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 transaction involves a conversion of…
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 bitcoin payments made directly from…
This blog has previously discussed how different countries have taken varying positions with respect to their friendliness toward cryptocurrencies and ICOs. Baker McKenzie’s office in Thailand has prepared a guide that contains an overview of the regulatory landscape on digital assets in Thailand.
It is well known that, among the biggest problems with public blockchains, such as the one behind Bitcoin, are the amount of time it takes to process a transaction and the enormous amount of energy it consumes. According to blockchain.com, for example, Bitcoin processes only three to seven transactions per second and, in August, had an average confirmation time for a transaction of 10-30 minutes, though that number had been as high as 50 hours…
In February 2018, the UK Treasury Committee launched an inquiry into digital currencies. In the course of its inquiry the Committee received oral and written evidence from a number of key players in the crypto space, including representatives from Ripple, CryptoUK and Blockchain, together with evidence from the FCA (the UK financial services regulator), the Bank of England and HM Treasury. Earlier than expected, the Treasury Committee published its crypto-assets report and conclusions and recommendations…
Texas has been one of the more active US states in combating fraudulent ICOs and cryptocurrency scams. Earlier this week it took three separate actions. According to the Emergency Cease and Desist Order, Coins Miner Investment Ltd. manipulates its email solicitations to make them appear as if they came from Coinbase, a well-known San Francisco-based online cryptocurrency platform. Ana Julia Lara, a person affiliated with Coins Miner, falsely claims to work at Coinbase as a cryptocurrency…
Last week we reported that FINRA brought its first-ever disciplinary action in the cryptocurrency space. But there were also two other first-of-their-kind enforcement actions last week by the U.S. SEC. On September 11, the SEC announced its first-ever enforcement action finding an investment company registration violation by a hedge fund manager based on its investments in digital assets. The SEC entered an Order finding that Crypto Asset Management LP (“CAM”) offered a fund that operated…
On Tuesday, September 11, a New York Federal Judge rejected a defendant’s argument that he cannot be prosecuted because the digital coins he sold were not securities. Maksim Zaslavskiy is accused of making materially false and fraudulent representations in connection with two investment schemes and ICOs for REcoin Group Foundation, LLC (“REcoin”) and DRC World, Inc. (“Diamond”). Zaslavskiy claimed that REcoin and Diamond did not involve securities and were therefore beyond the reach of the…
Australia’s corporate regulator, the Australian Securities and Investments Commission (ASIC) has released its 2018-2019 to 2021-2022 corporate plan (the Plan), articulating the regulator’s short and medium term strategic vision and focus. Cryptocurrencies, ICOs and blockchain featured as part of the Plan, reflecting their growing relevance for ASIC in protecting investors and markets. In summary, the Plan: acknowledges the significant impact that blockchain and distributed ledger technologies (DLT) are likely to have on Australia’s financial services…
On August 17, the central district of Chaoyang in Beijing issued a notice telling hotels, shopping malls, and office buildings in the area to refrain from hosting cryptocurrency events. The same South China Morning Post article that confirmed the ban also reported that at least eight blockchain and cryptocurrency-focused online media outlets – some of which raised several million dollars in venture capital – found their official public accounts on WeChat blocked.