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The merits and demerits of Hong Kong’s SFC resolutions and their impact on the crypto industry

  By David Drake   Global popularity of cryptocurrencies is undisputable. However, differences in the way digital assets are handled and the disparities across crypto exchanges have been on the rise, making it necessary for countries to develop regulations. In Hong Kong, the Securities and Futures Commission (SFC) intends to regulate the crypto market to prevent possible digital currency fraud. Just recently, Hong Kong’s SFC stated that it will introduce new governing rules and course of actions for the crypto market. Specifically, the regulator intends to focus on digital currency exchanges and funds operations. The SFC observed that current rules do not consider digital assets as securities or future contracts and are therefore not regulated by it. This means that those dealing in digitals assets are prone to insecurities. Due to this, the SFC resolved to safeguard investor assets by including them in the regulations. In the new regulations, those ... Read More »

Why Hong Kong’s Crypto Regulations Favor Institutional Investors

  By David Drake   While the western world grapples with decisions concerning cryptocurrency and governance, the Asian community is forging ahead. Hong Kong’s Securities and Futures Commission (SFC) is not derailed by indecision. Just recently, the commission announced favorable regulations towards cryptocurrencies. The country’s financial agency unveiled a comprehensive list of rules in an unprecedented move that could see Hong Kong become a major hub for digital assets in future. The new rules are geared towards controlling funds that invest in digital assets, and by extension, the platforms they use to trade. Companies engaged in retail services will be banned from using platforms that are strictly for professional investors. Also, a crucial element of the regulation is that funds have to be licensed by the SFC if they invest in excess of 10 percent of their portfolios in digital currencies. They are required to have insurance for almost all ... Read More »

Can Hong Kong Strike a Balance Between Innovation and Investor Protection in its Crypto Regulation?

  By David Drake   The cryptocurrency industry has achieved significant milestones in recent years as it strives to go mainstream. However, for its potential to be fully realised, the industry needs to overcome several challenges. Arguably, the regulation cloud hovering over the industry is the most significant challenge there is. The industry achieved tremendous growth when it was operating as a free market, true to its decentralised values. With government intervention though, there is consensus that it would be nearly impossible to go back to such an environment going forward. This is largely attributed to the growing legitimacy of digital currencies as an investment option by governments, as well as the need to protect consumers from fraud and other vices. The challenge, therefore, will be striking a balance between regulation and the decentralised nature of the industry without stifling innovation. One regulation development initiative that has raised interest in ... Read More »

Binance Moves to Uganda Just Weeks After Launching Tests on Beta Version in Singapore

  by David Drake     Just weeks after rolling out the testing phase for a Beta Version of the Singapore Fiat Exchange, Binance is on the news again having opened its first fiat-crypto exchange in Uganda this week. According to a press release by Binance Uganda, the newly launched branch is set to begin operations shortly, allowing users to make deposits and withdrawals in Uganda shillings. Last month, Binance unveiled a fiat-to-fiat cryptocurrency exchange in Singapore under a testing phase that is based on invites alone. This happened about a month after Binance opened the Lichtenstein exchange called Binance LCX, a fiat-to-crypto trading platform. Reports indicate that only two digital currencies – Ethereum and Bitcoin – will be traded on Uganda’s Binance cryptocurrency exchange. However, the exchange has plans to add more digital currency pairs in the near future. Focus on Blockchain In March 2017, the government of Uganda went ... Read More »

Self-Regulation: What Virtual Commodity Association and Blockchain Exchange Commission Should Really Focus On

  by David Drake     Cryptocurrencies and blockchain have become the talk in tech circles in recent years. This has raised concerns with respect to cryptocurrency regulation for industry players and governments alike. This is because blockchain, the technology that underlies cryptocurrencies, has particularly captured the attention of developers and paved way for innovations that seek to solve challenges across sectors. In the marketing industry, platforms such as IOU, Qupon and Noiz Chain are providing online customer satisfaction, marketing of digital coupons and interactive marketing solutions. In the social space, ONe Network facilitates social media security while URAllowance utilizes smart contracts to facilitate family interactions. The finance sector has not been left behind. Key innovations in this space include Gath3r that enhances digital monetization and BlockVest that enables investors to manage their virtual asset portfolios. At the same time, BQT facilitates hedge fund and cryptocurrency trading while LiveTradr enables portfolio ... Read More »

Will Dropping Some Currencies from Exchanges Reduce Crypto Cyber Crime?

by David Drake   According to Forbes, Japan’s Financial Services Agency (FSA) has quietly been pressuring cryptocurrency exchanges to stop trading digital currencies that tend to be favored by underworld users. The FSA argues that currencies such as Monero (XMR), Zcash (ZEC), and Dash (DASH) are ideal for money laundering because it is extremely difficult to track them and identify recipients. A shift in coin usage In February 2018, the European Union Agency for Law Enforcement Cooperation (Europol) raised red flags when criminals started shifting from bitcoin to altcoins which provide higher privacy levels. Europol linked the shift to increased monitoring of bitcoin by police forces and rising regulatory pressure against money laundering on the cryptocurrency. Luis Manuel López, General Coordinator of Workchain Centers holds that FSA is aligning its operations to concerns raised by Europol. In his view, the use of private cryptocurrencies has a negative effect on the market, especially crypto exchanges ... Read More »

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