirements around money laundering and terrorism financing comes amid a wider global push to regulate cryptocurrencies.

That has seen the likes of the EU enacting the Markets in CryptoAsset (MiCA) law and the UK passing into law its Financial Services and Markets Act (FSMA). The comprehensive legislations are expected to bring more clarity to crypto regulation, including stablecoins. 

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• The HM Treasury today published a policy update to the country’s crypto regulation.
• In it, the UK government has outlined the FCA’s regime in stablecoin regulation.
• The Bank of England (BoE) and the Payment Systems Regulator (PSR) will also have a role.

The UK government has published a policy update outlining a phased regulation of fiat-backed stablecoins in the country.

In terms of regulating activities around stablecoins, the HM Treasury will focus on two areas – their use in payment chains and issuance and custody “in or from the UK.” The latter will be irrespective of a fiat-backed stablecoin’s uses, that’s whether for payments, as a settlement asset, or as a store of value.

FCA, BoE role in stablecoin regulation

In the publication, which was made public on Monday, the HM Treasury explains the expected regulatory regimes of the Financial Conduct Authority (FCA), the Bank of England (BoE) and the Payment Systems Regulator (PSR).

“The regulatory landscape will bring certain (fiat-backed) stablecoins within the remit of the Bank of England, Financial Conduct Authority (FCA) and Payment Systems Regulator (PSR), which altogether will aim to minimise potential for customer harm and mitigate the conduct, prudential, and financial stability risks arising from those stablecoins, particularly when used for payments,” the document reads in part.

The government expects the FCA, BoE and PSR to work within statutory objectives that align with the overall stablecoin regulation framework, with regulators coordinating for a clear approach.

While the HM Treasury secondary legislation via parliament will bring stablecoins within the FCA’s regulatory perimeter, there’s co-responsibility on the FCA and BoE to supervise a firm recognised as systemic.

“In a scenario where an FCA authorised fiat-backed stablecoin firm is recognised as systemic by HM Treasury, and so should be supervised by the Bank of England, the government expects that the Bank of England should act as the lead prudential regulator and be able to supervise such an entity through Part 5 of the Banking Act 2009, while the firm continues to also be regulated by the FCA for conduct,” the document states.

UK’s legislation on crypto is set for 2024, after the Financial Services and Markets Act 2023 passed into law in June to allow for the treatment of crypto as a regulated activity. The latest policy update looks to prepare the various government agencies and regulators for this.

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• Zodia Markets is a Standard Chartered-backed digital asset exchange and brokerage platform.
• The company has announced its registration as a Virtual Asset Service Provider (VASP) by Ireland’s central bank.
• Zodia is looking to position itself for European expansion amid the upcoming MiCA laws.

Zodia Markets, a digital asset exchange backed by Standard Chartered, is now registered as a Virtual Asset Service Provider (VASP) in Ireland.

An announcement by the company on Friday stated that the VASP approval was granted to Zodia Markets (Ireland) Limited by the Central Bank of Ireland (CBI). This follows similar registrations by the Abu Dhabi Global Markets (ADGM) and the UK’s Financial Conduct Authority (FCA) – in September 2023 and in July 2022 respectively.

Ireland is a burgeoning crypto market

Zodia Markets’ registration in Ireland means the company now has regulatory approval in the EU, with this allowing it to expand its services in Europe, including crypto exchange and OTC trading. 

The milestone also aligns the platform with the upcoming implementation of EU’s comprehensive crypto laws, the Markets in CryptoAssets Regulation (MiCA) that’s expected to go into effect in the second half of 2024.

“VASP registration is an exciting development for Zodia Markets, and we’re delighted to be part of the burgeoning Irish digital assets ecosystem. The registration will act as a launchpad for the business to enter the EU, a market where we see significant opportunity and demand for our offering, and it paves the way for future MiCA authorisation when the regulations are implemented,” Michael Walsh, CEO of Zodia Markets Ireland, said.

Ireland continues to attract crypto companies amid the industry’s recognition of a supportive regulatory environment.

Coinbase, which has regulatory approval as an e-money institution and VASP in the country, recently announced that it had selected Ireland as its European hub. The US-based crypto giant first hinted at this move in 2020. 

Another major crypto company registered in the country is Kraken, which has CIB approval as an e-money provider.

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