A significant step in financial regulation will see major tech companies processing over 13 billion transactions annually subject to closer oversight. The US Consumer Financial Protection Bureau (CFPB) has finalised a rule bringing digital wallets and payment apps under the same scrutiny as banks. The move aims to enhance consumer privacy protections, combat fraud, and ensure fair account management.
The rule, targeting services like Apple Wallet, Google Pay, and Venmo, signals a shift in recognising digital payments as essential consumer tools. CFPB Director Rohit Chopra emphasised the need for oversight that reflects the growing reliance on these services. The measure, first proposed a year ago, has undergone substantial revisions to refine its scope and application.
Only companies processing over 50 million transactions annually will fall under the rule, a change from the initially proposed threshold of 5 million. Moreover, the regulation focuses solely on transactions in US dollars, excluding digital assets from its purview. Critics, including the Financial Technology Association, argue that the rule lacks a clear justification, though some in the banking industry support its introduction.
Set to take effect 30 days after its publication in the Federal Register, the rule has sparked debate over its future under a changing regulatory landscape. With the growing role of digital payments in daily life, the rule marks a pivotal moment for the industry and consumer protections alike.
Retail investors continue to dominate Bitcoin’s ownership, accounting for 88.07% of the circulating supply, according to The Block. Despite fears of institutional dominance, whales and institutions hold just 1.26% and 10.68% of Bitcoin, respectively, highlighting the strong grassroots presence in the market.
Adding momentum to Bitcoin, the historic launch of BlackRock’s Bitcoin ETF saw $1.9 billion in notional value traded on its debut day. This milestone signals growing institutional interest but also lowers barriers for everyday investors, ensuring Bitcoin remains accessible to the masses.
Bitcoin’s ownership distribution reflects its decentralised nature, with significant holdings by entities like Coinbase and even governments, though the bulk lies with retail holders. Critics arguing that Bitcoin is becoming centralised are contradicted by data showing financial products like ETFs increase accessibility while maintaining Bitcoin’s democratic ethos.
As Bitcoin edges closer to the $100,000 mark, its ownership by retail investors underscores its alignment with Satoshi Nakamoto’s vision for a decentralised financial future.
Gary Gensler, the chair of the US Securities and Exchange Commission (SEC), will step down on 20 January 2025, coinciding with President-elect Donald Trump’s inauguration. Gensler, who led the agency since 2021, is known for his stringent regulatory approach towards cryptocurrency. Under his leadership, the SEC pursued over 100 enforcement actions against crypto firms, aiming to bring compliance to what he described as an industry of 10,000 unregistered securities.
Trump, who has pledged to transform the US into the “crypto capital of the world,” plans to appoint more crypto-friendly regulators, including a new SEC chair. Summer Mersinger, a Republican CFTC commissioner advocating for leniency in crypto policies, is a potential candidate for a top regulatory position. Reports also suggest that Trump is considering establishing a White House post focused on cryptocurrency policy.
Gensler’s departure follows the earlier resignation of Gurbir Grewal, the SEC’s chief enforcer known for his rigorous oversight of the crypto sector. With Trump’s pro-crypto agenda, the leadership shake-up signals a potential regulatory shift, aiming to foster innovation and growth in the digital asset space.
The United Kingdom is set to finalise a draft regulatory framework for crypto assets by early next year, according to Economic Secretary to the Treasury, Tulip Siddiq. Speaking at the Tokenisation Summit in London on 21 November, Siddiq outlined plans for a streamlined approach to regulating stablecoins, staking services, and cryptocurrencies. The new Labour government, under Prime Minister Keir Starmer, will present the framework, replacing earlier Conservative-led initiatives disrupted by a general election.
Siddiq emphasised the importance of removing legal uncertainties, particularly around staking services, which the government does not intend to classify as “collective investment schemes.” This move aims to avoid unnecessary restrictions. Stablecoin legislation, which began in 2023, will also be part of the new framework, though it was never anticipated before 2025.
The UK faces mounting pressure to establish itself as a competitive crypto hub, especially with the European Union’s MiCA regulations taking full effect this year and the US expected to adopt a more crypto-friendly stance under President-elect Donald Trump. Critics have often blamed the Financial Conduct Authority for the UK’s perceived regulatory hurdles, but the upcoming framework seeks to enhance clarity and foster innovation in the growing crypto sector.
Former Binance CEO Changpeng Zhao has alerted the crypto community about a new exploit targeting Intel-based Mac users, which could expose their digital assets. Zhao urged users to immediately patch their systems to protect sensitive data, following the discovery of zero-day vulnerabilities on 19 November. These vulnerabilities also affect iPhones and iPads, prompting Apple to release emergency fixes.
The flaws, tracked as CVE-2024-44308 and CVE-2024-44309, allow hackers to exploit JavaScriptCore and WebKit components on macOS Sequoia. This could lead to cross-site scripting attacks, where attackers inject malicious code into trusted websites, enabling them to steal sensitive information and hijack user sessions.
Despite Apple’s strong security reputation, users have been at risk from several high-profile exploits this year. Previous attacks have included crypto-focused malware and vulnerabilities in Apple’s iMessage framework. With hackers exploiting these flaws, crypto users must stay vigilant and update their systems to safeguard their digital assets.
The Japanese government has announced plans to move forward with a significant stimulus package and sweeping tax reforms, which are expected to gain approval before the end of 2024. Prime Minister Shigeru Ishiba pledged to engage in bipartisan talks to overhaul policies, including changes to income tax, corporate taxes, and cryptocurrency taxation. It marks a notable shift from the ruling party’s earlier stance on increasing taxes.
Cryptocurrency tax reforms are set to be a focal point, as current regulations impose a variable tax of up to 55% on transactions. The opposition party has proposed a more simplified 20% flat rate for digital assets. Additional measures under discussion include raising the tax-free income threshold, reducing fuel taxes, and temporarily slashing sales taxes to support economic recovery.
These reforms come amid growing interest in Japan’s digital assets market, which has shown promising growth. The Liberal Democratic Party, under Ishiba, is pushing these changes as part of efforts to recover from political losses and adapt to shifting voter sentiment following a contentious election in September.
Gary Wang, a former FTX executive, has avoided prison after cooperating extensively with prosecutors in the case against cryptocurrency exchange founder Sam Bankman-Fried. Judge Lewis Kaplan acknowledged Wang’s lesser role in the $8 billion fraud and commended his efforts to accept responsibility. Wang had pleaded guilty to fraud and conspiracy charges but argued he was initially unaware of the scale of the misconduct.
Wang, a former chief technology officer at FTX, admitted to altering the platform’s software under Bankman-Fried’s direction, granting Alameda Research special access to customer funds. Despite realising the fraud later, Wang continued maintaining the system but expressed regret in court, vowing to dedicate his life to making amends. Prosecutors highlighted his assistance in uncovering the fraud and his current work on tools to combat market manipulation.
The two met during a summer math camp in their youth and later studied at MIT before founding FTX. Wang was part of the close-knit group living with Bankman-Fried in a luxury Bahamian penthouse before the exchange’s collapse in 2022. The company’s failure exposed the misappropriation of customer funds, leading to Bankman-Fried’s 25-year prison sentence, which he is currently appealing.
Wang’s sentencing marks the conclusion of legal actions against Bankman-Fried’s inner circle. Others implicated included Nishad Singh, who also avoided jail, and Caroline Ellison, sentenced to two years. Prosecutors emphasised Wang’s unique skill set and role in aiding investigations, describing his cooperation as pivotal in holding the former FTX leadership accountable.
South Korean authorities have officially confirmed that North Korean hacker groups Lazarus and Andariel orchestrated the infamous $50 million cryptocurrency heist from the Upbit exchange in 2019. The stolen 342,000 Ether (ETH), worth around $147 per coin at the time, has soared in value and is now estimated to be worth over $1 billion due to recent market surges.
The investigation, conducted by South Korea’s National Office of Investigation, tracked crypto flows, IP addresses, and linguistic patterns, with support from the US Federal Bureau of Investigation, to pinpoint North Korea’s involvement. It is the first time South Korea has directly tied a cryptocurrency attack to the reclusive nation, a significant breakthrough in cybercrime investigations.
Meanwhile, the probe into Upbit continues after allegations of weak Know Your Customer measures. Regulators flagged over 600,000 potential violations, including acceptance of unclear identification documents, which could lead to hefty fines and regulatory challenges for the exchange.
South Korea’s Democratic Party (KDP) is moving forward with plans to implement a tax on cryptocurrency gains starting in 2025, despite opposition from the ruling People’s Power Party (PPP), which proposed a delay until 2028. The KDP, however, is offering a compromise by raising the threshold for taxable gains from 2.5 million won ($1,800) to 50 million won ($36,000). This move would ensure that only larger investors—those making substantial profits from crypto—are affected by the tax, leaving smaller players with little to no impact.
The original crypto tax proposal, which was met with backlash from stakeholders and investors, aimed to impose a 20% annual tax on gains over 2.5 million won. The KDP’s revised plan aligns more closely with the country’s stock tax policies, where the threshold for taxable capital gains is similarly set at 50 million won. The party argues that this approach would make the tax more palatable by only targeting “big players” in the market.
This tax has been delayed multiple times, initially scheduled for implementation in 2021 but pushed back to 2023 due to opposition. Now, with a new proposal in the works, South Korea’s government aims to enact the crypto tax on 1 January 2025, unless further political manoeuvres alter the timeline.
Goldman Sachs is considering spinning out its technology platform within its digital assets business, signalling a potential shift in its blockchain and cryptocurrency strategy. The platform, which has played a significant role in advancing blockchain technology and crypto-linked products, is expected to become an independent entity within 12 to 18 months, according to Mathew McDermott, Goldman’s global head of digital assets.
The bank’s plans come as the cryptocurrency market experiences a resurgence, with Bitcoin more than doubling its value in 2024 following the approval of spot Bitcoin exchange-traded funds by the United States Securities and Exchange Commission earlier this year. The proposed spin-out would likely provide greater operational focus for the platform while aligning with market trends.
Although the project is in its early stages, Goldman Sachs‘ move highlights its commitment to adapting its digital asset strategies amid evolving regulatory and market conditions.
