Libra Testimony – Facebook Expects Switzerland Govt To Regulate Libra Association

Ahead of Test hearing before US senate committee on July 16, Calibra’s CEO David Marcus released his prepared testimony which quickly revealed few crucial aspects concerning Libra.
Libra v/s US Regulators
Mr.Marcus who is currently heading Facebook’s Calibra wallet has released 7 pages long testimony document, entitling “Hearing before the United State Committee on Banking, Housing, and Urban Affairs”. There are two days of hearing set for Libra Testimony – wherein the day one, July 16 hearing will be live-streamed on the Senate Banking Committee’s website.
While the initial phases of the paper state Facebook’s vision behind launching Libra, Libra Association, Libra Reserve, partners associating with Libra association and more – it quickly adds its expectation with the regulatory regime.
However, the social media giant had initiated its Libra effort in the United States but the US Regulators – so far – has raised serious concerns over the launch of Libra. In this testimony document, David Marcus mentioned that they expect Switzerland Govt to regulate Libra because, according to Mr.Marucs, if not America, other countries will.
I am proud that Facebook has initiated this effort here in the United States, Marcus writes. I believe that if America does not lead innovation in the digital currency and payments area, others will. If we fail to act, we could soon see a digital currency controlled by others whose values are dramatically different.
As Coingape earlier reported, Facebook is opting Geneva, Switzerland as the headquarter for Libra Association, Mr.Marcus detailed that “the company had preliminary discussions with Swiss Financial Markets Supervisory Authority (FINMA) and expect to engage with them on an appropriate regulatory framework for the Libra association”. Further, it reads that;
To be clear, the Libra Association expects that it will be licensed, regulated, and subject to supervisory oversight. Because the Association is headquartered in Geneva, it will be supervised by the Swiss Financial Markets Supervisory Authority (FINMA). It continued adding, the Association also intends to register with FinCEN as a money services business.
Although the testimony is scheduled for today, Tuesday, July 16 at 10.am ET, its predicted that committee might first address Libra and the testimony Marcus shared ahead of the hearing and later the privacy probably become the center of the whole topic.
US Regulators v/s Facebook’s Privacy Measures
Concerning about privacy, Marcus states that the first-ever product to be launched will be “Calibra wallet” and as such the financial information of the users will not be shared with Facebook, Inc. Further, it added “as a result, it cannot be used for targeting”, whereas “the vision will especially be enabling the unbanked and underbanked to take part in the financial ecosystem”. Moreover, it mentioned;
But we expect that the Calibra wallet will be immediately beneficial to Facebook more broadly (in the form of advertising the opportunity for business and transact directly ) That increased usage is likely to yield greater advertising revenue for Facebook.
Besides all these details, Mr.Marcus noted another point in the financial section of testimony which might be a center of attention for Senate committee. While writing about the privacy and security of personal information, Mr.Marcus assured that Facebook will not be involved in user’s data, except in limited circumstances;
And, except in limited circumstances, such as preventing fraud or criminal activity and complying with the law, Calibra will not share customers’ account information or financial data with Facebook unless people agree to permit such sharing.
As for now, the result of testimony is still not available but Mr.Marcus already explained what and how he will be testifying Libra in front of Senate Committee.
You can check the result of testimony here – https://www.banking.senate.gov/hearings/examining-facebooks-proposed-digital-currency-and-data-privacy-considerations
Image Source – FT
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Source: CoinGape

Indian on Crypto Ban: Alleged ‘Draft Bill’ Reveals Plans for “Digital Rupee”

The Indian Authorities have always been unclear about their stand on cryptocurrencies. However, they are actively adopting an opposing stand since the last couple of years.
It began with the banning of banking services to businesses and entities engaging in Virtual Currency transactions in June 2018. Nevertheless, P2P exchange platforms still flourish as crypto enthusiast continue to trade ethically in cryptocurrencies.
However, Koinex, one of the largest peer-to-peer platform in India announced its closure due to extreme scrutiny and hindrances caused by the policing authorities.
Draft Bill Shared By Blockchain Lawyer
Moreover, a report which came out in June 2019 regarding the draft cryptocurrency bill which seeks a ban on cryptocurrency transactions, ethical or unethical. While the authorities have made no confirmations or official statement, Varun Sethi, Indian Tech Lawyer and a crypto-enthusiast, has shared the alleged draft bill. He tweeted,
The complete draft of the ALLEGED #Banning of #CryptoCurrency and Regulation of Official #Digital Currency #Bill 2019 #India
The Alleged Draft Bill Shared Online (Source)
Coincidently, the contents of the draft bill leaked are in agreement with the previous reports which provides more authenticity to the document. Hence, the doubts around it seem to be diminishing by each revelation.
According to the leaked document, India does seek ban storage and usage of cryptocurrencies.
No person shall mine, generate, hold, sell, deal in, issue, transfer, dispose of or use cryptocurrency in the territory of India.
The drafting committee has also proposed fine and punishment for people engaging in crypto activities. The penalty will be decided by the Governments and can be up to three times the value of profit or loss generated. Moreover, imprisonment from one to ten years can also be expected.
Reportedly, there are more than 5 million cryptocurrency enthusiasts in the country. Moreover, India will be the first country to conduct crack-downs on such a large scale with such strictness. China, US, Japan, and countries in Europe have sought to deter the unethical activities, but a broad scale ban seems improbable at the moment.
Also Read: The Reserve Bank of India Denies Knowledge of Draft Bill on Cryptocurrency Ban
Nevertheless, the blockchain application and distributed ledger technologies will still be viable in the country. The bill also proposed that the Central Government, with approval from the Central Bank in India, will seek to approve the “digital rupee.” 
The nature and design of the digital sovereign currency were not explicit. However, the application of blockchain can be expected with the currency being backed by the Central Bank Reserves.
#IndiaWantsCrypto Campaign
Some of the blockchain and cryptocurrency leaders in the country have started a campaign to seek appropriate representation and presentation of reasoning before the Central Government or the drafting committee.
Nishal Shetty, the CEO, and founder of WazirX, and the forerunner of the online campaign tweeted,
The objective of this campaign is to be heard by our law makers. India needs to be at the forefront of the crypto revolution and by being vocal about it, you and I can make that happen. If we do not speak, they will never know. #IndiaWantsCrypto
Moreover, he also spoke about the authenticity of the leaked draft bill. According to him, the bill will probably come out with a lot of changes and will public comments before becoming a law. However, he also reiterated a joint effort by the community in engaging with the authorities is paramount at this point.
Do you think that an outright ban on cryptocurrency is the solution or it will create more problems? Please share your views with us. 
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Source: CoinGape

Big Blow to Libra: US Regulators Propose a New Bill for the “Big Tech”

The democratic wing of the House Financial Services Committee in the US has proposed a new bill that would prevent big tech companies “from functioning as financial institutions or issuing digital currencies.”
Reportedly, a bill “Keep Big Tech Out Of Finance Act” has been drafted and is being circulated with the regulators. If passed, the new law will rule out “Tech” space from entering into the payments space. Moreover, it targets explicitly Libra, the brainchild of Facebook, which is also backed by other big tech names like eBay and Uber.
According to the media source, the bill includes the following conditions which would prohibit the online services platforms and service providers from engaging in independent finance activities,
“A large platform utility may not establish, maintain, or operate a digital asset that is intended to be widely used as a medium of exchange, unit of account, store of value, or any other similar function, as defined by the Board of Governors of the Federal Reserve System,”
Notably, not a single bank has joined the Libra Association at the moment. However, the two big card issuing firms, VISA, and MasterCard, which have agreed to join are closest to the Financial Services industries. Even the President of the US, who recently spoke about cryptocurrencies also reiterated the fact that,
“Facebook and other companies want to become a bank, they must seek a new Banking Charter and become subject to all Banking Regulations, just like other Banks, both National and International.”
Moreover, as reported earlier on Coingape, the new SEC guidelines have also put considerable impositions on the crypto custodial platforms trying to seek the regulator’s approval. One of the few options that these firms currently have is registering as an SPDI under the Wyoming State laws.
Libra announcement had a massive impact on the cryptocurrency markets. It restored investor confidence as cryptocurrency seem to be gaining mainstream adoption. However, ever since its release, Facebook has received a lot of criticism from Governments all over the world.
Also Read: Japan’s Top Regulators Setting Up Working Group Dedicated on Libra Coin
Furthermore, if the above said bill is approved in the House, it would necessarily put an end to Libra. It would also motivate the firms involved to review their plans.
The increasing scrutiny around Libra might also be adversely affecting Bitcoin prices, as it attempted to break below $10,000. The price of Bitcoin at 3: 00 hours UTC on 15th July 2019 is 10,121. It is trading 11% lower on a daily scale.
Will a banking license solve things for the upcoming industry, or the regulators will nip it in the bud? Please share your views with us. 
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Source: CoinGape

Amidst Recent Hack, Remixpoint Gets New Crypto Services Approvals

Bitherb Co. Ltd. which is a subsidiary of Japanese public company Remixpoint, which operates a regulated Japanese crypto exchange, Bitpoint Japan, has been approved by Thailand’s Securities and Exchange Commission (SEC) to operate four new crypto services.
According to report on the commission’s website, the company, which has not begun operating on these approvals yet would be able to operate along the lines of the country’s SEC categories of crypto operation approvals available to companies including crypto exchange service, digital token exchange service, crypto brokerage service, and a digital token brokerage service.
The past few days have been particularly disheartening for Remixpoint and its subsidiary companies. On Thursday, the company announced a break of security in which one of its subsidiaries, Bitpoint, a Japanese crypto exchange was hacked and lost $32 million in crypto assets. Although the assets that were stolen were not exactly reported at the time, the exchange had trading support for five major cryptos including BTC and ETH.
The news of new approvals and event of hacking coming at the same time would create a mixed feeling for the big company who seemed to have several subsidiaries. While issues of refunding the customers affected in Bitpoint hack comes to mind, another issue is the funding of the new projects recently gotten approvals for.
Thailand seems to be catching up in the cryptocurrency adoption game. Recently, the Thai’s SEC approved three other companies to operate crypto services. These companies, which were all approved this year include Bitkub Online Co. Ltd. (Bitkub), Bitcoin Co. Ltd. (BX), and Satang Corporation (Satang Pro) — were approved in January. All of them got approvals for both cryptocurrencies and digital tokens.
Remixpoint announced in February that  BitHerb Co. Ltd. had gotten four approvals. However, the commission had not completely validated the subsidiary’s system and had not added it to its list of approved companies.
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Source: CoinGape

Japan’s Top Regulators Setting Up Working Group Dedicated on Libra Coin

Global regulators are raising their concern over Libra’s impact on the financial industry. Following the US’s concern, Japan is also seeking to conduct an in-depth study on the Libra and the possible impact as well as affect it can create over the financial industry.
Japan and Facebook’s Libra
According to the latest report, Japan’s top regulators; Bank of Japan, the Ministry of Finance and the Financial Services Agency (FSA) is setting up the working group this week to address key aspects regarding Libra. Nevertheless, the meeting is set to focus on “Libra’s impact on regulations, monetary policy, tax and payment settlement.
This meeting will go ahead of G7 ( Grup of seven economic powers), a meeting to be held by France in next week to examine how central banks ensure the better governance of cryptocurrencies such as Libra. G7’s crypto task force will be headed by European Central Bank board member Benoit Coeure and the key purpose will be how crypto can be better governed by central banks concerning various issues including money laundering laws and consumer protection rules.
As for now, Japan isn’t against Libra rather it seeks to dig deeper into how Libra works. The report comes in a wake of Bitpoint exchange’s hack that country has recently experienced. Unlike central banks in other countries, the separate body Financial Service Agency (FSA) governs banking regulations in Japan.
The officials further reported that Japan will follow suit of other countries and look at the ways to alight efforts introduced by both G20 and G7 – particularly to address the policy implications of Libra.
So far Libra’s launch announcement drew fast and worried reactions from across the world. Its worth to note that U.S Senate Banking has scheduled a hearing on Facebook’s plan of Libra and privacy on July 16 wherein Calibra’s CEO David Marcus will testify on company’s view of “privacy concerned” involved with Libra’s launch.
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Source: CoinGape

Top Crypto Leaders Writes Killer Notes On Trump’s Bitcoin Tweets

Updates of President Trump’s series of bashing tweets on Bitcoin, Libra and other cryptocurrencies spread like wildfire. While his twitter threads invited strong backlash from crypto community-on the other hand, Bitcoin backers actually received it as a positive note.
At Least He Notices Us.!
U.S President Donald Trump’s critique of Bitcoin has been assumed as “achievement unlocked” by Brian Armstrong” founder of largest crypto exchange, Coinbase. He thinks it’s a welcome move and compares it to a famous quote “First they ignore you, then they laugh at you, then they fight you and then you win”. According to Brian, the community has just won the third step following trump’s firing tweets on Bitcoin.
He wrote;

Achievement unlocked! I dreamt about a sitting U.S. president needing to respond to growing cryptocurrency usage years ago. "First they ignore you, then they laugh at you, then they fight you, then you win”. We just made it to step 3 y'all. https://t.co/N3tzUKELaK
— Brian Armstrong (@brian_armstrong) July 12, 2019

Trump’s tweet quickly gotten the attention of worldwide users and few members of the crypto community thinks that it has actually brought global users to the crypto industry. In fact, few thanks Trump, citing a quick surge in the price of Bitcoin and the interest documented by Google Trends.
While the president expressed his stern opinion on Bitcoin, Libra and other cryptocurrencies, it is believed that regulators are way closer to introduce regulations around crypto. Henceforth seeking Libra to follow banking regulations over its own cryptoucrrency’s launch.
No Affect on Crypto Market
Besides this, many think Trump’s statement had no adverse effect on the price of Bitcoin. In fact, according to the data from the Coinmarketcap, the price of cryptocurrencies are actually returning to its earlier growth. At the time of writing, Bitcoin is gaining the momentum of $11689 against the US Dollar with a surge of 0.87 percent over the past 24 hours. In addition to Bitcoin, other altcoins are also experiencing a significant growth such as ETH is soaring with 1.34 percent, XRP with 3.16 percent, LTC with 2.66 percent, BCH with 2.79 percent, BNB with 6.62 percent respectively.

Crypto Leaders Responds To Trump’s Tweets
Along with Brian, other crypto leaders such as Morgan Creek’s Anthony Pompliano, Shapeshift CEO Erik Voorhees, TRON’s Justin Sun, Kraken’s Jesse Powell and many others responded to Trump’s opinion on Bitcoin.
Pomp in one of his tweet quickly troll Trump on his statement “he is not a fan of Bitcoin whose value is highly volatile and based on thin air”. Accordingly, Pomp remarks that;
If your argument is that Bitcoin is based on thin air, while Bitcoin’s argument is that it is based on math, who should we believe?
In his other tweet, Pomp again addressed Trump and wrote: “Bitcoin is the most anti-fragile asset in the world”.
At the center of the president’s criticizing comments, Justin Sun strongly made a yet another invitation for his “Buffett Lunch” and this time it wasn’t for any other crypto leaders. Sun addressed President and said that “he would love to invite Trump to have lunch with crypto leaders along with WarrenBuffett on July 25”.

Mr. President, you are misled by fake news. #Bitcoin & #Blockchain happens to be the best chance for US! I'd love to invite you to have lunch with crypto leaders along with @WarrenBuffett on July 25. I guarantee you after this lunch, nobody will know crypto more than you! https://t.co/ZpRFEbninv
— Justin Sun (@justinsuntron) July 12, 2019

Besides Sun, Jesse Powell, Co-founder, and CEO of Kraken also responded to Trump and said: “if you study crypto, you will find much to agree with”. He continued that; Crypto is about personal responsibility and choice.
Mr. President, one could say the same of unregulated fiat currencies, like the privately operated US dollar. The advantage of cryptocurrencies is that they are predictable and transparent. Regulated or not, useful tools can be used for good and evil. Don’t let the US fall behind.
Well, President’s tweets on Bitcoin and Libra became the much-concerned topic – after all, Donald Trump is the president of the United State where Libra is seen with most uncertainty. Let’s not forget that the Calibra CEO David Marcus will testify before the Senate Banking Committee on the company’s plan of launching Libra and policy concern involved on July 16, 2019.
As of now, Bitcoin price hasn’t affected – rather surges significantly higher. Let’s wait for Facebook’s respond on Trump’s demand that states “Facebook should follow all banking regulations over Libra”.
Image Source – Shutterstock
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Source: CoinGape

Fed’s Chairman Denounces Libra, Predicts Project’s Uncertainty To Surpass Regulatory Demands

Jerome Powell, Chairman of the U.S. Federal Reserve has issued a stern warning to Facebook along the lines of its Libra project, maintaining that developments of the highly controversial cryptocurrency project cannot proceed until the accurate regulatory procedure has been put in place.
In Powell’s words, “serious concerns” are yet to be expressed and must be addressed before developments and implementation procedures.
Facebook seems to be under the limelight recently, particularly as a result of its newly announced cryptocurrency project, Libra. In this global financial services provision, as many as 1.7 billion unbanked people globally are targeted with financial services. This, according to report would enable Whatsapp and Facebook users to send and receive money on the respective platforms.
As many come to believe in this inbound “new dawn”, several governments and financial agencies move to put Libra under strict regulations, a result of which Facebook had to halt the development and implementation of Libra initially planned to launch in 2020.
The announcement of Libra had initially spelled good luck for bitcoin. This news came at the time when bitcoin was just recovering from the 2018 bear markets. With excitements of Libra in the air, bitcoin caught a bullish trend and moved up quite rapidly to record a high all-time of 15 months at $13,100 around early June. As bitcoin tried to maintain this those good day, news of Libra’s uncertain future caused a setback and bitcoin moved down the charts once again, loosing around 10% within the last 24 hours.
Powell commented that the proposed Bitcoin rival, Libra being developed by Facebook posed some serious financial problems than anyone can imagine as of now. According to him,
“Libra raises many serious concerns regarding privacy, money laundering, consumer protection, and financial stability,” Powell warned, added he doesn’t think “the project can go forward” until these are addressed.
Adding that Libra doesn’t exactly fit into the current financial system and policies, Powell also expressed his views on how regulatory procedure Libra has to pass through before implementation.
“It’s something that doesn’t fit neatly or easily within our regulatory scheme but it does have potentially systemic scale,” he said. “It needs a careful look, so I strongly believe we all need to be taking our time with this. The process of addressing these concerns should be a patient and careful one, not a sprint.”
Mark Zuckerberg and his Libra team, according to report are currently preparing to attend a Senate hearing next week and have promised to follow due regulatory process and cooperate with regulators. However, the implementation of Libra in other regions like India and China still remains uncertain.
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Source: CoinGape

How Crypto Custodian Firms will Form New Age Banks Under the SEC Guidelines: Analyst

Recently, the SEC in the US released a new set of guidelines on 8th July 2019, specifically for cryptocurrencies service providers. The SEC regulations have kept the start-ups under a lot of doubts for the current guidelines have failed to cover cryptocurrencies.
According to their new press release, the SEC will view custody arrangements and non-custodial arrangements differently. Furthermore, it has also allowed for the inclusion of non-custodial service firms to operate in the US. This is a positive move for start-ups like P2P platforms, payment facilitators, and OTC desks.
Caitlin Long, from the Wyoming Blockchain Task Force – a state-sponsored Task Force, established for blockchain development, reviewed the new rules and shared here analysis for the future of Crypto Custody Firms.
The pending ETF proposal, along with several other trading applications and Exchanges require the firms to act as custodians of the cryptocurrencies. Hence, Caitlin thinks that
“SEC’s new guidance would have been a bummer for the #crypto custody industry were it not for #Wyoming‘s new #SPDI law”
The State of Wyoming in the Western part of the United States has enacted several laws related to blockchain earlier this year, making it the only state which provides a comprehensive legal framework for entities engaging with cryptocurrencies.
The ‘Custody Rule & Customer Protection Rule’ set up by the SEC is to protect the traders and investors against all possible threats to their investments. The Crypto Custody firms have so far established themselves as Trusts; however, they are still failing to meet the SEC guidelines.
here’s the definition of “bank” under the Exchange Act–state-chartered banks work here, but trust cos don’t. So…#Wyoming is where #digitalsecurities custodians (& #crypto custodians more broadly) are likely to set up shop, using our new #SPDI law. Come check us out!
Definition of a bank according to the SEC (Source)
SPDI is an abbreviation for ‘Special purpose depository institutions,’ these are essentially banks that act as custodians but do not engage in any kind of lending or leveraging activities. The inclusion of such services within the Financial Industry is imperative because it will help prosper ‘hard money’ over an interest rate and inflation driven economy that is expected to doom. Many experts have suggested that the current financial system is failing, and cryptocurrency is a hedge against that.
Caitlin also predicted that in a tweet that Trust companies in the US like Gemini, Grayscale, and so on will probably end up being banks to facilitate crypto trading and custody. She tweeted,
set up trust companies (NY, SC, NV) will prob end up converting to a #Wyoming #SPDI so they can meet certain #SEC rqmts simply by nature of being a bank (such as good control location, among others). We knew the #SEC has a preference for banks over trust cos as #crypto…
Therefore, it might not be long before the actual ‘crypto-banks’ start competing in the Financial Services industry.
What do you think the existing banks will do to shun the competition? Please share your views with us. 
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Source: CoinGape

Libra: Facebook Speaks Again, Promises To Answer Lawmaker’s “Important Question”

Following Maxine Waters’ call for Facebook to halt the development of its new cryptocurrency project, David Marcus, head of Libra, has assured Maxine Waters and other top members of the House Financial Service Committee that Facebook’s new cryptocurrency development team is “taking the time to do this right”.
The letter, dated July 3rd, which was sent in response to Democratic lawmakers’ Moratorium on Libra, David promised to answer lawmakers “important questions” in a bid to defend Libra’s mission.
The Rising Issues With Libra
Libra is probably facing some hard times for a few obvious reasons. First, it draws natural pessimists from the present financial system who believe that projects like Libra would disrupt the financial system.
Also, Facebook has recently received accusations of user data and privacy scandals. For a cryptocurrency project which promises to render cross-border payments services, the issues of user data and privacy are of significant interests.
Further, Facebook has a user base of over 2.3 billion globally and also possesses records of privacy scandals. This made a good subject matter for regulators around the world to predict Libra’s propensity to fail along the lines of user data protection and privacy policies.
More To Be Heard Next Week
Next week, the house is expected to hold a hearing on Libra and David, in preparation to explain the core importance and use cases of the project have assured members of the house of maximum cooperation.
The Winklevoss Brothers’ Take On Libra
During an interview session with CNBC in which the Winklevoss twin brothers were present, they expressed optimism about Libra’s future implementations and possibilities of other tech giants following the trend.
Amidst preparation for next week’s Facebook Libra’s Senate hearing, Tyler Winklevoss, during the interview, advised Facebook’s CEO, Mark Zuckerberg and his team to cooperate with lawmakers. According to Tyler,
“Work with regulators…,” “Talk with them. You know, we definitely went through the front door, and we tried to educate the regulators and shape the regulation in a thoughtful manner because if you get the regulation wrong it can stifle innovation, but the right regulation allows for innovation to flourish, and we think we have achieved that right balance with New York.”
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Source: CoinGape

Regulation: US Legislators Debate New Crypto Rules

A bipartisan group of 20 US legislators in Washington has requested the Internal Revenue Service (IRS) to update its 2014 guidance on cryptocurrencies. The new update is expected to be made in the coming weeks.
In this new development, legal issues relating to the adoption and use of cryptos are particularly a point of interest, in which at least three bills are being considered for this purpose.

Brief History
Regulations in the US has never smiled at cryptocurrencies and its adoption in the region. And for the over 10 decades of existences of this set of digital assets, the US financial regulators have constantly enacted laws and regulations which widely restrict participation. Most recently, as Facebook aimed to bring cryptocurrencies to the public, it has met with regulatory obstacles, a result of which the proposed Libra project had to be halted.
With regards to Libra, Facebook had recognized the favorable framework of regulations in regions like Japan and Switzerland which prompted the social media giant to initiate the developmental process of its cryptocurrency in Switzerland. This, many US residents believe is a setback for the country in some ways.

“The concern I have is really about driving innovation out of the country,”

said Rep. Tom Emmer (R., Minn.), who led the congressional delegation that asked for the new IRS guidance.
The Unacceptable Bitcoin
Altho/ugh Bitcoin and other cryptocurrencies show great prospects and usability, they have also been able to gain disrespect among financial agencies which believe digital currencies like bitcoin are used and adopted for its anonymity of transaction and use especially among drug dealers and scammers. This explains why regulations are not the only issues faced with cryptocurrencies.
Not Everyone Is Happy
And not everyone in Congress like the idea. Last Tuesday, Rep. Maxine Waters (D., Calif.), chairwoman of the House Committee on Financial Services, asked Facebook to stop developing its Libra for the regulatory procedure to confirm its safety to the public, and global financial stability. The committee is set to hold a hearing on Libra later this month. According to spokesman Joshua Gunter, Facebook plans to work with legislators and attend hearings.
The Internal Revenue Service (IRS) in 2014 proposed to treat Bitcoin as an investment property in the same category as stocks or bonds. This subjected the crypto to capital-gain taxes and U.S. taxpayers were to report every gain or losses on the digital currency.
Legislators seem to have a different point of view. A bipartisan group of House members earlier this year suggested a law that would grant cryptocurrency a de minimus exemption as bonds and stocks. However, this Token Taxonomy Act would also exempt cryptocurrencies like bitcoin from being classified as security assets.

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Source: CoinGape

SEC Demands Blockchain Data From Providers To Improve Compliance, And Inform Policy

The U.S. Securities and Exchange Commission (SEC) is not backing down on its blockchain data policies. As a body which has been very pessimistic about blockchain efficiency and feasibility, SEC is now looking to narrow down its pessimistic approach towards the ecosystem and this time, how much data actually exist on the various blockchain is of significant interest.
Cryptocurrencies Vs Regulators
Cryptocurrencies lately have struggled to put their heads above waters under the watchful eyes of governments, financial agencies, and regulators seeking to either ban or restrict the blockchain in their respective areas.
One of the scapegoat projects that have recently jumped into rocky waters is Facebook’s Libra project. As at now, Libra’s development has been stopped and further developments are however uncertain.
SEC’s Data Requirements
The requirements listed by the SEC that all data is derived from hosted notes in the stead of blockchain explorers. The Bitcoin and Ethereum blockchains are important considerations, while others like Bitcoin Cash, Stellar, Zcash, EOS, NEO and XRP data are all specified as optional and therefore desirable. Also, as new blockchains gain increased recognition, the SEC would require support for them. The SEC wants total blockchain data from the original block or inception and information about any alternative currencies (tokens) connected with these blockchains.
What SEC Seeks To Achieve?
The SEC is popular for its various regulatory operations and activities on financial issues. As a matter of regulation, the SEC has made it a point of duty to alert investors about the dangers involved in purchasing securities and also to educate them on how to invest wisely. Lately, the SEC has gone widely against cryptocurrencies and have made several regulatory attempts at the industry, always looking to put this industry in check. This time, having a glimpse of what blockchain data contains and looks like will enable the commission to enact the regulations needed to really put the space under strict watch and control.
Required Data Format
The data style required is very particular with normalized regions for each included blockchain derived from on-node data, entirely. The least region indicated is ticker symbol; sending and receiving addresses; transaction stamp or hash, timestamp, and amounts; unspent send and receive balances; transaction fees; confirmations; block hash, and block height.
Possibly, the SEC also wants further metadata and chain metrics such as hashing algorithms and power, difficulty in mining and associated rewards, transactions values, size and quantity, coin supply and blockchain size.
The data, according to SEC should be provided directly by the vendor’s own node for each blockchain using a secure, digitally protected data feed; synchronized with the network; and run in a secure, controlled environment. The data must also be presented with a way to confirm its accuracy and completeness and meet the requirements of financial statement audit testing.
Application Deadline
The length of the contract is a period of 12 months originally which is followed by four consecutive 12-month terms which are optional. The application requires both a price and technical quote. Data vendors are expected by the SEC to submit an application by 12 pm EST on the 11th of July, 2019.
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Source: CoinGape

Facebook Libra At A Regulatory Checkpoint; Here’s Why!

Social media giant, Facebook has been asked by the US Democratic Congress to pause the development of its newly introduced global cryptocurrency project and ever since doubts relating to Libra’s success has filled the air around us.
Summary

Regulatory response to Facebook’s Libra continues.
Libra might evidently get strong opposition at the US Congressional level.
However, Libra gets support from other countries which aim to be important financial centers

As recently reported by Coingape, Facebook Libra’s introduction has caused the giant social media company to answer many regulatory queries and now it seems that Facebook has too much to stop than continue. But as time goes on, Facebook will face much sterner tests to its cryptocurrency. This results from the evidence to prove that Libra is not just another payments option, It shows the possibility of replacing the Dollar as a global standard of value.
The basic thing that’s wrong with Libra
According to the June 27th Facebook’s briefing to congregational staffers, Libra employees either showed signs of being clueless or actually are. This, according to congregational staffers present at the briefing instigated a rapid call for a halt in operations regarding Libra’s developments.

Several Democratic Congress members responded, firing off a letter to Facebook. According to the report,

“It appears that these products may lend themselves to an entirely new global financial system that is based out of Switzerland and intended to rival U.S. monetary policy and the dollar. This raises serious privacy, trading, national security, and monetary policy concerns for not only Facebook’s over 2 billion users, but also for investors, consumers, and the broader global economy.”

Financial agencies believe that Facebook promises way too much than it can achieve. And in fact, the problems associated with building something as enormous as Libra have been left to the public to procure solutions. As Facebook continually showed poor stewardship of its new opportunity, it has no plans of technical development work relating to Libra.
The Simple Strategy
Facebook Libra’s whitepaper showed substantial innocence of financial knowledge and developmental strategies. For a company as large as Facebook, it is unreasonable to believe that the whitepaper is a piece of work showing incompetence, but merely an “intentionally half a backed” description subtly luring the financial world to improve it on their own by scrutinizing and presenting suggestions as to its improvements.
As the governments and financial regulators continue to resist Facebook’s Libra plans, the giant social media company would have to reveal plans that show considerable expressions for governmental concerns, which at the same time, might allow for the project’s continual developments.
Other Pressing Issues
Other issues raised by regulatory responses include using a multiplicity of currencies in the stead of a single recognizable one like the Swiss Franc or USD, and Facebook’s proposed retention of interests income generated from customer’s transactions and investments.
As expected of an investment company, Libra must be able to present explanations relating to governance and funds management for it achieve success in its path.
According to a Libra spokesperson on the customer tax issue,

“People will be responsible for filing their taxes in accordance with local laws in the jurisdictions in which they operate. We expect that many wallets and financial services built on the Libra Blockchain will provide people with tools to help manage this.”

In short, reporting and paying the tax obligation is the customer’s problem. Another strike against Libra’s future.

The post Facebook Libra At A Regulatory Checkpoint; Here’s Why! appeared first on Coingape.
Source: CoinGape

Facebook Officially Responds to US Congressional Committee’s Letter to Halt Libra Development

Libra Coin has been emerged as one of the hottest topics in the crypto industry – not just with positive remarks but definitely, the launch announcement faced a lot of criticisms. Besides every new criticizing remark, Facebook isn’t stepping back from what it committed to bringing to the 1.7 billion unbanked users.
Calibra CEO Responds US Congressional Committee’s Letter
As a response to a recent letter sent by official Congressional committee to halt the development of Libra coin, Facebook wrote a personal note, detailing what it means to them and how they view community & regulator’s view on Libra Coin. On July 3rd, David Marcus, CEO of Calibra Wallet published a note, entitling ‘Libra, 2 weeks in”. In a detail note, Mr.Marcus explained, decentralization queries revolve around Libra, claiming that Libra is definitely not as open as Bitcoin, the mission behind Libra Association, why billions of people cannot access to current financial services and henceforth the emergence of Libra and eventually pinpointing at their plans to engage with regulators and lawmakers.
Facebook will not control the network, the currency, or the reserve backing it. Facebook will only be one among over a hundred members of the Libra Association by launch. We will not have any special rights or privileges.
Ready To Talk with Law Makers
Whenever regulator’s note comes in, Facebook often found of adding a positive note “we’re looking forward to discussing’, in fact, it had initially mentioned in its whitepaper – we believe in collaboration with regulators & experts across a variety of industries. In addition, with ongoing criticism by global regulators, including US Congressional committee – Facebook openly responded that they’re ready to talk with the policymakers.
We’re talking about something new, at scale in a very regulated industry, and if this is not done right, it could definitely present systemic risks no one wants, Marcus writes.
Believing that, Marcus states that they’re looking forward to having collaboration with central banks, regulators, lawmakers to ensure that Libra resolves the issues existed in the existing financial system “notably around money laundering, terrorist financing, and more”, the note reads.
Looking at Facebook’s letter, it is noticed that the team is not in a plan to halt Libra development – rather they’re looking forward to continuing to engage with the various communities and stakeholders. Conclusively it added;
In that spirit, I look forward to testifying in Congress in front of both the Senate Banking and House Financial Services Committees in the weeks to come.
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Source: CoinGape

Report: Amid The Koinex Shut Down, Exclusive Talk With Other Indian Crypto Exchanges

Ahead of scheduled Supreme court hearing on crypto aspects in India, one of the oldest Indian cryptocurrency exchange, Koinex decided to shut down its trading platform. This was obviously one of the most shocking news for Indians, specifically for a prospective audience of the platform at the precious time when Bitcoin was on a bull run.
Exclusive Talk with Indian Exchanges
One major question that raised the eyebrows of crypto enthusiast is India is – if regulations were the key reason behind closure, Koinex could also have their registered office outside of India – just like other exchanges decided to do so. Concerning the point, Sumit Gupta from CoinDCX add that;
From what I know, given the regulatory uncertainty, they are not focused on exchange business at the moment. Indian Exchanges will have to move outside the country focusing on global users if the regulations are not favorable to run exchange business in India.
In a similar tone, Nischal Shetty from WazirX detailed;
Their volumes had reduced drastically and that makes it difficult to run an exchange since volumes drive revenues. If they had good volumes now then I’m sure they wouldn’t have shut down. I would say that the banking ban was the single biggest reason for all Indian exchange shutdowns until now.
In addition to CoinDCX and WazirX, another Indian crypto exchange Bitbns also adds “there could be other ways to thrive in the crypto landscape for Koinex if it wishes to – continuing the point, Rahul from Bitbns told;
Yes they could have. We did and we are thriving. We recorded the highest volume traded till date in the last 24 hours.
However, it is worth to note that – during Coindelta’s closure in April this year, Indian crypto community were discussing on ‘pending withdrawal request at Koinex trading platform’. Furthermore, the exchange had delisted few coins Achain [ACT], CyberMiles [CMT], GAS [GAS], Nano [NANO], NEO [NEO] and Zcoin [XCZ] Tokens which wasn’t well received by the crypto community in India – and on top of all, the decision of delisting these Altcoins appeared immediately after the shutdown decision by Coindelta.
Not the First Exchange in India!
On early June 27, 2019 – Koinex published an official blog post, detailing the reason behind its decision – nevertheless, it adds ‘Regulatory uncertainty and Lack of Banking support’ were the key hurdles that stop them running smooth trading operation within the nation.
This is nothing new in India, in past, a couple of other exchanges including Zebpay, Coindelta, Coinome wrapped up their business operation citing unhealthy regulations from the country’s Govt but we ( Coingape) reached out to the current Indian exchanges, what they think about Koinex’s closure and how are they continuing their business in the same country where other exchanges closed their doors.
WazirX, CoinDCX, Bitbns, Instashift, Unocoin are few of the exchanges – currently, live and running their trading activities within the country despite having months of delays on a specific crypto decision by Govt of India. During our talk with Nischal Shetty – CEO of WazirX, Rahul Chitale – Co-founder of Instashift, Sumit Gupta – Founder of CoinDCX, and Rahul Jain – Digital Marketing Manager at Bitbns – it was revealed that the other reason behind Koinex’s decision could be “Cost structure with the fact that the team size was quite big” and their volume which had reduced drastically”.
Staff Salary Via Bank Account
Moreover, on a point of Koinex mentioning “their employees were being enquired for salary transactions from banking authorities”, we asked existing Indian exchanges on how they’re processing payments to their staff. While CoinDCX and WazirX declined to comment – on the other hand, Rahul Jain from Bitbns told that;
Bitbns or Its employee doesn’t face any such bank pressure
While he kept secret about the payment method they’ve been using, Rahul Chitale from Instashift re Rahul Chitale reveals their exchange is an Estonian entity and processed banking operation as per European laws. He says that;
InstaShift is an Estonian entity. We conduct all our banking operations out of the same with complete compliance with European laws. Almost all our operational expenses are paid using Crypto – that includes payroll to our small team (outside India). We also use our own crypto backed debit cards. The few expenses like Cloud are the channel through Fiat in Europe or Canada.
What’s your take on Indian cryptosystem.? Do you think Govt will favor existing exchanges with healthy regulations around crypto & blockchain ecosystem in India.? Let us know in the comment below. 
Image Source – Shutterstock
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Source: CoinGape

Japan: There Is Something New In Japan’s Blockchain Development, What…?

Japan is now developing blockchain innovations through a new regulatory sandbox system under the Cabinet Secretariat of Japan and this incubation process seems not to have enough of blockchain ideas.
An Empty Field Without Players
Back in June 2018, the Japanese government introduced the sandbox regime to instigate the introduction of new business ideas and innovative technologies. As startups and organizations both within and outside Japan can apply, the incubation allows developing with new technologies such as blockchain, artificial intelligence, and Internet of Things (IoT) in areas such as financial services, transportation, and healthcare.
The Mission Statement
The purpose of this system, experiments of which take place in virtual spaces and unlimited in the geographical region, however, is to confirm whether the new business is applicable and would work in real market situations. After the government evaluates the results of these trials, it plans to introduce deregulation measures.
According to Hirohiko Nakahara, a counselor in the Economic Revitalization Bureau of Japan’s Cabinet Secretariat,
“Our sandbox regime is open to everybody and we try to make it possible for everyone to experiment as fast as possible, ”…“We must prove there’s a social benefit and that a new business is acceptable and practicable. The important thing is to make our market attractive.”n
​Progress Report
According to the report, the sandbox has so far approved six projects for experiments involving a broad range of business propositions since its launch. One major trial was put forward by Panasonic, an Internet of Things (IoT)  in which home appliances would be tested using Power Line Communication (PLC). This is a technology that would allow data to be sent via already existing power lines.​
As anyone might expect, Sandbox also opens the door of opportunities to Fintech. Tokyo-based crypto finance firm, Crypto Garage which looks at how to advance settlements between digital currency exchanges focused on developing trustless financial services based on bitcoin and blockchain technology.
Also Read: Japan May License Bitmax To Begin Operation In Q3
Crypto Garage made an impressive display of idea and was chosen for the sandbox program due to its incredible settlement system called SETTLENET and its plans to develop the business in Japan and overseas.
Crypto Garage registered itself for the sandbox regime because Japan lacked a regulatory body for the new business model. Having gotten a 1-year experimental period, Crypto Garage hopes to take the technology abroad after reporting its results to the Cabinet Secretariat and calculating its potential economic value.
“I think the Japanese market is very interesting,” says Okuma. “The government is very progressive in promoting new financial systems under the regulatory sandbox. We have talented technology resources internally and we’re trying to match these with Japan’s progressive policies to expand the range of financial solutions.”
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Source: CoinGape