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Hawaii State Senate Authorizes Banks To Offer Crypto Custody

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The Hawaii State Senate is in the latest cryptocurrencies news now for passing the first reading of a bill that authorizes banks to hold digital assets in their custody. This bill was introduced on January 17 and was designed five state senators, including the Republican member of the Senate, Kurt Fevella. The bill passed the first reading on January 21 and was then referred to the committees of the Judiciary and Commerce, as well as Consumer Protection and Health on January 23.

Basically, the bill specifies the set of provisions which a bank must adhere to and provide custodial services for digital assets. As you may not know, the custodial services cover “the safekeeping and management of customer currency and digital assets through the exercise of fiduciary and trust powers under this section as a custodian and includes fund administration and the execution of customer instructions.”

Now, in order from a bank from Hawaii to qualify as a crypto custodian, it must adhere to certain standards in regards to accounting and internal controls. It also needs to maintain IT best practices and comply with the federal Anti-Money Laundering (AML) and Know Your Customer (KYC) requirements.

Aside from opening up bank regulations to include cryptocurrencies, this proposed law would also classify cryptocurrencies under the Uniform Commercial Code – which is a set of federal laws in the US that wants to provide uniformity in legislation surrounding sales and commercial transactions in the country.

The bill also specifies the manner of perfecting a security interest in digital assets. It discusses various methods such as smart contracts and multi-signature arrangements. The proposed legislation also authorizes the courts to hear claims which are related to digital assets.

Previously in our altcoin news section, we reported about Hawaii imposing strict requirements on firms dealing with cryptocurrency. This caused the Coinbase exchange to cease its operations in the state almost three years ago.

If passed in law, the latest bill by the Hawaii State Senate would not only give clarity to classification of cryptocurrencies – it will also bring them in line with several other states and set out a framework by which any compliant bank can act as a crypto custodian.

DC Forecasts is a leader in many crypto news categories, striving for the highest journalistic standards and abiding by a strict set of editorial policies. If you are interested to offer your expertise or contribute to our news website, feel free to contact us at editor@dcforecasts.com

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Regulation

More Crypto Regulation Suggested By Michael Bloomberg

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U.S Presidential candidate Michael Bloomberg suggests more crypto regulation which is expected to clarify the status of crypto assets within the financial system and he aims to offer more government oversight as well as improved consumer protection so let’s find out more in the regulation crypto news. Bloomberg made these statements in his now published Financial Reform Policy and the candidate is not the first one to support more crypto regulation but he is the most credible candidate given his history in the financial sector. The other candidate, Andrew Yang, recently dropped out of the race. Bloomberg plans to:
‘’Cryptocurrencies have become an asset class worth hundreds of billions of dollars, yet regulatory oversight remains fragmented and undeveloped. For all the promise of the blockchain, Bitcoin and initial coin offerings, there’s also plenty of hype, fraud and criminal activity. Mike will work with regulators to provide clearer rules of the game ‘’
The document wants to establish consumer protection and to clarify the taxation rules by creating a framework for initial coin offerings by determining which of the tokens are legal securities. He also calls for more regulations for banks and other financial institutions. The proposal is short but notable as the other leading candidates have remained silent on this matter. The other presidential candidate Bernie Sanders made no statements about crypto nor Joe Biden or Elizabeth Warren has commented. Trump is still not a fan of cryptocurrency and has made no calls for regulation. More discussion about the blockchain development could be sparse among the presidential candidates but the topic will not go away. Some of the other branches of government have been addressing the impending wave of crypto adoption and the Federal Reserve Chairman Jerome Powell discussed Bitcoin before the entire House Financial Services Committee. The fact that Bloomberg wants to address blockchain assets is not surprising. He founded one of the most successful financial companies that specialize in software and technology. There’s sure no doubt that he is familiar with crypto and its potential. If the crypto market continues to recover, more candidates will make new positions on how the federal government should approach the blockchain development. There is no doubt that the next president will have to recognize the crypto potential and the change of the entire economic landscape.
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Worldwide Cryptocurrency Regulation Turns Bearish

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The crypto markets are in a freefall and the worldwide cryptocurrency regulation seems to be turning bearish as well. One of the SEC Commissioners proposed a safe harbor for crypto projects and the US Secretary of Treasury announced more cryptocurrency regulation. So what can we expect? Let’s read in the cryptocurrency regulation news today. The cryptocurrency scene in Brazil got hit the hardest especially recently since the IRS agency imposed stricter cryptocurrency regulation back in 2019. Brazil was known as the crypto-friendly space but according to the crypto news site Porto do Bitcoin, all of the exchanges now have to report the transactions to the federal revenue service and they have to follow more compliance rules no matter the amount of the assets transferred. The Brazilian cryptocurrency exchanges had a hard time following the criteria and many shut down. Former CPO of Access Bitcoin exchange Pedro Nunes said:
 “After the rules of the Federal Revenue, we noticed a significant decrease in the volume traded within our market. We also feel that the market has cooled for smaller exchanges.”
The worldwide cryptocurrency regulation changes can be seen in Russia as well since the country seems to be sending out a lot of mixed signals as to how it aims to develop cryptocurrency regulation. Some of the most popular exchanges such as Binance added support for the Russian Ruble a while ago but today, the country steps up on its AML stance. This means clamping down on crypto as well. The United States has a strict regime towards crypto as well and denies it to warm up to crypto. The pro-bitcoin presidential candidate Andrew Yang withdrew from the presidential race and the current president is not really a fan of bitcoin and crypto in general. Steven Mnuchin explained to the Senate Finance Committee that they are preparing new requirements for cryptocurrency and said that ‘’we will be seeing a lot of work coming out very quickly’’:
 “We want to make sure that technology moves forward but, on the other hand, we want to make sure that cryptocurrencies aren’t used for the equivalent of old Swiss secret number bank accounts”
Another development in the cryptocurrency regulation comes from Belgium as the Financial Services and Markets authority reveled the new plan with the government to enforce greater regulation on digital currencies for transactions. The senator Jean-Paul Servais stated that the industry is growing rapidly and urged the lawmakers to establish a legal framework for sale, purchase, and use of cryptocurrencies.
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Regulation

New Cryptocurrency Regulation Could Save The Industry: Opinion

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New cryptocurrency regulation could be the savior of the entire crypto industry especially since there are now many who can’t wait what the new anti-money laundering directives will bring as we are reading now in the cryptocurrency regulation news. Over the past couple of weeks, there have been rising anxiety amongst cryptocurrency investors of an approaching crackdown on Bitcoin (BTC) service providers. This worry does not come without any ground, at the start of 2020, European Union countries activated an anti-money laundering directive, that had an article that indicated that services providers which are working in the crypto sector will be required to amass more information about the customers that use cryptocurrencies. The move of the European Union to implement this directive has already made certain damage in the cryptocurrency sector, with industry firms like Simplecoin and Bottle Pay having to close down their platforms. Many industry people were hugely dissatisfied by the closure of Bottle Pay because it gave the opportunity to customers for easy transactions of Bitcoin (BTC) through Twitter. And more recently, the Secretary of the U.S. Treasury, Steven Mnuchin, said in a hearing held by the Senate Finance Committee that the Financial Crimes Enforcement Network (FinCEN) branch of the Treasury will soon give “significant new requirements” for entities that work with crypto. Mnuchin said in the wake of the reveal of Libra by Facebook that cryptos are a national security threat, so this move was a long time anticipated. It is interesting to note that a top industry investor has made the suggestion that the integration of the “requirements” Mnuchin is asking for can actually be of help for Bitcoin’s growth in the long run. How Speaking with CNBC on Friday in regards to Bitcoin (BTC) and the broader crypto sphere, the incumbent CEO of Galaxy Digital and a former partner at Goldman Sachs, Mike Novogratz, said:
  “We’re going to see something from Treasury in the next few months that kind of puts some guardrails around Bitcoin. I think that’s a positive.”
It is not only Novogratz who made a suggestion that the implementation of more clear and stringent cryptocurrency regulation rules against cryptos can, in turn, help Bitcoin (BTC). The Democratic presidential candidate, Andrew Yang, that just recently dropped out of the race because of a poor showing in two primaries, stated in an interview in January with Bloomberg that the implementation of clear rules in the United States can, in turn, fuel innovation.
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Regulation

Crypto Regulation UK: The Bitcoin Climate Is Changing

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The major financial regulator in the United Kingdom, the Financial Conduct Authority (FCA), is right now looking to hire a specialist with a cryptocurrency background. As we can see from the crypto regulation UK, things are changing and the FCA is seeking an intelligence associate with crypto expertise who will address digital assets under the European Union's 5th Anti-Money Laundering Directive, as the regulator said in a recent LinkedIn job posting on February 6th. Additionally known as 5AMLD, the new law came into effect on January 10 and represents a major effort to tackle money laundering and terrorism financing across Europe as previous reports in the regulation news showed. While many people are still unclear and searching keywords such as "crypto regulation UK" on Google, the new situation shows that the UK finally exited the European Union on January 31 which is why the government must pay particular attention to the EU's recently enforced cryptocurrency law. As such, the FCA is now seeking to hire an expert for its core function team who will lead the crypto regulation UK team - the intelligence team - which has become responsible for 5AMLD regulation of the crypto asset sector since January 2020. The job posting also shows that the key responsibilities of the position include intelligence support for supervision as well as enforcement, as well as processing applications for firms in the UK financial services industry. All of this leads us to believe that the Financial Conduct Authority (FCA) has been very active in the cryptocurrency space as the regulator approved the operations of major crypto firms and carefully investigated the industry. The FCA was vocal in July 2019 as well, when it announced that it will not regulate the two top cryptocurrencies which are Bitcoin (BTC) and Ether (ETH). The latest action by the FCA regarding the 5AMLD and the setup of a new crypto regulation UK team comes after the agency announced on January 10 that it will start supervising the Anti-Money Laundering compliance of cryptocurrency related firms in the country. The crypto news at the time showed that the FCA is planning to enforce a much more stringent set of rules for cryptocurrency firms.
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