21Shares, a leading issuer of crypto exchange-traded products (ETPs), has called on the European Union to establish a unified regulatory framework for incorporating cryptocurrencies into investment products. The firm highlighted the current inconsistencies across member states, where countries like Germany and Malta allow crypto in UCITS funds, while others, such as Luxembourg and Ireland, do not.
A unified regulatory approach, 21Shares argues, would not only provide much-needed clarity for investors but also align Europe with other global markets, including the US and Hong Kong. By establishing clear guidelines, retail and institutional investors alike could benefit from greater diversification opportunities, all within a secure, regulated environment.
The European Securities and Markets Authority (ESMA) has already begun reviewing feedback on the inclusion of crypto assets in UCITS funds, with a decision expected to follow. 21Shares, which currently offers over 40 ETPs, believes this move would pave the way for greater access to digital assets in a regulated market.
The National Bank of Bahrain has launched its first bitcoin investment fund aimed at institutional investors in the Gulf Cooperation Council (GCC), which includes Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the UAE. Developed in partnership with ARP Digital, the fund allows investors to gain exposure to bitcoin while ensuring full protection against potential losses, albeit with a cap on possible gains.
Abdulla Kanoo, co-founder of ARP Digital, described the collaboration with NBB as a potential game-changer for the regional market. By combining ARP Digital’s expertise in digital assets with NBB’s strong presence in the financial sector, they have created a secure investment product for those looking to explore bitcoin.
Bahrain’s efforts to cultivate a crypto-friendly environment have attracted major players like Binance and Crypto.com, while the UAE is also advancing its regulatory framework for cryptocurrencies. In 2023, Dubai’s Virtual Asset Regulatory Authority issued comprehensive rules to facilitate Web3 firms operating in the region.
According to Chainalysis, the MENA region recorded $338.7 billion in crypto transactions between July 2023 and June 2024, primarily driven by institutional investors. With the new fund, NBB provides a promising opportunity for regional investors to safely engage with bitcoin in a well-regulated landscape.
A European Central Bank official has suggested the creation of a ‘European ledger,’ a blockchain platform that could bring together digital assets and money across the continent. This proposed platform, referred to as a digital capital markets union, would tackle Europe’s fragmented financial systems and outdated regulations, creating a more efficient environment for digital assets.
According to Piero Cipollone, an ECB executive board member, many European banks are already experimenting with distributed ledger technology (DLT), which could lead to greater financial integration. However, non-interoperable systems between countries continue to create fragmented liquidity. A unified platform could bring significant benefits, including cost reductions and round-the-clock operations, benefiting both investors and central banks.
Despite the advantages, concerns remain that a European ledger could stifle financial innovation. Cipollone noted that traditional finance might require the flexibility provided by competing DLT platforms to flourish. As discussions continue, the ECB is exploring ways to settle DLT transactions using central bank money, while seeking long-term solutions to avoid inefficiencies.
El Salvador’s President Nayib Bukele has met with Argentina’s President Javier Milei in Buenos Aires to discuss shared economic and security challenges. Their discussions included Milei’s zero-deficit budget strategy and Bukele’s experiences with debt management. Both leaders found common ground in their political journeys, particularly Bukele’s struggle with parliamentary opposition when he first took office.
During the visit, Bukele also met with Argentine senators and Vice President Victoria Villarruel to advise on cryptocurrency matters. Villarruel expressed significant interest in Bitcoin and El Salvador’s innovative use of Volcano Bonds for financing. These discussions signal Argentina’s growing interest in digital assets as part of its financial future.
Meanwhile, Uruguay has taken a major step in regulating cryptocurrency, passing a law that creates a clear framework for digital asset use. The law grants the central bank oversight of virtual asset service providers, ensuring compliance with anti-money laundering regulations whilst paving the way for new opportunities in the crypto sector.
The UAE has introduced amendments to its VAT regulations, exempting the transfer and conversion of digital assets, including cryptocurrencies, from VAT. This change, which applies retroactively from January 2018, will also benefit companies involved in managing investment funds. Businesses dealing with virtual assets are urged to review their past VAT positions to ensure proper input tax recovery, which enables them to claim back VAT paid on eligible purchases.
Virtual assets in the UAE are defined as representations of value used for digital trading or investment, excluding fiat currencies or financial securities. Meanwhile, regulators in the UAE have stepped up efforts to refine crypto regulations. Dubai’s VARA and the SCA have agreed to supervise virtual asset service providers jointly, allowing VASPs licensed in Dubai to operate across the wider UAE.
Additionally, the Virtual Asset Regulatory Authority has tightened rules on marketing, requiring firms to include disclaimers highlighting the volatility and potential loss in the value of digital assets. This move aims to ensure greater transparency in the rapidly growing crypto market.
LEGO Group’s website was briefly compromised on 5 October, with a scam promoting a fake ‘LEGO Coin’ token appearing on the homepage. The message encouraged users to purchase the token in exchange for ‘secret rewards’ but redirected them to a phishing site. The scam was removed after about 75 minutes, and LEGO confirmed that no user accounts had been compromised.
LEGO has since assured customers that the issue has been resolved and steps are being taken to prevent future incidents. Despite earlier hints in 2021 about entering the NFT space, LEGO has not officially pursued any crypto-related ventures.
This incident highlights the ongoing threat of cryptocurrency scams, which saw $127 million stolen from victims in the third quarter of 2024, with September alone accounting for $46 million in losses.
Taurus, supported by Deutsche Bank, has partnered with Chainlink Labs to enhance the adoption of tokenised assets by financial institutions. The collaboration aims to resolve key challenges, including security, data accuracy, and cross-chain connectivity, which are vital for institutional investors. By integrating Chainlink’s Data Feeds and Proof of Reserve, Taurus hopes to offer improved transparency and reduce risks associated with tokenised assets.
In addition, Chainlink’s Cross-Chain Interoperability Protocol will enable tokenised assets to move smoothly across different blockchains, increasing liquidity and accessibility. Taurus has already secured regulatory approval to offer tokenised securities trading, allowing retail clients to participate in digital asset markets more easily.
Both companies believe these advancements will encourage broader institutional adoption of tokenised assets, providing greater efficiency and data integrity in the market.
Cryptocurrency index investing is emerging as a strategic solution for managing the volatility of the digital asset market. By bundling multiple cryptocurrencies into a single investment vehicle, index funds allow investors to diversify risk and gain exposure without the complexities of managing individual assets. It approach is particularly appealing to institutional investors looking to include crypto in their portfolios.
The growing popularity of crypto index funds reflects their ability to streamline investment strategies. These funds offer a range of options, from focusing on stable assets like Bitcoin and Ether to targeting high-growth sectors such as decentralised finance. As the market matures, crypto index investing continues to attract professional investors seeking a balanced and risk-managed entry into the digital economy.
Stablecoins are now a crucial part of Sub-Saharan Africa’s crypto economy, representing 43% of the region’s total transaction volume, according to a report from Chainalysis. In nations struggling with unstable currencies and limited access to US dollars, dollar-pegged tokens like Tether and USDC are helping businesses and individuals manage value and carry out international trade.
Due to foreign exchange shortages, with 70% of African countries affected, many are turning to stablecoins as an alternative to traditional financial systems. Ethiopia, which recently devalued its currency by 30%, has experienced a 180% rise in stablecoin transfers, signalling growing reliance on this digital solution.
Experts believe stablecoins will continue to shape the region’s financial future. Rob Downes, head of digital assets at ABSA Bank, expects these tokens to be the primary crypto use case in South Africa within the next few years, as the need for dollar equivalents rises.
Kazakhstan’s financial regulators have frozen $1.2 million in cryptocurrency and shut down 19 illegal over-the-counter platforms, marking a significant step in their ongoing crackdown on unlicensed crypto activity. These platforms, with a combined turnover exceeding $60 million, were operating illegally and posed risks related to money laundering and terrorism financing.
In addition to freezing funds, the Financial Monitoring Agency has targeted illegal crypto-mining operations. Since the start of the year, authorities have dismantled nine mining sites and seized around 4,000 mining rigs. Furthermore, more than 5,500 unlicensed online exchangers have been blocked as part of this broad regulatory effort.
Kazakhstan’s attempts to tighten its control over the crypto industry extend to major international players. In December 2023, the country banned the US-based crypto exchange Coinbase, accusing it of violating local laws regarding the trading of uninsured digital assets.
