EU, US and UK Crypto Regulations Tighten

Hello and welcome to Protocol Fintech. This Monday: the global crypto crackdown, the BAYC Discord hack and who to see at Bitcoin 2022.

out of the chain

Vitalik Buterin didn’t get the memo not to post anything on April 1. His essay, apparently a defense of bitcoin maximalism, seemed strange to some from the creator of Ethereum. But it’s worth reading for insight into cryptocurrency culture, something that’s often overlooked in grabbing cash. Buterin also has some thoughts on this, but also a specific explanation of why it’s important for bitcoiners to obsess over the dietary implications of seed oils.

—Owen Thomas (E-mail | Twitter)

Crypto is Mastered Worldwide

It has been a difficult few weeks for crypto on the regulatory front. The EU wants information on all transactions. The UK pushes businesses to register – while being stingy with licenses. And the SEC is expanding the meaning of “securities trader” as it tries to set stricter accounting standards for crypto exchanges. The bottom line: Growth in crypto is rapid, but so is the push for greater accountability.

EU says no more anonymous transactions. the European Union rocked the crypto world with a new requirement for all crypto transactions to include information about the parties involved.

  • It essentially prohibits anonymous crypto transactions and means greater transparency for transactions involving non-hosted wallets.
  • The EU said the new rules aim to tackle financial crime. “Illicit flows of crypto assets move largely undetected across Europe and the world, making it an ideal instrument to ensure anonymity,” Ernest Urtasun, co-rapporteur of the EU Economic and Monetary Affairs Committee, said in a statement.
  • Crypto executives were quick to denounce the new rules, which have yet to go deeper into the EU’s complex political machine, as counterproductive. “These regulations harm crypto innovation without a commensurate anti-money laundering benefit,” Cameron Winklevoss, co-founder and chairman of Gemini, said in a statement emailed to Protocol.
  • Brian Armstrong, CEO of Coinbase blasted the proposal as “anti-innovation, anti-privacy and anti-law enforcement”. Coinbase Policy Director Faryar Shirzad warned that this could mean recording and reporting transactions via self-hosted wallets “even if there is no reason to suspect wrongdoing”.

The rules are getting stricter everywhere you look. EU news broke as crypto reeled from new guidelines in the US and UK

  • the The SEC has issued a new directive recommending that crypto exchanges record customer digital assets on their balance sheets as assets and liabilities. Crypto companies must also disclose the “nature and amount of crypto assets” they hold for clients.
  • SEC Commissioner Hester Peirce, who has criticized the regulator’s stance on the crypto market, said the decision underscores its “scattered and ineffective approach to crypto.”
  • Crypto is also under pressure in the UK The Financial Conduct Authority has ordered companies offering crypto products and services to register with the UK regulator. Some companies, like Revolut, got a break when the FCA extended the deadline. But the FCA has seen “too many financial crime red flags missed by crypto asset firms seeking registration,” a spokesperson said. Bloomberg. Few licenses were granted.

The flurry of new government rules is clearly upending crypto. Is it really a question of responsibility? Cathy Yoon, Legal Director of Fraction, is not sure. “I think it’s more like trying to control something that’s not understood and feared for some irrational reason,” she told Protocol. Fear is the mind killer, but crypto fears it is also a market killer.

—Benjamin Pimentel (E-mail | Twitter)

A version of this story first appeared on Protocol.com. Read it here.

A PLAID MESSAGE

Get ready to live stream the Plaid Forum 2022 on May 19. Join the world’s largest companies and build the future of digital finance. Registration is now open!

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on the money

The Bored Ape Yacht Club Discord channel has been hacked. the BAYC’s courier service was hacked by hackers who sought to trick users into creating fake NFTs. The Discords of two other NFT projects, Nyoki and Shamanz, were also hacked.

Russia has a SWIFT alternative for India. Russia offers a alternative payment system this would allow India to buy oil and arms from this country reeling from sanctions linked to the war in Ukraine. The plan would involve payments denominated in ruble rupees using a Russian courier system.

The Bank of Italy banned the N26. Italian central bank told the digital bank it could not recruit new customers after an on-site inspection found N26 had inadequate anti-money laundering controls.

Prime Blockchain goes public. Bitcoin mining and infrastructure company, also known as PrimeBlock, plans to make public via a SPAC merger with 10X Capital Venture Acquisition Corp II. The merger, which is expected to close by the second half of the year, would value the company at $1.25 billion including debt.

Indonesia plans to impose a crypto value-added tax. The Southeast Asian nation will charge tax on crypto-asset transactions and an income tax on capital gains from these investments from May 1.

I Hate Receipts launched a merchant network. The contactless receipt app company said it formed the Merchant Alliance Network to give retailers and technology partners a better way to engage with their customers.

Understood

Last Thursday was the deadline for crypto firms to register with the UK’s Financial Conduct Authority. This could cause some businesses to lock, according to christian fairiesexecutive chairman and co-founder of LendInvest. “The reality is that people are withdrawing their applications to do business here,” Faes said. “And they just go somewhere else, it’s a global market.”

Sen. Cynthia Lummis Recount chuck todd on Peacock’s “Meet The Press Reports” that the US should have a digital currency, but it shouldn’t replace crypto: “We absolutely should. But bitcoin and other cryptocurrencies still have an important role to play as they are not created by any government. They are completely decentralized. No government or group of people controls them. They are very transparent in that they are on the blockchain.

Town Says Metaverse Is Coming – And Could Be Worth $13 Trillion – But Computing Power Needs to grabthe authors of his new report wrote: “We believe the Metaverse is the next generation of the Internet – combining the physical and digital world in a persistent and immersive way – and not just a virtual reality world.”

Future

Tuesday is the 10th anniversary of the Jobs Act. The 2012 law allows companies to file an application for an IPO confidentially, although most of them seem to advertise that they do so anyway.

Treasury Secretary Janet Yellen testifies during a House hearing on Wednesday. It’s her annual cat with the Financial Services Committee on the state of the international financial system.

Bitcoin 2022 opens on Wednesday. the crypto conference in Miami Beach runs through Saturday. El Salvador President Nayib Bukele speaks, as do Peter Thiel, Senator Cynthia Lummis, Cathie Wood, Michael Saylor and Block TBD leader Mike Brock.

Later this month: Eastern Climate Protocol organize an event on April 19 which examines the climate goals of tech companies. Suzanne DiBianca of Salesforce is a speaker.

A PLAID MESSAGE

Get ready to live stream the Plaid Forum 2022 on May 19. Join the world’s largest companies and build the future of digital finance. Registration is now open!

Learn more

Thanks for reading – see you tomorrow!

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