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Crypto Firms Announce New Products in Custody, Stablecoins, Wallets
go through Keith R. Murphy
According to a recent press release, Prometheum Capital has received approval from the Financial Industry Regulatory Authority (FINRA) for the first time to operate as a special purpose broker-dealer for digital asset securities. The release states that the approval allows the firm to act as a qualified custodian of digital asset securities on behalf of institutional and retail clients, the first time digital asset securities have been custodied at a FINRA member firm and a broker-dealer registered with the U.S. Securities and Exchange Commission (SEC). . According to the company’s co-CEO, “[d]Digital asset investors in the U.S. are currently hosting cryptocurrencies as securities through platforms that don’t offer the same service [Securities Exchange Act] 15c3-3 Client Protections Required by Federal Securities Laws. By contrast, he expects custody of assets at an SEC-registered broker-dealer to provide regulatory protections to rebuild investor confidence, among other benefits.
Another recent press release announced that the cryptocurrency trading/copy trading platform is partnering with a digital asset custody provider to offer institutional clients an OTC settlement solution. The cryptocurrency exchange will join the ClearLoop network, which will reportedly allow institutional users of both companies to maintain assets within the custody provider’s infrastructure, but at the same time entrust those assets to be traded on cryptocurrency exchanges. According to reports, the integration will allow active trading between 450 coins and 580 trading pairs.
In a third press release, stablecoin issuer Circle announced the launch of the Eurocoin on the Avalanche network. The release notes that the launch is the first in a series of anticipated multi-chain launches for the euro-backed stablecoin.
The last recent press release announced that Magic, a leading wallet-as-a-service (WaaS) provider, has raised $52 million in a funding round that includes the venture capital arm of a major US fintech company. According to the press release, “Magic enables mass adoption of web3 by acting as the de facto WaaS provider for companies that are looking for a secure and easy way to bring their customers to web3.”
For more information, please refer to the following links:
New Crypto Guidance Published by UAE European Banking Institution CFTC
go through Robert A. Musiala Jr.
The U.S. Commodity Futures Trading Commission’s (CFTC) Division of Clearing and Risk (DCR) recently issued a staff advisory addressing “Risks Associated with the Expansion of Derivatives Clearing Organization (DCO) Digital Asset Clearing.” According to a press release from the CFTC, the advisory “reminds registrants and applicants that when expanding operations, changing business models, or offering new products, the DCR will continue to be aware of potential increased risk activities that may be associated with certain liquidations. DCR hopes to DCOs and applicants proactively identify new, evolving or unique risks and implement risk mitigation measures tailored to those risks that may arise from changes in product or clearing structures.” Among other things, the advisory states, “Due to the increased cyber and other operational risks that may be associated with digital assets, the DCR will emphasize compliance with the system assurance requirements set forth in the Commodity Exchange Act and Part 39 of the Commission’s regulations.”
In terms of foreign regulatory news, the European Banking Authority (EBA) recently released a draft for public comments on the proposed amendments to the EBA Anti-Money Laundering and Terrorist Financing (ML/TF) Risk Factors Guide This will extend the scope of the guidance to crypto asset service providers (CASPs). Among other things, the amendments will introduce new industry-specific guidance to CASPs, including on risk assessment and customer due diligence, and provide financial institutions with guidance on the risks to consider when entering into business relationships with CASPs.
And in the United Arab Emirates (UAE), the Central Bank of the UAE recently issued a new Guidance for licensed financial institutions on risks associated with virtual assets and virtual asset service providersThe 44-page guidance document is designed to help licensed financial institutions in the UAE understand and effectively meet their anti-money laundering obligations related to virtual assets and virtual asset service providers, terms defined by the Financial Action Task Force.
For more information, please refer to the following links:
Several financial institutions released reports on the cryptocurrency market
go through Robert A. Musiala Jr.
The International Organization of Securities Commissions (IOSCO) recently released its Policy Recommendations for Crypto and Digital Assets Market Advisory ReportAccording to the report, the IOSCO aims to finalize its policy recommendations to address market integrity and investor protection in the crypto asset market by early Q4 2023.In another recent release, the World Economic Forum (WEF) published a report entitled Regulatory pathways to cryptoassets: a global approach. According to a press release, the WEF white paper “sets out to understand and highlight the needs and challenges of developing a global regulatory approach to cryptoassets.”
In its third recent publication, the BIS recently published a paper laying out its policy perspective on central bank digital currencies (CBDCs). Among other things, the paper finds that (1) the development of CBDC work requires careful consideration and engagement with a broad range of stakeholders, including the private sector and lawmakers; (2) a CBDC ecosystem should allow for a broad range of private and public interest (3) The complex design issues and potential risks arising from the implementation of any CBDC need to be carefully considered; (4) The changing payments landscape requires central banks to consider How CBDC can be used for wholesale and cross-border use cases.
In the last recent publication, the New York branch of the U.S. central bank released a report on the second phase of Project Cedar, an ongoing project aimed at improving cross-border payments using distributed ledger technology. According to a press release, the report discusses findings related to an interconnected simulated central bank currency ledger; “atomic settlements,” in which “transactions are executed only after all branches in a cross-currency payment chain have been successfully executed.” Settlement”; “near real-time settlement”, “end-to-end settlement in simulated payment scenarios within 30 seconds on average”.
For more information, please refer to the following links:
OFAC Adds New Encryption Public Keys to SDN List
go through Christopher Lamb
According to a recent press release from the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC), four entities and one individual involved in “obfuscated revenue-generating and malicious cyber activities in support of the government of the Democratic People’s Republic of Korea” have been added to OFAC’s special on the list of designated nationals (SDN). Relatedly, OFAC also added two bitcoin addresses and two ethereum addresses to the SDN list.
In another recent OFAC press release, pursuant to Executive Order 14024, OFAC is enhancing its use of “Russia-related sanctions,” including “designating[ing] or logo[ying] Nearly 200 individuals, entities, ships and aircraft are included as blocked property. In connection with that action, an Ethereum wallet address that “has received more than $5.2 million in tether stablecoins since the war began” was added to the SDN list, according to the press release. According to OFAC, the person “ Helping high-net-worth Russian citizens obtain passports from other countries”.
For more information, please refer to the following links:
CFTC Charges Digital Asset Fraud Scheme, NY AG Charges Wallet Providers
go through Michelle N Tenney
According to a press release from the Commodity Futures Trading Commission (CFTC) dated May 24, 2023, the CFTC filed a civil lawsuit in the U.S. District Court for the Middle District of California against five defendants conducting business as Icomtech. The CFTC complaint alleges that, from August 2018 to December 2019, defendants and other Icomtech agents fraudulently solicited funds under the guise that Icomtech would trade bitcoin and other digital assets at returns of 0.9% to 2.8% per day. Hundreds of thousands of dollars of investor funds were misappropriated. % customer’s money. The CFTC alleges that the defendants used investors’ funds to pay for personal expenses and to pay themselves commissions and bonuses. The release notes that the DOJ is taking parallel action against the Icomtech program.
On May 23, 2023, during a fireside chat at the New York City Bar White Collar Crime Institute, CFTC Commissioner Christy Goldsmith Romero stated that while “[t]”There’s a lot of fraud in the cryptocurrency space,” and “we can’t police all the fraud.” Romero also noted that cryptocurrency cases account for about 20 percent of CFTC cases, including cases against Binance and FTX. Referring to the idea that there is a jurisdictional “turf war” between the CFTC and (SEC) in regulating cryptocurrencies, Romero said that while there is no turf war, many cryptocurrencies and digital asset offerings are very new, It can be boiled down to the fact that the CFTC and SEC are just “trying to figure it out.”
In a final noteworthy item, a recent press release from New York Attorney General Letitia James announced that the Attorney General’s Office has received a $4.3 million settlement from Brooklyn-based cryptocurrency firm Coin Cafe for defrauding investors . According to the press release, Coin Cafe charged its customers “exorbitant and undisclosed fees for using its wallet storage, even though its wallet storage is advertised on its website as ‘free.'” According to the settlement, “Coin Cafe will pay all Restitution payments to misleading investors, including more than $508,000 to more than 340 New York investors who were unknowingly charged fees.”
For more information, please refer to the following links:
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