Regulatory News
European Union (EU)
ESMA publishes its third batch of MiCA Consultations - On March 25, 2024, the European Securities and Markets Authority (ESMA) has published its latest series of consultations under the Markets in Crypto Assets Regulation (MiCA). These consultations encompass a range of topics including market integrity, portfolio management standards, crypto-asset transfers, and cybersecurity protocols. Noteworthy is ESMA's alignment of guidelines with existing regulatory frameworks, such as the Market Abuse Regulation and MiFID II, to ensure regulatory compliance among Crypto-Asset Service Providers (CASPs). Stakeholders have until June 25, 2024 to provide feedback, with ESMA expected to review responses and issue final reports by December 2024.
ESMA finalizes its first batch of Draft Technical Standards for MiCA - On March 25, 2024, ESMA published its final Draft Technical Standards for the Markets in Crypto Assets Regulation (MiCA) on various aspects such as notification procedures for crypto-asset services, authorization processes for Crypto-Asset Service Providers (CASPs), and complaints-handling procedures. Industry responses to the initial ESMA draft RTS consultation contested the assessment of acquisitions in CASPs, with stakeholders finding ESMA's requirements stricter than MiFID. Despite objections, ESMA upheld its initial proposal. The next step involves the submission of the Draft Technical Standards to the Commission, which has three months to adopt, amend, or reject them.
ECB's Cipollone Letter Discusses Implications of Multiple Digital Euro Accounts - Piero Cipollone, a Member of the ECB's Executive Board, recently addressed the Economic and Monetary Affairs Committee regarding the Digital Euro project. The letter, published on March 25th, acknowledges the Committee's support and provides updates on technical considerations surrounding multiple digital euro accounts for individual users. Alongside the letter, the ECB released a technical note highlighting potential trade-offs and considerations for payment service providers (PSPs) if implementing multiple accounts. Key points include privacy, user experience, enforcement of holding limits, and management of offline limits. The ECB emphasizes the value of the digital euro's "switch-and-port" functionality and invites feedback from market participants.
United Kingdom (UK)
LSE Plans to List Crypto ETNs by May After FCA Update - The London Stock Exchange (LSE) is set to list cryptocurrency exchange traded notes (ETNs) by the end of May, following a shift in stance by the UK's Financial Conduct Authority (FCA). Issuers will have until April 15 to submit such proposals if they want to have the securities listed on May 28, it added.The move marks a significant shift in UK crypto regulation, as the FCA previously banned the sale of crypto ETNs to retail investors but now allows them for professional investors.
UK Government Hosts Cryptoasset and Fintech Breakfast Reception to Discuss Regulatory Framework and Industry Growth - On March 21st, 2024, Bim Afolami MP, Economic Secretary to the Treasury, hosted a breakfast reception at No.10 Downing Street focused on crypto assets and fintech. Stakeholders, including the FCA and industry representatives, discussed creating a fair regulatory framework. Afolami highlighted the UK's fintech leadership, attracting $5.1 billion in investment in 2023. He emphasized the importance of maintaining the UK's position as a top destination for fintech firms, supporting job growth and economic development.
LATAM
Brazilian Authorities Form Committee to Boost RWA Carbon Credit Tokens - On March 25, 2024, the Brazilian government has published the DECREE Nº 11.961, that speaks about launching the Interinstitutional Committee of the Brazilian Sustainable Taxonomy (CITSB) along with key regulatory bodies such as the Central Bank and CVM. This move signals a concerted effort to advance the market for tokens backed by real-world assets (RWA), particularly those tied to carbon credits. By creating a standardized classification system for sustainable activities and assets, the committee aims to foster a green and digital economy while addressing environmental and climate concerns.
MENA
CBUAE Launches "The Digital Dirham" Central Bank Digital Currency Strategy - On March 23, 2024, the Central Bank of UAE (CBUAE) has commenced the implementation of its Central Bank Digital Currency (CBDC) Strategy, known as "The Digital Dirham," in collaboration with G42 Cloud and R3. The strategy, part of CBUAE's Financial Infrastructure Transformation (FIT) Programme, aims to enhance domestic and cross-border payments, promote financial inclusion, and strengthen the UAE's payment infrastructure. The first phase includes soft launch of mBridge for cross-border transactions, proof-of-concept for bilateral CBDC bridges with India, and domestic CBDC issuance. CBDC will serve as a secure, efficient form of payment and contribute to the UAE's digital transformation. Governor H.E. Khaled Mohamed Balama emphasizes CBDC's role in positioning the UAE as a global financial hub and accelerating digitalization.
ADGM Consultation Paper on Registering Trust Information - On March 27, 2024, the Registration Authority of Abu Dhabi Global Market (ADGM) has released a Consultation Paper seeking public feedback on proposed amendments to the Beneficial Ownership and Control Regulations 2022. The amendments aim to establish a non-public register of certain information for express trusts within the ADGM jurisdiction. Key features include requirements for trusts with an ADGM trustee acting by way of business, maintenance of trust records including beneficial ownership, trust name, creation date, and objectives, trustee responsibility for record maintenance, and non-public accessibility of the trust register. The proposed legislative framework reflects ADGM's commitment to combat money laundering, terrorist financing, and proliferation financing by providing competent authorities with essential trust information. The consultation period closes on April 21, 2024.
Global News
Hague Conference Launches Project on Digital Asset Tokenization - In March, the Hague Conference on Private International Law (HCCH) has initiated a project to explore legal aspects of digital tokens, aiming to resolve cross-border business uncertainties. The project will focus on collating the taxonomy of digital instruments, including real-world asset and fund tokenization. It excludes securities, CBDCs, and carbon credits, aligning with existing HCCH projects. Potential topics include tokenization of existing assets, custody rules, and control issues in different blockchain environments. This initiative reflects the growing recognition of digital assets in the legal landscape and seeks to address regulatory challenges in the industry.
Philippines Implements Ban on Binance Exchange Access Amid Regulatory Concerns - The Philippines Securities and Exchange Commission (SEC) has decided to restrict local users' access to the Binance cryptocurrency exchange due to apprehensions regarding the platform's unlicensed operations in the country. The SEC, in collaboration with the National Telecommunications Commission (NTC), will enforce the ban within three months to safeguard Filipino investors' funds. This move comes amidst a global trend of increased regulatory scrutiny on Binance, reflecting growing concerns regarding compliance and investor protection in the cryptocurrency space.
Industry News
LATAM
Brazil's Stock Exchange Aims to Become Custodian for Banks, OTC Desks, and Bitcoin Exchanges' Crypto Holdings - On March 25, 2024, Brazil's Stock Exchange, B3, revealed its annual report outlining its strategy for the crypto market, aiming to serve as the custodian for Bitcoin and other cryptocurrencies held by exchanges, banks, OTC desks, and digital asset firms in the country. This move aligns with potential regulatory requirements for asset segregation by the Brazilian Central Bank. B3's strategy prioritizes providing infrastructure and services for digital assets, including automated services for financial institutions, institutional infrastructure for digital assets, and a platform for verifying asset reserves. Additionally, B3 plans to expand its cryptocurrency trading services, initially launched in partnership with Banco Inter's investment platform, Inter Invest, catering to a specific client base.
Acura Capital and Patex Launch Digital Bank Focused on RWA Tokens in Brazil - Brazilian fund Acura Capital, with $3 billion in custody, has announced an exclusive partnership with cryptocurrency exchange Patex to launch the Patex Digital Bank in Brazil. This digital bank will prioritize security, efficiency, and financial inclusion, merging traditional financial services with crypto assets to cater to the unique needs of the Latin American market. With a focus on RWA tokens, the bank will facilitate the transformation of tangible assets into tradable securities, offering services such as earning interest on crypto savings, loans, integration with Pix, digital wallet, and support for multiple blockchains. Additionally, it will provide a system for merchants to accept cryptocurrencies and personal loan services.
Liqi and Crypto.com Partner to Bring CaaS to Brazil - Liqi and Crypto.com have teamed up to introduce Crypto as a Service (CaaS) to the Brazilian market. Liqi's CaaS solution, already utilized by Itaú, Latin America's largest private bank, will be integrated with Crypto.com's liquidity provisioning system. This collaboration aims to provide a comprehensive infrastructure for cryptocurrency trading in Brazil's institutional market, offering a customizable solution tailored to meet specific demands.
MENA
IOTA Foundation Launches $10 Million Investment Fund at Investopia 2024 - During Investopia 2024, Abdullah bin Touq Al Marri, Minister of Economy and Chairman of Investopia, announced the unveiling of a $10 million investment fund by the IOTA Ecosystem DLT Foundation. The fund aims to support TradeTech solutions and digital technology initiatives, fostering the growth of startups and venture projects. In partnership with TLIP, the fund seeks to enhance global trade technology and offer trade financing solutions. The initiative aligns with the UAE's commitment to advancing trade technology and digital solutions, positioning the country as a global hub for innovation. IOTA aims to redefine the digital trade and finance landscape, leveraging cutting-edge technologies for sustainable impact. Investopia 2024 provided a platform for showcasing IOTA's innovative solutions and fostering collaboration among investors and decision-makers.
UAE Crypto Investors Realize $204 Million in Gains in 2023: Bitcoin Dominates Choice - In 2023, UAE investors saw capital gains totaling $204 million from their cryptocurrency investments, with Bitcoin emerging as the preferred choice. The analysis reveals that Bitcoin accounted for 70% of the gains, followed by Ethereum at 24%. Despite the smaller gains compared to 2021, the positive trend signals recovery from the previous year's losses.
UAE's Booming Venture Capital Market to Propel Tech Start-ups in 2024 - The UAE's tech start-up ecosystem is set to thrive in 2024, with an anticipated surge in funding opportunities driven by the country's burgeoning venture capital market. Proactive government initiatives and a flourishing entrepreneurial landscape have positioned the UAE as a key player in the global start-up ecosystem. Despite global challenges, the UAE ranks second in the MENA region and 28th globally in the start-up ecosystem index, showcasing its resilience and growth potential. Start-ups in the MENAPT region secured significant investments in January, underscoring the UAE's prominence. Dubai, in particular, emerges as a leading VC ecosystem, attracting funds and start-ups alike. With a focus on early-stage investments and a stable economy, the UAE offers an attractive environment for venture capital, fostering innovation and growth in the tech sector.
Global News
Swift's CBDC Sandbox Experiments Explore Complex Use Cases - Swift, in collaboration with 38 global institutions, has concluded the second phase of sandbox testing on its central bank digital currency (CBDC) interlinking solution. The experiments demonstrated the potential of CBDCs and digital tokens across various scenarios, including digital trade, tokenized assets, FX networks, and payments. The results highlight the solution's ability to simplify trade flows, enhance liquidity in tokenized securities markets, and facilitate efficient FX settlement while promoting interoperability among diverse networks and technologies.
HashKey Teams Up with Victory Securities for Enhanced Custody and Trading - HashKey Exchange has partnered with Victory Securities to bolster virtual asset services in Hong Kong. The collaboration, announced on March 28, focuses on enhancing trading and custody services for virtual assets like Bitcoin and Ethereum. Victory Securities, licensed by the Hong Kong Securities and Futures Commission (SFC) for virtual asset services, brings regulatory expertise to the partnership. The move aims to expand HashKey Exchange's institutional business and ensure compliant, secure, and efficient solutions for virtual asset management. Victory Securities will also participate in the Hong Kong Web3 Festival to engage with industry leaders and explore the integration of virtual assets with traditional finance.
