Category Archives: Blockchain, Crypto, ICO Regulations

The UK Provides Legal Certainty For Smart Contracts And Cryptoassets In Its Landmark Legal Statement

Clyde & Co | Karen Boto | Nov 26, 2019

legal statement crypto and smart contracts - The UK Provides Legal Certainty For Smart Contracts And Cryptoassets In Its Landmark Legal StatementEarlier this week the UK Jurisdiction Taskforce (UKJT), part of the LawTech Delivery Panel of senior solicitors and barristers headed by Chancellor of the High Court, Sir Geoffrey Vos, published a landmark "Legal Statement" providing long awaited clarity as to how cryptocurrencies, distributed ledger technology (DLT) and smart contracts might be treated under English law.

The statement follows several rounds of public and private consultation, conducted to address the perceived legal uncertainties of these innovative technologies.

For the first time, the Panel has recognised that cryptoassets, including but not limited to, digital currencies, can be treated as property in principle, and that smart contracts are capable of satisfying the requirements of contracts in English law, making them enforceable by the Courts.

Highlights Below - What is a cryptoasset?

In summary, the Panel explains that a cryptoasset is defined by reference to the rules of the system within which it exists. It is typically represented by a pair of data parameters: one public (disclosed to all participants in the system) and one private. The public parameter contains encoded information about the asset, such as its ownership, value and transaction history. The private parameter (the private key) permits transfers or other dealings in the cryptoasset to be cryptographically authenticated by a digital signature. The private key should be kept secret to the holder.

See:  IIROC Announces Crypto-Asset Working Group Members

Dealings in cryptoassets are broadcast to the entire network and, once they are validated, they are added to the digital ledger. Most commonly the ledger is decentralised meaning no one person or entity has control over it. It is also immutable and cannot be changed. The most common type of ledger being used today is blockchain, although other models do exist. The rules governing the system are established by the informal consensus of the participants.

The novel features of cryptoassets are therefore broadly summarised as follows:

  • intangibility;
  • cryptographic authentication;
  • use of a distributed transaction ledger;
  • decentralisation; and
  • rule by consensus.

Can cryptoassets be characterised as property?

The Panel has considered what property is, as a matter of English law. As no general or comprehensive definition of property exists in statute or case law, the Legal Statement focusses upon the necessary characteristics of property as identified in a number of authorities. The Legal Statement provides that before a right or interest can be admitted into the category of property: "it must be definable, identifiable by third parties, capable in its nature of assumption by third parties, and have some degree of permanence or stability. Certainty, exclusivity, control and assignability have also been identified in case law as characteristic of property rights."

See:  Coinshares Reveals Top 10 Crypto Trends in 2019

Although whether English law would treat a particular cryptoasset as property will be fact sensitive and require a consideration of the nature of the asset concerned, and the rules of the system in which it exists, in general, the Panel concluded that "cryptoassets have all of the indicia of property."

The Panel also concluded that the "novel or distinctive features possessed by some crypto-assets" set out above, did not "disqualify them from being property.....nor are cryptoassets disqualified from being property as pure information, or because they might not be classifiable either as things in possession or as things in action."

Why does it really matter if a cryptoasset is property?

It is important to determine whether a cryptoasset is capable of being property because it means that it can be owned, which gives rise to important proprietary rights that can be recognised against the whole world. The owner of a thing is entitled to control and enjoy it to the exclusion of anyone else.  Proprietary rights are of particular importance when it comes to issues relating to succession on death, the vesting of property in personal bankruptcy, and the rights of liquidators in corporate insolvency, as well as in cases of fraud, theft or breach of trust.

So, what is the asset and who owns it and how is it transferred?

The Legal Statement confirms that whilst cryptoassets can be transferred either via an "on chain" transfer (with the ledger being updated in the usual way) or by way of an "off chain transfer" (another type of transfer outside the ledger which is vulnerable to a superseding on-chain transfer i.e. double spending by the transferee)) these will not constitute transfers in the legal sense. This is because of the way the distributed ledger technology operates: unlike a tangible asset, the same cryptoasset does not pass, unchanged, from one person to another. Instead, the transferor typically creates a new cryptoasset, with a new pair of data parameters: a new or modified public parameter and a new private key. The data representing the "old" cryptoasset persists in the network, but it ceases to have any value or function because the cryptoasset is treated by the consensus as spent or cancelled so that any further dealings in it would be rejected.

See:  Singapore Poised to Allow Crypto Derivatives on Approved Venues

What consequences does this classification have?

The Legal Statement concludes that it is possible to declare a trust over an ownership interest in a cryptoasset.

However, as the Panel found that a cryptoasset is not a physical thing, it cannot be subject to a possessory relationship, such as a bailment, a lien or a pledge. That said, the Panel expressly states that it could see no obstacle to the granting of other types of security such as charge or mortgage.

It is also clear that cryptoassets are not documents of title, documentary intangibles or negotiable instruments (though some form of negotiability may arise in future as a result of market custom), nor are they instruments under the Bills of Exchange Act.

Nevertheless, as the Panel was of the view that cryptoassets can be property at common law they were in no doubt that they may therefore also be property for the purposes of the Insolvency Act 1986 (IA 1986) which contains a very wide definition of property. Indeed, even if a cryptoasset was deemed not to be property at common law, it might still be deemed to be property under the IA 1986.

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NCFA Jan 2018 resize - The UK Provides Legal Certainty For Smart Contracts And Cryptoassets In Its Landmark Legal Statement The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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HK’s SFC Finalises New Regulatory Framework For Virtual Asset Trading Platforms

Herbert Smith Freehills | William Hallatt and co-authors | Nov 22, 2019

digital and virtual - The UK Provides Legal Certainty For Smart Contracts And Cryptoassets In Its Landmark Legal StatementOn 6 November 2019, Hong Kong's Security and Futures Commission (SFC) issued a position paper setting out a new regulatory framework for the licensing of centralised virtual asset trading platforms, following the SFC's conceptual framework issued last year.

The SFC's CEO, Ashley Alder, made clear in his speech at Hong Kong FinTech Week that the new framework is intended to be "principles-based and technology neutral", applying consistent principles of investor protection in order to encourage "FinTech to flourish in a way that promotes a high level of confidence in all who participate". The new framework is comparable to the regulatory standards for licensed security brokers and automated trading venues, adapted to deal specifically with the technology on which the virtual asset trading platform industry is based.

Platforms which "opt-in" to the new framework will no doubt benefit from the clear competitive advantage a SFC licence represents, acting as an indicator to the market and investors that the operator is willing to adhere to a high level of standards and practices.

See:  Recession gatecrashes Hong Kong’s fintech party | SFC outlines VATP regulatory framework and China’s digital currency

However, as discussed in this bulletin, the new regulatory framework which is created within the current legislative framework has a number of limitations. It also does not apply to virtual assets which are futures contracts and the SFC said that it is unlikely to issue licences to carry on a business in such contracts, given the SFC considers them to be extremely risky. The SFC has indicated it will continue to monitor the virtual asset market and explore the need for legislative changes in the longer term.

Global landscape and the SFC's regulatory approach

Together with other regulators, the SFC has taken note of the exponential growth of virtual assets (also known as cryptocurrencies, crypto-assets and digital tokens). Globally, there are now around 3,000 digital tokens and 200 virtual asset trading platforms. Notwithstanding a period of erratic volatility in 2019, the virtual asset market looks unlikely to substantially diminish.

With the entrance of greater numbers of traditional financial institutions and service providers, the virtual asset ecosystem has steadily grown and become more sophisticated in providing services comparable to traditional mainstream finance.
In Hong Kong, the SFC is principally mandated to regulate "securities" and "futures contracts". Where virtual assets fall within the scope of these definitions, they are likely to fall within the SFC's jurisdiction. However, many virtual assets, including Bitcoin, do not fall within the scope of these definitions and are likely not within the SFC's regulatory remit.

In light of this gap, the SFC has taken steps to bring some virtual asset activities into its regulatory net. In November 2018, it published a statement setting out regulations for virtual asset fund managers and fund distributors and a conceptual framework for virtual asset trading platforms. Earlier this year, it published licensing conditions for certain virtual asset fund managers.

See:  UK Financial Conduct Authority Provides Final Guidance on Cryptoassets: Better Defines Utility Tokens

In the new position paper, the SFC said it remains concerned about investor protection in the virtual asset platform industry. In particular, it cited reports of platforms being hacked, with investors suffering substantial losses. It said trading rules may not be transparent and fair, and crypto markets are vulnerable to manipulation. In addition, the anonymity and other technical features of blockchain-based virtual assets are of concern from an anti-money laundering (AML) and counter-financing of terrorism (CFT) perspective.

The new regulatory framework

The SFC's new regulatory framework covers various key investor protection concerns, including the safe custody of assets, know-your client (KYC) requirements, AML/CFT and market manipulation.

The framework is essentially an "opt-in" licensing system, offering a route to licensing only for those "centralised platforms" in Hong Kong which offer trading of at least one virtual asset which is a security token. "Centralised platforms" are platforms that provide trading, clearing and settlement services, and have control over investors' assets.

Where the framework applies to a platform, it covers all platform operations, even if the majority of virtual assets traded are not securities. For example, when considering whether a licence applicant is fit and proper to be granted (and to continue to hold) an SFC licence, the SFC will take into account the manner in which the applicant conducts its entire virtual asset trading business, as this may impact upon its fitness and properness to undertake regulated activities. This includes whether the platform follows (or is willing and able to follow) expected regulatory standards, whether this involves security or non-security virtual assets and whether occurring on or off its platform.

See:  All You Need to Know About China’s Latest Crypto Crackdown

Licenced platforms will be subject to licensing conditions to address specific risks associated with their operations. These may include a restriction that platform services can only be provided to professional investors who can demonstrate that they have sufficient knowledge of investing in this area. Platforms may also be required to obtain the SFC's prior written approval for any plan or proposal to add products to their platforms.

Licenced platforms will also be subject to an initial period of close and intensive supervision in the SFC Regulatory Sandbox, entailing more frequent reporting, monitoring and reviews.

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NCFA Jan 2018 resize - The UK Provides Legal Certainty For Smart Contracts And Cryptoassets In Its Landmark Legal Statement The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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Fintrac releases key updates to AML obligations, including virtual currency exchange MSB registration

CFCS | Brian Monroe | Nov 22, 2019

altcoins - The UK Provides Legal Certainty For Smart Contracts And Cryptoassets In Its Landmark Legal StatementFintrac releases key updates to AML obligations, including virtual currency exchange MSB registration, details tactics to verify individual, corporate identities  

Canada’s Financial Transactions and Reports Analysis Centre (Fintrac), the country’s financial intelligence unit (FIU), has released a bevy of critical updates tied to anti-money laundering (AML) obligations, including opening the door for virtual currency exchanges to register as money services businesses for compliance purposes and offering more clarification on how to verify individual and corporate identities.

Fintrac, cognizant that countries, including Canada, are under more pressure to uncover and detail the beneficial owners of corporations, is bolstering a critical precursor for such initiatives: ensuring that the documentation tied to corporates, individuals and other entities is ironclad and can form the foundation of strong customer due diligence, risk assessments and be reliable in related AML investigations.

Here is a look at some of those updates:

MSBs in Canada acting as virtual currency exchanges must register and can do so now

See:  Canada Seeks to Widen AML Compliance Net

MSBs that deal in virtual currency can now voluntarily register with Fintrac in advance of June 1, 2020, when registration will be mandatory, according to a notice on the regulator’s site.

In short, the requirements mirror similar efforts by U.S. regulators, where a virtual currency exchange is considered an MSB and, correspondingly, MSBs are subject to a host of AML rules. Fintrac notes that crypto exchanges, and those engaged in P2P exchanges on behalf of others, are captured by the rules, even if the transactions are involving only virtual values.

AML rules, and related Fintrac and MSB registration duties, get tripped for both virtual currency exchange and virtual currency transfer services, in several scenarios, including:

1. Virtual currency exchange services include exchanging:

  • o funds for virtual currency,
  • o virtual currency for funds or,
  • o virtual currency for another virtual currency.

2. Virtual currency transfer services include:

  • o transferring virtual currency at the request of a client or,
  • o receiving a transfer of virtual currency for remittance to a beneficiary.

To read more about the upcoming virtual currency registration deadline, or to get a better sense of what Fintrac considers an MSB, click here.

Identity verification 

Methods to verify the identity of an individual and confirm the existence of a corporation or an entity other than a corporation

Fintrac also released guidance on how best to review and verify documents, details and data to properly confirm the identify of individuals and corporates to the depth required by Canada’s AML rules.

Though this may seem a rote, rudimentary task at first blush, the quality and accuracy of data is considered the lifeblood of the financial crime compliance program and customer information in particular is considered a powerful foundation for related risk assessments, which in turn, tune bank transaction monitoring systems to alert and lead to producing suspicious activity reports (SARS).

See:  Cyberattacks now cost small companies $200,000 on average, putting many out of business

Fintrac covers key nuances to identify verification, including using digital documentation, how and when institutions can rely on identification captured by affiliates and agents and taking a hybrid approach by combining several weaker forms of identification to reach a threshold that meets regulatory expectations while not running afoul of privacy rules.

This document answers the following questions:

  • 1. What does it mean to verify the identity of an individual or to confirm the existence of a corporation or of an entity other than a corporation?
  • 2. How do I verify the identity of an individual?
  • 3. How do I use an affiliate, agent, or mandatary?
  • 4. How do I identify a child?
  • 5. How do I confirm the existence of a corporation or of an entity other than a corporation?
  • 6. Are there restrictions on the use of personal information?

Some key snapshots include ways to verify the identity of individuals and corporations.

For individuals:

  • A government-issued photo identification document must be issued by either a federal, provincial or territorial government in order to be used to verify the identity of an individual.
  • You may accept a foreign government-issued photo identification document if it is an equivalent to a Canadian document such as those listed in this guidance.
  • Photo identification documents issued by municipal governments, Canadian or foreign, are not acceptable.

See:  Cybercrime FinTech, Flare Systems, Raises $1M, Led by Luge Capital

For corporations:

  • its certificate of incorporation;
  • a certificate of active corporate status;
  • a record that has to be filed annually under provincial securities legislation; or
  • any other record that confirms the corporation’s existence, such as the corporation’s published annual report signed by an audit firm, or a letter or notice of assessment for the corporation from a municipal, provincial, territorial or federal government.

To read the full Fintrac report on identity verification, click here.

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NCFA Jan 2018 resize - The UK Provides Legal Certainty For Smart Contracts And Cryptoassets In Its Landmark Legal Statement The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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All You Need to Know About China’s Latest Crypto Crackdown

Bloomberg News  | Zheping Huang and Olga Kharif | Nov 27, 2019

Crypto china - The UK Provides Legal Certainty For Smart Contracts And Cryptoassets In Its Landmark Legal Statement(Bloomberg) -- China’s latest crypto-crackdown is already claiming its first casualties.

At least five local exchanges have halted operations or announced they will no longer serve domestic users this month, after regulators issued a series of warnings and notices as part of a cleanup of digital currency trading.

China’s stepping up scrutiny of its massive cryptocurrency industry just weeks after President Xi Jinping ignited a market frenzy by declaring Beijing’s support for blockchain technology. Financial watchdogs including the Chinese central bank have in past weeks ordered crypto firms to shutter and warned investors to be wary of digital currencies, seeking to rein in a market prone to excesses. Weibo, a Chinese Twitter suspended accounts operated by major exchange Binance Holdings Ltd. and blockchain platform Tron.

See:  News on China cryptocurrency and more reforms

Taken together, the latest wave of shutdowns and restrictions represent the biggest cleanup of the sector since an initial Chinese clampdown in September 2017. Although exchanges that allow users to buy Bitcoin and Ether with fiat money were banned, trading had remained rampant in China through over-the-counter platforms or services that deal with crypto assets only.

“It appears that, like everything else within their borders, China feels it needs to have tighter controls on the crypto market including exchanges, miners and asset issuers,”

said Katie Talati, head of research at Arca, a Los Angeles-based asset manager that invests in cryptocurrencies.

“I do believe, however, they are moving in a similar direction as Japan and other jurisdictions that have tight and clear regulations for crypto businesses.”

“The current situation and environment for blockchain in China is still very positive,” Tron founder and crypto entrepreneur Justin Sun said. “In the short term, it may not get as much progress as we’d expect.”

See:  Why China is Winning at Blockchain

Here’s a timeline of the recent developments from China that’s been blamed for the plunge:

  • On Nov. 13, Binance’s Weibo account was suspended.
  • On Nov. 14, the Chinese central bank’s Shanghai office and the city’s financial regulator issued a notice asking local government agencies to work with crypto-related companies under their supervision to exit such businesses immediately. On the same day, Beijing’s financial regulator published a statement warning against illegal exchange operations.
  • On Nov. 15, Tron’s Weibo account was frozen.
  • On Nov. 21, Shenzhen financial regulator said in a statement it’s looking into allegedly illegal crypto operations, organizing check-ups and gathering evidence.
  • On Nov. 21, crypto publication the Block reported Binance’s Shanghai office was shut in a police raid. Binance disputed the report, or that it has fixed offices in China.
  • On Nov. 22, the Chinese central bank’s Shanghai branch said in a statement that companies that have conducted publicity campaigns, or have offered other services to offshore crypto exchanges, have been ordered to take immediate corrective actions or exit the business.

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NCFA Jan 2018 resize - The UK Provides Legal Certainty For Smart Contracts And Cryptoassets In Its Landmark Legal Statement The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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Central Bank Digital Currency and Fintech in Asia

ADBI | Nov 27, 2019

Central Bank Digital Currency and Fintech Asia - The UK Provides Legal Certainty For Smart Contracts And Cryptoassets In Its Landmark Legal StatementThe development of financial technology has already radically altered the landscape of the financial system in Asia and promises to have an even greater impact in coming years.

This book provides a comprehensive introduction to the principles and developments regarding central bank digital currency and fintech.

The first part of the book covers the theory of central bank digital currency, regulatory aspects, economic digitalization, and the role of fintech in advancing financial inclusion for small and medium-sized enterprises.

In the second part, selected case studies offer an in-depth overview of recent fintech-related developments in major Asian economies, including Australia; the People’s Republic of China; Hong Kong, China; Indonesia; Japan; the Republic of Korea; and Thailand.

You may also like: 

Singapore Fintech Week: Data, technology and policy coordination – BIS Speech

The Rise of Vietnam – the new Asian Innovation hub

The future of Asia: Asian flows and networks are defining the next phase of globalization

Singapore overtakes the US to become world’s most competitive country, WEF says

India Challenges China in Global Fintech Fundraising

 

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NCFA Jan 2018 resize - The UK Provides Legal Certainty For Smart Contracts And Cryptoassets In Its Landmark Legal Statement The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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Why a digital dollar isn’t coming anytime soon (or so the Fed says)

MIT Tech Review | Mike Orcutt | Nov 21, 2019

Jerome Powell - The UK Provides Legal Certainty For Smart Contracts And Cryptoassets In Its Landmark Legal StatementWhile central bank digital currencies may address problems in other countries, the US doesn’t have those problems, according to Fed chair Jerome Powell.

A digital dollar is a solution in search of a problem. Well, at least in the US, according to Jerome Powell, chair of the US Federal Reserve. While central-bank digital currencies may provide benefits in some cases around the world, it’s not clear that those potential benefits are “relevant in the US context,” Powell argued this week in a letter to two US congressmen.

“Overall, we observe that the characteristics that make the development of central-bank digital currency more immediately compelling for some countries differ from those of the US,” he said. Powell was responding to a letter the two lawmakers had sent him last month, in which they had asked a number of questions, including whether the Fed is considering issuing such a currency.

What are those characteristics? Some countries, notes Powell, may be considering issuing central-bank digital currencies because they have seen a “rapid migration by consumers away from cash.” That concerns central bankers because it is through the provision of banknotes and coins that governments maintain a direct presence in the consumer payments market. The fear is that leaving this area completely up to private companies could introduce new risks to individuals and the economy. 

But in the US, reports Powell, demand for physical cash “remains robust.”

In 2018, consumers used cash for 26% of payments, dropping four percentage points from the previous year. (Debit and credit card payments made up 28% and 23%, respectively.)

Another reason some countries are considering central-bank digital currencies is that they lack “otherwise fast and reliable digital payment services,” says Powell. But “the US payments landscape is highly innovative and competitive, with many such options available for consumers.”

It’s fair to take some issue with Powell’s argument here. Indeed, his own bank arguably already has. Unlike many countries around the world, the US lacks a broadly accessible real-time bank-to-bank payment system. The Fed’s current system can take several days to settle payments, and it closes on the weekends. Although a group of big commercial banks has built a real-time payment platform, many smaller banks around the country still don’t have access to the service. That’s why the Fed has decided to build a new public platform, Fed governor Lael Brainard said when the project was revealed in August. Called FedNow, it’s not expected to be ready until 2023 or 2024.

See:  United States: The Fed’s Jump Into Real Time Payments Appears To Be Good News For Community Banks and FinTechs

Things change fast in the world of financial technology; it’s plausible that in four years the cutting-edge payment technology will look a lot like today’s digital currencies. But even if the Fed wanted to issue a digital currency at some point, some important questions must be addressed first, says Powell: Would retailers be obligated to accept it? How will it affect financial stability? What are the security risks? If the system is designed to catch illicit activity, how private can it be? Should the central bank open accounts for millions of regular consumers?

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NCFA Jan 2018 resize - The UK Provides Legal Certainty For Smart Contracts And Cryptoassets In Its Landmark Legal Statement The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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Singapore Poised to Allow Crypto Derivatives on Approved Venues

Reuters | Nov 20, 2019

Monetary authority of Singapore - The UK Provides Legal Certainty For Smart Contracts And Cryptoassets In Its Landmark Legal StatementHONG KONG (Reuters) - Singapore’s central bank plans to bring bitcoin and other similar cryptocurrency futures traded on approved exchanges under its regulation in response to interest from international institutional investors, it said on Wednesday.

Market watchdogs worldwide have been debating whether and how they should regulate the cryptocurrency industry. Many have focused their attention initially on investor protection issues given concerns about market manipulation and cryptocurrencies’ volatility.

See:

 

In a consultation document, the Monetary Authority of Singapore (MAS) said that it had seen interest from institutional investors in trading “payment tokens” like bitcoin and ether, who “have a need for a regulated product to gain and hedge their exposure to the payment tokens.”

The consultation will close on Dec. 20.

MAS only proposes to regulate futures traded on exchanges it already regulates. It warned investors it did not regulate token derivatives not traded on approved exchanges.

“The inclusion of these products in the approved exchanges will certainly provide new opportunities for all regulated exchanges. This may create liquidity for these products,” David Gerald, president of the Securities Investors Association (Singapore), said in a statement, but warned retail investors of the high risk involved in investing in these products.

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NCFA Jan 2018 resize - The UK Provides Legal Certainty For Smart Contracts And Cryptoassets In Its Landmark Legal Statement The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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