Taiwan's Bitgin cryptocurrency exchange under investigation for money laundering
Bitgin, a cryptocurrency exchange in Taiwan, is being investigated for money laundering by the country's police force. The COO of Bitgin, Yuting Zhang, was arrested for his alleged involvement in the "Eighty-Eight Guild Hall" money laundering incident. Two local businessmen, Zhemin Guo and Chengwen Tu, were previously accused of operating a multi-billion-dollar money laundering scheme using their foreign exchange offices and crypto exchange accounts. Taiwan currently has no official licensing regime for cryptocurrency exchanges, and Bitgin is a member of the Virtual Asset Service Provider Preparatory Office (VASP) for self-regulation and lobbying. Bitgin stated that it is cooperating with the investigation and hopes that the facts can be clarified soon.
Russian court fines Coinbase for refusing to localize Russian users' data
Coinbase, a crypto exchange, has been fined 1 million rubles ($11,000) by a Russian court for failing to localize Russian users' data within the country. This is part of a trend of Russia imposing fines on international technology companies for various violations, seen by some as an attempt to gain more control over the internet. Other companies that have been fined for similar reasons include Google, Apple, Spotify, WhatsApp, Airbnb, Zoom, and Telegram. Russia's internet and communications regulator, Roskomnadzor, had ordered foreign internet companies to localize Russian users' data by July 1, and around 600 companies had complied by that deadline.
New CFTC proposal requires exchanges to segregate customer and company cash to protect crypto derivatives traders
US Commodity Futures Trading Commission (CFTC) is developing a proposal to ensure that more derivative exchanges separate customer funds from company cash. The draft will expand the scope of CFTC's existing regulation to apply to exchanges that allow customers to trade without going through a broker. CFTC Democratic member Kristin Johnson said that the proposal would help prevent FTX from competing for customer funds from its subsidiary LedgerX, which is regulated by CFTC.
Kristin Johnson said that the rules requiring customer asset segregation should apply to any company using or seeking a similar direct-to-customer model, regardless of whether they offer crypto products or other types of derivatives. Given events such as the collapse of FTX, CFTC should take immediate action to develop rules to prevent customer funds from being misused or lost.
Taiwan's Cathay Securities receives country's first security token offering license for "Sunshine Green Yield" bonds
Cathay Securities has been granted Taiwan's first security token offering (STO) license by the Financial Supervisory Commission (FSC). The STO bonds, called "Sunshine Green Yield," have a maturity of six years, an initial annual interest of 3.5%, and an initial principal amount of 30 million New Taiwan Dollars ($0.93 million). The bonds will allow enterprise owners to purchase green electricity on the market for environmental, social, and corporate governance initiatives under favorable conditions and receive variable interest rate payments of up to 5.8% per year. Trading for the Subshine Green Yield bonds will debut on Dec. 12 on Cathay's in-house STO exchange platform.
New U.S. bill proposes banning government use of Chinese-developed blockchain and USDT
US lawmakers proposed a new bill called CLARITY on Wednesday, which prohibits federal government officials from conducting business with Chinese blockchain companies. The bill also explicitly prohibits US government officials from trading with iFinex, the parent company of Tether, the issuer of the world's largest stablecoin, USDT. The bill also prohibits US officials from trading with The Spartan Network, The Conflux Network, and Red Date Technology Co. (the development company behind the digital yuan).
It is reported that the CLARITY bill is co-led by US Representatives Zach Nunn (Republican from Iowa) and Abigail Spanberger (Democrat from Virginia), aimed at prohibiting US government officials from trading with Chinese crypto companies and cutting off government employees' access to networks supporting blockchain or cryptocurrency trading platforms in China.
Neither of the bill's two sponsors are members of the US House leadership or hold important positions in committees.
Spanish regulators launch first-ever crypto advertising probe against tech firm for breaching promotion rules
The National Securities Market Commission (CNMV) in Spain has launched its first-ever cryptocurrency advertising investigation against Miolos S.L. for two crypto-related campaigns that allegedly violated promotion rules. The CNMV claims that the campaigns failed to include warnings and relevant information about the risky nature of crypto assets and did not communicate with regulators before launching. The regulator is also investigating four other incidents related to similar breaches of crypto advertising. Firms must give the CNMV at least 10 days notice before advertising crypto assets to an audience exceeding 100,000 people.
FCA official: will work with the Bank of England to develop strict standards for stablecoin issuers
Matthew Long, Director of Payments and Digital Assets at the Financial Conduct Authority (FCA) in the UK, stated that the country's financial regulators will not deviate from their tough stance on cryptocurrencies when regulating stablecoins under proposed rules. Long said, "Ultimately, we will set standards, those that meet the standards will be allowed in, those that don't won't, and we won't apologize for having those high standards."
Long explained that in order to regulate stablecoins in the country, the FCA will work with the Bank of England (the UK's central bank) to develop strict standards for stablecoin issuers. The FCA will observe the market and pay attention to the emergence of "systemic" stablecoins that are widely used, and the two regulatory bodies plan to reach a formal agreement on their respective roles.
Dubai postpones crypto license registration deadline to November 17
The Dubai Virtual Asset Regulatory Authority(VARA)has extended the final deadline for virtual asset service providers to apply for VARA registration, operate or provide service licenses in Dubai to November 17, 2023. VARA urges VASPs who have not yet submitted their applications, missed notifications from commercial licensing agencies, or submitted incomplete forms to proactively contact them to avoid unexpected regulatory consequences. The agency stated that more than 1,000 traditional companies have already submitted registration applications under Dubai's regulatory framework.
IRS plans to increase surveillance of cryptocurrency, leading to potential DOJ confiscation
The IRS is planning to increase its surveillance of cryptocurrency usage, which could result in the DOJ seizing cryptocurrency at an unprecedented rate. The DOJ's 2022 report on Executive Order 14067 recommends expanding its authority over criminal, civil, and administrative forfeiture. Despite the FBI and IRS seizing over $4 billion in cryptocurrency between 2014 and 2021, the DOJ argues that the US government is struggling to seize cryptocurrency. With the IRS collecting vast amounts of new information on Americans' cryptocurrency use, the DOJ may find new arenas for cryptocurrency confiscation, even without an actual crime being committed. The proposed crackdown on cryptocurrency by the IRS highlights the risks of mass data collection and should be monitored closely by users. The government's increasing interest in cryptocurrency, whether for audits or confiscation activities, is a cause for concern. Nicholas Anthony, a policy analyst at the Cato Institute, questions the rationale for the cryptocurrency provisions in The Infrastructure Investment and Jobs Act and advocates for a better framework for financial privacy in the digital age. This article is for informational purposes only and does not constitute legal or investment advice. <br>
Gemini UK Implements Travel Rule Restrictions for Cryptocurrency Transfers
Gemini UK will only allow cryptocurrency transfers to and from entities registered with TRUST, in compliance with Travel Rule regulations. Outgoing transfers will only be permitted to 58 TRUST-registered companies, while incoming transfers from non-TRUST VASPs may result in account freezes or limits. Gemini's partnership with TRUST is part of its strategy to comply with the UK's evolving regulatory landscape for digital assets, which includes the introduction of a financial promotions regime and legislation empowering law enforcement to seize crypto assets tied to illegal activities. The exchange's proactive approach highlights its commitment to operating within regulatory expectations and fostering a secure and trustworthy environment for cryptocurrency transactions.
