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Nigeria’s SEC Proposes Significant Fee Hikes for Crypto Exchanges

The Securities and Exchange Commission (SEC) of Nigeria has put forward a proposal to amend the rules governing platforms offering crypto services, suggesting a substantial increase in registration fees for crypto exchanges. The proposed amendment includes raising the registration fee from 30 million naira to 150 million naira, among other adjustments. These proposed changes, aimed at providing clarity and incorporating feedback from industry stakeholders and engagements with the Central Bank of Nigeria, reflect a significant shift in the regulatory landscape for crypto businesses in the country. The amendments also include renaming the rules to encompass a broader scope of digital asset activities. While the SEC attributes the adjustments to stakeholder input, concerns have been raised regarding the steep capital requirement, which could potentially favor foreign entities over local firms. This move comes amidst Nigeria's growing prominence in the global crypto economy and its...

Former IcomTech Promoters Convicted of Wire Fraud Conspiracy

A New York jury has delivered guilty verdicts against David Brend and Gustavo Rodriguez, former promoters of the alleged crypto mining and trading company IcomTech, for their involvement in a wire fraud conspiracy. The conviction carries a maximum sentence of 20 years for each defendant, marking the culmination of a two-week trial in a New York District Court. The U.S. Attorney's Office for the Southern District of New York revealed that IcomTech, purportedly a crypto mining and trading firm, was actually a Ponzi scheme orchestrated by its founder, David Carmona. Rodriguez, hired by Carmona in mid-2018, played a pivotal role in creating a website and maintaining a portal that falsely displayed guaranteed daily returns from crypto trading and mining. Brend and other promoters of the scheme allegedly diverted substantial sums of investor funds for personal use, including purchasing real estate, extravagant travel, and hosting lavish events to entice further investments. As complaints...

Hong Kong’s Securities and Futures Commission Issues Warning Against Bybit Exchange

The Securities and Futures Commission (SFC) of Hong Kong has issued a public warning regarding Bybit, a global cryptocurrency exchange, labeling it as an "unlicensed virtual asset trading platform (VATP)." The SFC expressed concerns about various products offered by Bybit, including futures contracts, options, leveraged tokens, and wealth management services. Notably, the SFC highlighted that no entity within the Bybit group is licensed or registered to conduct regulated activities in Hong Kong, emphasizing that dealing in crypto-related products without proper authorization constitutes a criminal offense. Bybit has been added to the SFC's list of Suspicious Virtual Asset Trading Platforms and Suspicious Investment Products. Despite Bybit's application for a VATP license in Hong Kong, concerns persist regarding its compliance with regulatory standards. The warning issued by the SFC against Bybit serves as a stark reminder of the regulatory scrutiny surrounding crypto exchanges and...

Dubai International Financial Centre (DIFC) Enacts Groundbreaking Digital Assets Law

The Dubai International Financial Centre (DIFC) has taken a significant step forward in recognizing and regulating digital assets with the enactment of what it calls the "world's first" digital assets law. This landmark legislation, which amends various existing laws within the DIFC framework, acknowledges the existence of digital assets and provides a comprehensive legal framework for their treatment. The Digital Assets Law revises laws related to contracts, insolvency, damages, obligations, securities, and personal property to accommodate the unique characteristics of digital assets. It introduces new definitions and classifications for these assets and outlines protocols for their control, transfer, and management by relevant parties. Jacques Visser, Chief Legal Officer at DIFC Authority, emphasized the pioneering nature of this law, highlighting its role in establishing legal clarity and certainty around digital assets. He noted that the legislation represents a significant...

SEC Charges 17 Individuals in $300 Million Crypto Ponzi Scheme

The United States Securities and Exchange Commission (SEC) has brought charges against 17 individuals involved in an alleged cryptocurrency Ponzi scheme operated under the guise of CryptoFX LLC. The scheme targeted predominantly Latino investors in the U.S., promising substantial returns through crypto and foreign exchange trading. According to the SEC, CryptoFX posed as a trading platform for crypto assets and foreign exchange markets, with the charged individuals acting as leaders of the network. They solicited investments from over 40,000 investors, luring them with promises of guaranteed returns ranging from 15% to 100%. However, instead of engaging in legitimate trading activities, the perpetrators allegedly used the funds raised to sustain their own lifestyles and pay returns to earlier investors, characteristic of a Ponzi scheme. The SEC's Director of Enforcement, Gurbir S. Grewal, described CryptoFX as a "$300 million Ponzi scheme" that preyed on investors' aspirations for...

US Senators Urge SEC to Reconsider Crypto ETP Approvals

US Senators Jack Reed and Laphonza Butler have called on Securities and Exchange Commission (SEC) Chairman Gary Gensler to halt the approval of further crypto exchange-traded products (ETPs) beyond Bitcoin. Their letter to Gensler emphasizes concerns over investor protections in the volatile crypto market, citing misleading communications from brokers and potential confusion over naming conventions. The senators' letter reflects apprehensions about the accessibility of volatile cryptocurrency investments to the general public through brokerage and retirement accounts. They highlight a review by the Financial Industry Regulatory Authority (FINRA), revealing that 70% of broker communications with retail investors regarding cryptocurrency breached fair disclosure rules, raising concerns about investor knowledge and protection. The letter particularly addresses the labeling of Bitcoin ETPs as "exchange-traded funds" (ETFs), expressing worries that investors may be misled into believing...

Hong Kong Expands e-HKD Pilot Programme to Explore CBDC Applications

Hong Kong is advancing its e-HKD Pilot Programme to explore the potential of a digital version of the Hong Kong dollar (e-HKD). Phase 2 of the program, following the completion of Phase 1 in October 2023, aims to delve deeper into specific areas where an e-HKD could offer unique advantages, including programmability, tokenization, and atomic settlement. The Hong Kong Monetary Authority (HKMA) will leverage an enhanced sandbox environment to facilitate innovation and development, allowing participants to accelerate the prototyping, development, and testing of e-HKD use cases. The expansion of the e-HKD Pilot Programme reflects Hong Kong's commitment to exploring the potential applications of central bank digital currencies (CBDCs) within its financial system. By focusing on programmability, tokenization, and atomic settlement, Phase 2 aims to unlock new possibilities for the e-HKD and streamline processes within the financial ecosystem. The HKMA's efforts, combined with its broader...

Banco Do Brasil and Giesecke+Devrient Collaborate to Enable Offline Payments for Brazilian CBDC

Banco Do Brasil, in partnership with Giesecke+Devrient, is exploring the integration of offline payment functionality into Drex, Brazil's upcoming central bank digital currency (CBDC). The initiative aims to extend financial services to individuals in remote areas with limited or no internet access. By introducing offline capabilities, Drex seeks to serve as a viable payment option in regions where internet connectivity is deficient, complementing cash transactions, which are prevalent in Brazil. The collaboration will involve testing the feasibility and technical compatibility of the offline solution within Drex's pilot program. Notably, this feature also aims to address crisis situations such as power or internet outages, providing a resilient payment alternative. Both partners emphasize the importance of ensuring accessibility and inclusivity for all users, reinforcing the need for a CBDC that operates seamlessly under various conditions. Drex is slated for launch by the end of...

El Salvador to Move Significant Bitcoin Holdings to Cold Storage

El Salvador is planning to transfer a substantial portion of its Bitcoin holdings to an offline, cold storage wallet for enhanced security. President Nayib Bukele announced the decision, revealing that the country's Bitcoin portfolio has reached a value of approximately $407 million. The move aims to safeguard the digital assets from online threats and ensure long-term protection. The decision to move a significant portion of El Salvador's Bitcoin holdings to cold storage reflects a proactive approach to securing valuable assets in the face of evolving cyber threats. By opting for offline storage, the government aims to mitigate risks associated with online hacking and theft, enhancing confidence in the security of its Bitcoin reserves. However, the move also underscores the persistent challenge of ensuring transparency and accountability in managing digital assets, especially in the absence of comprehensive disclosure regarding the exact size and distribution of the country's...

South Africa Approves 59 Licenses for Cryptocurrency Exchanges

The Financial Sector Conduct Authority (FSCA) in South Africa has granted operating licenses to 59 cryptocurrency exchanges, out of over 300 providers seeking permits. By law, digital-asset exchanges require permits to operate in the country, and the FSCA has been processing licensing applications in phases. The FSCA declared cryptocurrency assets to be financial products in 2022, necessitating their regulation to safeguard financial customers and mitigate risks. Exchanges were given until November 30 to apply for licenses or face enforcement action. FSCA Commissioner Unathi Kamlana emphasized the phased approach to processing licensing applications due to the high number received. South Africa's move to regulate cryptocurrency exchanges reflects global trends toward increased oversight of the crypto industry. By requiring licenses for digital-asset exchanges, the FSCA aims to protect consumers from financial risks and ensure compliance with anti-money laundering and...

Thailand Introduces Crypto Tax Break to Boost Investment Token Use

Thailand's Revenue Department has approved a tax break for holders of investment tokens, exempting them from personal income tax. The aims is to promote the use of investment tokens for fundraising and stimulate economic growth. Investment tokens are digital assets issued by businesses to raise funds, often through Initial Coin Offerings (ICOs) or Security Token Offerings (STOs). These tokens represent ownership or rights to a company's assets or profits. The tax break comes as part of Thailand's efforts to embrace blockchain and crypto technology. Kulaya Tantitemit, director-general of Thailand’s Revenue Department, emphasized the importance of digital tokens for investment, recognizing them as a tool for business operators to raise funds in the country. By providing tax incentives for investment token holders, Thailand hopes to encourage more businesses to explore alternative fundraising methods and facilitate economic expansion. Thailand's pro-crypto stance is further demonstrated...

Australian Court Dismisses Regulator’s Case Against Finder Wallet

An Australian court has dismissed a case brought by the nation’s market regulator, the Australian Securities and Investment Commission (ASIC), against Finder Wallet. The court found that the product offered by Finder Wallet, called Finder Earn, did not qualify as a debenture as alleged by the ASIC. Consequently, the court ruled in favor of Finder Wallet and ordered the ASIC to pay the defendant’s costs. This decision marks a significant victory for the crypto industry in Australia, as it shows the need for clear regulatory guidance and collaboration between policymakers and industry players. The dismissal of the ASIC's case against Finder Wallet is a notable development in the regulatory landscape of the crypto industry in Australia. It underscores the importance of precise legal definitions and clear regulatory frameworks to avoid confusion and unnecessary legal battles. The court's decision sets a precedent for future cases involving crypto assets and regulatory compliance in the...

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