Regulation

Kevin O’Leary Expects US Crypto Regulations to Come Out After Midterm Elections

21/05/2022 by Idelto Editor

Shark Tank star Kevin O’Leary, aka Mr. Wonderful, says U.S. crypto regulations will not come out until after the midterm elections. He explained that President Joe Biden “is not interested in discussing crypto” when his approval ratings have sunk to record lows. O’Leary also cited other factors, including double-digit inflation and high food and gas prices.

Kevin O’Leary on Crypto Regulation, Biden’s Policy

Shark Tank star Kevin O’Leary talked about bitcoin and cryptocurrency regulation in an interview with Stansberry Research, published Friday.

He was asked how far away the U.S. Securities and Exchange Commission (SEC) is from approving a spot bitcoin exchange-traded fund (ETF).

“It’s a long way away,” O’Leary replied. “That’s not what’s going to happen first. I think what’s going to happen first is we are going to see policy on stablecoins.” He cited two bills that have been proposed for the regulation of stablecoins. One was introduced by Senator Bill Hagerty and the other by Senator Pat Toomey.

Noting that a bill on stablecoins will be easy to pass after the midterm elections, he emphasized:

Nothing’s gonna happen until after the midterms. Biden is not interested in discussing crypto when his poll ratings are, you know whatever it is, sub-31%. That’s not a place where he wants to go, so you’re gonna have to wait until after the midterms.

Mr. Wonderful noted that when Biden issued the encouraging executive order on crypto, his ratings were higher. A new poll shows that President Joe Biden’s approval rating dipped to the lowest point of his presidency in May; only 39% of U.S. adults approve of his performance as president.

The U.S. midterm elections are scheduled for Nov. 8. If the Republican Party gains control of either or both chambers, it will have the power to thwart the president’s plans.

O’Leary explained that crypto is not one of the “issues that when you are declining in the polls, you become a champion of. That doesn’t help you.”

Noting that “The market is correcting … People are getting gas at the pump, going to the driving season, at unheard-of prices the last 20 years. The price of protein’s up 20% to 40%,” the Shark Tank star said:

Biden’s facing close to double-digit inflation … He’s not sitting around worrying about crypto.

In addition, O’Leary described that there are a lot of different proposals coming out of the SEC around climate change, crypto, and bitcoin mining. “So it’s a very volatile situation right now,” he said.

Mr. Wonderful was also asked if he thinks this crypto winter will be a long one and where the market will head now.

“The forecasts for bitcoin have never been accurate. No one’s been able to forecast its volatility,” he opined. “And you know, the speculation that it was going to be a hedge against inflation was just flat out wrong.” He continued:

I’d argue that the volatility of bitcoin is going to remain very akin to what Amazon was for the first 15 years — 30% to 50% corrections every 12 months.

He explained the reason was that “There was no institutional support in the early days of Amazon.” The Shark Tank star asserted: “That’s the same right now for bitcoin … People talk about institutions owning it. That’s just not true. They don’t own any of it and they won’t until the SEC rules on it.”

What do you think about the comments by Kevin O’Leary? Let us know in the comments section below.

Draft Law About NFTs Submitted to Russian Parliament

21/05/2022 by Idelto Editor

Lawmakers have filed a bill with the State Duma aimed at introducing the term NFTs to Russian legislation. The authors of the draft say the rights of those who own non-fungible tokens need to be protected as Russians are currently dealing with NFTs at their own risk.

Russian Deputies Propose Amendments Legally Defining NFTs

Members of the lower house of Russian parliament, the Duma, have put forward a draft law that will incorporate the term “NFT-tokens” into the Civil Code of the Russian Federation. The sponsors of the bill, Vladislav Davankov and Anton Tkachev, are from the parliamentary group of the liberal New People party.

The explanatory note to the bill, Tass news agency reported, states that the initiative aims to “recognize NFT-tokens as non-fungible tokens of unique digital assets (images, videos or other content) in the form of non-fungible data stored in a distributed ledger system (blockchain system).”

“We need to protect the rights of NFT owners,” said Tkachev, quoted by the party’s press service. He pointed out that at present the legal concept of non-fungible tokens does not exist in Russian law and people continue to make transactions with NFT tokens at their own risk. He further elaborated:

Things have moved forward with cryptocurrencies, but an NFT is not a digital currency but a digital certificate of ownership, that is, an object of intellectual property, which is why we propose to regulate NFTs as intellectual property.

While Russian authorities have been taking steps to comprehensively regulate the country’s crypto space, Russia’s current and upcoming legislation does not explicitly mention NFTs. The term digital financial assets (DFAs), introduced with a law which went into force in January 2021, partially covers cryptocurrencies and some types of tokens.

A new bill “On Digital Currency,” which was submitted by the Ministry of Finance in February, is expected to be adopted this year. It has been designed to fill the remaining regulatory gaps in the nation’s legislation. It has already won the support of the federal government in Moscow, while the Central Bank of Russia remains opposed to the legalization of cryptocurrencies like bitcoin.

Do you think the State Duma will approve the new legislation for non-fungible tokens? Tell us in the comments section below.

G7 Finance Leaders Call for Swift and Comprehensive Crypto Regulation

21/05/2022 by Idelto Editor

The G7 finance ministers and central bank governors have called for a swift and comprehensive regulation of crypto assets. The G7 decision followed the recent crypto market turmoil, including the collapse of cryptocurrencies LUNA and UST.

G7 Countries Calling for Swift, Comprehensive Regulation of Crypto Assets

The finance ministers and central bank governors from the Group of Seven (G7) industrialized nations convened in Bonn and Königswinter, Germany, on May 18–20.

Among the topics they discussed was the regulation of crypto assets following the recent market turmoil and the collapse of cryptocurrency terra (LUNA) and algorithmic stablecoin terrausd (UST).

“The G7 supports work by the Financial Stability Board (FSB) to monitor and address financial stability risks arising from all forms of crypto-assets, and welcomes increasing global cooperation to address regulatory issues associated with the use of crypto-assets, including in cross-border payments,” according to the communique summarizing the finance leaders’ key decisions, published Friday.

The G7 finance chiefs added:

In light of the recent turmoil in the crypto-asset market, the G7 urges the FSB … to advance the swift development and implementation of consistent and comprehensive regulation of crypto-asset issuers and service providers.

The FSB will work “in close coordination with international standard-setters” on crypto regulation “with a view to holding crypto-assets, including stablecoins, to the same standards as the rest of the financial system,” the communique further details.

“In particular, the G7 calls for rapid implementation of the Financial Action Task Force (FATF) ‘travel rule’ and stronger disclosure and regulatory reporting, for instance, as regards reserve assets backing stablecoins,” the finance leaders continued, adding:

We reaffirm that no global stablecoin project should begin operation until it adequately addresses relevant legal, regulatory and oversight requirements through appropriate design and by adhering to applicable standards.

“The G7 remains committed to high regulatory standards for global stablecoins, following the principle of same activity, same risk, same regulation,” the communique concludes.

Following the collapse of LUNA and UST, a number of countries have independently called for an urgent regulation of crypto assets, particularly stablecoins.

In the U.S., Treasury Secretary Janet Yellen told Congress last week that it is important and urgent to regulate stablecoins. She mentioned the fall of terrausd by name. The U.K. government also reaffirmed its commitment to regulate stablecoins this week.

What do you think about the G7 financial chiefs calling for a swift and comprehensive regulation of crypto assets? Let us know in the comments section below.

SEC Chair Gensler Warns a Lot of Crypto Tokens Will Fail Following LUNA, UST Collapse

20/05/2022 by Idelto Editor

The chairman of the U.S. Securities and Exchange Commission (SEC), Gary Gensler, has warned that a lot of crypto tokens will fail and many crypto investors will get hurt following the collapse of terra (LUNA) and stablecoin terrausd (UST).

SEC Chair Gensler’s Warning After LUNA and UST Collapse

U.S. Securities and Exchange Commission Chairman Gary Gensler expressed his concerns Wednesday that more crypto investors will be harmed following the implosion of cryptocurrency terra (LUNA) and stablecoin terrausd (UST).

He told reporters after a House Appropriations Committee panel hearing:

I think a lot of these tokens will fail … I fear that in crypto… there’s going to be a lot of people hurt, and that will undermine some of the confidence in markets and trust in markets writ large.

Last week, algorithmic stablecoin UST lost its peg to the U.S. dollar, sending its price and the price of cryptocurrency LUNA into free fall.

The collapse of the two cryptocurrencies has caused grave concerns among regulators and lawmakers. U.S. Treasury Secretary Janet Yellen cited the collapse of UST while calling for increased regulations of stablecoins last week.

Gensler said Wednesday that SEC-registered asset managers do not have significant exposure to crypto assets. However, he noted that his agency has less visibility into private funds, particularly family offices. The SEC chief believes that most cryptocurrencies out there are securities. He has been urging cryptocurrency trading platforms to approach the SEC and register.

“There is a path forward that we’re talking with these exchanges about to do both: to get the platforms registered and have a pathway for the tokens as well,” he said, noting that the agency has the authority to create exemptions where necessary. He added:

They should move towards getting registered or, you know, we’re going to be the cop on the beat, and we’re going to bring the enforcement actions.

However, Gensler has been heavily criticized by some for taking an enforcement-centric approach to regulating the crypto sector. He announced earlier this month that the SEC plans to nearly double the size of its Enforcement Division’s crypto unit.

The SEC chairman indicated Wednesday that his agency does not have enough resources to adequately police financial markets. He stressed:

We’re really outpersonned.

Commenting on the SEC lacking resources, U.S. Representative Tom Emmer tweeted to Gensler:

You put all of the SEC’s taxpayer funded resources into crypto crackdowns. Now you don’t have the funds to do your actual job so you’re coming to Congress for more? You’ve got to be kidding me.

What do you think about Gary Gensler’s comments and his crypto regulatory approach? Let us know in the comments section below.

Cyprus Drafts Crypto Rules, May Introduce Them Before EU Regulations

20/05/2022 by Idelto Editor

Cyprus has prepared its own legislation to regulate crypto assets and is likely to adopt it before Europe finalizes a common regulatory framework, a government official has indicated. The authorities in Nicosia welcome the “careful” use of cryptocurrencies, he added.

Government of Cyprus to Submit ‘Attractive’ Crypto Bill

Cyprus has an “enviable position” in the EU when it comes to innovation, with the second-best progress last year, according to the European Innovation Scoreboard, the country’s Deputy Minister for Research, Innovation and Digital Policy Kyriacos Kokkinos stated at a meeting with the local fintech community. The event was devoted to digital assets, entrepreneurship and financial technology.

Commenting on the future of digital assets in Cyprus, including cryptocurrencies, the minister walked a fine line between embracing innovation and having to pay heed to laws, the Cyprus Mail wrote in a report on Thursday. Quoted by the English-language daily newspaper, Kokkinos elaborated:

I can tell you that Cyprus welcomes the use of digital and crypto assets, but we still need to be very careful and respect not only the regulations currently in place but also the absence of any regulations.

The government representative gave an example with Malta, the regulatory framework of witch attracted many crypto companies and investors but also led to increased scrutiny and investigations into some of its companies and banking institutions. “We have to be careful of the frameworks of the European Union since we are a member state,” Kokkinos emphasized.

The deputy minister then revealed that the Cyprus government has already drafted a “very attractive bill on crypto assets.” The legislation has been published and interested parties can review it, he pointed out. The executive power has also commissioned a New York-based firm to assist the island nation with the implementation of the regulations.

“Our challenge is not being aligned with the EU, it’s about the dilemma of whether to wait for the ECB to finalize their own regulatory framework or do we go alone on our own, with the former scenario also involving the possibility of that framework being overregulated,” Kyriacos Kokkinos remarked. “My answer is that we will go at it alone while respecting the rules,” he added.

The deputy minister acknowledged that certain challenges exist, including some disagreements between the government and the Central Bank of Cyprus (CBC). “We must remember that the CBC is subject to the ECB and central banks tend to be conservative, so our job is to challenge them through the debates we are having with them,” he told the audience at the event which took place in Larnaca.

Do you expect Cyprus to introduce crypto regulations before the European Union? Tell us in the comments section below.