U.S. FTC Shuts Down Promoters of Deceptive Cryptocurrency Schemes

At the request of the Federal Trade Commission, a federal court has halted the activities of four individuals who allegedly promoted deceptive money-making schemes involving cryptocurrencies. These schemes falsely promised that participants could earn large returns by paying cryptocurrency such as bitcoin or Litecoin to enroll in the schemes. The complaint was filed under seal on February 16 and announced today.  It alleges that three defendants – Thomas Dluca, Louis

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Cryptocurrency, Litigation, US

The Cautious Approach to Cryptocurrencies and ICOs in Malaysia

The global frenzy around cryptocurrencies has seen prices fluctuate dramatically over the past year, leading to a growing interest among Malaysian investors. The Central Bank of Malaysia (BNM) has repeatedly maintained its position that digital currencies are not legal tender in Malaysia, and has advised the public to be cautious of the risks that come with them. While there are no specific Malaysian regulations governing cryptocurrencies or their exchanges, the

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Cryptocurrency, ICO, Malaysia

Regulatory Aspects of ICOs in Switzerland

The Swiss Financial Market Supervisory Authority (FINMA) is one of the regulatory bodies that has taken specific steps with respect to ICOs.  In its recently published booklet, Regulatory Aspects of ICOs in Switzerland, Baker McKenzie’s Zurich office gives an overview of the regulation of ICOs in Switzerland.

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ICO, Switzerland

ICO Regulation in Germany

Initial Coin Offerings are now mushrooming in Germany as well.  Besides the recent Savedroid ICO, the local Frankfurt news section of the Frankfurter Allgemeine Zeitung recently  mentioned at least three more transactions that are in the process of being launched. Like its many European counterparts, the German regulator BaFin is very skeptical regarding blockchain-based coin (“token”) sales and has issued a number of warnings to consumers. More recently, on 20

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Germany, ICO

SEC Says Cryptocurrency Platforms Must be Registered

There have been previous posts in this blog about statements by the U.S. SEC saying that most ICO’s would seem to qualify as securities offering and thus must be registered (or qualify for an exemption).  In a Statement issued yesterday, the SEC took another tact with implications for the cryptocurrency industry, this time going after exchanges.  The SEC said, “If a platform offers trading of digital assets that are securities

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Cryptocurrency, Exchanges, SEC, US

Court Affirms CFTC Jurisdiction Over Cryptocurrency

As early as September 2015, the CFTC took the position that virtual currencies such as Bitcoin are commodities. See In re Coinflip, Inc., No. 15-29 (C.F.T.C. Sep. 17, 2015). Based on that jurisdiction, in January, the CFTC brought a suit against Patrick K. McDonnell, of Staten Island, New York, and CabbageTech, Corp. d/b/a Coin Drop Markets (CDM). McDonnell brought a motion challenging the jurisdiction of the CFTC.  In a decision yesterday,

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CFTC, Cryptocurrency, Litigation, US

Coinbase Hit With Two Class Action Lawsuits

When traders want to purchase crypto using traditional currency, or exchange one cryptocurrency for another, they do so via an exchange.  Coinbase is one of the world’s largest, with over 13 million users.  Over the past few days it has been hit with two class action lawsuits, both in federal district court in California. The first an insider trading case.   The suit claims Coinbase employees unfairly profited from the December

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Cryptocurrency, ICO, Litigation, US

Two Global Companies Talk Blockchain

In terms of real-world applications, much of the blockchain activity is in fintech and among startups.  But earlier this week, two global companies discussed how they plan to use blockchain.  As Techcrunch reported, Rakuten is planning a new cryptocurrency called Rakuten Coin — built on blockchain technology and the company’s existing loyalty program, Rakuten Super Points — which it plans to use to encourage loyalty services globally and to help

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SEC Investigates Cryptocurrency Companies

The U.S. SEC, in recent months, repeatedly put cryptocurrency companies and their advisers on notice about what officials said were violations of securities rules designed to protect investors.  see posts of 1-3; 1-23; 2-6.  And  SEC chairman Clayton said he had instructed his staff to be on high alert for approaches to ICOs that may be contrary to the spirit of those laws.  According to a Wall Street Journal report,

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Cryptocurrency, ICO, SEC, US

Malaysian Central Bank Requires ID for Cryptocurrency Transactions

A press release from Bank Negara Malaysia (BNM), Malaysisa’s central bank, stated that the  “Anti-Money Laundering and Counter Financing of Terrorism Policy for Digital Currencies”  went into effect as of February 27, 2018.   It had been introduced as a draft in December 2017. Reporting institutions are required to conduct customer due diligence on all customers and the persons conducting the transaction when the reporting institution establishes business relationship with a

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Cryptocurrency, Malaysia