Updates

E-Money and virtual currencies

2019

By recent reports, Russian government is preparing to move the significant amount of resources to the virtual currencies. Allegedly, Russia is planning the regulation addressing the use of cryptocurrencies and other crypto assets. Russian economics close to Kremlin stated for the press that Russia even considers to use bitcoin as a reserve currency by investing the significant amount of resources.

 

At the request from the European Commission in order to set the regulatory framework with regards to ICO and crypto-assets in general, European Securities and Markets Authority (ESMA) published a guideline in which classified crypto-assets and looked at the specific gaps in regulatory framework considering crypto-assets. Crypto-assets are recognized to be in several forms. They can be virtual currency, digital tokens issues trough ICO, or tokens that have attached profit or governments rights. ESMA expressed the concerns about the risk for investors, and emphasized the importance of appropriate safeguards to be set in place. Recognizing that crypto-asset is the new way of digital assets, ESMA looked at the possible existing regulatory framework mainly the Markets in Financial Instruments Directive (MiFid). ESMA recognized that assets that cannot be covered by the MiFid, (such as cryptocurrencies) at a minimum needs to have Anti Money Laundering (AML) requirements set on place. The ESMA’s Advice take a look at possible ways in which noted gaps can be addressed. Read the full report here.

Capital markets authorities of Kenya issued the statement warning the general public about the specific ICO founding for: 'keniacoin'. Warning is addressing the dubious nature of this particular ICO, but also warned the general public to withhold the participation in initial coin offering issued in Kenya. Financial authority was investing the company Wiseman Talent Ventures about the discrepancy in claims about the funds raised.

Authorities are also warning about the promises of the 10% return for every investment in this ICO.

2018

Paper by American and Israeli researchers looked at the proliferation of frauds using tactic long known by the financial markets, called ‘pump and dump’ scheme. They looked at the unofficial channels on Telegram, Discord, and other messaging app groups that sent the false informations; so called ‘pump signals’. Emergence of nearly 2000 cryptocurrencies in 2017, created the place for the known financial swindlers and other unethical players to take the advantage of unregulated markets and online exchanges. Research recorded more than 3500 ‘pump signals’, concluding that ‘pump and dump’ schemes are widespread in cryptocurrency market. This can be a strong signal for regulators to try impose the rules common in other financial markets.

One of the biggest cryptocurrency companies Blockstream announced the launch of its fifth satellite into the Earth's orbit. This will complete the worldwide coverage of broadcasting bitcoin blockchain. Blockstream announced that bitcoin users will no longer need an Internet connection in order to connect to the global bitcoin payment network. New, fifth satellite will cover the region of Asia-Pacific completing the world wide coverage. Blockstream is working on building the global payment infrastructure for cryptocurrencies.

Boerse Stuttgart Group, second largest stock exchange in Germany announce the plans for start of the cryptocurrency trading from the beginning of 2019. They announced the plans for teaming up with the fintech company Solaris in order to develop the trading platform. In a joint statement ‘Boerse Stuttgart Group’ and ‘Solaris bank’ stated that: ‘reliable and performant trading venue is a fundamental contribution to our shared vision of a hybrid financial world with both fiat and crypto currencies’

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