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Bitcoin

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As the Wall Street Journal reported, on June 21, 2021: “The People’s Bank of China …said it summoned representatives of multiple institutions—including state-owned commercial banks and Ant Group Co.’s Alipay—and told them to “strictly implement” recent notices and guidelines from authorities on curbing risks tied to bitcoin and cryptocurrency fundraising activities. It was the latest sign that Beijing is intensifying its crackdown on unregulated virtual currencies.” The PBOC Statement talked about how cryptocurrencies are used…

Early in the morning of June 9, 2021, President Nayib Bukele of El Salvador, 39, tweeted that the Salvadoran Congress had approved his proposed law that would make Bitcoin legal tender in El Salvador. The vote was 62 out of 84. El Salvador thus becomes the first country to approve the use of Bitcoin as legal tender. The country currently uses the U.S. Dollar as its currency. Bitcoin will become legal tender in 90 days,…

On 31 March 2021, the UK tax authorities (HMRC) consolidated their existing guidance on crypto-asset taxation for businesses and individuals and published new guidance on the taxation of “staking” activities. This is contained in a new manual (guidance for HMRC officers which is publicly available online but which does not have the force of law). The new guidance on staking activities is almost identical to the existing guidance on mining, but the fact that HMRC…

In 2013, the U.S. Securities and Exchange Commission was asked for the first time to approve a Bitcoin exchange-traded fund.  That request was denied.  More than a dozen other applications followed, each resulting in denial.  With at least six applications pending, and a number of changed circumstances, it is hoped that the SEC is finally ready to approve Bitcoin ETFs.  For a more detailed discussion of the state of play of Bitcoin ETFs, you can…

In Ion Science Ltd. v Persons Unknown and others (unreported), the Commercial Court granted a proprietary injunction and a worldwide freezing order in respect of Bitcoin that had been dissipated by the wrongdoers due to cyber-fraud. The Commercial Court also granted permission to serve disclosure orders against the coin exchanges that processed the transactions in order to help locate the missing assets and wrongdoers. This judgment further solidifies Bitcoin’s status as property, but also shows…

We previously reported that, in July 2019, the U.S. Internal Revenue Service announced that it had begun sending the now infamous letters to taxpayers who, supposedly, may have failed to properly report income and pay taxes associated with cryptocurrency transactions. About 10,000 of these Letter 6173 were sent. And we previously reported that James Harper had sued the IRS claiming the IRS violated his rights under the Fourth and Fifth Amendments of the U.S. Constitution…

For years, we have been writing about the reluctance of the U.S. Securities and Exchange Commission to approve a Bitcoin exchange-traded fund. See here and here. The stated concern of the SEC was whether the Bitcoin market was sufficiently resistant to market manipulation. However, as we recently reported, on February 12, 2021, Canada approved such an ETF. Indeed, it now has three: I Galaxy Bitcoin ETF (BTCX), Purpose Bitcoin ETF (BTCC), and the Evolve Bitcoin ETF (EBIT).…

Eight times since 2013, the U.S. Securities and Exchange Commission has repeatedly refused to approve applications for a cryptocurrency-linked exchange traded fund (ETF). See here and here. Time and again, the SEC said that the applicants were unable to persuade the Commission that the Bitcoin market was sufficiently resistant to market manipulation. Another common theme was the dissent of Hester Pierce (affectionately known as “Crypto Mom), who said in January 2020, for example: This order…

On January 29, 2021, Hugo Sergio Mejia, 49, of California, was charged in a two-count information with operating an unlicensed money transmitting business and money laundering. In a plea agreement, Mejia agreed to plead guilty to these felony offenses. According to his plea agreement, from May 2018 to September 2020, Mejia operated a virtual currency business that exchanged Bitcoin for cash, and vice versa, charging commissions for these transactions. Mejia admitted he never registered his…

Previous posts have talked about India’s interesting relationship with cryptocurrency. In 2018, India’s central bank, the Reserve Bank of India (RBI), had banned domestic financial institutions from providing banking services to cryptocurrency exchanges in India. In March 2020, the India Supreme Court struck down the RBI ban as unconstitutional. The report last month that the Indian government was weighing a proposal to impose an 18% goods and services tax on Bitcoin transactions was looked on…