CFTC Says Ether is a Commodity

Last December, the Commodity Futures Trading Commission (CFTC) issued  a public call for feedback to “better inform the Commission’s understanding” of the Ethereum network and the cryptocurrency ether.  The CFTC said input would better inform the agency in the event that market participants submit proposals to list new cryptocurrency-based futures or derivatives products. The CFTC has already recognized the trading of Bitcoin-based derivatives. Speaking at the Yahoo! Finance All Markets Summit on Thursday October

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CFTC, Commodity, Ether, US

SEC Digital Asset Guidance a Boon For Investors Claiming XRP is Unregistered Security

A group of investors in Ripple’s cryptocurrency XRP filed an amended complaint exploiting recent guidance published by the Strategic Hub for Innovation and Financial Technology (FinHub) of the U.S. Securities and Exchange Commission (SEC).  The SEC’s “Framework for ‘Investment Contract’ Analysis of Digital Assets” provides guidance for evaluating whether a particular cryptocurrency has the characteristics of an “investment contract” and therefore subject to registration under federal securities laws.  The SEC’s

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Litigation, Ripple, SEC, Securities, US

Swiss Bankers Association Publishes Updated Guidelines on Opening Banks Accounts for Companies with a Nexus to Distributed Ledger Technology

On August 20, 2019, the Swiss Banking Association (“SBA”) released guidelines for member banks (in German with Italian, French and English versions to follow) about opening company accounts for companies with a nexus to distributed ledger technology (“DLT”).  These guidelines update the SBA’s guidelines from  September 21, 2018. The guidelines outline what banks should require of DLT-nexus companies in the account opening process to address risk management related to issues

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AML, Banking, Cryptocurrency, KYC, Switzerland

Crypto Exchange Startup Seeks SEC Approval for Initial Public Offering of Security Tokens

Crypto exchange startup INX Limited filed a preliminary prospectus outlining its plans to raise between $5 million and $129.5 million in an initial public offering (IPO), making it one of few cryptocurrency companies to seek a U.S. listing for its tokens through registration of a public offering.  INX filed a prospectus with the U.S. Securities and Exchange Commission (SEC) in August in anticipation of an offering of approximately 130 million

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IPO, Securities, US

Swiss Financial Market Supervisory Authority FINMA issues guidance on stable coins and comments on planned Libra cryptocurrency

On September 11, 2019, the Swiss Financial Market Supervisory Authority (FINMA) has issued guidance on the regulatory treatment of stable coins. As a supplement to the previously issued ICO Guidelines, FINMA outlines how it treats stable coins under the Swiss regulatory framework. In this connection, FINMA also gives initial indications on the request for a regulatory assessment filed by the Geneva-based Libra Association, a high-profile cryptocurrency project orchestrated by Facebook

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Libra, Regulation, Stable Coins, Switzerland

Burundi Bans Cryptocurrency

The Bank of The Republic of Burundi issued a statement in which it banned the use of cryptocurrencies in the country. The Statement said, “Since virtual currencies or cryptocurrencies are not regulated and are not issued or guaranteed by any Government or Central Bank, these currencies do not have legal tender in the territory of Burundi.” The measure was justified as a consumer protection measure: “virtual currencies are traded on

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Burundi, Cryptocurrency

Marshall Islands To Issue Its Own Cryptocurrency

In 2018, the Marshall Islands passed a Sovereign Currency Act, declaring its intention to release a new, national digital currency.  In an essay published by Coindesk on September 4, The Honorable David Paul, Minister In-Assistance to the President and Environment of the Marshall Islands, stated that the official launch of the cryptocurrency – to be known as the sovereign (SOV) coin — will be announce at Invest:Asia 2019, upcoming in

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Cryptocurrency, Marshall Islands

IRS Begins Notifying Owners of Cryptocurrency of Potential Failures to Report Income and Pay Taxes

In July, the IRS announced that it had begun sending letters to taxpayers who may have failed to properly report income and pay any tax associated with cryptocurrency transactions or who did not properly report such transactions. The IRS expects to send more than 10,000 letters before the end of August. Taxpayers who have not properly reported their cryptocurrency transactions are, where appropriate, liable for tax, penalties, and interest, and

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Cryptocurrency, IRS, US

SEC Fines SimplyVital for Unregistered ICO

On August 12, 2019, the U.S. Securities and Exchange Commission announced settled charges against a New England-based blockchain company for offering and selling approximately $6.3 million of securities to the public in unregistered transactions. According to the SEC’s order, in late 2017, SimplyVital Health, Inc. publicly announced its plan to conduct an ICO to raise money to further its development of Health Nexus, a “healthcare-related blockchain ecosystem.” SimplyVital offered a

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ICO, SEC, Simple Agreements for Future Tokens (SAFTs), US

SEC Obtains TRO Against Organizer of “Fraudulent” ICO

On August 13, 2019, the U.S. Securities and Exchange Commission announced on fraud charges against a Brooklyn individual and two entities under his control who allegedly engaged in a fraudulent scheme to sell digital securities to investors and to manipulate the market for those securities. The SEC filed charges against Reginald “Reggie” Middleton, a self-described “financial guru,” and two entities he controls, Veritaseum, Inc. and Veritaseum, LLC (collectively, Veritaseum).  The

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ICO, SEC, Temporary Restraining Order (TRO), US

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