Japanese Financial Services Agency accredits the Japan Virtual Currency Exchange Association as a Self-Regulatory Organization

On October 24, 2018, the Japanese Financial Services Agency (JFSA) accredited the Japan Virtual Currency Exchange Association (JVCEA, established in March 2018) as a self-regulatory organization under the Payment Services Act (PSA). On the same day, an initial set of self-regulations and related guidelines came to effect, as prepared by the JVCEA. Going forward, it is anticipated that the JVCEA will cooperate with continued inspection and monitoring by the JFSA

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AML, Cryptocurrency, ICO, Japan

Securities stakeholders group recommends that ESMA provides clarity on regulation of cryptoassets

Cryptoassets continue to be a hot topic for financial services regulators. On 19 October 2018, it was the turn of the Securities and Markets Stakeholders Group (“SMSG“), which represents various stakeholders’ interests to the European Securities Markets Authority (“ESMA“). The SMSG published a report setting out its advice to ESMA on how to contain the risks of cryptoassets and ICOs.

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Cryptocurrency, EU, Sandbox, Securities

Unhashing Blockchain: Blockchain Explained

Our blog reports on blockchain developments around the world and across industries. For those of our readers interested in some blockchain basics, Baker McKenzie has just published “Unhashing Blockchain: Blockchain Explained.”  In it, we provide an overview of blockchain technology, discuss how it is being used and identify the legal issues that will arise (or have already arisen) in connection with this nascent technology.

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Bitcoin, Cryptocurrency, International, Smart Contracts, Supply Chain, Use Case

European Parliament adopts Blockchain Resolution

On Monday 3 October, the European Parliament adopted a non-legislative Resolution on distributed ledger technologies (DLT) / blockchain. In the Resolution, the Parliament makes clear that it is keen to make Europe a leading player in the blockchain field. It discusses a range of blockchain use cases including: improving data efficiency and the reporting of clinical trials in the health sector; improving supply chain processes, such as facilitating the forwarding

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EU, GDPR, ICO, Smart Contracts

Ukraine Publishes Draft Taxation Law on Virtual Assets

On September 19,  2018, the Ukranian Parliament published a draft law which aims to set out the legal basis for the taxation of transactions involving virtual assets. The draft law defines the concept of “virtual assets,”  as well as concepts such as “cryptocurrency,”  “distributed ledger,” “token,” and “mining.” The draft law (available here in Ukrainian) seeks to introduce a separate taxation regime for transactions involving virtual assets. Thus, if a

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Cryptocurrency, ICO, Smart Contracts, Ukraine

Australian Regulator Takes Action Against Misleading Initial Coin Offerings

In May of this year, the Australian Securities and Investments Commission (ASIC) indicated that ICO issuers and their associated advisers would come under regulator scrutiny where their conduct or statements were identified as misleading or deceptive.  The Australian Competition and Consumer Commission (ACCC) authorized ASIC to take action against misleading and deceptive conduct in relation to ICOs, even where the ICO does not constitute a “financial product” under Chapter 7

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Australia, ICO

SEC Suspends Trading in Company for Making False Cryptocurrency-Related Claims about SEC Regulation and Registration

Last week we reported that the US SEC stopped a fraudulent ICO that falsely claimed that it had SEC approval.  Yesterday, the SEC suspended trading in the securities of a company amid questions surrounding its statements about partnering with a claimed SEC-qualified custodian for use with cryptocurrency transactions and a purportedly registered public offering of preferred stock. The SEC’s trading suspension order says that two August 2018 press releases issued

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Report Shows Underbelly of Cryptocurrency Money Laundering

On October 10, CipherTrace – a developer of cryptocurrency AML, bitcoin forensics, and blockchain threat solutions – released its Cryptocurrency Anti-Money Laundering Report – Q3 2018 (the “Report”).  The Report analyzed 45 million bitcoin transactions involving the top 20 global cryptocurrency exchanges to produce some sobering findings regarding the level of criminal activity at crypto exchanges and the effectiveness of AML regulation. Some key findings are summarized below. 97% of

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AML, Cryptocurrency, Money Laundering, US

Swiss Financial Market Supervisory Authority Grants Its First Authorization to a Crypto Company

Crypto Fund AG, a subsidiary of Swiss-based Crypto Finance AG, received authorization from the Swiss Financial Markets Supervisory Authority (FINMA) to act as an Asset Manager defined under the Swiss Collective Investment Schemes Act (CISA). The Press Release from Crypto Finance AG states that Crypto Fund AG, now being an authorized Asset Manager, is permitted to “manage and distribute domestic and foreign investment funds to qualified investors and provide investment

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Banking, FINMA, Switzerland

IBM Launches Blockchain as a Service Food Tracking Network

On Monday 8 October 2018, IBM announced the “IBM Food Trust”, a blockchain based production cloud network which will enable participating retailers, suppliers, growers and food industry providers to see supply chain data in near real time. IBM believes that the network will enable greater traceability, transparency and efficiency in the food chain. The IBM Food Trust relies on the open source blockchain framework, Hyperledger Fabric and will be made

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Supply Chain