Schlagwort: blockchain regulation

Key takeaways

• Crypto exchange Coinbase has filed a lawsuit against the Securities and Exchange Commission (SEC).

• Coinbase wants the agency to provide a yes or no to Coinbase’s request for the commission to draft and approve a digital asset-specific rule.

• Cathie Wood’s Ark Invest has purchased $8.6 million worth of Coinbase stock.

Coinbase sues US SEC

Coinbase, one of the leading crypto exchanges in the United States, has filed a lawsuit against the United States Securities and Exchange Commission.

The lawsuit comes after the crypto exchange filed a petition with the SEC last summer. Coinbase wants the securities regulator to provide a yes or no to its request for the commission to draft and approve a digital asset-specific rule.

Coinbase’s chief legal officer Paul Grewal wrote in a blog post on Monday, stating that;

“From the SEC’s public statements and enforcement activity in the crypto industry, it seems like the SEC has already made up its mind to deny our petition. But they haven’t told the public yet. So the action Coinbase filed today simply asks the court to ask the SEC to share its decision.”

The crypto exchange can also file another lawsuit to try to make a federal court force the SEC to make a new rule if the regulatory agency declines.

The SEC and Coinbase are currently in what could become a long legal battle. Last month, the SEC served Coinbase with a Wells Notice, indicating that it is looking into Coinbase’s activities for potentially violating U.S. securities laws.

Coinbase’s CEO revealed last week that the crypto exchange could relocate to another country if the regulatory unclarity in the United States persists. 

Ark Invest loads up on Coinbase stock

Ark Invest, an American investment management firm run by CEO Cathie Wood, continues its buying spree of Coinbase’s stock. The ARK Innovation ETF purchased 122,083 shares in Coinbase, the ARK Fintech Innovation ETF, meanwhile, bought 14,633 shares, while the ARK Next Generation Internet ETF added 20,327 shares, totalling $8.6 million.

Cathie Wood’s Ark Invest remains one of the biggest Coinbase shareholders despite selling $13.5 million worth of the stocks last month. 

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The European Parliament’s approval of the Markets in Crypto Act, MiCA regulation continues to be hailed as a watershed moment for the crypto space, particularly for Europe.

Commenting on the development, Philipp Pieper, co-founder of Swarm, a regulated DeFi platform that’s a member of Germany’s Digital Finance Forum, says the legislation is a new beginning for crypto.

“A new era for global crypto has begun and Europe, for a change, has just become the leading innovator in the industry,” the Swarm co-founder noted in a statement shared with CoinJournal. 

MiCA creates clear and unambiguous rules for crypto

As we reported on Thursday, EU lawmakers’ nod for MiCA saw the bloc become the first major global jurisdiction to have a comprehensive regulation framework for crypto. 

Many within the digital assets space say the law offers a clear way forward for exchanges and other platforms, with investor protection measures clearly spelled out.

“The passing of the MiCA regulation has created clear and unambiguous guidelines for crypto companies across the European market… Most importantly, crypto investors now have far more security and won’t be left holding the bag when companies collapse due to dodgy business practices,” Pieper noted as he added his voice to the matter.

While the devil could be in the details, Pieper believes the legislation establishes Europe as the world’s blockchain hub. With the regulatory environment supportive of crypto innovation, it’s possible that Europe outpaces peers in markets still mired in regulatory uncertainty.

According to Pieper, MiCA’s implementation “shouldn’t be viewed as a bad thing,” but rather as a positive step for crypto companies within the EU bloc. Those with a clear framework within which to operate will march forward confidently, something that cannot be said for US-based counterparts. 

It’s a “first-mover advantage” that companies like Swarm will certainly benefit from after having embraced regulation from the beginning. Swarm is regulated by Germany’s BaFin, and offers customers a chance to trade Real World Assets (RWAs) on-chain.

Regulation now a part of crypto

Looking ahead to MiCA implementation, Pieper says any pains likely to come from the new law will form part of the “growing” process for crypto. He opines that with things changing fast, regulation has become a necessary part of the industry’s growth.

“While some parts of crypto have an anti-government ethos, regulations are now a fact and resisting is no longer feasible,” he commented. “We know anecdotally there are roughly 300 organizations that are affected by this and need to register. The impending significant bottleneck and the potential of having to pause business operations is now very real for these organizations.” 

The US is being left behind

As Pieper rightly pointed out, the US is seen to be lagging Europe when it comes to crypto regulation .In deed, as CoinJournal highlighted, a senior UK minister recently indicated it could release its own crypto rules within a year.

Across the Atlantic, this week’s fiasco that was SEC Chair Gary Gensler’s responses on the subject of crypto at a Congressional hearing left many unimpressed. The SEC chief’s lack of clarity when handling some of the questions has been heavily criticised. 

Messari founder Ryan Selkis called the hearing a “train wreck” in relation to Gensler’s responses.

1/ It’s been 24 hours to reflect on Chair Gensler’s absolute train wreck of an oversight hearing yesterday.

Schadenfreude is satisfying, but here’s the substance of how ineffective, and out-of-touch the Biden admin’s financial regulators are right now.

— Ryan Selkis 🪳 (@twobitidiot) April 19, 2023

Some of the other most scathing comments came from Congressional Republicans, who have pointed out that the SEC cannot ask exchanges, for instance, to “come in and register” when there are no clear guidelines on the process.

Coinbase CEO Brian Armstrong shared his frustration at the lack of clarity this week, noting the US-based crypto exchange could relocate its base if the American regulatory environment remained as it is. 

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• The MiCA Act was first introduced in 2020.
• The European Parliament had previously postponed voting on legislation two consecutive times.
• The MiCA act now awaits approval from the European Council to be published as an effective regulation.

After two consecutive vote postponements since the Markets in Crypto-Assets Act, known as MiCA was introduced in 2020, the European Parliament has now voted to adopt the legislation. The legislation will now move to the next step which is approved by the European Council before being adopted as law.

MiCA’s rapporteur and the Member of the European Parliament posted a tweet immediately after the voting On April 20 reporting that the bill has been adopted:

Habemus MiCA! Das EU-Parlament hat die #Regulierung angenommen. Ein Meilenstein für die #Krypto-Asset-Industrie. Danke an alle Kollegen und auch für den ganzen Support der Community hier! #MiCA 🎉 @btcecho @DECointelegraph pic.twitter.com/avPmOE2Vl0

— Stefan Berger (@DrStefanBerger) April 20, 2023

Harmonized European crypto rules

The European policymakers aim at using the MiCA legislation to set a standard regulation for harmonized crypto rules and provide legal certainty for crypto assets in the EU.

The legislation provides guidelines for the operation, structure and governance of digital assets issuers. It will also offer rules on disclosure and transparency requirements for issuing and trading cryptocurrencies.

However, while MiCA is seen as a huge step toward crypto regulation in the EU, there are still a number of issues that some crypto players do not agree with in the 400-page document. For instance, the current draft does not mention decentralized finance (DeFi), crypto lending, or crypto staking, and does not provide any rules for nonfungible tokens (NFTs).

The head of EU policy at Chainalysis recently pointed out that the success of MiCA would depend on the reworking of certain parts of the document and robust feedback from players. Others like Caisse des Dépôts Group’s blockchain program director Nadia Filali stressed on the importance of regulators, governments, and industry participants collaborating to develop the rules.

The EU officials however emphasize that the safety of crypto investors is the main aim of MiCA.

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Key takeaways

• Andrew Griffith has estimated that the UK could roll out its crypto regulation within a year.

• He pointed out that the UK is working hard to become a crypto hub, promoting innovation while ensuring progressive regulation.

• Coinbase’s CEO recently revealed that the crypto exchange could relocate from the US due to regulatory uncertainties.

UK’s crypto regulation could be out soon

Andrew Griffith, the economic secretary to the U.K. Treasury, told CNBC in an interview earlier this week that the United Kingdom could roll out digital asset regulation within 12 months. 

According to Griffith, the UK wants to take advantage of the benefits that blockchain technology can bring to the private sector and the economy. The senior minister added that the long-term vision is to enable firms to make the most of the opportunities from crypto assets while ensuring sound regulation. 

He pointed out that the UK government is well-positioned to regulate the crypto ecosystem in a proportionate manner. The UK’s exit from the European Union allows it to look at crypto regulation independently of the broader Europe. He said;

“I think over the next 12 or so months is the window. We’ve got this great asset in the U.K., we’ve got control back of a rule book — not something the U.K. has had for decades — so we’ve got the ability to move in an agile and proportionate way.”

The senior minister added that the United Kingdom is currently in a growth mindset as seeks to maximise the economic efforts led by tech innovation in the private sector.

Crypto regulatory framework to consist of new and existing rules

According to Griffith, the cryptocurrency regulatory framework would be a combination of existing financial asset laws and new crypto-specific rules. He stated that;

“Wherever possible, we want to see the same asset regulated in the same way, but there are some additional opportunities in the crypto asset or distributed ledger space, and we want to take advantage of that.”

He revealed that the regulation of stablecoins is included in the financial services bill, and it is coming even sooner than the broader crypto regulatory framework. 

When asked about the UK’s efforts regarding a central bank digital currency (CBDC), Griffith said it would take time before it is launched. He said

“If you’re going to have a sovereign digital currency, you’ve got to have the highest level of resilience and infrastructure, so that’s not going to happen overnight.”

This latest cryptocurrency news doesn’t come as a surprise, as the UK is one of the leading global financial hubs. 

Earlier this week, Coinbase’s CEO Brian Armstrong spoke at the Fintech Week in London, revealing that the crypto exchange could relocate from the United States due to regulatory uncertainties. 

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• Zipmex says it filed for the court extension as it seeks to find a solution that suits its customers and an investor.
• The moratorium was put in place following Zipmex’s bankruptcy filing in July last year.
• The cryptocurrency exchange says it is negotiating with new investors even as it engages the current one.

Zipmex, a cryptocurrency exchange that filed for bankruptcy amid last year’s crypto market contagion, has provided an update to its investment deal.

Per an announcement published today, Zipmex says it is seeking an extension to the moratorium currently in place amid its bankruptcy proceedings. 

The exchange revealed that it had filed for a two-month extension from the Singapore bankruptcy court after an investor delayed payments agreed upon as part of the exchange’s restructuring.

Zipmex Asia seeks 2-month moratorium extension

After missing the March tranche of payments and impacting Zipmex’s Z Wallet operations, the said investor asked for the investment agreement – the Scheme of Arrangement – to be modified. The investor reportedly also sought the crypto exchange to modify the investment amount.

“As of today, the investor claims that the SSA has lapsed and that it is no longer bound to abide by the terms of the SSA. The investor has also demanded a return on its working capital loan,” Zipmex wrote.

According to the update, Zipmex is now in talks with the investor as it looks to find a solution that would suit all parties. Knowing that the delay impacts customer withdrawals and the planned reopening of Z Wallet, the company has also begun negotiating with new investors.

This is why the Zipmex team is looking to have the moratorium extended for two months to allow it to find the best possible solution for its customers.

As CoinJournal reported, the Southeast Asia exchange halted withdrawals in July before filing for bankruptcy protection. At the time, Zipmex revealed $5 million and $48 million exposure to collapsed Celsius Network and Babel Finance respectively.

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