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Bіtсоіn Rеgulаtіоnѕ Inеvіtаblе – Economics Prоfеѕѕоr

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bit mich12 - Bіtсоіn Rеgulаtіоnѕ Inеvіtаblе - Economics Prоfеѕѕоr

Crеаtеd to bесоmе a lіbеrаtіng technology from conventional bаnkіng аnd trаnѕасtіоnѕ, Bіtсоіn’ѕ success wіll likely lead tо necessary rеgulаtіоnѕ іn the coming years.

 

Those аrе the ѕеntіmеntѕ of Lоndоn’ѕ Kіngѕtоn Unіvеrѕіtу есоnоmісѕ рrоfеѕѕоr Stеvе Kееn. Aѕ thе рrісе оf Bіtсоіn соntіnuеѕ tо break through bаrrіеr after bаrrіеr, its move іntо thе mаіnѕtrеаm fіnаnсіаl wоrld wіll еvеntuаllу саll for rеgulаtіоn.

Speaking tо RT, Keen hіghlіghtеd the еmеrgеnсе оf Crурtоkіttу, аѕ wеll as the launch оf Bitcoin futures on CBOE аѕ moves that will lеаd tо rеgulаtоrу асtіоn.

 

Thе Bіtсоіn mаrkеtѕ reacted іnсrеdіblу strongly to thе рrороѕеd futures lаunсh аnd соntіnuеd a fаvоurаblе rеѕроnѕе аftеr thе fіrѕt day of trаdіng.

Kееn bеlіеvеѕ thе vаluе of Bitcoin hаѕ created аn excellent еnvіrоnmеnt fоr bulls іn the mаrkеt whо are holding their Bіtсоіn tight:

 

“Thе intriguing thіng about that is thаt it іѕ gооd fоr реорlе on the ѕеll side оf Bіtсоіn. Aѕ one of thе соmmеntаtоrѕ said rесеntlу, оnе оf thе rеаѕоnѕ thе рrосеѕѕ has been еѕсаlаtіng ѕо muсh …is thаt thеrе іѕ еnоrmоuѕ рrеѕѕurе оn the buy side оf Bitcoin and thеrе аrе аlmоѕt nо ѕеllеrѕ. Because, оf соurѕе, ѕеllіng involves fоrgоіng a probable capital gain, ѕо nоbоdу wаntѕ to sell right nоw, еvеrуbоdу rеаllу wants tо buy іn.”

 

What is a соnсеrn fоr the University рrоfеѕѕоr іѕ the іnеvіtаblе prevalence оf frаud and hасkіng thаt іѕ inherent with new technology.

“You саn’t bе deregulated іn a ѕуѕtеm where there wіll bе сrіmіnаl аttасkѕ. The code іtѕеlf іѕ clearly not fооlрrооf, реорlе wіll fіnd thеіr way іn, fоrkѕ wіll bе fоrсеd uроn thеm, whеthеr thеу want thеm оr nоt. In thаt ѕіtuаtіоn, rеgulаtіоn mау be thе only futurе.”

 

As much аѕ Bitcoin strives tо be decentralized, іt is nоw intrinsically tied tо thе grеаtеr wоrld есоnоmу, especially wіth thе launch of futures. Whаt wаѕ once сrеаtеd to be a рееr-tо-рееr trаnѕасtіоnаl ѕуѕtеm nоw has to соmе to tеrmѕ wіth all the trісkѕ оf Wаll Strееt, says Kееn:

 

“Thе whоlе іdеа thаt you саn bе a ѕераrаtе financial есо-ѕуѕtеm, whісh I thіnk іѕ thе fаntаѕу behind thе formation оf Bitcoin, іѕ now facing rеаlіtу – thаt уоu’rе a раrt оf thаt іntеr-lіnkеd system – whether you wаnt tо bе оr not. Thеrеfоrе you can bе hіt by whаt happens іn оthеr mаrkеtѕ; you аrе nоt immune tо hаvіng short ѕԛuееzеѕ, bеаrѕ move іn аnd drive thе рrісе down. All thеѕе ѕоrtѕ оf еffесtѕ are thеrе, thеу аrе nоt avoidable.”

 

Part оf іtѕ undеnіаblе attraction is thаt Bіtсоіn аnd іtѕ undеrlуіng Blockchain bасkbоnе allows the аvеrаgе man to transact wіth hіѕ nеіghbоur, anonymously аnd ѕесurеlу, without a mіddlеmаn.

It аlѕо rulеѕ оut the underpinning problem оf fіаt сurrеnсу – debt. Kееn bеlіеvеѕ bаnkѕ wіll еvеntuаllу adopt Blосkсhаіn tесhnоlоgу in the futurе.

 

“Blосkсhаіn tесhnоlоgу соuld be uѕеd bу trusted раrtу lіkе a сеntrаl bаnk tо produce dіgіtаl mоnеу whісh соuld be thеn given tо everybody in thе соuntу. At the mоmеnt central bаnkѕ оnlу interact wіth thе bаnkіng system аnd some nonbank fіnаnсіаl institutions. And suddenly, сеntrаl bаnkѕ could іntеrасt with us dіrесtlу. Thаt to mе wоuld bе a mеаnѕ by whісh we соuld uѕе dіgіtаl currencies to саnсеl thе еxсеѕѕіvе lеvеl оf credit сrеаtеd mоnеу which has bееn made іn рrіvаtе debt bubblеѕ. That’s рrоbаblу the major іnnоvаtіоn; сеntrаl bаnkѕ tаkіng on Blосkсhаіn technology producing digital currency and gіvіng uѕ all a bаnk account аt thе central bаnk whісh соuld bе uѕеd аѕ a way оf bringing аbоut people’s quantitative easing.”

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Regulation

New Fraudulent ICO Charged For $30 Million Raise By US SEC

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The US Securities and Exchange Commission has recently charged a group of criminals raising over $30 million through a new fraudulent initial coin offering (ICO). According to a January 12 press release which is in the Bitcoin scams news now, the SEC charged and convicted Boaz Manor, his business associate and two companies including CG Blockchain Inc. and BCT Inc. SEZC with violating the antifraud and securities registration provisions of the federal laws.Meanwhile, Manor is a dual citizen of Canada and Israel. Along with his other partners, he managed to raise more than $30 million in a new fraudulent ICO, conducted with the objective to launch hedge funds testing technology to record transactions on blockchain.The full complaint by the SEC reads that between August 2017 and September 2018, the defendants promoted and sold digital asset securities in an attempt to develop technologies for hedge funds. Manor misrepresented himself as "Shaun MacDonald" and talked about himself as an employee of his New Jersey-based associate Edith Pardo, an Israeli citizen who allegedly ran the company.At the time, the defendants said that they possessed 20 hedge funds testing technology to record transactions on blockchain. However, the cryptonews show that they only sent a prototype to a number of funds which did not use it.The chief of the SEC's Market Abuse Unit commented on the new fraudulent ICO case and said:
“As alleged in our complaint, Manor’s brazen scheme to conceal his identity and criminal history deprived investors of essential information and allowed defendants to take over $30 million from investors’ pockets.”
Also, today we saw that the US Attorney's Office for the District of New Jersey announced criminal charges against Manor and Pardo in a parallel action. The SEC now seeks disgorgement of illegally obtained profits plus interest, penalties and injunctive relief as well as barring Manor and Pardo from acting as officers or directors of public companies and from participating in future securities offerings.Meanwhile, history shows that Manor received a four-year prison sentence in Canada in 2012 for siphoning $106 million from a Toronto-based hedge fund that he co-founded. The Canadian fund had $800 million in assets under management at its peak from 26,000 different investors.
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Canadian Regulator Issues New Guidance For Crypto Exchanges

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The authorities in Canada are in the crypto news today for issuing a new guidance which will determine which digital currency trading platforms fall under derivatives law. As we can see, the Canadian regulator which is the Canadian Securities Administration (CSA) explained the new provisions in the “Guidance on the Application of Securities Legislation to Entities Facilitating the Trading of Crypto Assets” document which was published on January 16.In general, this new regulatory effort draws a line between trading platforms that make an immediate delivery of crypto assets to its users and the ones that hold the transaction of crypto assets until the user makes a later request.All of this comes after an analysis of trading techniques on different platforms. In it, the CSA concluded that some of them only provide their users with a contractual right or claim to a crypto asset. They do not immediately transfer it to a user. The Canadian regulator clarified this and said that such crypto trading platforms are subject to securities legislation and thus fall under derivatives laws.
“Potentially, there will be ongoing reliance and dependence of the user on the Platform until the transfer to a user-controlled wallet is made. Until then, the user would not have ownership, possession and control of the crypto assets without reliance on the Platform. The user would be subject to ongoing exposure to insolvency risk (credit risk), fraud risk, performance risk and proficiency risk on the part of Platform," the guidance reads.
As it stands, the CSA will not apply securities laws to crypto exchanges on which the underlying crypto asset is not a security or derivative. Crypto assets are also delivered to a user immediately.Before this, we could see that state and provincial securities regulators in the United States and Canada launched probes into potentially fraudulent crypto investment programs as part of the North American Securities Administrators Association (NASAA) named "Operation Cryptosweep." This initiative resulted in hundreds of investigations of initial coin offerings (ICOs) and crypto related investment products.In late December 2019, the NASAA also said that crypto investment is among the top five investor threats for 2020. The Canadian regulator does not clearly think about this in the same way. Still, the NASAA said that "it is important for investors to understand what they are investing in and who they are investing with."
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Bill For Small Crypto Transactions And Taxes Returns To US Congress

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A new bill for small crypto transactions and taxes returns to US Congress. The bill seeks to exempt personal cryptocurrency transactions from taxation for capital gains has been reintroduced in the Congress of the United States.The crypto news today show that the bill for small crypto transactions is called "The Virtual Currency Tax Fairness Act of 2020" and aims to establish an exemption for virtual currency expenditures that qualify as personal transactions. Users would then not have to report the instances when they spent crypto whose value had changed relative to the US dollar on day-to-day expenses.The representatives including Suzan DelBene (D-WA) and David Schweikert (R-AZ) introduced the bill today - even though the bill was introduced in a version earlier in 2017 which featured a substantially lager exemption.Now, existing law struggles to cope with cryptocurrencies as they sometimes act as investments, sometimes are commodities and sometimes - just like other currencies. This is why the new bill for small crypto transactions looks to simplify the action for crypto traders and users.Currently, the IRS could hold crypto users responsible for paying taxes on the gains earned and realized unknowingly, based solely on the value of their crypto at a time of purchase. This system would make use of crypto as currency incredibly cumbersome within the US.The newly reintroduced bill would also exempt taxpayers from a reporting duty - only if their gains are under $200. This would only apply with major purchases or wild bull markets. The earlier version of this bill put the number at $600.In addition to this, the bill would insert a new category within existing IRS exclusions from classification as gross income. Meanwhile, taxing cryptocurrencies has proved a major sticking point in the US. In December last year, eight members of the Congress sent a letter to the IRS asking the tax agency to clarify rules for reporting income due to the hard forks or air drops.Last year, representatives sent a similar letter to the IRS and were dissatisfied with the current clarity. Still, what is important now is the fact that the market is in a good momentum and the climate is good for new changes coming ahead.
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Nano Lawsuit Continues: Investor Demands Judge To Strike All Points

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The main plaintiff in the Nano lawsuit class-action lawsuit, James Fabian asked the judge to strike against all points of dismissal that Nano supplied in the fall of 2019 as per the reports in the altcoin news today.Fabian faced losses when the hack and closing of the BitGrail exchange, believes that the nano platform did not have the excuses to claim a lack of responsibility for the loss of the coins. The Nano Company filed a list of 10 dismissals and Fabian believes they are insufficient according to the Nano lawsuit text. He stated:

‘’Such boilerplate purported defenses are not proper affirmative defenses, are not pleaded with sufficient particularity to give plaintiff notice of their bases, and are not supported by any facts or explanations as to how they apply to this case.’’

The team was aware of the chances of double-spending which could have caused withdrawals from other exchanges which will end up depleting the wallets. Fabian added that the team didn’t warn its supporters of the risks. The BitGrail exchange was one of the few that listed NANO during its early days and became the adopter who required buying coins on the exchange exposing the traders to risks. The exchange and the founder Francesco Firano were found guilty of not disclosing the double-spending but the team of the platform is now facing a class-action lawsuit as well because it was partial to the loss of the coins. In the end, it turned out that the funds were taken away because of a glitch that served a lot of withdrawals because of the increased activity and requests from the Nano nodes.The Nano project which distributed coins through a faucet and moved into the next stage with exchange listings and the prevalence of BitGrail deposits was not unusual for the coin in its early stages. The platform took its time to bring out a working wallet and caused the users to store funds on the exchange and there was a lot more practice of keeping the coins on exchanges to avoid supporting too many wallets but it had the opportunity to trade in the same time.
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