According to incomplete statistics from Mankiw Law Firm, from July 15 to July 21, 2024 (UTC+8), a total of 35 key encryption policies and related actions were disclosed by countries and regions around the world, with the main focus on the entry into force of MiCA in Europe, the consultation summary of Hong Kong's stablecoin issuance and the sandbox application. Among them:
There are 12 pieces of information on China’s crypto policies, including Hong Kong, which plans to submit a draft stablecoin regulation by the end of the year after announcing the consultation summary of stablecoin issuers and sandbox applicants;
There are 7 policies and actions related to the crypto industry in the United States, among which the U.S. SEC approved 2 ETH spot ETFs, which will be officially listed for trading after the final S-1 document review is completed;
There are 8 policy consultations related to the crypto industry in Europe. The most noteworthy one is that European regulators published a draft guideline on crypto asset classification standards based on MiCA and solicited market opinions.
South Korea has 4 policy pieces of information worth noting, especially the first cryptocurrency law taking effect, which imposes stricter regulatory measures on South Korean digital asset exchanges.
The following is a summary of the policies from July 15 to 21 compiled by Mankiw Law Offices:
China
Hong Kong legislator: Sandbox application process lacks transparency
According to Wen Wei Po, Hong Kong Legislative Council member Qiu Dagen believes that the sandbox application process lacks transparency, including the start time of the sandbox and how long it will take to officially issue the license. At the same time, there are still many unresolved issues before the official license is issued, such as virtual asset custody and intermediaries. He pointed out that many companies in the market already have experience in issuing stablecoins internationally, and these companies may be considered in the next round of sandboxes.
Hong Kong Exchange will launch CSOP Bitcoin futures inverse product on July 23
Wu said he learned exclusively that on July 23, the Hong Kong Stock Exchange will launch Asia's first Bitcoin inverse product, the full name of which is CSOP Bitcoin Futures Daily Inverse (-1 x) Product (http://7376.HK), which directly invests in the nearest expiring monthly Bitcoin futures traded on the Chicago Mercantile Exchange. The trustee is HSBC Institutional Trust Services (Asia) Limited.
Hong Kong plans to submit a draft regulation on fiat stablecoins by the end of the year
According to Yahoo Finance, Hong Kong Treasury Department Chan Ho-lim revealed that it is expected that a regulatory draft for fiat stablecoins will be submitted to the Legislative Council before the end of this year. The draft establishes a 6-month transition period and clarifies licensing standards, allowing issuers of existing substantive businesses to continue operating, while strengthening regulatory measures to ensure financial market stability and user protection.
Hong Kong Monetary Authority: Participation in the "Sandbox" is not a necessary condition for applying for a stablecoin issuer license
Chen Weimin, deputy chief executive of the Hong Kong Monetary Authority, pointed out that applicants entering the "Sandbox" need to demonstrate detailed and feasible business and "Sandbox" plans. One of the keys is to propose specific application scenarios and explain how their stablecoin business can practically solve the pain points in economic activities. At the same time, entering the "Sandbox" is not a prerequisite for applying for a stablecoin issuer license in the future. Even if participating institutions that have entered the "Sandbox" intend to obtain a license in the future, they must submit a formal application after the regulatory system is implemented.
HKX Hong Kong Virtual Asset Trading Platform License Application Has Been Withdrawn
The official website of the Hong Kong Securities and Futures Commission has been updated. The application for a virtual asset trading platform license submitted by HKX to the Hong Kong Securities and Futures Commission was withdrawn on July 17. At present, the list of virtual asset trading platforms announced by the Hong Kong Securities and Futures Commission includes 2 licensed companies, namely OSL Exchange and HashKey Exchange; 16 companies are still applying, of which 11 are deemed to have been licensed; 13 applicants have withdrawn/returned, of which 1 was returned.
Hong Kong Monetary Authority releases list of participants in stablecoin issuer "sandbox"
The Hong Kong Monetary Authority announced the list of participants in the "Sandbox" for stablecoin issuers, including JD CoinChain Technology (Hong Kong) Co., Ltd., Yuanbi Innovation Technology Co., Ltd., Standard Chartered Bank (Hong Kong) Co., Ltd., Anmi Group Co., Ltd., and Hong Kong Telecommunications (HKT) Limited. Other applicants are still being processed and will be announced in due course if there are any new applicants. At the same time, the HKMA reminds "Sandbox" participants that they must comply with the requirements of the "Sandbox", and will not use the public's funds in the initial stage, nor will they raise funds from the public or provide any related products in the name of the "Sandbox".
Crypto custody company Copper obtains TCSP license in Hong Kong to expand into Hong Kong market
Crypto asset custodian Copper has successfully obtained a trust or company service provider (TCSP) license in Hong Kong, a key development in the company's expansion in the Asia-Pacific region. The license, granted by the Hong Kong Companies Registry, allows the holder to provide trust and company services to institutions in the region.
Hong Kong Treasury and Hong Kong Monetary Authority release consultation conclusions on regulatory regime for stablecoin issuers
The Hong Kong Treasury Department and the Hong Kong Monetary Authority jointly issued a consultation summary on the legislative proposal to implement a regulatory regime for issuers of fiat stablecoins in Hong Kong. The regulatory framework includes reserve management, redemption requirements and issuer eligibility requirements, etc., aiming to ensure that the issuance and operation of fiat stablecoins meet international regulatory standards. The summary mentioned that a considerable number of respondents agreed to the proposal to enact new legislation to implement the regulatory regime for issuers of fiat stablecoins and to exclude the issuance of fiat stablecoins from the regulatory regime for securities and stored value payment instruments. At the same time, they supported the requirement that the total value of the reserve assets of fiat stablecoins must maintain full reserves at all times, and recognized that this is a core element to support the stability mechanism of stablecoins.
Taiwan's Legislative Yuan amends the Anti-Money Laundering Act to strengthen supervision of virtual asset services
Taiwan's Legislative Yuan has passed an amendment to the Anti-Money Laundering Act, which will bring businesses or personnel that provide virtual assets and third-party payment services under the scope of regulatory control. The new law stipulates that these service providers must complete relevant registrations, otherwise they may be sentenced to up to two years in prison or a fine of NT$5 million. At the same time, the amendment also revised the penalties for general money laundering crimes, and regulated special money laundering, voluntary surrender and commutation clauses, and prosecutors' investigative powers.
Hong Kong regulator plans licensing regime for stablecoin firms
According to Bloomberg, the Hong Kong Monetary Authority (HKMA) plans to introduce a licensing system for stablecoin issuers. Stablecoin issuers that track the price of fiat currencies need to obtain a license from the HKMA and publish proof of reserve assets audited by a third party every month to ensure that the stablecoin is fully backed by reserves. The proposed regulations are expected to be submitted for legislative review later this year.
The Office of the Financial Committee of the Fujian Provincial Party Committee issued a risk warning on preventing illegal financial activities in the name of DD 0 digital options
The Office of the Fujian Financial Committee issued the latest risk warning, reminding the general public to guard against illegal financial activities by some companies under the name of "DD 0 Digital Options", which is essentially the issuance and trading of virtual currencies. At the same time, it encourages people to actively report to local anti-illegal fund-raising offices or public security organs once they find any clues. Once the report is verified, it will be rewarded.
A "U-swap" OTC merchant was sentenced to three years in prison and fined 5 million yuan for illegal business operations
In the Chongqing case, the defendant He was sentenced to three years in prison and a fine of 5 million yuan by the Yubei District People's Court of Chongqing for the crime of illegal business operation because he illegally engaged in fund payment and settlement business on a virtual currency trading platform and earned profits from the price difference.
USA
US court eases restrictions on Binance subsidiary BAM
The U.S. District Court for the District of Columbia issued a motion to relax certain restrictions on BAM, allowing it to conduct some financial operations under specific conditions, including: BAM can entrust a third-party investment advisor to invest its corporate assets; invest customer funds in U.S. Treasury bonds; and transfer crypto assets to a non-affiliated third-party custodian.
US Treasury sanctions Venezuelan criminal group Tren De Aragua
The Office of Foreign Assets Control (OFAC) under the U.S. Treasury Department has imposed sanctions on the transnational criminal organization "Aragua Train" originating from Venezuela, accusing it of involvement in illegal activities such as kidnapping, human trafficking, and extortion, and claiming that the organization partially uses cryptocurrencies to launder money.
SEC issues investor alert: Five fraudulent ways investors may be tempted to participate in scams involving crypto-asset securities
The SEC’s Office of Investor Education and Advocacy issued an investor alert stating that fraudsters continue to exploit the popularity of crypto assets to lure retail investors into scams. These scams involve using social media platforms or casual text message contacts to build trust, using artificial intelligence technology to create fake investment opportunities, and impersonating trusted sources or manipulating crypto asset prices, as well as requiring investors to pay additional fees to withdraw funds or recover losses. Investors should be wary of these scams and avoid making investment decisions based on these fraudulent practices.
U.S. judge approves $9 million settlement for Robinhood
A federal judge has approved a $9 million settlement in a class-action lawsuit against Robinhood over its "refer a friend" program, which sent promotional text messages to users without their consent, in violation of Washington state consumer protection laws. The settlement also includes $2.2 million in attorney fees.
US SEC approves two ETH spot ETFs to be listed on NYSE Arca
The U.S. Securities and Exchange Commission (SEC) has approved two ETH spot ETFs issued by Grayscale and ProShares. These two ETFs will be listed on the New York Stock Exchange's Arca electronic trading platform, marking the SEC's further open attitude towards cryptocurrency ETFs. These two products still need to wait for the final S-1 document review to be completed before they can be officially listed for trading.
Trump names J.D. Vance his Republican vice presidential nominee
Trump announced J.D. Vance as his Republican vice presidential candidate. J.D. Vance is a cryptocurrency-friendly politician who holds between $100,000 and $250,000 worth of Bitcoin, according to his latest federal financial disclosure, and is drafting a bill to reform the way U.S. financial regulators oversee digital assets.
SEC Enforcement Director Calls for Tighter Crypto Regulation to Protect Investors
Gurbir S. Grewal, Director of the U.S. Securities and Exchange Commission’s (SEC) Bureau of Enforcement, spoke at the William Mary Business Law Review Symposium, emphasizing the importance of enforcing federal securities laws in the evolving cryptocurrency market. Grewal noted that the principles-based definition of securities from the 1946 Supreme Court case SEC v. Howey is applicable to new types of investment schemes, including crypto assets.
Europe
European regulators seek comments on guidelines for crypto asset classification under MiCA regulation
The European Banking Authority (EBA), the European Insurance and Occupational Pensions Authority (EIOPA) and the European Securities and Markets Authority (ESMA) have published a consultation document to seek market opinions on the guidelines for the classification of crypto assets under the Market in Crypto Assets Regulation (MiCA). The guidelines include standardized tests and interpretation templates, aiming to promote consensus and consistency in the classification of crypto assets.
Greek government plans to impose cryptocurrency tax from 2025
According to Ekathimerini, the Greek government has set up a special committee to study crypto assets and will submit a report to the Ministry of Economy and Finance in September this year. It is expected that the new tax system will start in January 2025 and tax the gains from cryptocurrency transactions at a capital gains tax rate of 15%.
OKX selects Malta as EU MiCA compliance centre
OKX cryptocurrency exchange announced that it will use Malta as its compliance center for the EU Market for Crypto Assets (MiCA) to ensure compliance with EU regulatory requirements. The company chose Malta because of the high local regulatory standards and established team base. At the same time, OKX also plans to provide spot trading services, including euro and US dollar stablecoin USDC, to qualified EU residents through Okcoin Europe Ltd.
Crypto-friendly Roberta Metsaura re-elected as European Parliament President
Roberta Metsoula was re-elected as President of the European Parliament. She has advocated the introduction of cryptocurrency and blockchain regulation at the right time. During her last term, the EU passed the Markets in Crypto-Assets Act (MiCA). Metsoula's re-election means that the European Parliament continues to maintain a pro-crypto attitude, which is beneficial to the continued upward development of the European blockchain industry.
Saxony, Germany sells 50,000 BTC, 90% of which are OTC transactions
According to an announcement on the official website of the German state of Saxony, the Saxony State Prosecutor's Office sold nearly 50,000 bitcoins in multiple sales over a period of about three and a half weeks. The amount sold each time was less than 1% of the market trading volume, and more than 90% of the transactions were conducted through OTC to ensure that the impact on Bitcoin price fluctuations was reduced.
Basel Committee releases revised framework and standards for banks’ crypto asset risk disclosures
The Basel Committee on Banking Supervision has published its final disclosure framework for banks’ crypto-asset risks and made targeted revisions to its crypto-asset standards to strengthen the criteria for certain stablecoins to receive preferential regulatory treatment. Both standards will be implemented on January 1, 2026. The new disclosure framework requires banks to disclose qualitative information on their crypto-asset activities and quantitative information on their crypto-asset risks to enhance information availability and support market discipline.
EU regulators publish draft guidance on crypto asset classification standards
The three major European financial regulators, the European Banking Authority (EBA), the European Insurance and Occupational Pensions Authority (EIOPA) and the European Securities and Markets Authority (ESMA), jointly issued a consultation document on the Market Crypto-Assets Regulation (MiCAR), proposing standardized tests and templates, with a particular focus on asset-referenced tokens (ARTs) and other crypto-asset categories to ensure consistency with the MiCAR standard, and requiring relevant legal opinions to support the compliance of crypto-assets. The consultation deadline is October 12, 2024.
UK financial regulator calls for data on digital wallets
The UK Payment Systems Regulator (PSR) and the Financial Conduct Authority (FCA) have jointly launched a public consultation on digital wallets to collect information on the potential benefits and risks they bring to individuals and businesses. The regulators hope that through this consultation, they will have a more comprehensive understanding of the impact of the popularity of digital wallets on consumers and the business environment.
Japanese and Korean
South Korea's first cryptocurrency law takes effect, focusing on protecting investor safety
South Korea's first cryptocurrency regulatory framework, the Virtual Asset User Protection Act, has come into full effect, with a one-year grace period to refine regulatory details. The bill requires digital asset exchanges to take stricter measures, including storing at least 80% of user cryptocurrency deposits in cold wallets, separate from their own funds. In addition, exchanges must entrust local licensed banks to manage user cash deposits and maintain cryptocurrency reserves of the same amount and type as customer deposits. Crypto service providers in South Korea are also required to take out adequate insurance or set up reserve funds to guard against possible hacker attacks or liquidity crises.
South Korean prosecutors request arrest warrant for crypto market manipulation suspect
According to the Seoul Economic Daily, South Korean prosecutors are applying to arrest a suspect in cryptocurrency market manipulation named Jonbur Kim or HODL Kim, who is suspected of bribing employees of the Coinone exchange to list the POD token on the exchange and then manipulating its market price.
South Korea implements new amendment, prosecutors can directly investigate virtual asset crimes
The South Korean government recently passed an amendment that allows prosecutors to directly investigate virtual asset crimes. The new law will officially take effect on October 19, involving criminal activities such as market manipulation and insider trading, and offenders will face heavy penalties. At the same time, the amendment also covers the upcoming Personal Debtor Protection Act, which stipulates that unauthorized institutions are not allowed to engage in the collection of personal financial claims.
South Korea again postpones cryptocurrency taxation until 2028
The South Korean government announced that it will postpone the implementation of cryptocurrency taxation again to 2028. This is another adjustment after several previous postponements due to the coordination with the financial investment tax and the strong market reaction. The government said that more time is needed to improve the relevant systems and legislative framework to ensure the smooth implementation and fairness of tax policies.
Other countries and regions
The Bank for International Settlements (BIS) issued new regulations to restrict banks from holding XRP and other second-class crypto assets
The Bank for International Settlements (BIS) recently issued new regulatory requirements for banks holding XRP and other unbacked crypto assets, including stablecoins such as Bitcoin and Ethereum, as well as those that lack effective stabilization mechanisms. The new rules require that banks' total exposure to Class II assets shall not exceed 1% of their Tier 1 capital, and that holdings of any single Class II cryptocurrency shall not exceed 5% of total holdings. The new rules are expected to take effect on January 1, 2026.
Nigeria begins review of its blockchain technology policy
Nigeria's National Information Technology Development Agency (NITDA) has begun re-evaluating the implementation guidelines for the country's blockchain technology policy. The review, chaired by the chairman of the Blockchain Policy Steering Committee, aims to integrate the latest technologies and expand the scope of application of the policy to land registration, healthcare and education. In addition, Nigeria also plans to establish specialized research centers in the country's six major geopolitical regions to focus on blockchain innovation and other cutting-edge technologies.
Sydney court imposes injunction on BitConnect promoter
The Sydney District Court in Australia has convicted John Bigatton of providing illegal financial advice without a financial services license and banned him from managing a company for the next five years. The Australian Securities and Investments Commission (ASIC) noted that Bigatton promoted the defunct cryptocurrency trading platform Bitconnect through seminars and social media between 2017 and 2018.
Russian State Duma Committee Recommends Cryptocurrency Mining Regulation Bill
The Russian State Duma Committee on Financial Markets has recommended that the lower house adopt a bill on regulating crypto mining activities at its first reading. The document, initiated by a group of deputies led by the chairman of the State Duma Committee on Financial Markets, is expected to be considered at the July 23 session. The bill sets out requirements for individuals and legal entities to conduct cryptocurrency mining activities, with supervision by the Ministry of Digital Development.
