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US Congressional Members Ordered to Disclose Crypto Holdings

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The House Ethics Committee has informed all US Congress members that they must disclose any investment worth more than $1,000 as of June, 18. All lawmakers on Capitol Hill make an annual financial disclosure but a new memo has informed them that any cryptocurrency purchase or sale that exceeds $1,000 must be reported within 45 days.

Congress Must Disclose Digital Holdings

Cryptocurrency, and it’s most well known token Bitcoin, came to be as a means to disrupt the global banking system. Many of those who initially embraced it were distrustful of the government and saw using the fiat alternative as a way to keep control of their own finances without federal interference. As its popularity rose and then exploded in late 2017 people from all walks of life were pulled into the investment craze.

This new memo from the Ethics Committee means that the public will know if their member of Congress is trading in digital assets, even as regulatory rulings over their status are still being debated. Some see the decision as a way to protect against future conflicts of interest, as when voting occurs on any bill that may affect the way cryptocurrency is officially seen by federal regulatory bodies.

Representatives elected to Congress, and their staff have been required to disclose personal assets for decades, including real estate and investments. In 2012 that was tightened further to include a full disclosure of any holdings in stocks, bonds or derivatives by members of Congress or their family members. Now as investments in digital assets such as Bitcoin become more popular questions of how they should be reported have arisen since, in many cases, they remain unregulated and undefined by the federal government.

The recent memo from the House Ethics committee also included guidelines on crypto related side jobs. Members of Congress are limited to earning $28,050 from employment apart from their work in the house. The memo has informed them that this cap includes crypto mining.

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Bitcoin and PayPal Shake Bank Stocks, According to Jim Cramer

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Do you think banks are already being affected by the rising popularity of Bitcoin and other banking alternatives? Don’t hesitate to let us know in the comments below! 

Days after the Federal Reserve’s major announcement that it would hike short-term interest rates four times instead of three in 2018, bank stocks have failed to improve as expected. Jim Cramer shared his take on the matter, outlining the rising popularity of Bitcoin and other blockchain-based technologies as one of the possible reasons. 

Currently hosting CNBC’s “Mad Money,” Jim Cramer is a former hedge fund manager currently holding shares of PayPal, Amazon, Goldman Sachs, J.P. Morgan, and Citigroup. He shared his thoughts on the reasons for faltering bank stocks, despite the announcement regarding the hike of short-term interest rates.

‘Like Old-Line Brick-and-Mortar Stores’

One of Cramer’s main points is that plenty of young portfolio managers seem to think of banks as outdated institutions which are about to lose their credibility and authority to the emerging modern technological solutions. He explained:

There are plenty of younger portfolio managers who think the banks are like Sears and J.C. Penney: they’re old-line brick-and-mortar stores that are about to lose their relevance thanks to all sorts of new technologies from bitcoin, blockchain, PayPal [and] Square.

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Dash (DASH) No-Need-For-Regulation System

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Cryptocurrency Regulation

Crypto-regulation, specifically in NY – US, are becoming more tolerant on a daily basis. In less a week, the very rare Bitlicense was given two times by the regulators. The Bitlicense was launched in 2015 and has since received numerous complaints from entrepreneurs for the burden that it places on innovation.

In the other side, officials from South Korea are more hesitant when it comes to issuing regulations as it could signal that gov is recognizing the crypto-verse. Member of the National Assembly Committee – Park yong-jin added:

“We fully understand that the government is reluctant towards regulating the cryptocurrency market because it will inevitably lead investors to consider it as the government’s way of legitimizing the market”

But, the Committee member continued adding that the gov officials realized that regardless of what the regulators decide to do, crypto-enthusiasts and the cryptocurrency community will continue to grow which is why the market cannot be left unregulated at all.

Dash (DASH) being Different

One of the characteristics that makes Dash be set apart the other leading coins in the list by market capitalization, is its self-regulation side. Usually consumer protection reasons are those that make the gov officials regulate the market, like shielding from maligned interests or fraud. But, Dash is designed in that way which needs for regulators to step in are unnecessary.

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Ruian PD Dismantles Illegal Siacoin Mining Gang

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The RuiAn Police Department in China recently dismantled a gang of hackers who were installing malware on the victims’ computers, using their resources to mine Siacoin (SC).

The information was covered by the Hz News newspaper, which mentioned some important numbers to understand the magnitude of this criminal operation.

Siacoin: The cryptocurrency mined by the Cyber-criminals

According to the original news, RuiAn police were able to identify 16 members of this operation. They have already infected thousands of computers in more than 30 cities across the country, making an estimated profit of at least RMB 5.1 million, which would be equivalent to almost 1 million Dollars in a matter of months.

Mr Liu, a cybercafé owner who spoke to Hz News, said concerns arose when they noticed a significant drop in computer performance and an increase in electricity bills.

Seeing that the problem was common among other similar stores, the concerns turned into suspicion, prompting several business owners to file a collective complaint with the police:

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The Central Banks’ Bank (BIS) Hates Bitcoin — Which is Reassuring

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The Bank for International Settlements (BIS), a global “bank for central banks” based in Basel, Switzerland, has once more declared that cryptocurrencies are not only “not ready for prime time,” but could also “bring the Internet to a halt.”

BIS: Bitcoin, You Scary

On Sunday, BIS released a new 24-page document outlining why it believes cryptocurrencies like Bitcoin cannot become a bona fide financial instrument for the global economy.

The latest report cites a “range of shortcoming,” including the usual concerns over high volatility and electricity consumption, as well as inability to scale. The BIS extrapolates that if Bitcoin was to process all global payments in its current state, the decentralized network would overload everything from mobile devices to servers around the globe and effectively break the internet. The report notes:

The associated communication volumes could bring the internet to a halt, as millions of users exchanged files on the order of magnitude of a terabyte.

The environmental impact would also be significant, according to the report, which estimates that the total electricity consumption of Bitcoin mining equals to that of mid-sized economies like Switzerland.

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Ripple’s (XRP) Execs Confident that Reserve Bank of India will Overturn Ban on Crypto

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News reaching Ethereum World News, indicate that Ripple (XRP) Company Executives, are confident that the currently standing cryptocurrency ban by the Reserve Bank of India (RBI) will be overturned.

The Times of India reported that the company is betting on Basel Norms and the RBIs own panel report on digital currencies. The latter could provide a new framework that could result in the said overturning of the ban. This is after the RBI was found out to have not carried out ample research before issuing the order in the country.

With respect to Ripple betting on the Basel Norms to also revert the ban, these are the standardized regulations for central banks around the globe. They are refereed to as the Basel Norms for Basel, in Switzerland, is the headquarters of the Bureau of International Settlements (BIS). India’s Central Bank (RBI) has accepted the Basel Norms for banking, in its operations and practices.

Dilip Rao, who is Ripple’s Global Head of Infrastructure Innovation said that unlike Bitcoin and other cryptocurrencies, XRP is designed to enable remittances of fiat currencies and not to replace them. With RippleNet being continually accepted amongst several global central banks, Mr. Rao is quoted as saying that:

There is a great regulatory comfort with Ripple Net — particularly in the light of the Bank for International Settlements’ policy requiring central banks to have a backup for payment systems having non-similar technology.

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International Watchdog to Introduce Binding Regulations for Cryptocurrency Exchanges

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Do you think binding regulations will improve the performance of cryptocurrency exchanges and enhance security? Don’t hesitate to let us know in the comments below!

The Financial Action Task Force (FATF) – a multi-national agency tasked with combating global financial criminal activity, will discuss developing and introducing legally binding rules for governing cryptocurrency exchanges later this month.

Reuters reports that the Paris-based agency – comprised of 37 countries – will meet with both the Gulf Cooperation Council and the European Commission in an attempt to establish legally binding regulations governing cryptocurrency exchanges.

Developing Binding Guidelines

The push for the development of said guidelines comes after a call on behalf of financial policymakers from G20 economies earlier in March. The current rules, which were set back in 2015, are non-binding, making enforcement among the countries challenging and inconsistent, to say the least.

According to the guidelines which are currently in place, cryptocurrency exchanges need to be registered or licensed and they need to verify the identity of their customers in order to prevent money laundering. Yet, due to their non-binding nature, 68% of cryptocurrency exchanges fail to comply with the KYC requirements.

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South Korea: Cryptocurrency Exchanges To Be Regulated As Commercial Banks, Boosting Global Legitimacy

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Cryptocurrency traders, in not only South Korea, but the entire world can now relax a bit with the current news of South Korea announcing that the country will be regulating cryptocurrency exchanges in the same manner they regulate commercial banks The regulation shall be carried out by the Korea Financial Intelligence Unit (KFIU) in collaboration with other local financial regulators.

The Director of KFIU, Kim Geun-ik led a meeting that discussed on the existing regulations in the country that provide strict measures against money laundering and terrorist financing in the country. His sentiments echoed  the policy guidelines issued by the same government entity back in February when it was cracking down on cryptocurrency exchanges and ICOs in the country. Mr. Geun-ik also proposed stricter policies to both commercial banks as well as independent financial service providers.

In the meeting, the KFIU decided to include cryptocurrencies in its Anti-Money Laundering and Know Your Customer (KYC) initiative. What would then proceed the meeting, is the drafting and proposing of a bill in the South Korean Congress that would give local financial authorities the mandate to monitor traditional bank account and cryptocurrency users within their jurisdictions and in a transparent manner within the law.

A Spokesperson of KFIC had this to say with respect to the current development in the country:

Under current regulations, there are clear limitations in preventing money laundering on crypto exchanges because the only way authorities can spot suspicious transactions is through banks. If the bill of lawmaker Jae Yoon-kyung from the Democratic Party of Korea passes, local authorities will be able to impose identical regulations on crypto exchanges that are implemented on commercial banks.

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Apple Warns iPhone Users Not to Mine Cryptos

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Smartphones have evolved way beyond their original concepts and are now used for all manner of computing tasks, including mining cryptocurrencies. It appears though that Apple is not happy with users of their devices undertaking this practice.

The tech giant has recently updated its developer guidelines to ban mining cryptos according to CNBC. The new rules introduce more app restrictions, targeting those that drain battery life, generate excessive heat, or stress system resources. According to the company website; “Apps, including any third party advertisements displayed within them, may not run unrelated background processes, such as cryptocurrency mining,”

The likelihood of being able to actually mine a Bitcoin on an iPhone is very slim since the hardware required to crunch the numbers is way beyond what can be squeezed into a smartphone. However the move could restrict any future applications that may be able to mine other less intensive cryptocurrencies.

Apple’s anti-crypto stance goes way back to 2014 when it removed Coinbase and other crypto related apps from its App Store. According to the updated policy;

3.1.5 (b) Cryptocurrencies:

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Banks Shut Down Accounts for Cryptocurrency Exchange in Colombia

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What do you think the Colombian banks shutting down accounts associated with Buda.com? Let us know in the comments below.

Compared to many other countries, Colombia is a small fish in the cryptocurrency sea, but interest is rising. Dark clouds, however, are appearing as one cryptocurrency exchange, Buda.com, has had their accounts closed by every bank.

Bitcoin in Colombia

Similar to most countries, Colombia has no active Bitcoin regulation. That doesn’t mean this industry is completely frowned upon at this point in time. So far, the government has allowed Bitcoin to thrive, up to a certain extent. That situation is now coming to a change, albeit it seems to be due to a decision by the country’s banks. Back in February, the Colombian Financial Supervisor advised all banks that they were not authorized to interact with cryptocurrency businesses.

This is not a positive development for the Bitcoin industry in Colombia. In fact, it can be quite troublesome for any of the exchanges or wallet services operating in the country. However, this informal declaration by the Colombian Financial Supervisor has only impacted one entity so far: the Buda.com cryptocurrency exchange. So far, Bancolombia, BBVA, and Davivienda have all closed the associated accounts for Buda.com.

What Comes Next?

Even though this decision seems final, that may not be the case. The Colombian Senate has been debating as to how they regulate cryptocurrencies and blockchain technology. There seems to be genuine support among government officials for both technologies.

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Coinbase Set to Clear US Regulatory Hurdles

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Coinbase has announced they are getting legit with the US government and all of its regulatory agencies with the recent acquisition of Keystone Capital.

Coinbase is Moving Towards Regulatory Legitimacy

San Fransico based cryptocurrency exchange Coinbase posted on their blog today that they are on track to become a regulated broker-dealer pending approval by US federal authorities. The company announced that if approved it will soon be able to offer blockchain based securities in compliance with the US Securities and Exchange Commission (SEC) and the Financial Industry Authority (FINRA) made possible by their acquisition of a broker-dealer license (B-D), alternative trading system license (ATS) and a registered investment adviser (RIA) license.

Coinbase acknowledged the continuing obscurity of US regulatory policy as it concerns cryptocurrency by writing into their open message,

“There are now many types of blockchain-based digital assets, from cryptocurrencies to security tokens to collectibles. In the United States, some of these assets will be subject to SEC oversight. With this in mind, securing these licenses will bring us a step closer to our goal, which is to be the most trusted way for our customers to buy, sell, and use many different types of crypto assets.”

The blog concludes by mentioning that these moves have been enabled by Coinbase’s recent acquisition of Keystone Capital. This takeover of securities of securities dealer Keystone Capital may also allow Coinbase to expand its offerings and eventually to expand into non-crypto based financial products.

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Two Thirds of US, EU Crypto Exchanges Fail to Verify Customer Identities

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Analyst P.A.ID Strategies has revealed the results of research into the on-boarding practices of cryptocurrency wallets and exchanges across the U.S. and Europe, research that focused on which of these crypto service providers are using Know Your Customer (KYC) checks when on-boarding customers. These companies might have to change their protocols when the EU’s anti money laundering regulations come into effect next year. 

Out of the 25 services included in the study — picked based on the volume of transactions — the identification protocols of 14 exchanges, including Kraken, Coinbase, Gemini, and Poloniex, and 11 wallets, including Luno, Bonpay, and Mercatox, were examined.

The research, commissioned by Mitek, a digital identity verification firm, shows that of the 25 wallets and cryptocurrency exchanges examined, 68% are allowing users to trade crypto and fiat currency with no official identification or KYC checks — with most requiring just an email address and a telephone number.

These lax requirements might be set to change. When the The EU’s fifth anti money laundering directive, AMLD5, comes into effect in 2019, it will seek to bring these currently non-compliant platforms in line with other financial service providers like traditional banks, making it law that checks are carried out on new customers to confirm their identities. John Devlin, principal analyst at P.A.ID, said of the issue:

“Cryptocurrency wallets and exchanges want to enjoy the same trust as the wider traditional financial services, but for this to happen they need to rise above the sometimes-dubious reputation of cryptocurrencies’ past and be seen as ‘model citizens’ of the economy.”

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Vietnam Finance Minister Wants to Ban Bitcoin Mining Rigs

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Will the ban on cryptocurrency mining rigs help the government prevent cryptocurrency-related fraud? Let us know your thoughts on the matter in the comment section below. 

News has emerged of yet another cryptocurrency-related ban — this time in Vietnam. The country’s Finance Ministry is proposing a ban on the importation of cryptocurrency mining rigs. According to the ministry, these mining rigs are used to launch unregulated digital payment methods. 

Vietnam Struggles to Get a Handle on Cryptocurrency

The entire spectrum of Vietnam’s digital currency regulations is thus; “cryptocurrencies are illegal in the country.” However, this stipulation hasn’t stopped the occurrence of fraudulent activities in the country.

In April 2018, news emerged of a $658 million ICO scam that defrauded more than 30,000 people. The affected people invested in a company which promised significant returns on the mining of iFan and Pincoin cryptocurrencies.

According to the ministry, mining rigs imported into the country are and were used to create new cryptocurrencies and unregulated payment systems. It is the belief that many of these mining activities are set up to defraud unsuspecting investors. Thus, the ministry is calling for a ban on all mining rig imports to combat the activities of fraudsters.

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Germany: Finance Regulator Says 6 Institutions Involved In Cryptocurrency

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What do you think about German financial institutions dealing in cryptocurrency? Let us know in the comments section below!

Six financial institutions in Germany are already “dealing” in cryptocurrency in some form, the country’s finance ministry has confirmed.

BaFin Confirms Cryptocurrency ‘Dealing And Possible Acquisition’

Responding to an inquiry from Thomas Lutze — a member of left-wing populist political party The Left — the Federal Financial Supervisory Authority (BaFin) confirmed that cryptocurrency activity is ongoing in institutions under its jurisdiction, Reuters reported.

BaFin’s response related to the “dealing in or possible acquisition of” cryptocurrency, but did not name the banks or related entities involved.

While several players in the banking industry became notable first movers on the German market several years ago by offering Bitcoin exposure to clients, the country continues to drag its feet on the broader issue of regulation and classification of virtual assets.

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South Korea May Soon Legalize ICOs

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What do you think about the potential legalization of ICOs in South Korea? Do you think the market will react positively to this development? Be sure to let us know in the comments below!

South Korea’s National Assembly has put forth an official proposal to permit domestic initial coin offerings (ICOs), signaling a possible reversal of the outright ban on the lucrative crowdfunding method issued in September of last year.

Time for Some Action

South Korea, the third most prominent Bitcoin marketplace in the world, has long remained a source of uncertainty in the cryptocurrency space. The country’s government flat-out banned initial coin offerings (ICOs) in September 2017 and has since failed to deliver any sort of clarity in regards to the future of cryptocurrency within the East Asian nation. Meanwhile, domestic companies have flocked to Singapore and Switzerland to circumvent South Korean restrictions, while South Korean investors have been increasingly exposed to fraudulent imposters.

Now, the East Asian nation’s National Assembly is seeking to finally provide some definitive answers by putting forth an official proposal to permit domestic ICOs. As reported by Business Korea, the National Assembly recommends legally allowing ICOs under conditions which provide investor protections.

The proposal was put forth at the last general meeting of the Special Committee on the Fourth Industrial Revolution on May 28, where it was stated:

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South Korea’s National Assembly Officially Proposes Lifting ICO Ban

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South Korea’s national legislature has officially proposed to allow domestic initial coin offerings, effectively lifting the ban imposed by the government in September last year. With the lack of proper guidelines, South Korean companies have been migrating abroad to launch their token sales.

National Assembly’s Proposal

The National Assembly, the 300-member unicameral national legislature of South Korea, has officially proposed for the government to lift the ban on initial coin offerings imposed last September, Business Korea reported on Tuesday. The news outlet elaborated:

The National Assembly has officially made a proposal to allow domestic initial coin offerings (ICOs). As the administration is sitting on its hands after imposing a total ban on ICOs in September last year, the National Assembly has come forward with an official recommendation.

Citing the Assembly’s proposed “legislative and policy proposal of recommendation to allow ICOs under the conditions of investor protection provisions,” the publication explained that the next step is for the administration to discuss the proposal with the Assembly.

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South Korea is Easing Cryptocurrency Trading Regulations, What Are Future Implications?

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What happens in South Korea usually echoes around global crypto markets. It is second only to Japan for crypto trading and often dictates the direction of the daily trend in the region. Earlier this month the new South Korean Financial Supervisory Service (FSS) boss, Yoon Suk-heun, said that plans were in the pipeline to ease cryptocurrency trading regulations in the country.

Korean Crackdowns Crippled Markets

A wave of crypto crackdowns including an outright ban on initial coin offerings swept across South Korea earlier this year. Many speculated that this was one of the major factors influencing the ongoing downtrend that crypto markets have been in since early January. Following the ICO ban the South Korean government put the kybosh on anonymous crypto trading and required that banks and exchanges upgraded their KYC policies to demand full identification and address details from customers.

Once the regulations started mounting up, South Korean traders took their foot off the gas and trade volume began to shrink. Since mid-January the cryptocurrency market has shed over 60% of its capitalization from a high of $830 billion to around $315 billion where it currently trades today, daily volume is almost a third of what it was back then. South Korea’s influence on this cannot be directly quantified but there has definitely been a significant impact.

Since the announcement in early May sentiment in South Korea has improved and domestic exchanges often dominate trade volume during the Asian trading session. The ability to trade a range of altcoins using fiat (KRW) puts South Korea above many other countries where only the major two or four crypto assets are available in fiat (usually BTC and ETH only).

Far East Bullish on Crypto

With ongoing crackdowns and investigation in the US, and the UK and Europe usually following suit, the Far East has a lot more optimism and seems to be opening up its digital doors at a greater rate. In Japan the list of blockchain companies and exchanges lining up for licenses and government approval is over a hundred and growing. Just this week a further 6 publically listed companies announced plans to offer crypto related services there.

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German Stock Exchange Could Offer Bitcoin (BTC) Futures

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Deutsche Boerse AG, owner of the country’s largest stock exchange, is delving into the blockchain and cryptocurrency industry. Company head of clients, products and core markets, Jeff Tessler, made the comments at an industry event in London this week which sparked speculation that Germany was about to enter the futures fray.

US exchange giants CME and CBoE launched Bitcoin futures in December which many speculate has led to the current price action following the ability to short the market. Conjecture aside, both exchanges have done very well out of their crypto related offerings and no European exchange has been able to follow suit with similar products. Deutsche Boerse could be the first one to do so.

According to Bloomberg, Tessler said the emphasis at the moment was comprehension of the technology;

“Before we move forward with anything like Bitcoin we want to make sure we understand the underlying transaction which isn’t the easiest thing to do.” Before adding “We are deep at work with it,”

Crypto market volatility and regulation are also issues that need to be addressed; “we want to understand the volatility and make sure clients are in line and make sure regulators are in line.” He added.

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Singapore Proposes Regulatory Changes Which Could Green-Light Blockchain Related Exchanges

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Do you think these regulatory proposals will be successfully adopted in Singapore? Are they enough to position it as a haven for cryptocurrency exchanges? Let us know what you think in the comments below.

The Monetary Authority of Singapore (MAS) has proposed changes to its current regulations which are expected to lower the market entry for blockchain related exchanges.

A Regulator Responds to Blockchain & a Changing Financial Landscape

According to reports, MAS  – which is Singapore’s central bank and financial regulator – has issued a consultation paper in which it is reviewing the current regulatory framework which has been in place since 2002. This is to accommodate the demands of a dynamic financial services landscape. All financial institutions and other interested parties have been invited to submit written comments to the paper by 22 June 2018.

The authority has stated that the current regulatory framework cannot handle the demands of new business models that rely on emerging technologies.

One of these changes is blockchain technology and its related services, referenced in the consultation paper as  “new business models in trading platforms, including trading facilities that make use of blockchain technology, or platforms that allow peer-to-peer trading without the involvement of intermediaries”.

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U.S. Department of Justice Set to Probe Suspected Bitcoin Price Manipulation

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There are unconfirmed reports that the U.S. Department of Justice (DOJ) has set up a probe to investigate suspected Bitcoin price manipulation activities. According to Bloomberg, four unnamed sources revealed that federal prosecutors are worried that the market is overrun with misconduct.

Fears of Rampant Spoofing and Wash Trading in Bitcoin

The two major points of inquiry for the probe are spoofing and wash trading. Spoofing refers to flooding the market with fake orders, tricking other traders in the process while wash trading involves creating false volumes that overvalue the market. Both of these malpractices drive up the prices in the direction desired by the manipulators.

For many years, financial regulators have worked hard to eliminate these illicit trading practices from the mainstream markets. However, in the predominantly Wild West crypto scene, it appears spoofing and wash trading is (allegedly) having the run of the mill.

Thus, the DOJ is partnering with the Commodity Futures Trading Commission (CFTC) to investigate the matter. The CFTC only has oversight powers on crypto derivatives. However, the Commission has the authority to act if it spots fraud in the actual markets where digital coins are traded.

Examining the Evidence for Crypto Price Manipulation

In 2017, a crypto blogger known as Bitfinex’ed presented evidence that a trader or group of traders known as “spoofy” was manipulating the price of Bitcoin. According to the blogger, Bitfinex was the platform of choice for the price manipulators.

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