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Russia Says Yes To Crypto Mining

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Russia has just made a major breakthrough in digital asset mining. President Vladimir Putin has signed a bill that officially legalizes cryptocurrency mining. The signed bill also covers mining pool, mining infrastructure operator, address identifier, and the individual who organizes mining pool activities. 

Mining is considered a component of turnover meaning that the revenue generated from these activities would included in the overall revenue or income of a business. This becomes subject to taxation, similar to other business activities. Secondly, mining is a business activity rather than the issuance of cryptocurrency. Individuals who do not exceed the energy consumption limit set by the government can mine without registration.

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Russia Says Yes To Crypto Mining 2

Recognising crypto’s economic prospects, Putin made a clarion call “to seize the moment” and establish a legal framework and regulations. He also urged Russian entities and entrepreneurs to develop infrastructure, and create conditions for the circulation of digital assets.

The law will be enforced ten days after the date of its official publication, providing further flexibility to set an effective date to specific parts of the law based on their nature and requirements.

As per reports, Russia might used it for cross-border transactions amidst increasing Western sanctions. Spearheaded by the Ministry of Finance and the Bank of Russia, the initiative reflects a significant shift in the country’s approach to digital assets.

Russia’s Strategic Crypto Move

Previously, Russia maintained a conservative stance on cryptocurrency. However, the evolving geopolitical crisis with Ukraine and the imposition of heavy sanctions, compelled a reevaluation of this policy.

Deputy Finance Minister Alexei Moiseev has underscored the importance of establishing a legal framework for crypto transactions. One that comply with Anti-Money Laundering [AML] and Know Your Customer [KYC] regulations, benefiting many Russians who are currently forced to rely on foreign platforms for crypto services.

This move has secured key support from high-ranking Russian officials, including the State Duma, which has been advocating for allowing miners to sell cryptocurrency as an export product. Futhermore, the authorities are also considering imposing a 20% income tax on cryptocurrency miners to bolster the national budget and tap the burgeoning crypto market to contribute to the country’s economy.

Lawmaker’s Fury: Crypto Regulations Drive Exchanges Away from Hong Kong

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In a recent crypto opinion piece published in the Hong Kong Economic Journal, Duncan Chiu, a member of Hong Kong’s Legislative Council, raised concerns over the stringent regulations imposed on crypto exchanges in the region. Chiu’s commentary comes in the wake of major global exchanges withdrawing their license applications, citing regulatory hurdles that have stifled market growth and dampened investor confidence in Hong Kong’s crypto ecosystem.

The Securities and Futures Commission (SFC) mandates that crypto trading platforms failing to submit license applications by February 29 must cease operations in Hong Kong by May 31. Following this deadline, all Virtual Asset Trading Platforms (VATPs) must either obtain an SFC license or be deemed unauthorized.

Chiu highlighted the adverse impact of these regulations on market development, stating that they lack a comprehensive strategic approach for fostering Hong Kong’s virtual asset market. He criticized the disjointed policies governing various aspects of the industry, including VATP, stablecoin issuance, and over-the-counter trading, which hinder cohesive growth.

Moreover, Chiu noted discrepancies between regulatory requirements and the innovative nature of Web3 finance. The SFC’s insistence on standards akin to traditional financial institutions appears “excessively stringent” and incompatible with the decentralized and agile nature of financial markets.

Technical Expertise Lacking in Crypto Oversight

Another key concern raised by Chiu is the disparity in technical expertise between regulatory bodies and industry operators. While regulators demand extensive experience from management teams, they often lack personnel with practical knowledge of operating Web3 businesses. This mismatch complicates communication and inhibits effective regulation tailored to the unique needs of the crypto industry.

The withdrawal of license applications by major global exchanges such as OKX, Gate.io, and HTX underscores the urgency of addressing these regulatory challenges. Chiu called for a forward-looking vision that embraces innovation and flexibility, urging authorities to collaborate with industry stakeholders to devise a regulatory framework conducive to sustainable growth in Hong Kong’s crypto landscape.

As Hong Kong navigates the evolving dynamics of the digital economy, striking a balance between regulatory oversight and fostering innovation will be pivotal in positioning the region as a leading hub for crypto innovation.

SEC’s Crypto Custody Rules Overturned: All Eyes on Biden

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In a crucial development, the Senate has voted to overturn SEC-issued crypto accounting guidelines that discourage financial institutions from being custodians of digital assets. Now the final decision lies with President Biden. He must decide whether to sign the appeal [and allow the overturn] or veto it and support it going forward. If signed by him, financial institutions will be allowed to custody crypto assets at scale. SAB 121 CRA—the first standalone crypto bill ever to pass both chambers of Congress—sailed through the Senate 60-38.

The SEC published the SAB 121 guidance, known as a bulletin, in March 2022, which advises any entity safeguarding crypto assets on behalf of others to put them on its balance sheet as if it owned them. According to those opposed to the rule, it would limit options for American crypto owners who prefer to keep those digital assets at traditional banks, which face additional regulatory pressures beyond SEC disclosures.

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SEC's Crypto Custody Rules Overturned: All Eyes on Biden 4

Additionally, crypto proponents argue that this could be an issue if the entity goes bankrupt, as they declare ownership of assets they are merely custodians of, which does not protect retail investors at all. On top of that, this does not apply to traditional assets like stocks. Critics emphasized that it was done to block regulated financial entities from providing custodial services.

SEC: GAO Says It’s Time for Congress to Step In

Additionally, a legal inquiry conducted by the Government Accountability Office [GAO] determined that the SEC’s guidance, referred to as Staff Accounting Bulletin 121, essentially functioned as an agency rule that should be subject to congressional scrutiny. The SEC’s enforcement strategy before formal regulations has faced significant backlash from cryptocurrency supporters, who have accused the regulator of exceeding its jurisdiction.

Citing the guidance, market observers are also skeptical about the adequacy of existing regulations to police crypto markets and the need for new custody rules. The discussion also delved into the SEC’s approach to enacting different crypto custody rules for digital assets while simultaneously giving the entire custody of Bitcoin ETFs to Coinbase.

“It’s just a really weird situation and a good example of how the SEC has tied itself in knots a bit with its full-court press against crypto,” Sean Tuffy, a banking regulation expert, stated.

New SEC Chief Initiates Crypto Regulation Talks Amidst Industry Turmoil in Nigeria

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The ne­wly appointed Director Gene­ral of the Securities and Exchange­ Commission (SEC) in Nigeria, Dr. Emomotimi Agama, will convene a me­eting with local and international crypto exchange­s to discuss crypto regulations in the­ country. This meeting, organized by the­ Blockchain Industry Coordinating Committee of Nigeria (BICCoN), aims to addre­ss relevant issues and chart a progre­ssive course for crypto regulations.

“Everyone’s presence and insights are invaluable as we collectively navigate the regulatory terrain and strive toward fostering an environment conducive to innovation and growth within the blockchain and cryptocurrency sector,” said Lucky Uwakwe­, the Chair of BICCoN.

The me­eting will include repre­sentatives from various associations, such as the Blockchain Nige­ria User Group (BNUG), the Cryptographic Deve­lopment Initiative in Nigeria (CDIN), the­ Digital Currency Consortium (DCC), and the Stakeholde­rs in Blockchain Technology Association of Nigeria (SiBAN). These­ stakeholders will have the­ opportunity to engage in collaborative dialogue­ with the SEC Chief to address re­gulatory challenges and explore­ opportunities for the industry.

SEC Chief Initiates Collaborative Crypto Regulation Talks

Nigeria has had a tumultuous relationship with cryptocurre­ncies in recent ye­ars. In December 2023, the­ country lifted a ban on crypto, but has since taken ste­ps that contradict this decision. In February 2024, the Ce­ntral Bank of Nigeria (CBN) used tele­communication providers to prevent local crypto use­rs from accessing the website­s of various crypto exchanges, such as Binance, OctaFX, and othe­rs.

Additionally, the SEC in Nigeria has proposed an ame­ndment to the rules guiding platforms offe­ring crypto services, suggesting a hike­ in the registration fee­ for crypto exchanges from N30 million ($18,620) to N150 million ($93,000). This move has raise­d concerns within the crypto community, as it could potentially cre­ate barriers for smaller playe­rs in the industry.

The upcoming mee­ting with the SEC Chief prese­nts an opportunity for the crypto stakeholders in Nige­ria to voice their concerns and work towards a more­ favorable regulatory environme­nt. The collaborative dialogue is e­xpected to address the­se challenges and e­xplore ways to foster innovation and growth within the blockchain and cryptocurre­ncy sector.

According to Uwakwe, the virtual mee­ting is being convened at the­ invitation of the SEC Chief, who aims to engage­ with key stakeholders in the­ blockchain and cryptocurrency ecosystem to addre­ss crypto regulations challenges and opportunitie­s through collaborative dialogue.

As Nige­ria navigates the evolving crypto landscape­, this meeting could serve­ as a pivotal moment in shaping the future of the­ industry in the country. The SEC Chief’s willingne­ss to meet with local and global stakeholde­rs is a positive sign, indicating a potential shift towards a more inclusive­ and progressive approach to crypto regulation.

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Vietnam Takes Bold Step to Crypto Regulation, Aiming to Prevent Illegal Activities

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Vietnam, re­nowned for its innovative population, follows a proactive approach regarding digital currencie­s. By May 2025, the nation intends to establish a compre­hensive legal frame­work for crypto regulation. This proactive measure re­sponds to Vietnam’s surging crypto ownership and the ne­cessity to address potential risks arising from an unre­gulated market.

Although Vietnam hasn’t banned cryptocurre­ncies, an absence of regulations has bre­d uncertainty for users and businesse­s alike. Cao Dang Dinh, deputy director of the­ Ministry of Justice’s Civil Law Department, highlighted the urgency of addre­ssing this void. The widespread adoption of cryptocurre­ncies requires robust legal frameworks, asserte­d Dinh, recognizing the potential for e­xploitation without clear guidelines.

Financial authorities are­ actively formulating rules to overse­e digital currencies. This e­ndeavor aims to establish lawful ownership, combat unlawful actions like­ laundering funds, and safeguard consumer inte­rests. These me­asures align with research conducte­d in 2021, which underscored the ne­cessity for regulations accompanied by e­ducational campaigns to encourage responsible­ usage of cryptocurrencies.

Vietnam Aims to Balance Crypto Regulation and Innovation

The Vie­tnamese central bank plays a crucial role­ in crypto regulation. The­y diligently investigates approache­s to prevent the illegal use­ of digital assets. This emphasis on combating money launde­ring and financial crimes shows the governme­nt’s dedication to creating a secure­ environment for cryptocurrencie­s.

Crafting effective crypto regulations requires a delicate balance. While safeguarding citizens from potential dangers is crucial, over-regulation could stifle innovation and hinder the growth of the crypto market. Vietnam’s approach seems to prioritize striking this balance by establishing clear rules without stifling the burgeoning crypto sector.

With a target completion date of May 2025, Vietnam’s journey towards crypto regulation is still in its early stages. The coming months will be crucial in observing how the framework takes shape and how it impacts the country’s crypto landscape. This move by Vietnam serves as an example for other nations grappling with similar regulatory challenges in the ever-evolving world of digital assets.

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Singapore enforces Strict crypto rules beyond borders: 30 Days Deadline

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Singapore, known for its progressive stance on financial technology, has recently expanded its regulatory oversight on cryptocurrency-related activities. The Monetary Authority of Singapore (MAS) announced on Tuesday that it would now regulate custodial services and cross-border money transfers involving digital assets, even if the transactions do not occur within the city-state.

This move comes as an amendment to the Payment Services Act (PS Act), a framework designed to regulate payment service providers. Initially passed in 2021, the legislation aimed to provide regulatory clarity in the rapidly evolving digital asset landscape. However, the amendments, which were supposed to be enacted earlier, have only been implemented recently, reflecting the growing importance of regulating digital asset activities amidst global market volatility.

The expansion of regulatory oversight is seen as a significant step towards enhancing user protection and ensuring financial stability within the digital asset world. Angela Ang, a senior policy adviser at TRM Labs and former MAS regulator, hailed the move as a long-awaited clarification, particularly regarding custody services.

Crypto Regulations and Investor Protection

Under the new regulations, cryptocurrency service providers must adhere to stringent requirements. These include segregating customers’ assets in trust accounts, maintaining transparent records, and implementing robust systems and controls. These measures are aimed at safeguarding investors’ funds and mitigating the risk of financial malpractice within the industry.

Entities already engaged in crypto-related activities under the Payment Services Act must undergo a transition process within 30 days and submit a license application within six months. The application process entails providing an attestation report of compliance with anti-money laundering and counter-financing of terrorism requirements, validated by an external auditor within nine months.

MAS has made it clear that entities failing to comply with these regulations will be required to cease all crypto-related activities. This stringent enforcement underscores Singapore’s commitment to maintaining the integrity of its financial system while fostering innovation in the burgeoning crypto sector.

In conclusion, Singapore’s decision to expand regulatory oversight on crypto activities reflects its proactive approach to addressing the challenges posed by digital currencies. By implementing robust regulations, Singapore aims to strike a balance between fostering innovation and safeguarding investor interests in the rapidly evolving crypto landscape.

Taiwan Advances Crypto Regulation: Draft Crypto Act Clears First Hurdle – Report

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Taiwan has taken a significant step toward regulating the cryptocurrency industry as a draft crypto act passed its first reading at the Legislative Yuan, the nation’s parliament. The proposal, jointly put forth by Yung-Chang Chiang and 16 other lawmakers, is aimed at providing a legal framework for the virtual asset sector.

Yung-Chang Chiang, one of the proponents of the special act, expressed his optimism about the progress. He noted that “after the first reading of the bill, discussions on the regulatory framework for the virtual asset industry have progressed to the next stage.” Chiang also called upon the Financial Supervisory Commission (FSC) to contribute their draft bill to facilitate consensus-building among various sectors of society.

This move comes in the wake of guidelines issued by Taiwan’s FSC, encouraging the industry to establish self-supervisory rules through a potential industry association. However, Chiang highlighted the limitations of such voluntary measures, explaining that the special law would empower regulatory authorities to impose penalties on operators who violate self-regulation rules.

The proposed crypto law will mandate all cryptocurrency platforms operating in Taiwan to seek a permit. Failure to do so could lead to regulators ordering the cessation of their operations. While no specific timeline has been set for the second reading of the bill, it’s unlikely to occur by the end of January 2024, given that the current legislative tenure in Taiwan ends in January.

Presently, Taiwan’s cryptocurrency industry remains largely unregulated, with anti-money laundering compliance being the primary requirement for virtual asset service providers, introduced by the FSC in July 2021.

Circle’s Innovative ‘Points-to-Crypto’ Service

In related news, United States-based stablecoin issuer Circle has formed a partnership with Taiwan’s second-largest convenience store chain, FamilyMart, and a local crypto exchange, BitoGroup. This collaboration aims to introduce a “Points-to-Crypto” service on the FamilyMart app, allowing customers to convert loyalty points into a Circle-issued USD Coin.

This move is expected to democratize access to cryptocurrencies, leveraging the popularity of loyalty point systems in Taiwan, where a large percentage of users engage in point accumulation and redemptions.FamilyMart’s FamiPoints and BitoGroup’s user base are set to play a significant role in this initiative, offering millions of potential users the opportunity to engage with digital assets.

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California Governor Approves ‘Digital Financial Assets Law’ For Crypto Regulations

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In a significant development for the crypto world, California Governor Gavin Newsom has given the green light to a cryptocurrency bill that ushers in more stringent regulations for businesses involved in crypto operations. This legislative move, titled the ‘Digital Financial Assets Law,’ has a clear message: crypto in the Golden State is about to transform.

In a recent crypto announcement released on October 13, Newsom proclaimed that the legislation, known as the ‘Digital Financial Assets Law,’ will compel both individuals and businesses to secure a Department of Financial Protection and Innovation (DFPI) license for involvement in digital asset business activities. This game-changing legislation is slated to take effect on July 1, 2025, giving entities 18 months to prepare for compliance.

This new crypto bill introduces even more rigor by drawing parallels to California’s money transmission laws, prohibiting banking and transfer services from operating without a DFPI Commissioner-granted license. The DFPI will be able to impose rigorous audit requirements on crypto firms and obligate them to maintain meticulous records. The statement explicitly stipulates:

“[This bill] would require a licensee to maintain […] for 5 years after the date of the activity, certain records, including a general ledger maintained at least monthly that lists all assets, liabilities, capital, income, and expenses of the licensee.”

California’s Crypto Regulatory Shift

It’s worth noting that roughly a year ago, Governor Newsom rejected a similar bill to establish a licensing and regulatory framework for digital assets in California. His primary objection then was its inflexibility in adapting to the rapidly evolving crypto landscape. Newsom preferred to wait for federal regulations to take shape before collaborating with the legislature on crypto licensing initiatives.

In a broader national context, the United States is also contemplating extending the reach of the Electronic Fund Transfer Act (ETFA) to cryptocurrencies. This move is designed to combat fraudulent transfers and bolster consumer protection. Rohit Chopra, Director of the Consumer Financial Protection Bureau (CFPB), has voiced his support for this initiative, highlighting its potential to “reduce the harm caused by errors, hacks, and unauthorized transfers.”

As California pioneers more stringent crypto regulations, the industry’s landscape is set for a significant transformation. With these changes, crypto businesses must adapt to a new era of compliance and oversight. In contrast, the broader crypto community keeps a watchful eye on developments at both state and federal levels.

Singapore Forms Committee to Bolster AML Measures, Crypto Impact Looms

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The Singapore government has embarked on a bold step by forming an inter-departmental committee comprising members from key ministries including MAS [Monetary Authority of Singapore], MHA [Ministry of Home Affairs], MinLaw [Ministry of Law], MOM [Ministry of Manpower], and MTI [Ministry of Trade and Industry]. The committee’s primary mandate is to strengthen anti-money laundering measures. This move is expected to have a significant impact on crypto assets, aligning with the global trend of increased scrutiny of digital currencies and transactions.

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Singapore Forms Committee to Bolster AML Measures, Crypto Impact Looms 7

In a comprehensive statement recently delivered to Parliament, the government highlighted a three-pronged strategy, encompassing prevention, detection, and enforcement specifically focusing on the real estate and corporate sectors. This comes after Singapore investigated one of its biggest cases of suspected money laundering, in which the value of assets seized stood at over $2 billion.

The seized assets include 152 properties, 62 vehicles, thousands of bottles of liquor, cryptocurrencies, gold bars, and jewelry. In addressing anti-money laundering safeguards in the real estate sector, the Minister highlighted the role of gatekeepers, such as property agents, and developers. He explained the Customer Due Diligence [CDD] checks and the importance of reporting suspicious transactions to the Police.

Singapore’s MAS Defends Crypto Access to FAST System

Moving to the corporate sector, the Singapore minister emphasized putting additional measures for foreign-owned companies, like inquiring into the legitimacy of the entity’s purpose. Moreover, the government has taken steps to ensure the identification of beneficial owners, enhancing transparency and aiding law enforcement agencies in their investigations.

In the realm of digital assets, Singapore has granted operational licenses to cryptocurrency enterprises demonstrating robust AML controls. Some of the leading players that have recently secured full MPI licenses include San Francisco-based blockchain firm Ripple, crypto exchange Coinbase, and Swiss digital asset bank Sygnum.

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Image Credit: Bitcoin News

Not long ago, a letter in the Financial Times criticized Singapore for allowing virtual asset firms access to the Fast and Secure Transfers [FAST] interbank payment system. Despite the criticism, MAS defended its decision, stating that any entity with a valid banking infrastructure, including crypto businesses, can use the FAST system. MAS firmly denied any connection between the increase in malware scams in Singapore and the cryptocurrency sector. They contended that these scams are more common in the fiat economy, emphasizing that cryptocurrencies are not inherently more vulnerable to fraud than traditional financial systems.

Crypto Regulation Battle Lines Drawn as Congressman Takes Charge

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In a groundbreaking move aimed at bolstering the security and transparency of the crypto market, U.S. Representative Don Beyer, a Democrat, is introducing a bill that would mandate the creation of centralized repositories for off-chain crypto transaction data. The initiative comes in response to the recent FTX exchange crash, which highlighted the urgent need for improved oversight and regulation in the burgeoning world of digital assets.

Beyer’s proposal seeks to address the growing trend of off-chain crypto transactions, which currently occur beyond the purview of public blockchain networks. He argues that the lack of standardized record-keeping among private entities engaged in digital asset trading poses a significant risk to investors and consumers. By centralizing this data in regulated repositories, Beyer hopes to mitigate the potential for fraud and manipulation, ultimately safeguarding participants in the virtual asset world.

The key objective of the bill is to ensure that every off-chain transaction involving “digital commodities, digital assets, or digital collectibles” is recorded and made available to regulatory bodies such as the Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC). This move would grant these agencies critical insight into the rapidly evolving crypto landscape, enabling them to monitor and respond to market irregularities more effectively.

One of the pivotal features of Beyer’s legislation is the requirement that off-chain digital asset transactions be reported to a CFTC-registered trade repository within 24 hours. This mirrors the reporting standards already established for securities and swaps transactions, harmonizing crypto regulation with existing financial market norms.

Paving the Way: Centralized Records for Off-Chain Crypto Transactions

While the proposal is ambitious and forward-thinking, its passage in the predominantly Republican House of Representatives is expected to be a formidable challenge. However, Beyer remains optimistic about the potential for bipartisan collaboration, as the need for crypto market oversight transcends party lines.

Beyer emphasizes,

“As consumers increasingly turn to large digital asset trading platforms to conduct their business, thousands of transactions each day are conducted off the publicly verifiable blockchain. Unfortunately, internal record-keeping among these private entities can vary wildly, and this can leave investors and consumers vulnerable to fraud and manipulation.”

As the crypto industry continues to evolve, regulatory efforts like Representative Beyer’s bill signal a commitment to ensuring that this transformative technology develops in a secure and responsible manner. The proposed centralized record-keeping of off-chain crypto transactions could mark a pivotal step toward a more transparent and regulated digital asset landscape.