The Securities and Exchange Commission (SEC) is facing new controversy, as United States Representative Warren Davidson has announced plans to introduce legislation that would remove SEC Chair Gary Gensler from his role. The move follows the SEC’s proposed rule amendments, which could bring certain brokers under additional regulatory scrutiny and redefine an “exchange.” While Gensler has said the proposed changes could benefit investors and markets, SEC Commissioner Hester Peirce has criticized the move, accusing the regulator of stifling new technology and entrepreneurship.
Peirce, who is known as “Crypto Mom” for her pro-crypto positions, has criticized the SEC’s approach to crypto regulations. She believes that the SEC has been expanding its reach to solve problems “that do not exist” and has refused to alter current regulations to allow room for new technologies and new ways of doing business. Peirce has also accused the SEC of using the “notice-and-comment rulemaking process” as a threat. In her opinion, a concept release should have been issued instead of the proposed rule amendments, given the concerns over their ambiguity and scope, and the SEC’s “limited understanding” of the space.
The SEC has faced criticism for using enforcement actions to develop the law on a case-by-case basis, rather than creating clear regulations. The regulator has launched more than a few high-profile actions against crypto companies such as Ripple, LBRY, and Coinbase over alleged violations. It has also taken aim at staking and stablecoins, prompting some critics to argue that the SEC has been stifling innovation in the crypto space.
Meanwhile, Davidson’s proposed legislation to remove Gensler from his role as SEC Chair has raised eyebrows. Gensler is widely regarded as a tough regulator who is committed to protecting investors and ensuring market stability. He has previously served as chairman of the Commodity Futures Trading Commission (CFTC) and is known for his work in implementing the Dodd-Frank Act, which was designed to reform the U.S. financial system after the 2008 financial crisis.
In conclusion, the proposed legislation to remove SEC Chair Gary Gensler from his role is the latest development in a long-running debate over crypto regulations. While Gensler has said that the proposed rule amendments could benefit investors and markets, Commissioner Hester Peirce has accused the SEC of stifling innovation and entrepreneurship. The SEC has faced criticism for using enforcement actions to develop the law on a case-by-case basis, rather than creating clear regulations. It remains to be seen whether Davidson’s proposed legislation will gain traction, but it is clear that the debate over crypto regulations is far from over.
On December 28, Ajay Tyagi, the chairman of the Securities and Exchange Board of India (SEBI) encouraged mutual funds to resist investing in crypto-related assets as they wait for the government to consider new cryptocurrency rules.
While speaking at a press conference on Tuesday, Ajay advised mutual fund companies to refrain from investing in funds linked to crypto assets until the government clarifies the policy and regulatory framework.
The recent warning from SEBI comes after the assets management firm (AMC), Invesco mutual fund delayed its blockchain fund last month due to the uncertainty with the legislative. They did so even with approval from SEBI.
Invesco is not the only mutual fund in India wanting to get into the crypto space since earlier this month, Navi mutual fund also filed a draft with SEBI to have a blockchain index fund of funds (FoF) that will track the IndxxBlockain Index. However, the index does not track crypto assets directly but tracks mainstream firms such as Nvidia, Superior Micro units and other firms with crypto activities.
Nitin Sharma, a partner at Antler India and blockchain told Business Insider that it is prudent for regulated entities with public markets exposure to wait for clarity regarding the legality of digital assets as securities or commodities in India.
India Grappling To Develop Crypto Laws
As reported by Blockchain.News, India has already witnessed a high rise in crypto popularity despite the regulatory environment for cryptocurrencies in the country being suspicious. India’s cryptocurrency and regulation of the official Digital Currency Bill (2021) are still pending and awaiting approval from the cabinet.
The parliament has been discussing cryptocurrency during the winter session recently. The talks gained further momentum after a parliamentary standing committee on finance’s meeting with cryptocurrency stakeholders to identify opportunities and challenges that may arise due to crypto financing and investment.
The Indian government had plans to introduce the cryptocurrency and regulation of the official Digital currency bill, 2021, in the parliament for debate. However, the bill is not a priority for India’s lower house as it concludes the winter session.
Narendra Modi, Indian prime minister, has been vocal on the issues of cryptocurrencies in 2021, urging democratic nations to collaborate to gain more from cryptocurrencies and blockchain technologies. He also warned against their malicious use during the recent Sydney Dialogue.
During an MSNBC interview, Hillary Clinton continued to suggest hypothetical scenarios in which cryptocurrencies could destabilize the United States and called on the Biden administration to regulate them as she fears that state and nonstate actors manipulate the role of the U.S. dollar.
Related Reading | Inverse Signals: Why Bitcoin Weakness Is Attributed To Dollar Strength
Clinton warned people are only beginning to see the need to regulate the cryptocurrency markets and called to imagine “the combination of social media, the algorithms that drive social media, the amassing of even larger sums of money through the control of certain cryptocurrency chains,”
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The former presidential candidate has already voiced her unamicable views around cryptocurrencies before, seeing them as a threat for the United States.
Likewise, for Clinton, the nations of China and Russia are manipulative obstacles for the country.
We are looking at not only states, such as China or Russia or others, manipulating technology of all kinds to their advantage, we are looking at nonstate actors, either in concert with states or on their own, destabilizing countries, destabilizing the dollar as the reserve currency.
Clinton thinks that the Biden administration needs to address many questions regarding the role of cryptocurrencies in the U.S. nation and its economy, but added they might not have much time to do so.
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The Former Secretary of State hopes that the current administration will try to operate “exactly” in the way she thinks best based on what she has been “hearing from them”, meaning their views regulations match her hostility.
We certainly need new rules for the information age, because our current laws, our framework, it is just not adequate for what we are facing.
Is The U.S. Marching Towards More Crypto Hostility?
Last week, the Former Secretary of State made a similar warning during the Bloomberg New Economy Conference, where she stated that crypto represents a risk for the stability of the U.S. nation and currency (the U.S. dollar).
Clinton believes the “interesting and somewhat exotic effort” of crypto mining can undermine the role of the dollar and seemed to consider full-ban on cryptocurrencies similar to China’s:
It appears as though China is going to prevent outside technology payment systems, like the cryptocurrencies development, from playing a big role inside China. I think they recognize, giving their nationalism, perhaps earlier than other nations, that this could be a direct threat to sovereignty.
On the other side, Senator Pat Toomey had voiced back in September that the China ban was an advantage for the United States and tweeted his own opinion on the upside of innovation and economic liberty, which Hillary Clinton still fails to approach.
Beijing is so hostile to economic freedom they cannot even tolerate their people participating in what is arguably the most exciting innovation in finance in decades. Economic liberty leads to faster growth, and ultimately, a higher standard of living for all.
Furthermore, Jerome Powell has just been renominated as U.S. Federal Reserve Chair to face the accelerating inflation and other challenges the nation’s economy is facing. Powell has been warry around cryptocurrencies, but he has also stated he would not opt for a ban, but regulatory controls on stablecoins.
Related Reading | Bitcoin Heads Towards $35,000 as Biden Stimulus Hurts US Dollar
Crypto total market cap at $2.5 trillion in the daily chart | Source: TradingView.com
It seems UK users will soon be unable to access Monero on one of the leading crypto exchanges. There have always been concerns around the Bitcoin competitor regarding the absolute privacy that the digital asset confers. Until now, it remains impossible to track/trace Monero transactions, making it the ultimate privacy coin, and governments are worried that individuals will use this to evade taxes.
Another concern is around the use of the cryptocurrency as a criminal tool, although there is no definitive way to tell if this is true. However, it remains high enough on the list of concerns that even countries where cryptocurrencies are not illegal are clamping down on the cryptocurrency. The latest is the UK as regulations have pushed Kraken to remove access for its citizens.
Delisting Monero Over Regulations
In an email sent out to users that were posted on Reddit, Kraken outlines the reason for the delisting. The email explained that the crypto exchange was trying to be in compliance with UK regulations and as such, it will no longer be supporting Kraken (Payward Ltd) on its platform. The delisting will happen in a week and will affect trading activities around the privacy coin.
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Kraken announced in the email that as of November 26th, UK users will no longer be able to trade Monero (XMR) on the platform. All trading activities will cease including Instant Buy/Sell Services, order book trading on the XMR/BTC, XMR/USD, and XMR/EUR pairs.
In addition to halted trading services, UK users will also not be allowed to fund their balances with Monero on the exchange after November 26th. However, users will be able to withdraw all of their current Monero balance to other wallets or exchanges.
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XMR trading at $234 | Source: XMRUSD on TradingView.com
Margin trading is also affected and will slowly go into effect. On November 23rd, UK users will no longer be able to increase their Monero margin positions on the exchange but they can reduce it. Three days after, on November 26th, the exchange will force liquid all open margin positions and cancel all open orders.
In closing, the Kraken team said; “We appreciate your understanding and we apologise for any inconvenience caused. Should you have any questions, please do not hesitate to contact our support team.”
Why The Crackdown?
Monero is one of the few cryptocurrencies that manage to confer absolute privacy to their investors. This has made it the coin of choice for investors who want to be in control of their own money. As this Reddit user eloquently puts it, it’s “One of the few coins that truly makes your money your own. Security without compromising privacy, something that was unheard of only a few years ago.”
Related Reading | New Record For Bitcoin Lightning Network As Adoption Grows
Monero is a cryptocurrency that has maintained the privacy component behind the creation of cryptocurrencies. It puts the investor in complete control and makes it impossible for a third party to interfere or see where the funds are going, and since governments cannot track it, then they cannot tax it. Hence the crackdown on privacy coins to limit their use by residents.
Featured image from Kraken Blog, chart from TradingView.com
Binance has launched a crypto rights campaign, outlining ten fundamental crypto rights and calling on industry leaders, regulators, policymakers, and users to help create policy surrounding crypto assets.
Binance Drafts Crypto Rights
The world’s largest crypto exchange is showing its commitment to regulation.
Binance launched a crypto rights campaign Tuesday morning, taking out its first advertisement in the Financial Times. The full-page spread starts with the controversial title “Crypto is evil” but goes on to outline ten fundamental crypto rights which the exchange says will help “unlock crypto for all.”
Our first ad ever, on Financial Times. pic.twitter.com/gnwNms6psq
— CZ 🔶 Binance (@cz_binance) November 16, 2021
Binance’s ad calls on “industry leaders, regulators, policymakers, and users to help shape the future of global finance together,” stating that decisions on crypto regulation should be decided by a nation’s policymakers and their constituents.
Many of the rights focus on working with regulators to establish a clear legal framework for crypto assets. “Like seat belts in a car, a more regulated crypto market provides greater protections for everyday users,” the ad reads. The ten crypto rights also highlight preventing financial crime, ensuring user data privacy, and comprehensive deposit insurance for assets held on exchanges.
In addition to the Financial Times ad, Binance has also created a website where users can view the exchange’s crypto rights campaign. At the bottom of the page, readers are encouraged to share their views with other leading crypto exchanges with links to the Twitter pages of FTX, Coinbase, Gemini, Kraken, and Crypto.com.
With the crypto rights campaign, Binance appears to be signaling its willingness to work with regulators. The exchange may be trying to make amends after receiving warnings from several national regulators over the summer. In August, Binance CEO Changpeng Zhao stated the exchange was “pivoting to proactive compliance” to address regulatory concerns.
Disclosure: At the time of writing this feature, the author owned BTC, ETH, and several other cryptocurrencies.
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The information on or accessed through this website is obtained from independent sources we believe to be accurate and reliable, but Decentral Media, Inc. makes no representation or warranty as to the timeliness, completeness, or accuracy of any information on or accessed through this website. Decentral Media, Inc. is not an investment advisor. We do not give personalized investment advice or other financial advice. The information on this website is subject to change without notice. Some or all of the information on this website may become outdated, or it may be or become incomplete or inaccurate. We may, but are not obligated to, update any outdated, incomplete, or inaccurate information.
You should never make an investment decision on an ICO, IEO, or other investment based on the information on this website, and you should never interpret or otherwise rely on any of the information on this website as investment advice. We strongly recommend that you consult a licensed investment advisor or other qualified financial professional if you are seeking investment advice on an ICO, IEO, or other investment. We do not accept compensation in any form for analyzing or reporting on any ICO, IEO, cryptocurrency, currency, tokenized sales, securities, or commodities.
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The first Bitcoin-based futures ETFs have been approved to operate in the U.S., though Bitcoin spot ETFs have not.
The two kinds of ETFs are regulated under different laws, which could explain the discrepancy.
Futures ETFs are more complex than spot ETFs, but may offer additional layers of risk management.
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The first Bitcoin futures ETF in the U.S. went live on the New York Stock Exchange this week. However, there’s still a lot of confusion over how it differs from a spot-based ETF.
As ProShares’ Bitcoin futures ETF launches on the New York Stock Exchange, Crypto Briefing unpacks the differences between futures and physical ETFs.
How ETFs Are Regulated
The crypto industry has taken a major step toward mainstream adoption this week, with the first Bitcoin-based ETF launching in the U.S. ProShares’ Bitcoin futures ETF went live on the New York Stock Exchange Tuesday and several other funds are expected to receive approval for similar products later this month.
While crypto enthusiasts have welcomed the SEC’s decision to approve a Bitcoin futures ETF, many have questioned the agency’s reluctance to approve a Bitcoin spot ETF. The SEC has rejected dozens of applications since 2013, with no clear indication that it intends to change its stance. The clear difference between futures-based ETFs and physical ETFs may explain the decision.
One of the biggest differences between the two types of ETFs lies in the regulatory framework, as they both go through different pathways. Physical ETFs are ruled via the 1933 Securities Act process, which requires exchanges to file a Form 19b-4 to show that the underlying market is not subject to manipulation. In contrast, futures-based ETFs are ruled via the 1940 Investment Company act and therefore do not require the same form.
Cryptocurrency spot markets are largely unregulated, whereas regulations in futures markets offer some clarity for investors. In the case of ProShares’ Bitcoin futures contracts, it’s the Commodity Futures Trading Commission that has set the rules.
The CFTC’s presence as a federal regulator in the futures market may explain why the SEC has been open to ETFs like the one ProShares launched. On the other hand, while there is no federal regulatory regime for spot crypto markets, applications for spot Bitcoin ETFs have consistently been rejected.
Bitcoin Spot vs. Bitcoin Futures ETFs
A Bitcoin spot ETF would give many retail investors a way to gain direct exposure to the asset while removing the hassle and complexity associated with acquiring and storing it in a cryptocurrency wallet. According to BitwiseInvestCIO Matt Hougan, financial advisors control 40% of all assets in the U.S. Under the current regulations, they are not allowed to invest in cryptocurrencies on behalf of investors. As such, while many have celebrated the launch of the first Bitcoin futures ETF, a spot fund offering exposure to Bitcoin would arguably be a bigger catalyst for the institutionalization of the asset.
Futures-based ETFs differ in that they offer investors access to futures contracts rather than any asset. Futures contracts are legal agreements to buy or sell a commodity, asset, or security at a predetermined price at a specified time in the future. They offer a different risk profile to spot-based investing.
A futures-based ETF tracks futures contracts via the CME-listed futures markets as opposed to tracking the spot price of the underlying asset. Therefore, the price of the ProShares ETF will not be the same as the price of Bitcoin.In addition, with cash-settled futures, none of the underlying assets actually trade hands (i.e., there is no on-chain BTC activity).
CME Bitcoin futures are cash-settled and designed to track theCME CF Bitcoin Reference Rate (BRR), a price index based on the aggregated average trade price from several BTC exchanges, including Bitstamp, Coinbase, Gemini, itBit, and Kraken.Every futures contract has an expiration date and, in the case of BTC, contracts are listed for six consecutive months.
Often traders will “roll over” futures contracts by selling those whose maturity dates are fast approaching and then buying others whose expirations are further out by a few months. This rollover incurs a cost, or what is more commonly known as “contango” (i.e., when the futures price of a commodity becomes higher than the anticipated spot price at the same point in the future).
A Bitcoin spot ETF would remove the costs and price tracking issues associated with futures contracts. It would also be a simpler product for the retail market. However, unless the SEC changes its position, the Bitcoin futures ETFs will be the closest alternative product available on the stock market.
The first Bitcoin futures ETF launch has sparked debate surrounding the potential impact on the crypto market, and how an ETF offering direct exposure to Bitcoin would change the landscape. Many believe that a spot Bitcoin ETF would be a bigger step for the industry. While that may be true, as Bitcoin futures ETFs help increase mainstream crypto exposure and demand for liquidity due to institutional futures trading, it’s hard to argue that they won’t be a net benefit to the industry.
Disclaimer: At the time of writing, the author of this feature owned BTC and several other cryptocurrencies.
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The information on or accessed through this website is obtained from independent sources we believe to be accurate and reliable, but Decentral Media, Inc. makes no representation or warranty as to the timeliness, completeness, or accuracy of any information on or accessed through this website. Decentral Media, Inc. is not an investment advisor. We do not give personalized investment advice or other financial advice. The information on this website is subject to change without notice. Some or all of the information on this website may become outdated, or it may be or become incomplete or inaccurate. We may, but are not obligated to, update any outdated, incomplete, or inaccurate information.
You should never make an investment decision on an ICO, IEO, or other investment based on the information on this website, and you should never interpret or otherwise rely on any of the information on this website as investment advice. We strongly recommend that you consult a licensed investment advisor or other qualified financial professional if you are seeking investment advice on an ICO, IEO, or other investment. We do not accept compensation in any form for analyzing or reporting on any ICO, IEO, cryptocurrency, currency, tokenized sales, securities, or commodities.
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The High Court of Sindh (SHC), the highest judicial body in Pakistan’s Sindh Province, has asked the government to come up with modalities for cryptocurrency regulation.
According to Pakistani English daily The Express Tribune, the SHC gave the instruction while hearing a petition brought before the court challenging the legality of the country’s 2018 crypto ban.
The SHC instructed regulators such as the Securities and Exchange Commission of Pakistan (SECP) and the central bank to work with government agencies such as the Ministries of Information Technology and Law to develop crypto regulations within three months.
As part of the proceedings, the SHC also requested that a report on the steps taken to regulate cryptocurrencies be submitted in the same time period.
As previously reported by Cointelegraph, the SECP has been considering crypto regulations since November 2020.
Combating money laundering and terrorism financing is reportedly at the heart of government consultation surrounding cryptocurrencies especially amid pressure from the Financial Action Task Force.
The SHC’s instruction on Wednesday puts Sindh as the latest province to demand some form of recognition for cryptocurrencies in Pakistan.
Back in December 2020, the Khyber Pakhtunkhwa assembly called on the federal government to legalize crypto. At the time, the lawmakers pointed to the broad-based nature of digital currency adoption as an indication that cryptocurrencies were poised to replace fiat in the future.
Related:Pakistan’s central bank is ‘carefully studying’ CBDCs, says governor
In March, Khyber Pakhtunkhwa, another of Pakistan’s four provinces, announced plans to pilot crypto mining farms in the region.
Meanwhile, the State Bank of Pakistan (SBP), like many other central banks across the world, is also studying central bank digital currencies.
In a separate crypto-related case before the Lahore High Court involving stakeholders such as the SECP, the SBP and the federal government, the court asked for participants to present legal points on the matter in subsequent proceedings.
Lahore is the capital of Punjab, another of Pakistan’s four provinces.
Mohan Bhagwat, the head of the Rashtriya Swayamsevak Sangh, or RSS — a right-wing Hindu nationalist society — has urged India’s government to pursue crypto regulations “in the larger interest of society.”
According to Asian News International, the RSS chief made these remarks during his speech marking the celebration of the Hindu festive Dussehra.
Despite numerous reports of looming crypto bans, the narrative from government sources has been that stakeholders prefer to create a framework for regulating the market.
A coalition of pro-crypto entities was even able to secure a Supreme Court ruling that overturned a previous ban imposed by the central bank that prevented banks from offering services to cryptocurrency exchanges.
Bhagwat’s comments come amid reports of increasing crypto popularity in India despite the lack of a clear-cut regulatory framework for cryptocurrencies and numerous reports of a possible ban on virtual currencies.
In September, Cointelegraph reported that Indian crypto exchanges were preparing targeted advertising campaigns in preparation for the festive season. However, such content might need to adhere to ad disclaimer policies that educate viewers about the risks involved in cryptocurrency investments.
This growing crypto popularity has also reached India’s entertainment sector with Bollywood stars like Amitabh Bachchan launching their own cryptocurrencies or endorsing major exchanges in the country.
Related:Indian central bank remains anti-crypto, affirming ‘no change’ in its stance
Bhagwat’s stance could indicate a conservative repudiation of the spreading crypto acceptance among the more liberal segments of India’s society.
Indeed, the RSS chief also took streaming platforms to task for failing to censor some of their content from underage viewers.
Bhagwat claimed drug abuse was on the rise and that the money circulating in these markets was being used to promote “anti-national activities.”
Crypto exchange giant Binance has hired Mark McGinness, former head of international relations at the Dubai Financial Services Authority (DFSA), as its chief regulatory liaison officer.
According to an announcement issued on Thursday, Binance stated that McGinness will contribute to the company’s push towards better relations with regulatory bodies across the globe.
Indeed, McGinness is the latest Binance hire with expertise in regulatory compliance and engagement with financial regulators.
Before his stint with the DFSA, McGinness was also the head of international relations at the Australian Securities and Investment Commission.
The former DFSA executive has also held advisory positions at the International Monetary Fund.
In a conversation with Cointelegraph, McGinness stated that he plans to leverage the experiences gained and relationships cultivated during the course of his career to improving Binance’s standing with regulators, adding:
“I am looking forward to bringing this experience to Binance where I shall be working with these industry leaders and policymakers to assist not only in setting best practice and regulatory frameworks, but also in broadening their understanding of the blockchain and crypto industry.”
Commenting on McGinness joining the Binance compliance team, the company’s CEO Changpeng Zhao identified the former DFSA executive’s 30 years of experience working with regulators and other policymakers around the world.
Zhao called McGinness’s appointment “a huge step forward” for Binance especially as the business tries to navigate a stricter crypto regulatory climate.
Related:Binance hires former IRS-CI special agent to head intelligence division
As previously reported by Cointelegraph, Binance has been forced to discontinue several crypto trading services in many jurisdictions around the world.
In September, Binance blocked fiat deposits and spot crypto trading services for users in Singapore. The platform has also stopped offering crypto futures trading in Australia.
The exchange giant continues to be the subject of significant scrutiny from state agencies many of whom say Binance is not licensed to operate in their respective jurisdictions.
McGinness told Cointelegraph that Binance maintains a long-term commitment to the industry and is keen to create a “sustainable ecosystem around blockchain technology.”
“In addition to localizing our operations and business to comply with local regulations, we are striving for productive dialogue with regulators so that we can formulate best practices and regulations that are for the long-term benefit of all participants” McGinness wrote to Cointelegraph.
Earlier in October, reports emerged that Binance may situate its headquarters in Ireland. The exchange has been the subject of “globe-trotting” accusations by critics who say the platform’s actions are indicative of attempts to circumvent regulatory provisions.
Anthony Albanese, chief operating officer of Andreessen Horowitz’s (a16z) crypto division, and Katie Haun, general partner at the firm, are among a high-powered delegation from the venture capital giant that will engage with lawmakers and administration officials in the United States on crypto regulations.
According to CNBC on Wednesday, the move is part of efforts by the Silicon Valley-based VC outfit to promote favorable regulation of the emerging Web 3.0 ecosystem.
Speaking to CNBC, a16z’s global policy chief Tomicah Tillemann decried the broken state of the current Web 2.0 status quo. According to Tillemann, Web 3.0 offers an alternative to the challenges posed by the issues in today’s internet.
In a Web 3.0 policy document issued on Wednesday, the VC firm argued for better regulatory standards for the new internet paradigm stating: “The easiest way to lose out on all of this potential is to treat web3 as if it were a monolith,” adding:
“Policymakers should focus on calibrating regulatory activities to the specific applications and their associated risks. Treating all digital assets the same is like having a single regulatory framework for stocks, real estate, cars, art, watches, and trading cards. We need policy that’s fit for purpose.”
Related:Former CFTC brass joins Andreessen Horowitz as an advisor
A16z’s current lobbying efforts for digital technology and Web 3.0 come amid fears of stringent policy measures that industry stakeholders say could derail America’s ability to establish itself in the expanding digital economy.
Crypto has come in for some negative comments from policymakers in Washington with the prevailing rhetoric being that digital assets require more regulatory oversight.
Indeed, a16z joined the push against plans to enact stringent regulatory measures targeted at self-hosted crypto wallets earlier in the year.
Back in August a16z co-founder Marc Andreessen called crypto a “fundamental technological breakthrough.”
As previously reported by Cointelegraph, the Silicon Valley VC firm launched the largest crypto venture fund valued at $2.2 billion at the time. The fund has since grown to reach a $3.1 billion valuation.
