The exchange has notified its clients in India to close all margin positions and withdraw funds by April 30, as failure to comply will restrict account access to withdrawals only. This move comes as India has been strengthening the regulatory framework on cryptocurrency exchanges.
Notably, OKX was not among the cryptocurrency exchanges listed in the notice issued by the FIU IND in December. Discussions between Indian authorities and some of the exchanges that received notices indicate efforts to address regulatory concerns and explore ways for exchanges to operate legally in India.
Cryptocurrency entrepreneur Do Kwon has been approved for extradition from Montenegro to South Korea by the appeals court in Montenegro. This decision comes as a result of allegations of fraud linked to the collapse of his cryptocurrency company, Terra, which resulted in the loss of around $40 billion of investors’ money and shook global crypto markets. Kwon, whose real name is Kwon Do-hyung, had been on the run for months before being arrested in Montenegro in March last year for using a fake passport.
The Montenegrin appeals court rejected the appeal made by Kwon’s lawyers and upheld the extradition order issued by the Podgorica High Court. However, no specific timeline for the extradition transfer has been mentioned. This decision follows a previous court’s ruling against extraditing Do Kwon to the United States.
Kwon’s business partner, identified by his initials J.C.H., has already been deported to South Korea in early February, highlighting Montenegro’s cooperation with South Korea in this matter. The collapse of TerraUSD, a stablecoin, and its sister token Luna in May 2022 resulted in significant financial losses for many investors. Experts have described the collapse as a glorified Ponzi scheme set up by Kwon, which caused numerous investors to lose their life savings.
The news text also mentions the increasing scrutiny faced by cryptocurrencies, including the high-profile collapse of the exchange FTX, as regulators have become more vigilant in light of various controversies in the past year. This highlights the need for stricter regulations in the cryptocurrency sector to protect investors and ensure the legitimacy of these digital assets.
A Nigerian court has issued an interim order requiring cryptocurrency exchange Binance to provide comprehensive information on all Nigerian traders using its platform to Nigeria’s Economic and Financial Crimes Commission (EFCC). The order comes after Nigeria initially requested information about Binance’s top 100 users in the country and their transaction history over the past six months. Justice Emeka Nwite from the Abuja Division of the Federal High Court granted the motion filed by EFCC, seeking information on any Nigerian involved in trading on Binance. The court ordered Binance to provide the EFCC with the requested data.
This move by Nigerian authorities is part of their efforts to regulate the cryptocurrency industry, which they accuse of facilitating illegal capital outflows. They claim that these outflows have contributed to the weakening of the Nigerian currency ‘naira’ against the dollar. Binance, in particular, has come under scrutiny, with Nigerian authorities demanding $10 billion in penalties for enabling around $26 billion of untraceable funds.
To further address concerns, Nigerian authorities have detained two senior executives from Binance after inviting them to the country for discussions on the matter. A court hearing for the detained executives is scheduled for Wednesday. In addition, Nigerian authorities have proposed a 400% increase in registration fees for crypto firms operating in the country.
The European Banking Authority (EBA) has released the final draft of the Regulatory Technical Standards (RTS) for handling complaints received by issuers of asset reference tokens (ARTs) under the Markets in Crypto-Assets (MiCA) regulation. The EBA collaborated closely with the European Securities and Markets Authority (ESMA) in developing the requirements, templates, and procedures necessary for effectively managing complaints related to stablecoins.
The draft RTS cover a range of aspects regarding complaints handling. They include guidelines for the complaints management policy and function, the provision of information to stablecoin holders and other interested parties, templates and recordings, languages, procedures for investigating complaints, and communication of the investigation outcomes to complainants. Specific provisions are outlined for complaints handling involving third-party entities. These comprehensive guidelines aim to establish a fair and transparent process for dealing with complaints in relation to stablecoin issuers.
During the public consultation period the proposed approach by the EBA received overall support from respondents who considered it to be appropriately balanced. However, some respondents suggested a more uniform approach to complaints handling between the EBA’s RTS and the equivalent RTS by ESMA for the crypto asset service provider sector.
Taking into account the responses received, the EBA has made targeted amendments to the draft RTS in order to add clarity and align more closely with ESMA’s RTS. The amendments primarily focus on requirements related to languages, data protection, and the procedure for submitting an electronic complaint. These changes aim to address the suggestions put forward during the public consultation period and ensure consistency between the two authorities.
Although stakeholders raised concerns about trademark misappropriation and infringement on NFT platforms, the study found that most stakeholders believe the existing laws and registration practices are sufficient. Therefore, the study concluded that no changes to intellectual property laws or registration practices are necessary at this time.
Some stakeholders expressed concerns about enacting NFT-specific legislation too prematurely, as it could impede the ongoing development and evolution of NFT technology. The study supports the viewpoint that enacting specific legislation for NFTs would be premature and could hinder the industry’s growth.
The US Securities and Exchange Commission (SEC) deemed the NFT offerings sold by Impact Theory to be securities because the company promised investors would profit from them. As a result, Impact Theory agreed to reimburse investors and pay a fine of $6.1 million. It is important to note that this case does not imply that all NFTs are considered securities by regulators.
The study also identifies the lack of controlling judicial precedent regarding the enforcement of trademark registrations for physical goods against the use of the same mark on similar digital goods tied to blockchains and NFTs.
The Hong Kong Monetary Authority (HKMA) has announced the launch of a new stablecoin issuer sandbox arrangement. This initiative is part of the HKMA’s plan to regulate stablecoin issuers in Hong Kong. It aims to provide a platform to communicate supervisory expectations to parties interested in issuing fiat-referenced stablecoins in Hong Kong, and to gather feedback on proposed regulatory requirements.
Applicants who wish to participate in the sandbox arrangement must have a genuine interest in developing a stablecoin issuance business in Hong Kong, supported by a reasonable business plan. Under this arrangement, their proposed operations will be conducted within a limited scope and in a risk-controlled manner. Detailed information about the sandbox arrangement can be found in the Annex.
To ensure transparency, the HKMA will maintain an up-to-date list of the participants on its website, which will be regularly updated. This will allow interested parties to stay informed and up-to-date with the latest developments.
Mr Eddie Yue, Chief Executive of the HKMA, emphasized the importance of the sandbox arrangement as a platform for the HKMA and the industry to exchange views on the proposed regulatory regime. He noted that the arrangement will aid in formulating fit-for-purpose and risk-based regulatory requirements, which are crucial for promoting the sustainable and responsible development of the stablecoin issuance business.
The London Stock Exchange has detailed the process for admitting Crypto Exchange Traded Notes (ETNs) to its trading platform. ETNs are debt securities that provide exposure to an underlying asset, and in this case, Crypto ETNs track the performance of cryptoassets like Bitcoin or Ethereum.
For the admission of Crypto ETNs, the London stock exchange has established specific criteria to protect the reputation and integrity of its markets. Firstly, the proposed Crypto ETN must be physically backed and not leveraged. Secondly, it must have a reliable and publicly available market price or value measure for the underlying asset. Lastly, the underlying cryptoassets must be Bitcoin or Ethereum.
Regarding the custody of the cryptoassets, they must be held in “cold storage,” meaning offline depositary wallets. If alternative arrangements are used instead of cold storage, the issuer must obtain an audit report from a qualified third party. The custodians holding the cryptoassets must also comply with Anti-Money Laundering (AML) regulations in the United Kingdom, European Union, Jersey, Switzerland, or the United States.
To facilitate a smooth admission process for Crypto ETNs, the London stock exchange encourages early engagement from prospective issuers. Issuers can admit up to three different currency lines for each Crypto ETN. These lines can be applied for simultaneously with the main currency line or at a later stage. The required documentation for multi-currency lines is similar to that of the standard line, except for the prospectus/pricing supplements.
The Financial Conduct Authority (FCA) has announced that it will allow Recognised Investment Exchanges (RIEs) to create a UK listed market segment for cryptoasset-backed Exchange Traded Notes (cETNs). This segment would be exclusively available to professional investors, such as investment firms and credit institutions authorized or regulated to operate in financial markets.
With a longer trading history and increased data, the FCA believes that exchanges and professional investors will be better equipped to assess the risk associated with cETNs. The FCA will consider applications from RIEs on a case-by-case basis for listing cETNs.
Exchanges must have appropriate safeguards in place to ensure that the market segment is only accessible to professional investors and must fully understand the risks associated with admitting crypto-linked instruments to trading.
The FCA reminds individuals that cryptoassets are high-risk and largely unregulated, and advises them to be prepared for potential losses. The FCA is actively collaborating with the government, international partners, and industry to develop the UK’s cryptoasset regulatory framework and lead international standards in this domain.
The BRICS group of countries (Brazil, Russia, India, China, and South Africa) is collaborating on the creation of an independent payment system using blockchain and digital technologies, according to a report by Russian news agency TASS. The objective is to develop a secure, efficient, and blockchain based payment system that is convenient for governments, ordinary people, and businesses. It should also be cost-effective and free from political influence. This initiative is part of the BRICS group’s efforts to enhance its role in the international monetary system and reduce reliance on the US dollar.
Kremlin aide Yury Ushakov stated in an interview with TASS that an independent payment system is an important future goal. By developing their own payment system, BRICS countries aim to enhance their financial sovereignty and reduce vulnerabilities associated with relying on existing global payment systems.
The report also highlighted the BRICS group’s ongoing efforts to reduce reliance on the US dollar, a concept known as de-dollarization. The development of the Contingent Reserve Arrangement will play a crucial role in this aspect as it will enable the use of currencies other than the US dollar. This diversification aims to provide BRICS countries with more stability and flexibility in their financial transactions and reduce exposure to potential economic risks associated with a single dominant currency.
The endorsement of crypto assets, tokenization, and AI underscores the importance of embracing technological advancements in the future of finance.
The most popular cryptocurrency, bitcoin, experienced a rally in price during the last two weeks. Contrary to some predictions, approval of the Exchange Traded Funds (ETF) in the United States pushed the request for the cryptocurrency, creating the cycle in which the bitcoin price went up in a short time. The previous all-time high price traded for one bitcoin was $69.000 back in November 2021. The bitcoin is now traded above the $67.000
Back in January, the US Securities and Exchange Commission (SEC) approved the first bitcoin ETF after seven years since the first request. The SEC granted 11 ETFs and some of the biggest financial firms and institutional investors announced that their ETF was a success. The SEC’s decision made a clear path for institutional investors to offer bitcoin as an investment to its customers.
Having in mind the number of bitcoins consumed by the ETFs daily, and considering that the bitcoin mining industry can produce around 900 bitcoins per day, the demand for bitcoins continues (and will continue) to grow. It is important to mention that, regardless of the large demand, the bitcoin creation can not be hurried up or anyhow ramped up. Bitcoin has a set emission (fixed supply) which is planned and embedded into the consensus mechanism that underlays cryptocurrency.
Another event, also embedded into the bitcoin protocol, played a significant role and will continue to do so in forthcoming days. In approximately 48 days (mid-April 2024) bitcoin will have another ‘halving’ event. That is a planned reduction of the reward for miners in the form of newly minted coins. At this moment, the reward for miners who find a valid bitcoin block is 6.25 bitcoins. After the next halving, the reward will drop to 3.125 newly created bitcoins per block. This will reduce the number of daily minted bitcoins to around 450, creating even more pressure on the demand side, hence a possible new time-high valuation for the bitcoin. The halving occurs once in four years and it has influenced the price of bitcoin throughout its history. No reason to believe it will be different this time.
