New Blockchain and Cryptocurrency Regulation (2023)

Introduction

If you follow the new regulations, you will notice many changes coming to the crypto world. These include ARTs, Stablecoins, AFSL requirements for investment managers, and an EO on Ensuring Responsible Development. This is a big deal, and it will have a profound impact on how the crypto industry functions. Check Out this bitcoin trading platform if you want to start trading Bitcoin.

Stablecoins

Singapore’s regulators have promised to tighten crypto regulations. While there is still no final rule, the proposed rules include measures to limit retail investors’ exposure to crypto. The Treasury Department’s report is expected to be released this fall and will consist of recommendations and a template for federal rules. The information is expected to include provisions protecting consumer privacy, new reserve requirements, and a framework for the industry’s future.

The regulatory landscape is still nebulous, but recent examples of spectacular failures illustrate the importance of comprehensive regulation. The draft publication discusses how the industry has grown and how the government should respond. Stablecoins are digital currencies pinned to relatively stable assets, typically existing fiats. These fiats are valued by governmental decree and are not backed by precious metals, such as gold.

ARTs

The New Blockchain & Cryptocurrency Regulation (2023) covers various topics, from government attitude to cryptocurrency regulation, sales regulation, and taxation. It also discusses ownership and licensing requirements. For example, GLI discusses how cryptocurrency regulation will impact blockchain-based projects.

Regulators must make tough decisions about how and when to regulate the crypto ecosystem. As a result, we should expect significant changes in cryptocurrency policy over the next two years. The recent market crash has exposed vulnerabilities and systemic concerns within the crypto landscape and has increased policymakers’ awareness of the need to regulate. While the current downturn has helped to reduce asset prices, it may only be a temporary respite.

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AFSL requirement for investment managers

If you manage investments in cryptocurrencies, you may need an AFSL to offer the products and services. Cryptocurrency is a distributed ledger technology used to store, exchange and verify the information. Investment managers must be regulated by ASIC and have an Australian Financial Services License to offer investment products and services in this industry.

Under the Corporations Act, investment businesses must have an AFSL to conduct business in Australia. ASIC has developed Regulatory Guide 255 to provide further guidance to investment businesses.

EO on Ensuring Responsible Development

The United States has recently signed an Executive Order to address issues surrounding the development and use of digital assets. The Executive Order defines digital assets as cryptocurrencies, digital assets like bitcoin, and forms of exchange recorded on the Blockchain. It represents the first step in developing a whole-of-government approach to regulating digital assets.

President Biden issued the Executive Order on March 9. The EO is the first coordinated plan for digital asset regulation in the United States. It outlines several key policy goals to protect American consumers, maintain financial system stability, prevent illicit finance, and advance U.S. leadership and financial inclusion.

The Executive Order will give various federal agencies the authority to review these issues and make recommendations. These agencies are expected to issue policy recommendations within six to twelve months.

FSB proposals

FSB proposals for Blockchain and cryptocurrency regulation will be finalized in mid-2023 and are expected to give policymakers and regulators a clear direction for the industry’s future. The rules outline a legal framework for reining cryptocurrencies and decentralized finance companies. The FSB plans to continue to monitor the industry and provide guidance.

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The proposals are nonbinding, and the committee seeks public comments until December 15. The FSB expects to provide final recommendations by mid-2023.

Conclusion

The New Blockchain & Cryptocurrency Regulation is intended to regulate and monitor the use of crypto assets and their transactions. The regulation includes rules for sales, taxation, money transmission laws, and ownership and licensing requirements. A draft of the code is available here. It should be noted that the current is not legally binding. However, it may help regulators interpret the scope of the legislation.

The regulation will target exchanges, wallet providers, and cryptocurrencies. The goal is to make these technologies more acceptable, credible, and durable. It will also require them to be widely accepted as payment. The issue with cryptocurrencies is that they have low acceptance as a payment method, limiting their use. Increased regulation could be a positive step in their mass adoption.

The New Blockchain & Cryptocurrency Regulation will help prevent fraudulent and illegal activities and provide a legal framework for these types of transactions. The New Blockchain & Cryptocurrency Act of 2018 aims to protect consumers and the American public. The executive order also lays out a framework for responsible digital asset development. It lays the foundation for further action on these issues at home and abroad. The report also calls for agencies to foster innovation and help cutting-edge U.S. firms gain a foothold in international markets. Other key recommendations include enhanced enforcement of existing laws and creating efficiency standards for cryptocurrency mining.

While several states have adopted some regulatory frameworks, there are few specific regulations governing the use of cryptocurrency. For instance, if a person transfers cash to crypto and vice versa, he must follow the money-transfer laws in the state where they reside. Ultimately, lawmakers will need to pass legislation establishing a common rulebook for cryptocurrency and blockchain companies and assign regulators to determine the fine details.