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Taiwan’s Major Crypto Exchanges Form Association to Align with Upcoming Regulations

by Blockchain NewsSeptember 27, 2023

Key Takeaways

Taiwan’s leading crypto exchanges form an industry association ahead of new regulations.

The association aims to facilitate dialogue with regulators and integrate the crypto industry.

Nine exchanges are currently part of the preparatory group for the association.

As Taiwan’s Financial Supervisory Commission (FSC) prepares to unveil its “Guiding Principles for the Management of Virtual Asset Service Providers (VASPs)” in September, the country’s major crypto exchanges have taken proactive steps. They have formed a preparatory group, known as the Taiwan VASP Association Preparatory Committee, in early September. The initiative is expected to become legally effective in October, following the government’s release of its crypto framework.

Unified Industry Efforts

The preparatory group consists of nine crypto exchanges, including the first three founders: MaiCoin Group, BitoGroup, and Ace Exchange. Other members are BitstreetX, Hoya Bit, Bitgin, Rybit, Xrex, and Shangbito. “The association is a family and a beacon. It guides us in the direction, collects information, sets standards, builds consensus, speaks on our behalf, and leads us to further progress,” said Wang Chenhuan, President of Ace Exchange.

Regulatory Alignment

The association aims to align with the upcoming regulations by the FSC. “We have a responsibility to lead industry partners in perfecting infrastructure and regulations,” said Zheng Guangtai, Founder and CEO of BitoGroup. He added that BitoGroup has accumulated rich experience in areas like cybersecurity, internal control, anti-money laundering, and counter-terrorism financing over the past decade.

Broadening the Ecosystem

The association is not limited to exchanges and aims to include other key players like traditional banks, fintech firms, accountants, and insurance companies. “The most important work at this stage is to play the role of internal communication. Only through unity and cooperation can we build a robust industry chain,” said Xiao Huizong, Co-founder and Chief Revenue Officer of Xrex.

Transparency and Future Plans

The preparatory group holds weekly meetings every Tuesday afternoon, and the minutes are publicly available on GitBook to ensure transparency. They plan to submit their application to the Ministry of the Interior by mid-October, aiming for the formal establishment of the Taiwan VASP Association by the end of the year.

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South Africa Sets Year-End Licensing Deadline for Crypto Exchanges

by Blockchain NewsJuly 4, 2023

According to Bloomberg, South Africa has mandated that all crypto exchanges operating within its borders must secure licenses by the end of the year. The Financial Sector Conduct Authority (FSCA), the country’s financial regulator, has already received approximately 20 applications since the licensing process was initiated a few weeks ago.

FSCA Commissioner Unathi Kamlana has warned that the regulator will take enforcement action against firms that continue to operate without a license beyond the November 30 deadline. This could result in these firms being shut down or fined. Kamlana explained that the regulatory framework was introduced due to the potential harm that financial customers could face when using crypto products.

South Africa, Africa’s most developed economy, is the first country on the continent to require digital asset exchanges to secure licenses. This move affects several major trading venues that originated from South Africa, including Luno, owned by Digital Currency Group, and Pantera-backed VALR. Global platforms such as Binance that operate in the country will also need to secure licenses.

The trend of intensifying regulations is not confined to South Africa alone. Yesterday, the Monetary Authority of Singapore (MAS) announced that crypto service providers in Singapore are required to place customer assets into a statutory trust by the end of the year for secure storage. This action underscores a global shift towards more stringent regulation in the cryptocurrency sector.

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Tagged : Crypto / Crypto Exchanges / FSCA / News / South Africa

Nigeria Plans to Regulate Digital Asset Platforms

by Blockchain NewsMay 1, 2023

Nigeria, one of the most curious nations about cryptocurrencies, is preparing new industry regulations for digital asset platforms. The Nigerian Securities and Exchange Commission (SEC) is considering new regulations that would allow licensed digital exchanges to list tokens backed by certain assets, according to a report by Bloomberg.

Abdulkadir Abbas, the head of securities and investment at the Nigerian SEC, noted that the authority plans to only authorize listings of tokens based on assets such as equity, debt, or property. Cryptocurrencies like Bitcoin and Ether will not be among those assets. The aim is to register fintech firms as digital sub-brokers, crowdfunding intermediaries, fund managers, and tokenized coins issuers. However, the SEC will not register crypto exchanges until the central bank provides clear regulations for the crypto market.

License applicants would undergo a year of “regulatory incubation,” during which the SEC would study their operations and render their services in the country, according to Abbas. He added that by the 10th month, the SEC should be able to make a determination whether to register the firm, extend the incubation period, or even ask the firm to stop operation.

The Central Bank of Nigeria had banned local banks from providing services to cryptocurrency-related platforms in early 2021. On the ban, the regulator cited high risks associated with trading cryptocurrencies such as Bitcoin. The central bank also promised to impose strict penalties for any lender or financial institution failing to comply with the directive.

Despite the ban, Nigeria has emerged as one of the most active countries in terms of adoption and curiosity about Bitcoin and other cryptocurrencies. Nigeria ranks second by search interest for the keyword “Bitcoin,” behind El Salvador, which adopted Bitcoin as legal tender in 2021, according to data from Google Trends. Other jurisdictions in the top-five crypto-curious countries list include Slovenia, Netherlands, and Switzerland.

Nigeria was also among the top 20 countries in terms of crypto adoption in 2022, according to Chainalysis’ crypto adoption index.

While prohibiting cryptocurrencies, the Central Bank of Nigeria has been actively promoting its central bank digital currency known as the eNaira. The eNaira reportedly saw increased adoption due to national fiat reserves facing severe shortages.

In conclusion, Nigeria is taking steps to regulate digital asset platforms, with the SEC considering allowing licensed digital exchanges to list tokens backed by certain assets. The country aims to register fintech firms as digital sub-brokers, crowdfunding intermediaries, fund managers, and tokenized coins issuers. However, the SEC will not register crypto exchanges until the central bank provides clear regulations for the crypto market. Despite the ban on cryptocurrencies, Nigeria has emerged as one of the most active countries in terms of adoption and curiosity about Bitcoin and other cryptocurrencies.

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Tagged : Crypto Exchanges / DIGITAL ASSET PLATFORMS / FinTech / News / Nigeria / SEC / Tokenized Assets

US Prosecutors Seek Lengthy Sentence for Crypto Shadow Bank Executive

by Blockchain NewsApril 19, 2023

US prosecutors are seeking a lengthy sentence for Reginald Fowler, a former minority owner of the Minnesota Vikings NFL team, over his alleged involvement in shadow banking practices through Crypto Capital Corp, an alleged crypto shadow bank. Fowler’s sentencing is scheduled for April 20, following his arrest in 2019 and subsequent charge with bank fraud, illegal money transfers, and conspiracy connected to his operation of an unlicensed money transmitting business.

In a request filed on April 18, US District Attorney Damian Williams requested a sentence of at least seven years imprisonment for Fowler, with a suggested range of 15 to 20 years to reflect the seriousness of the offense. Williams argued that Fowler’s actions as an unlicensed money transmitter and his alleged deception of financial institutions warranted a significant penalty.

Fowler established a firm called Global Trading Solutions (GTS) in 2018 under the umbrella of the Panama-based Crypto Capital Corp, an alleged crypto shadow bank. Through GTS and Crypto Capital, Fowler is alleged to have provided shadow banking services to several crypto exchanges including Bitfinex, Binance, CEX.io, and QuadrigaCX. Between February and October 2018, GTS and Crypto Capital processed approximately $750 million in cryptocurrency transactions, providing unlicensed crypto firms with unlawful access to the U.S. banking system, according to the filing.

The use of shadow banking practices by Crypto Capital and GTS came to light during the court case regarding Bitfinex’s failure to disclose the loss of $850 million in customer funds. Fowler and Crypto Capital were identified as key players in the case, which was settled in February 2022 with the firms ordered to pay $18.5 million in civil penalties and shut down New York trading operations.

The alleged involvement of Fowler and Crypto Capital in shadow banking practices highlights the risks associated with unlicensed money transmitting businesses and the potential for illegal activities to occur within the crypto industry. The case also underscores the need for stronger regulation and oversight of crypto exchanges and shadow banking practices to prevent illicit activities and ensure the integrity of the financial system.

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Tagged : CRYPTO CAPITAL CORP / Crypto Exchanges / News / REGINALD FOWLER / SHADOW BANKING / UNLICENSED MONEY TRANSMITTING

South Koreans transacted $4.3 billion through illegal crypto exchanges

by Blockchain NewsMarch 7, 2023

South Korea has been tightening its regulatory regime towards crypto exchanges, but it seems that some citizens are still engaging in illegal transactions. According to local sources, South Koreans transacted 5.6 trillion Korean won ($4.3 billion) through illegal crypto exchanges in 2022, a significant increase from the previous year. The Korea Customs Service provided the numbers, indicating that the overall amount of funds caught in economic crimes increased from 3.2 trillion won ($2.5 billion) in 2021 to 8.2 trillion won ($6.2 billion) last year.

Out of all the illicit money traffic captured by officers, crypto transactions comprised almost 70%. However, the total amount of intercepted digital assets ($4.3 billion) only accrues for 15 transactions. These transactions were aimed at purchasing foreign virtual assets with the intention of selling them in the country later. This is because the South Korean regulatory regime isolates the local market and makes the prices of foreign crypto higher for customers.

The government has been cracking down on illegal crypto exchanges since 2017, when the Foreign Exchange Transactions Act required entities involved in crypto transactions to get regulatory approval from the Financial Services Commission. Hence, the attempts to participate in the global crypto trade, from foreign players coming to the Korean market or domestic investors seeking a better exchange course abroad, are labeled “illegal.”

In August 2022, the Korea Financial Intelligence Unit took action against 16 foreign-based crypto firms, including KuCoin, Poloniex, and Phemex. All 16 exchanges have purportedly engaged in business activities targeting domestic consumers by offering Korean-language websites, running promotional events targeting Korean consumers, and providing credit card payment options for cryptocurrency purchases. These activities all fall under the Financial Transactions Report Act.

The Korean customs also reported detaining 16 individuals involved in illegal foreign exchange transactions connected to crypto assets worth roughly $2 billion. These cases demonstrate the government’s determination to crack down on illegal crypto transactions and to promote a safe and regulated crypto market.

However, some critics argue that the South Korean government’s regulatory regime is too strict, which has led to the country missing out on potential economic benefits. They suggest that a more balanced approach should be taken to ensure that the country can benefit from the growing crypto market while still maintaining a safe and regulated environment. Regardless, it is clear that illegal crypto exchanges are still a significant issue in South Korea, and the government will continue to take action to address this problem.

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Tagged : Crypto Exchanges / ECONOMIC CRIMES / ILLEGAL TRANSACTIONS / News / REGULATORY REGIME / South Korea

UK Requests Crypto Exchanges to Report Suspected Sanction Breaches

by Blockchain NewsSeptember 5, 2022

Cryptocurrency exchanges are now requested to report suspected sanctions breaches to UK authorities under new rules recently introduced amid concerns that cryptos are being used to evade restrictions imposed in response to Russia’s invasion of Ukraine.

The Guardian media reported the matter on Sunday., citing the updated official guidance of HM Treasury’s Office of Financial Sanctions Implementation (OFSI) on August 30. The regulator explicitly included cryptocurrencies and other valuable digital assets like non-fungible tokens (NFTs) among those that must be frozen if sanctions are imposed on an individual or a company.

The rules set by the regulator now mean that crypto exchanges commit a criminal offence if they fail to report customers designated for sanctions.

Under the latest regulation, crypto exchanges must immediately act if they suspect that one of their clients is under sanctions or if they suspect a breach of sanctions.

The new policy has given such exchanges obligations similar to just the likes of professionals like estate agents, accountants, lawyers, and jewellers.

Financial sanctions on people and firms linked to the regime of Vladimir Putin have been among the UK’s most prominent responses to the Ukraine invasion.

Targets for sanctions have included Russian oligarchs and relatives with direct interests in crypto assets, including Vladimir Potanin, Said Gutseriev, and Oleg Deripaska, among others.

In April, Binance cryptocurrency exchange blocked the accounts of relatives of Russian politicians, including Polina Kovaleva, the stepdaughter of the foreign minister, Sergei Lavrov, Russian Foreign Minister, and Elizaveta Peskova, the daughter of Putin’s spokesperson, Dmitry Peskov.

This came as a response by the western powers led by the US, the UK, and the EU imposing unprecedented financial sanctions on Russia. During that time, fears amounted to Russian companies considering using cryptocurrency for international payments to dodge sanctions.

Using crypto to evade sanctions and move money across the globe was already illegal under UK laws. However, the new changes underline authorities’ concern that the new asset class could be used for evading sanctions because users do not depend on regulated entities to make transactions.

Whether Russia may try using cryptocurrencies to evade sanctions has been an open discussion since March this year. And decentralized finance (DeFi) and decentralized exchanges (DEX) platforms are seen as particularly vulnerable.

Cryptocurrencies have already been used to evade sanctions in Iran and North Korea.

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Tagged : Crypto Exchanges / OFFICE OF FINANCIAL SANCTIONS IMPLEMENTATION / Regulation / Russia / Sanctions / THE HM TREASURY / UK / Ukraine

MAS to Tighten Oversight on Crypto Exchanges as it Looks Toward Functional Regulations

by Blockchain NewsAugust 28, 2022

The Monetary Authority of Singapore (MAS) is currently making several inquiries from crypto companies within its borders in preparation for more comprehensive crypto regulation.

According to a Bloomberg report, the proposed regulation may turn out to be too strict for crypto firms to operate freely.

The Singapore government has often boasted of a safe hub for cryptocurrency trade with its fair regulations on digital assets. That narrative is now gradually changing.

The various events that have rolled out as a result of the prolonged crypto winter, witnessing the bankruptcy of some crypto firms in Singapore, as well as the loss of investments in crypto assets have now attracted the attention of the MAS.

While the source cited in the Bloomberg report remains anonymous, it was confirmed that questionnaires have been sent to licensed crypto companies in Singapore, demanding to know the total token in their reserves, how they are connected with other lending firms, and the tokens staked through DeFi protocols.

The current regulation adopted by the MAS only covers issues relating to crimes such as money laundering, fraud, and terrorism. This new development, however, will usher in the unveiling of new and modified regulations regarding cryptocurrencies in Singapore.

A spokesperson for MAS notes that both the licensed and applicant crypto vendors in the country are to report to the MAS on whatever challenges their business may be experiencing so as to salvage the situation before it becomes irreparable.

A legal professional in Singapore, Hagen Rooke said that the numerous uncertainties that have plagued the crypto ecosystem in Singapore have spurred the MAS to reconsider its regulations on crypto. He added that “it is possible that measures under consideration include requirements for MAS-regulated firms to obtain collateral when lending crypto,” so as to minimize risks remarkably.

While trading cryptocurrency involves lots of risks, Singapore’s financial watchdog, MAS has often deployed various measures to ensure a safe haven for crypto users within its borders.

In July, the regulator announced through its senior minister, Tharman Shanmugaratnam that it will be imposing stricter measures on cryptocurrency trade within its borders.

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Tagged : Crypto Exchanges / Mas / Regulation

Uzbekistan Blocks Binance among Foreign Exchanges Operating in the Country

by Blockchain NewsAugust 12, 2022

Uzbekistan has blocked the websites of global cryptocurrency exchanges operating their services in the country, according to ForkLog media company reported the matter on Thursday.

According to ForkLog, the National Agency of Perspective Projects (NAPP), the industry regulator in the Republic of Uzbekistan, announced on Wednesday that it has restricted access to crypto exchanges and over-the-counter brokerage firms because the country’s regulations don’t allow citizens to trade cryptocurrencies on foreign platforms.

The agency told Forklog that foreign platforms that offer crypto services in Uzbekistan must obtain a service provider license to operate in the nation.

The NAPP said the only exchange that has received a license is the local exchange UzNEX.

The regulator accused foreign platforms of requesting personal data of the country’s residents without considering the requirement to install servers in the jurisdiction of Uzbekistan.

“We are always ready to consider applications for a license from all major crypto exchanges if they are interested in starting their activities on the territory of Uzbekistan in accordance with the requirements of the law,” NAPP stated.

Gleb Kostarev, Binance’s head of Eastern Europe, confirmed that since Tuesday, the exchange’s website hasn’t been accessible for its users in Uzbekistan. The executive also mentioned that exchanges such as Huobi, FTX, Bybit, and others are also blocked.

Kostarev said Binance is engaging in discussions with Uzbekistan authorities about the exchange status in the country.

Establishing KYC Requirements

The NAPP recalled that in April this year, the Uzbekistan government issued a decree that said, from January 1, 2023, Uzbekistan citizens and legal entities are expected to conduct purchase transactions and sale of cryptocurrencies exclusively through local service providers.

The regulator said: “From the moment [the decree was published], we did not block foreign platforms, as we understand that our citizens have funds on these platforms. But this measure did not mean that citizens could safely trade on foreign platforms until January 1, 2023. There has already been a ban on this since 2019.”

In May, Uzbekistan President Shavkat Mirziyoyev established a regulatory framework for the nation’s crypto industry and gave the NAPP more authority in overseeing the industry.

On April 27, President Mirziyoyev issued a directive that crypto exchanges, mining pools, and crypto custodians operating in their services in the Central Asian country must be registered locally.

As of January 1 2023, the directive expects Uzbekistan residents to be able to purchase or sell cryptocurrencies only on the local exchanges, which must verify the identity of users through a Know-Your-Customer (KYC) process and store data about all transactions for five years.

The directive assigned new responsibilities to the NAPP and ordered the agency restructured. The agency is now responsible for developing new policies for crypto and ensuring that such digital assets are not used for money laundering and terrorism financing.

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Tagged : Crypto Exchanges / Exchanges / Regulation / Uzbekistan

Uzbekistan Blocks Binance Operating in the Country, Except UzNEX

by Blockchain NewsAugust 12, 2022

Uzbekistan has blocked the websites of global cryptocurrency exchanges operating their services in the country, according to ForkLog media company reported the matter on Thursday.

The agency told Forklog that foreign platforms that offer crypto services in Uzbekistan must obtain a service provider license to operate in the nation.

The NAPP said the only exchange that has received a license is the local exchange UzNEX.

The regulator accused foreign platforms of requesting personal data of the country’s residents without considering the requirement to install servers in the jurisdiction of Uzbekistan.

Kostarev said Binance is engaging in discussions with Uzbekistan authorities about the exchange status in the country.

Establishing KYC Requirements

In May, Uzbekistan President Shavkat Mirziyoyev established a regulatory framework for the nation’s crypto industry and gave the NAPP more authority in overseeing the industry.

On April 27, President Mirziyoyev issued a directive that crypto exchanges, mining pools, and crypto custodians operating in their services in the Central Asian country must be registered locally.

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Tagged : Crypto Exchanges / Exchanges / Regulation / Uzbekistan

Bitcoin’s Balance on Exchanges Hits a 4-Year Low Amid Traders Becoming Overly Optimistic

by Blockchain NewsJuly 16, 2022

As Bitcoin (BTC) continues hovering around the $20K area, the balance on exchanges is shrinking.

Market analyst Ali Martinez explained:

“The last time the BTC balance on exchanges was below 2.38 million BTC was in late July 2018 when Bitcoin was trading at around $8,000.”

Source:Glassnode

Bitcoin exiting crypto exchanges is bullish because it symbolizes a hodling culture, given that coins are often transferred to cold storage and digital wallets for future purposes other than speculation.

With BTC’s balance on exchanges dropping to a 4-year low, time will tell whether this will trigger the much-needed momentum to drive the leading cryptocurrency upwards based on its current consolidation around the psychological price of $20,000.

For the ranging market to be breached, Michael van de Poppe believes the $21,200 area should be broken. The CEO and founder of educational platform Eight stated:

“No break of $21.2K for Bitcoin means some more consolidation. On the other hand, the coming weeks are crucial for EUR/USD. It makes sense to have a slight reversal there, and I’m also expecting Bitcoin not to be done with the upside. Cracking $21.2K is a crucial one.”

Similar sentiments were shared by crypto trader Rekt Capital, who pointed out:

“It’s easy to become bullish on BTC on a green day & bearish on a red day. But BTC is still just between $19K-$22K. This will continue until either of these levels is broken.”

Bitcoin oscillated around the $20.6K zone during intraday trading, according to CoinMarketCap.

Meanwhile, Bitcoin traders are depicting high optimism levels, suggesting that they expect a bullish momentum. On-chain insight provider Santiment stated:

“Bitcoin’s mild +8% July rise has been enough for crypto traders to begin breaking out the lambo & moon mentions again. Whether sarcasm or not, this occurs when traders are becoming overly optimistic. Mentions hit their highest levels since Jan 18.”

Source:Santiment

Furthermore, BTC was one of the trending topics among investors due to high social dominance levels, Blockchain.News reported.

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Tagged : #BTC / Bitcoin / Crypto Exchanges / Cryptocurrencies / Investment / Market Analysis / PRICE ACTION