Regulatory News
European Union
ESMA releases second consultation on regulations for the crypto market - European Security and Market Authority: ESMA, the EU's financial regulator, has issued its second consultation package for the Markets in Crypto-Assets Regulation (MiCA), seeking feedback from stakeholders until December 14, 2023. The package includes proposals on sustainability indicators for distributed ledgers, inside information disclosures, white paper technical requirements, trade transparency measures, and record-keeping for crypto-asset service providers. ESMA will use the feedback to draft technical standards for European Commission approval by June 30, 2024. A third consultation package covering additional mandates will be released in Q1 2024.
EC call for tender on sustainability standards for crypto assets eTendering: The European Commission (EC) has issued a call for tender aimed at creating a methodology and sustainability standards to address the environmental impact of crypto-assets. The EC acknowledges that crypto-assets, depending on their consensus mechanisms, can have a substantial negative effect on the environment. The growing demand for crypto-assets and the expansion of crypto-mining pose a potential threat to the European Union's climate and sustainability objectives. Therefore, the EC is taking steps to strengthen its ability to evaluate and mitigate the impact of crypto-mining while also working on the formulation of precise sustainability standards. These efforts are a precursor to potential legislative actions in this field.
Response to the classification of ARTs and EMTs - European Banking Authority: On September 29, the EBA responded to the EC's Call for Advice on MiCA's delegated acts regarding the significance classification of ARTs and EMTs and the associated fees. MiCA regulates crypto-assets in the EU from June 29, 2023. The EBA's response suggests core and ancillary indicators for assessing significance, with core indicators carrying weight and ancillary ones applied when core indicators are inconclusive. It also proposes a fee structure, including an entry fee, with specific amounts to be determined by the EBA, aiming to provide regulatory clarity in the EU's crypto-assets sector.
Portugal Central Bank Head calls for global crypto regulation - Bank of Portugal: Mário Centeno, Governor of Banco de Portugal, called for global collaboration in regulating cryptocurrencies during the 2023 Banco de Portugal Financial Stability Conference. He stressed the inadequacy of national-level regulation for managing global crypto risks. Centeno expressed doubts about the long-term viability of crypto assets and their ability to democratize finance. He praised the European Union's MiCA framework but advocated for a worldwide "same risk, same regulation" approach. Similar sentiments have been echoed by regulators globally, emphasizing the urgency of harmonized international crypto regulations.
United Kingdom
UK Think Tank urges looser KYC rules for crypto in Web3 - Policy Exchange: A UK think tank, Policy Exchange, has proposed 10 recommendations to improve Web3 regulation in the country. Among the suggestions is the limitation of liabilities for individuals holding tokens in decentralized autonomous organizations (DAOs) and the easing of Know Your Customer (KYC) requirements by the Financial Conduct Authority (FCA) to allow for innovative techniques like digital identities and blockchain analytics. The think tank aims to attract Web3 firms relocating from the US due to regulatory uncertainty. These proposals come amid a tightening regulatory stance in the UK, including potential bans on crypto-related cold calls and stricter marketing rules for crypto businesses.
British Treasury seeking to launch Digital Securities Sandbox in Q1 2024 - Decrypt: Helen Boyd, a prominent figure at the Financial Conduct Authority (FCA), engaged in a Fireside Chat at the CCDAS digital asset conference, organized by CCDtata, an FCA-authorized benchmark administrator and a world-leading provider of high-quality digital asset data for institutional use. As per details from Decrypt, Boyd that the FCA plans to utilize the forthcoming UK crypto sandbox, pending Treasury approval, as a foundation for crafting comprehensive legislation.
LATAM
2023 Debate: Argentine Candidate Advocates CBDCs for Hyperinflation - Canal 26: Argentine presidential candidate Sergio Massa has proposed launching a central bank digital currency (CBDC) to combat the country's chronic inflation. He rejected the idea of dollarization, emphasizing the need to defend the national currency. Massa faces competition from pro-Bitcoin candidate Javier Milei, who seeks to adopt the U.S. dollar as Argentina's currency and abolish the central bank. The general election on October 22 will decide the nation's monetary direction in addressing inflation, which ranks among the world's highest.
Update of the Law 3706, de 2021 - Senado Federal do Brasil: A Brazilian Senate committee has endorsed a bill proposing legal definitions and penalties for pyramid schemes and cryptocurrency-related crimes, along with mandatory asset segregation for crypto exchanges. Penalties may include prison terms of four to eight years and fines. The bill will move to the Constitution and Justice Committee for further consideration. Senator Soraya Thronicke stressed the importance of legal clarity to prevent cryptocurrency-related fraud.
MENA
UAE Introduces Stablecoin and Digital Asset Rules and Laws - Cryptopolitan: In the final week of September, two major regulatory bodies, namely the Dubai Virtual Assets Regulatory Authority and the Dubai International Financial Center (DIFC) in the UAE, unveiled revisions to their cryptocurrency regulations. These updates specifically target digital assets, security tokens, and stablecoins. The Dubai Virtual Assets Regulatory Authority, known as VARA, introduced amendments to its virtual asset rulebook and implemented fresh regulations pertaining to what it terms "Fiat Referenced Virtual Asset" (FRVA), more commonly recognized as stablecoins linked to a stable value.
Global
Working Paper on assessing macrofinancial risks from crypto assets - International Monetary Fund: The IMF has introduced a Crypto Risk Assessment Matrix (C-RAM) to help countries identify crypto-related risks and responses. It assesses the macroeconomic impact, traditional financial indicators, and global risks. When applied to El Salvador, C-RAM identified market, liquidity, and regulatory risks due to its Bitcoin adoption. The IMF has consistently cautioned against El Salvador's use of Bitcoin, citing threats to financial stability and consumer protection. Regulators are working to respond to evolving crypto risks, with the IMF and Financial Stability Board collaborating on policy recommendations.
Industry News
European Union
Kraken acquires Dutch crypto broker BCM for European expansion - Kraken: Kraken is acquiring Dutch crypto broker Coin Meester B.V. (BCM) to expand its European presence. BCM, founded in 2017, offers crypto services in the Netherlands, and this acquisition will strengthen Kraken's position in the Dutch market while providing BCM's clients access to Kraken's offerings. Kraken's move aligns with European regulatory changes, like the Markets in Crypto-Assets (MiCA) framework, to offer more competitive products and services. The deal is subject to regulatory approvals, and financial details remain undisclosed.
Bitpanda's battle against clones: Safeguarding trust in crypto exchanges - Finance Magnates: Bitpanda, a reputable cryptocurrency exchange, has become a victim of clone activity, highlighting a significant issue in the crypto industry. The Spanish CNMV has issued a warning against unregulated entities offering trading platforms, including a clone named Bits Panda, which closely resembles Bitpanda. These clones can deceive investors, posing a threat to trust in the crypto exchange sector. Regulatory authorities are taking steps to address this problem, as clone websites are proliferating in the crypto industry, targeting both seasoned and novice traders.
Estonia's crypto licensing attracts criminal activity and sanctions evasion - Kyiv Independent: An investigation reveals that Estonia's crypto licensing system, intended to regulate cryptocurrency businesses, has attracted international crypto criminals who exploited the "licensed in the EU" title for illicit purposes. Crypto firms in Estonia have been linked to money laundering, fraud, sanctions evasion, and support for Russian paramilitary groups. Journalists uncovered connections between an Estonia-registered crypto company, Sberbank (Russia's largest state-owned bank), and various cybercriminals.
LATAM
Visa's Innovation Head discusses Brazil's payment projects - Neofeed: The article discusses Brazil's role as Visa's innovation hub and explores various payment projects underway in the country. Vanessa Colella, Visa's global head of innovation, highlights initiatives like DREX and solutions addressing currency exchange challenges. Brazil's dynamic market and diverse payment ecosystem make it an ideal testing ground for Visa's innovative projects. The article likely delves into specific details and insights from Vanessa Colella regarding Visa's innovation strategy in Brazil.
MENA
DTR launches in UAE and licenses stablecoin to DRAM Trust - Finextra: Distributed Technologies Research Ltd. (DTR), based in Abu Dhabi Global Market (ADGM), has launched in the UAE and licensed its stablecoin technology to Hong Kong-based DRAM Trust. This move marks DTR's mission to develop innovative finance technologies. Stablecoins, like DRAM, are cryptocurrency types tied to an underlying asset for stability. DRAM Trust aims to provide stability to the monetary system, similar to how Dynamic Random-Access Memory revolutionized microcomputers. The stablecoin market is expected to grow to $2.8 trillion in the next five years, with DTR selecting DRAM Trust as its partner due to its transparency, cybersecurity, and dollar-linked stablecoin.
Global
Project Atlas - Bank of International Settlement (BIS): BIS, De Nederlandsche Bank, and Deutsche Bundesbank are partnering on Project Atlas, a data platform to analyze the macroeconomic impact of crypto asset markets and DeFi. This collaborative effort combines on-chain and off-chain data, offering tailored insights for central banks. The initial proof of concept focuses on cross-border crypto asset flows. The project aims to address the challenge of fragmented and unstandardized crypto data sources, providing valuable insights for payments, macroeconomic analysis, and financial stability. Project Atlas is an example of the BIS Innovation Hub's interdisciplinary work, offering a starting point for comprehensive analysis of crypto market data.
Project Mariana - Bank for International Settlement (BIS): The BIS, in partnership with the Bank of France, MAS, and the Swiss National Bank, released a report called "Project Mariana" focusing on cross-border trading and settlement of wholesale central bank digital currencies (wCBDCs) using DeFi technology on a public blockchain. The project employs a common token standard for currency exchange and interoperability, with bridges connecting different networks and an Automated Market Maker (AMM) for spot FX transactions. It explores the commercial viability of AMMs for wCBDC-based FX transactions and the potential benefits of tokenization for monetary policy. The report calls for continued experimentation by central banks and market participants to understand tokenization's advantages and challenges.
Visa discloses $3 billion crypto payment volume via exchanges - Cointelegraph: Visa executive Akshay Chopra told Cointelegraph that their partnerships with cryptocurrency exchanges have facilitated over $3 billion in payment volume since 2021. Visa's collaboration with major crypto exchanges enables users to make payments at 80 million Visa merchants. Chopra emphasizes Visa cards as a bridge between traditional and crypto payments and discusses blockchain's potential to disrupt payment settlements. He highlights the benefits of progressive regulatory environments like the UAE's. Visa is actively promoting stablecoin and blockchain payment adoption and investing $100 million in AI-driven products through Visa Ventures.
Fliggs and T-Mobile Launch All-Digital Web3 Mobile Service - PR Newswire: Fliggs mobile and T-Mobile have teamed up to launch the world's first all-digital Web3 Mobile Virtual Network Operator (MVNO). This groundbreaking collaboration integrates a non-custodial wallet into Fliggs mobile's app, enabling customers to access Web3 and FinTech services, decentralized ID, and cryptocurrency payments, all while prioritizing data privacy. Fliggs mobile aims to make leading technologies affordable and accessible to all through this partnership. T-Mobile, with its extensive 5G network, is excited to support this innovative venture, which is set to redefine mobile services and Web3 integration. The MVNO is expected to launch its super app in Q1 2024, offering a range of telco and Web3 services.
Nodle partners with Adobe and Linux Foundation to develop blockchain-based content authenticity solution - Coin Time: Blockchain technology is being used by Nodle, in collaboration with Adobe and the Linux Foundation, to authenticate real-world media content as AI advances. Nodle's ContentSign solution employs blockchain to ensure the integrity of data from the moment it's captured by devices, offering applications in journalism and insurance. In journalism, it verifies the authenticity of content by creating a unique signature and minting it as an NFT on the Nodle blockchain. In the insurance sector, it's explored as a means to validate visual proof for claims accurately and securely.
Wirex unveils W-Pay: Transforming payments with ZK-Powered App Chain - Wirex: Wirex is introducing W-Pay, a cutting-edge App Chain designed to transform payments. This article highlights W-Pay's key features, including Zero-Knowledge technology for fast and secure transactions, EVM compatibility, and Account Abstraction for user-friendly experiences. The adoption of Polygon CDK ensures scalability and security. Wirex's approach includes reshaping fiat credit with digital asset collateral and simplifying payments through on-chain wallets. W-Pay represents a significant step toward integrating blockchain into payments in the era of Web 3.0.
