Canadian Regulators: Bitcoin Exchanges Are Not Money ...

The SEC, Canadians.. and Jury Duty

Well well well.. where to start?? maybe the SEC and the Ethereum ICO?
A little bit of precedent..
(by Amy Castor, at
-In the beginning-
If Ethereum had a birthday, that would be in November 2013. That’s when Vitalik Buterin, the creator of the project, emailed a whitepaper to 15 friends, who then disseminated out to their own networks. Two months later, the project had eight co-founders and a growing army of contributing developers and supporters.
Instead of raising venture capital money, Ethereum bootstrapped. Co-founders Anthony Di Ioro and Joseph Lubin lent their own money to the project. And then Ethereum held a crowdsale by which it raised money selling ether, which it called a “ cryptofuel ” for its future platform.
Ethereum’s crowdsale tokens were only part of a larger premine. Premine refers to the tokens that exist the moment a platform goes live. This contrasts with Bitcoin, where all of the virtual currency has to be mined. Ethereum used some of its premined tokens for compensating its contributors—those who worked on the project in the months leading up to the crowdsale.
Although, the “ Terms and Conditions of the Ethereum Genesis Sale ,” refers to those contributors as “volunteers” and their allotment of ether as a “gift.”
According to the Howey test, a security is an investment of money in a common enterprise with a reasonable expectation of profits based on the efforts of a third party.
Did participants in the Ethereum crowdsale expect the value of ether to skyrocket? Many in the crypto space had already witnessed bitcoin’s run up from its pizza days , when one bitcoin had almost no value, to its first price peak of $1,200 in November 2013, the same month Buterin dispatched his white paper.
Morgan Peck, a journalist who was on the ground at Ethereum’s public debut in Miami in late-January 2014, wrote of Ethereum in Backchannel : “I WAS TOLD IT WOULD BLOW BITCOIN OUT OF THE WATER."(1)
-The Crowdsale-
Before holding a crowdsale, Ethereum had to officially set up shop.
On February 28, 2014, the project registered EthSuisse (Ethereum Switzerland Gmbh), a for-profit entity in Zug. After Buterin single-handedly pushed through a decision to make Ethereum a non-profit, the project also set up a foundation ( Stiftung Ethereum ) on July 14, 2014.
“ At the beginning of June [2014], I had to fire the two people who no one liked working with. It just so happened that these people were among the main instigators of the for-profit idea. I forced through the non-profit. Some people were unhappy, but oh well,” Buterin told Tank earlier this year.
And then on July 22, EthSuisse launched a 42-day crowdsale that ran to September 2. The sale was open to the general public. What’s more, there was no cap on the sale, so you could buy as much ether as your heart desired. The sale was also open to the project’s own employees.
If you want to legally sell securities to U.S. citizens, Section 5 of the Securities Act of 1933 requires you to register with the SEC or else file an exemption , such as a Regulation D , that allows you to sell only to accredited investors, meaning wealthy folks and institutions. Ethereum did not do either, perhaps because it didn’t view ether as a security.
Instead, to avoid running afoul with regulators, Ethereum spent significant resources on lawyers (Pryor Cashman in the U.S. and legal and tax compliance specialist MME in Switzerland) working out the finer details of its crowdsale.
As Lubin told the Financial Post last year, before doing that, his thoughts ran more like this: “WE THOUGHT IT WAS POSSIBLE WE WOULD LAND AT JFK ON A CERTAIN DAY AND THE FBI WOULD TACKLE US TO THE TARMAC.” (2)
-Are we decentralized yet?-
What is ether? Is it a utility token, a commodity, an investment, or some combination?
The U.S. Commodity and Futures Exchange (CFTC), has determined that bitcoin is a commodity , but it has fallen short of issuing a clear determination on ether. The CFTC recently issued a request for information to learn more about Ethereum and how it compares to bitcoin.
Meanwhile, the SEC has said that it believes current offers and sales of ether are not securities due to the network’s “decentralized structure.” That means that ether would have had to transform from a security to something other than a security at some point in time.
“I kind of don’t think this is going to work,” former CFTC chairman, Gary Gensler told a crowd at a blockchain conference at MIT in April. “I don’t think there’s any precedent in the law for a security to transform to be something else.”
SEC chairman Jay Clayton explained his view at Consensus Invest last month with an analogy:
“Let’s say you’re the producer of a new play and you get 15 people to invest in that play and you say, ‘Your interest in this play is going to be a suite of tickets. You’re giving them tickets in exchange for their interest in the play—those tickets are securities. They’re taking those tickets back, waiting for the profits. It’s like taking 10% of the play. But when the play gets done and everybody has their tickets distributed and all you can exchange the tickets for is going to see the play, that’s decentralized.”
UNTIL A JUDGE STEPS IN TO SETTLE THE MATTER AND TAKES A LOOK AT THE ETHEREUM CROWDSALE AND HOW THE NETWORK IS CURRENTLY OPERATED, THE ISSUE IS OPEN TO DEBATE. And Ethereum, along with the thousands of other projects that held ICOs, will have to wait and see to find out with certainly what laws they are supposed to comply with.
-June 2018-
SEC Official Declares Ether is Not A Security
(BY RAKESH SHARMA Jun 14, 2018)
Ether is not a security, according to Bill Hinman, U.S. Securities and Exchange Commission Director of Corporate Finance.
“Based on my understanding of the present state of ether, the ethereum network, its decentralized structure, we believe current offers and sales of ether are not securities transactions,” he said at the Yahoo Finance All Market Summit: Crypto. After bitcoin, ether is the second most valuable cryptocurrency in the markets today and is referred to as the “gas” that powers ethereum’s blockchain.
-Fast Forward, June 2019-
No Judge stepped in to declare "Ether" a "non-security", this wasn't sent to Court; it was the SEC's decision alone to declare ETHER decentralized enough and not a security anymore. Also, no fines??!!!
Aaaaaaaand it was their decision to sue "KIK"; the issuer of KIN.. and in the process.. a "JURY TRIAL" was demanded.
-BREAK!!! (A word on Canadians)
As a U.S.A. citizen, and I dont mind if you want to know or not.. this is how we see Canadians.
Not only we share the same values, like the same sports.. to a U.S. citizen ,a Canadian is that sistebrothecousin/aunt/uncle/badass person that we all admire. Canadians are respectful and peaceful.. to put it simple: -Imagine it's the end of world, you have a Canadian by your side.. and that Canadian says "don't worry, it's gonna be ok".. guess what!! that Canadian meant it!! and everything is gonna be ok.-
-July 2019 and the beauty of "Jury Duty"-
For all of you out there, from another country.. not the U.S.A.
One of the greatest rights and responsibilities of being a U.S. citizen is being able to take part in the Court system. If this case indeed proceeds past July/19 and a Jury Trial is set, some of us are gonna be summoned to take part in this trial. Oh!! what great times!! I love you Canada!!
As a Juror, I would have so many questions for the SEC..
So, you didnt fine "Vitalik and friends" but you want to fine Kik? you dumb?
As a Juror, I would tell the SEC.. "you consider Bitcoin to be the Gold of crypto.. Ethereum is the Silver.. and by your own standards.. KIN is the PLATINUM.. case dismissed.."
Ha!! no SEC is gonna take away my wife's, my son's, my friends, my family's KIN.. good luck SEC!!! for I will be a Juror in your case against KIK.. and I already know my decision..
The SEC knows this, too.. thats why they want KIK to settle.. no SEC lawyer is gonna win against Jurors who love their rewards/virtual currency/crypto/whatever you wanna call it.
Thank you all.. for these are just humble words..
submitted by Albert8a to KinFoundation [link] [comments]

Regulations Applied To Cryptocurrencies Around The World

Cryptocurrency Regulations
Since the launch of Bitcoin in 2009, the economic revolution of cryptocurrencies has generated a stir in its demand, causing an increase in its popularity, therefore, increasing the transactions within the blockchain and the movements of crypto in the market. Consequently, many countries have had to implement laws and regulations to control crypto transactions within their jurisdiction, note that the blockchain are decentralized and do not respond to any public financial and legal entity, causing a lack of control over the transactions within the network.
Telos Blockchain, having governance and a specific and defined arbitration system, is governed by laws and regulations that prevent many illicit actions from becoming effective, this collaborates with the cause of the countries that are implementing new regulations, becoming the ideal platform.
As the demand for crypto increases, governments apply greater regulations at a global level, taking into account that cryptocurrencies are not backed by central banks, which is why many countries believe that there should be regulations that control this type of currency since it affects its local currency directly and indirectly; despite being an asset that can bring economic benefits to its users, it also lends itself to criminal actions through the network and the crypto. Any decision or economic announcement made in each country determines negatively or positively the behavior of the price of digital currencies.
The regulators aim to prevent illicit actions in exchange houses, such as, for example, money laundering, terrorism financing, scams, payments to the dark web among others; According to the DEA, 10% of transactions with cryptocurrencies are used for illegal activities. During an interview with Lilita Infante of the United States Drug Enforcement Administration (DEA), published in Bloomberg, five years ago the percentage of criminal activity in blockchain transactions was 90%, at present, this number represents 10%, which has become transactions for price speculation and not for other purposes.
In countries of the first world, governments have established regulations and laws that control the use of crypto assets. The regulations applied in China are not the same applied in the United States or Japan. Herein will be specified some regulations of countries where crypto have marked a trend.

Regulations In Japan

Asia, is one of the continents where more transactions of cryptocurrencies are made, not all countries that constitute the continent have been receptive, but this is not the case in Japan; where there are regulations in the commercial exchange of cryptocurrencies. The amendment that approved the use of cryptocurrencies in the country took effect as of 2017; under the Payment Services Act, only exchanges with representatives that reside in Japan and have offices in the country registered as part of the Japanese financial services agency may legally operate in the exchange of digital currencies.
The National Tax Agency (Dec 2017), established that all income in cryptocurrency are classified as “miscellaneous income” and are added to the total amount of other income that a citizen has; the taxes are calculated from the total amount of the incomes and then they are taxed. Investors must pay taxes at rates that range from 15% to 55%.
Japan under the Act on Prevention of Transfer of Criminal Proceeds, exchanges are required to verify the identities of customers who open accounts, keep records of transactions and notify the authorities when a suspicious transaction is recognized. Following the loss of 400 million dollars in NEM tokens in one of the most used exchanges in Japan, Coincheck, the government of Japan, according to the Library of Congress,
“The local Finance Bureau ordered Coincheck to submit a report on the same day, examined it, and issued an order of business improvement on January 29, 2018. The following day the FSA requested all cryptocurrency exchange businesses to review their system-risk management plans and report the results to the FSA. On March 2, 2018, the FSA conducted an on-site inspection of Coincheck. On March 8, 2018, the local Finance Bureaus issued business-improvement orders to seven exchange businesses, again including Coincheck. A group of cryptocurrency exchange businesses publicized their decision to form a new self-regulating body on March 2, 2018, that all registered exchange businesses will join. The body aims to obtain authorization from the FSA under the Payment Services Act.”

Regulations In China

Mainland China

In this country, both cryptocurrencies and exchange houses have been banned by the People’s Bank of China (PBOC), were completely eliminated in 2017, where 173 platforms were closed by 2018. Financial institutions cannot make any transactions with Bitcoin or another digital currency. In addition, they also banned ICOs and national currency exchanges. Additionally, as of January 2018, most of the crypto miners closed operations.

Hong Kong

Unlike mainland China, there is a British ex-colony that in 1997 stopped being part of Britain and became part of the Chinese, but it was agreed that this region would be autonomous for half a century before Beijing takes full control over it. In other words, it is “one country, two systems”. This area called Hong Kong is governed by the same president of mainland China but does not comply with the same communist regulations. Unlike China, the cryptocurrencies are legal, currently, there is no legislation that regulates digital money, but they have an anti-crime organization which sanctions those who do not comply with requirements that stops cases of money laundering or fraud; Bitcoin is considered a virtual asset.
Crypto Legal Status 2019

Regulations In The USA

Currently, cryptocurrencies are not considered as legal tender, although their exchange is; the regulations will depend on the state and the federal authorities since each one has different concepts of cryptocurrencies.
The Financial Crimes Enforcement Network (FinCEN) considers that tokens are another value that replaces the local currency (Dollar), unlike the Internal Revenue Service (IRS) which establishes that cryptocurrencies are taxed as a property and not like a coin.
In 2015, 802 people declared and paid taxes on the cryptocurrencies profits, which means that users are evading these taxes; The IRS is apparently using a unique software that helps them locate those users who are evading taxes. This theory is promoted by Laura Walter, a certified public accountant and cryptocurrency tax specialist, who published on July 8, 2018, a document that apparently has been presented to IRS agents of the Criminal Investigation division. The document indicates that the IRS intends to serve the subpoenas to request from large technology companies (Apple, Google, Paypal among others) information on users’ download history and to confirm whether they have any application in their devices related to any cryptocurrency.
The United States is considered one of the countries with most transactions in LocalBitcoin, therefore, they have placed more regulations and laws when making this type of transactions. In 2018, the US Supreme Court debated the future of Bitcoin for the first time, and this and other cryptocurrencies are regulated under United States law.
The treasury of the United States classified in 2013, that Bitcoin is a “convertible decentralized virtual currency”. The Commodity Futures Trading Commission, CFTC, classified bitcoin as a “good or asset” in September 2015.
The US government has required all monetary service companies, such as, for example, exchanges, which carry out considerable transactions in the region, to meet several requirements:
• Register in the FinCEN.
• Design an anti-money laundering (AML) program.
• Maintain record and make reports in case of suspicious activity (SAR). US FinCEN receives 1,500 SARs per month.
• Make and deliver reports of digital currency transactions (CTR).

Regulations In Canada

Currently, cryptocurrencies are not considered as legal tender, although their exchange is, depending on the province. Since 2013, the Canada Revenue Agency has taxed the cryptocurrency transactions depending on the type of activity. Canada was one of the first countries to draw up cryptocurrency legislation, which designated exchanges as “money service businesses,” where they have to follow with anti-money laundering and know-your-client requirements among others.

Regulations In The European Union

Cryptocurrencies are legal, depending on the country the regulations will change. Exchange houses are currently not regulated at the regional level. In some cases, the exchanges have to register with the regulators of each country, where they grant these companies authorizations to operate legally within the jurisdiction of each country. In addition, each jurisdiction has different tax systems, which charge citizen’s taxes from the profits of the purchase and sale of cryptocurrency that ranges from 0% -50%.

Regulations In Australia

In Australia cryptocurrencies (treated as property) and exchanges are considered legal; In 2017 the Australian Senate declared the legality of cryptocurrencies and are subject of Capital Gains Tax. The same year, they began debating statutes for anti-money laundering to the country’s cryptocurrency exchanges; by the end of the year, cryptocurrency exchanges have to register with the country’s financial intelligence agency Austrac where they have to verify the user identity and other requirements. Currently, there are no regulations for the use of digital money as a payment method.

Countries where cryptocurrency is banned or legal 2019

In conclusion…

Consequently to the economic collapses that many developing countries have been through, there is a need for a stable economic structure that is not easily influenced by its environment. The blockchain has provided solutions to this need and many users from all over the world have had to resort to this economic model, as, for example, Third World countries, which suffer inflation, exchange controls, economic regulations by their governments, among other problems. Telos Blockchain has come to give an economical alternative to the user for the best management of their assets and their patrimony with a reliable and safe model, unlike other blockchains that have fallen into fraud, scams, money laundering among others, many countries have taken action on the matter and have placed regulations and laws that control possible security flaws in this model, such as unlawful acts.
submitted by Telosfeed to Futurology [link] [comments]

What Are the Biggest Alleged Crypto Heists and How Much Was Stolen?

What Are the Biggest Alleged Crypto Heists and How Much Was Stolen?

As the appeal of cryptocurrency has grown, so has the opportunity for scammers to part naive investors from their money. 2019 has been no exception, with cryptocurrency and blockchain forensics company Ciphertrace dubbing it “the year of the exit scam.”
Exit scams are not a new phenomenon, with a 2018 report conducted by Statis Group revealing over 80% of initial coin offerings (ICOs) in that year to have been fraudulent. Here, Cointelegraph explains exit scams and how to spot them, as well as a look at some of the biggest scams that have been discovered by various researchers.

What are exit scams?

The premise of cryptocurrency is simple, a new ICO launches, claiming to offer lucrative returns for investors. Investors can’t believe their luck and clamor to buy in. The business runs for some time on the back of the invested capital, but, sooner or later, disaster strikes and the company shuts down, often with no explanation.
After a while, it becomes obvious that the company is gone for good, along with the invested funds. The poisoned chalice of crypto’s decentralized nature often means that investors are left in the dark when trying to recoup or trace their pilfered funds.

How to spot an exit scam

Many exit scams have tell-tale signs that investors should look out for. The financial content site Investopedia has a handy list of key characteristics.
First, exit scams often have inconsistent or misleading information about the team behind the project. When scouting potential investment opportunities, investors should scour for information on key members of any ICO.
It’s important to remember that online credibility can be faked by purchasing likes, profiles and followers on social media. Celebrity endorsements with verified accounts could also ring alarm bells for investors. A fake Twitter account purporting to be Elon Musk, with a supposedly verified twitter account, raised over $155,000 as part of a 2018 Bitcoin scam.
Investors should verify the credentials of backers, team leaders and promoters of cryptocurrency projects. Although individuals may seem to be legitimate at first glance, brand new social mediaprofiles and few followers or connections should raise eyebrows.
The most significant characteristic unifying exit scams in cryptocurrency is the promise of a huge return on investment (ROI) — chances are that it’s probably too good to be true. Investors should always look through even the smallest details of what they are required to invest and what the company purports to be able to give back to them.
ICOs usually come with a white paper, setting out the design details of the project along with a business plan and other information. Investors should pursue all available information for ICOs, as any vagueness in the white papers should signal a big red flag.
When investing in an ICO, it’s vital to get an understanding of the business model. Investopdia writes that anything powered by concept alone should be a warning to anyone tempted to buy in. Although cryptocurrency projects can and do launch off the back of technological advances, investors should be wary of projects looking to gather millions of dollars before taking a sober look at the project’s ability to return the investment from the published information.
Heavy promotion of an upcoming ICO can also be a sign of an exit scam. Past scams have employed bloggers to promote via numerous forums. Ads both online and in print media could also be suspicious.

$2.9 billion PlusToken scam could be largest exit scam ever

A 2019 report shared with Cointelegraph by the cryptocurrency and blockchain forensics company Ciphertrace dubbed 2019 the year of the exit scam and highlighted the billions of dollars stolen in multiple scams this year alone.
The report shines a light on what, if confirmed, could be the biggest crypto scam ever, with an estimated loss of around $2.9 billion after Chinese police uncovered an alleged Ponzi schemeinvolving the South Korean wallet provider and exchange PlusToken. Although more is being uncovered about PlusToken, mystery still surrounds the key events.
Ciphertrace reports that the platform has enshrouded several Chinese nationals, the government of Vanuatu, the Chinese police and the company’s co-founders — a South Korean man operating under the alias of “Kim Jung Un” and a Russian known only as “Leo.” The alleged PlusToken scam centers around an app with which the wallet provider claimed investors could invest in PlusToken (PLUS).
According to the report, the firm claimed that the token, based on the Ethereum blockchain, was developed by a major technology company. PlusToken is also said to have falsely stated that it could deliver wallet holders an ROI of between 8% and 16% per month, with a minimum deposit of $500 in crypto assets.
Ciphertrace also reported that no verifiable source of revenue existed other than the proceeds from new membership. Those were onboarded per the traditional method of a Ponzi scheme, which require a constant stream of new investment in order to support its semblance of growth. Investors were incentivized to recommend new users with an invitation, which was the only way to join.
Although this was enough for some members to dismiss the legitimacy of the project outright, Leo, the company’s co-founder, published a press release that claimed he had met with Prince Charles, the future head of the English royal family, providing photos as proof. Ciphertrust reported that it had contacted the Prince Charles Foundation, which confirmed that Leo had indeed attended the event, but would not provide other information about the individual due to European Union General Data Protection Regulation, or GDPR.
PlusToken’s fate was seemingly sealed on June 28, after members of the Chinese police touched down in Vanuatu, detained six people involved with the project and extradited them back to mainland China. Ciphertrace reported that the so-called “PlusToken Six” were either Vanuatu citizens or applying for citizenship at the time of their arrest.
Soon after, PlusToken members found that they were unable to withdraw funds from their accounts. Customers were informed that withdrawals via the app were frozen due to “technical difficulties.” By June 20, the PlusToken app had ceased operations due to purported system maintenance.
For investors, there seems to be no secure lead on the final resting place of the allegedly billions of dollars of stolen funds. The Chinese government has yet to comment. A July 12 post from PlusToken stated that the six Chinese individuals were simply service users and not actually involved with the running of the company itself, stating that users should ignore the rumors and not try to log in until they receive confirmation that the servers are back online.


On April 9, 2018, two ICOs — iFan and Pincoin — operating under the umbrella of company Modern Tech based in Vietnam, went silent after reports outed them as scams that had scalped 32,000 investors out of an alleged $660 million in tokens, according to Tuoi Tre News.
Victims claim that the damages amount to roughly 15 trillion Vietnamese dong ($660 million) in token sales. Angered investors held a demonstration outside Modern Tech’s Ho Chi Minh City headquarters on April 8.
One of the initial characteristics that could have alarmed investors was the fact that Pincoin offered service users bonuses for successfully bringing other people on board. Pincoin did initially pay out cash until January 2018, when the company switched to iFan tokens, TechCrunch reported.
The owner of Modern Tech’s office building said that the company left its offices in March and that no one knew their current whereabouts. The firm left behind only an incomplete website that is now inactive. Modern Tech initially tried to pass itself off as a mere representative of both coins in Vietnam, prior to media reports confirming that seven of its Vietnamese executives were in fact behind the projects.
TechCrunch reported that the ambiguous mission statement from the then-functional site is typical of the vague and jargon-filled copy used by exit scammers:
“The PIN Project is about building an online collaborative consumption platform for global community, base on principles of Sharing Economy, Blockchain Technology, and Crypto Currency”
Financial scam directory Behindmlm released a report in February 2018 that found its buy-in method was typical of an ROI Ponzi scheme. Pincoin’s website is currently down, though iFan’s is still online.

QuadrigaCX — regulators catch on

The death of 30-year old Gerald Cotten shook the crypto world — not only because Cotten was the co-founder and CEO of Canada’s largest cryptocurrency exchange, QuadrigaCX, but also because his control of the passwords and keys to accounts rendered all the assets on the exchange forever inaccessible after his death. Cotten took over $195 million of stolen cryptocurrency with him to the grave.
Related: QuadrigaCX Users Lose $190M as Speculations Over Cotten’s Death Swirl
Commenting on the May 9 Ernst & Young report, Ciphertrace said Cotten had played fast and loose with customer funds for many years in order to support a lavish lifestyle for both himself and his wife. Cotten allegedly exercised complete control over the exchange and used his position to perform “unsupported deposits” — i.e., fabricated transactions not represented by either fiat or cryptocurrency.
Cotten also used significant volumes of customers’ cryptocurrency via transfers from the platform into other exchanges he controlled. As per the EY report, Cotten shifted significant amounts of fiat and cryptocurrency between alias accounts, although less than 1% of these transfers was supported by documentation. Ciphertrace notes that as the admin, Cotten was in a perfect position to hide his fraudulent activities.
In a pattern that may now seem familiar, Cotten used customer funds to pay for QuadrigaCX operating costs after the company suffered liquidity issues due to his reported fraudulent use of user deposits. As QuadrigaCX began to struggle to stay afloat, EY reported that Cotten gambled customer funds in off-platform margin accounts to meet margin calls.
The report also states that Cotten traded unsupported deposits for legitimate funds thereby generating artificial trading markets, abused his position to override Know Your Customer requirements and hoarded all passwords:
“The Monitor understands passwords were held by a single individual, Mr. Cotten and it appears that Quadriga failed to ensure adequate safeguard procedures were in place to transfer passwords and other critical operating data to other Quadriga representatives should a critical event materialize (such as the death of key management personnel).”
As of April 12, EY estimated that Quadriga held around $20.8 million in assets and around $160 million in liabilities. The debts and assets are spread over three subsidiary companies, 0984750 B.C. LTD. (the “Quadriga Estate”), Quadriga Fintech Solutions and Whiteside Capital Corporation. On July 31, the Supreme Court of Nova Scotia approved over $1.6 million in fees for parties seeking remuneration from the exchange, according to court documents.PDF) seen by Cointelegraph.

CFTC action launched after $147 million BTC scheme

On June 18, 2019, the United States Commodity Futures Trading Commission (CFTC) initiated a civil enforcement action against now-defunct Control-Finance Limited for a scheme involving $147 million worth in Bitcoin.
It is alleged that Control-Finance Ltd. defrauded over 1,000 investors by laundering around 22,858 Bitcoin. In mid-September 2017, its website was abruptly taken offline, payments to clients were suspended and advertising content from social media accounts was deleted.
The firm initially said that it would reimburse customers by late 2017. However, the company allegedly began transferring laundered Bitcoin by using the crypto wallet service CoinPayments. According to Ciphertrace’s Q2 2019 Anti-Money Laundering (AML) report, the CFTC complaint charges the company and its founder Benjamin Reynolds with:
“Exploiting public enthusiasm for crypto assets by fraudulently obtaining and misappropriating at least 22,858.22 Bitcoin from more than 1,000 customers through a classic high-yield investment (HYIP) Ponzi scheme called the Control-Finance Affiliate Program.”
Per the CFTC, the company claimed that investors who buy Bitcoin through the firm would be guaranteed daily profits thanks to their team of expert cryptocurrency traders. The complaint also stated that the firm falsely claimed market volatility would ensure funds invested through Control-Finance would result in profit.
The CFTC also alleged that Control-Finance misleadingly promised that it could earn customers a 1.5% ROI daily and 45% monthly. Control-Finance is also reported to have sent partial amounts of new clients’ BTC deposits to other customers, which were disguised as profit from trading, a tactic typical of Ponzi schemes. The legal action seeking civil monetary penalties and permanent trading bans continues.

Co-owner of Bitmarket found shot dead after alleged exit scam

On July 8, the Poland-based exchange Bitmarket shut down, citing liquidity issues. According to Ciphertrace’s Q2 2019 AML report, the shutdown cost users around 2,300 Bitcoin, approximately $23 million. Users attempting to log on to the site were met with the following message:
“We regret to inform you that due to the loss of liquidity, since 08/07/2019, was forced to cease its operations. We will inform you about further steps.”
Ciphertrace reports that Bitmarket had a history of partners pulling out. In 2015, the firm lost payment processors CashBill and BlueMedia after the companies' banks requested they end their working relationship with Bitmarket. PKO Bank Polski, Bitmarket’s own bank, also terminated its relationship with the firm only six months after Bank BPH had done so earlier in 2015.
Bitmarket’s two founders, Marcin Aszkiełowicz and Tobiasz Niemiro, have contradicting accounts about the misplaced user funds. Aszkiełowicz claimed that the exchange had been hacked for 600 BTC in 2015, an incident from which the company was unable to recover.
Niemiro, however, claimed that he was not responsible for activities on the exchange. Niemiro also purported to have been told that the company was purchased with a deficit of 600 BTC, which he allegedly repaid with his own money. Niemiro said he could not confirm that his partners had indeed used the money to purchase the 600 BTC.
Two weeks after the interview, Niemiro was found dead in a forest near his home with a gunshot wound to the head, which the police deemed to be self-inflicted. The District Attorney’s Office stated that it is not looking into the involvement of third parties in Niemiro’s death, but are still actively investigating the misappropriation of funds.
submitted by Rajladumor1 to omgfin [link] [comments]

In case you missed it: Major Crypto and Blockchain News from the week ending 12/14/2018

Developments in Financial Services

Regulatory Environment

General News

submitted by QuantalyticsResearch to CryptoCurrency [link] [comments]

How to get Your Money Back From Coinbase

-----Originally Posted by Ariaa_ but was removed-----
So I've had the same problem with coinbase, account locked for a mistake on their system considering me being in Iran etc. What I did was I reached out to support, they didn't respond and I waited for a long time to get a response which was not the right move. Here is how you actually get a response from them: open a ticket with them and wait the 72 hours that they promise they will provide an answer. if they don't do so, you need to start the following: Contact CFPB (Consumer Financial Protection Bureau) using the following link:
I have tried every possible channel, a nice lady from U.S. Securities and Exchange Commission (SEC) answered my email with the following information which is very useful:
Dear Mr. *****: Thank you for contacting the U.S. Securities and Exchange Commission (SEC). Please be advised that a search of our database indicates that Coinbase is not registered with the SEC. Please note that the Commodities Futures Trading Commission (CFTC) has jurisdiction over some virtual-currency related issues and investments. As such, you may wish to report your concerns to the CFTC. Contact information is as follows: Commodity Futures Trading Commission Three Lafayette Centre 1155 21st Street, NW Washington DC 20581 CFTC Toll-Free Complaint Line: 866-366-2382 Online Complaint Info:
You may also wish to report your concerns to the Federal Trade Commission (FTC) and the Consumer Financial Protection Bureau (CFPB) as follows:
FTC Consumer Response Center 600 Pennsylvania Avenue, NW Washington, DC 20580 Toll-Free Complaint Line: 1-877-382-4357 Toll-Free Identity Theft Hotline: 1-877-438-4338 CFPB P.O. Box 4503 Iowa City, Iowa 52244 Fax (855) 237-2392 (855) 411-CFPB (2372) For general information regarding virtual currency-related investments, please review our publication "Bitcoin and Other Virtual Currency-Related Investments," available at, as well as our investor alert "Ponzi Schemes Using Virtual Currencies," available at For information about insurance provided by the Federal Deposit Insurance Corporation (FDIC), we recommend reviewing the FDIC's page on the matter, "Understanding Deposit Insurance, " available at You can also contact the FDIC as follows: FDIC Consumer Response Center 1100 Walnut Street, Box #11 Kansas City, MO 64106 877-275-3342
Additionally, as you appear to be a resident of Canada, we recommend contacting Canadian regulators to determine if they may be of assistance. For help finding information about regulators in Canada, please visit the International Financial Regulators Gateway at
The SEC’s Office of Investor Education and Advocacy processes many comments from individual investors and others. We keep records of the correspondence we receive in a searchable database that SEC staff may make use of in inspections, examinations, and investigations. In addition, some of the correspondence we receive is referred to other SEC offices and divisions for their review. If they have any questions or wish to respond directly to your comments, they will contact you. Sincerely, Lisa Skrzycki Attorney Office of Investor Education and Advocacy U.S. Securities and Exchange Commission (202) 551-5953 (direct) (202) 551-6551 (main) (800) 732-0330 (toll free) ref:_00D30JxQy._500t06oF5cAAE:ref
Following the above steps, you will open the magic box and voila! Hope everyone gets what coinbase has withheld from them, thought I should contribute to the community although I didn't get much other than hate from coinbase fanatics in here! I'm sure by doing this, coinbase will go ahead and close my account now but hey, who cares! !
submitted by ChibiRay to CoinBase [link] [comments]

The Regulatory/Legal Environment

Hello! My name is Daria Volkova and I am the Head of Platinum Legal Department. Our team believes that these are exciting times for the crypto market. We supported more than 100 clients, created and promoted their STO and ICO campaigns, got from an idea to funding in a matter of 2.5 months! See the full list of our services: We are more than proud to present our education project. The UBAI can help you to learn specifics about cryptocurrencies and blockchain technologies. Learn all about ICO avenues and opportunities, plug into the world of trading cryptocurrency markets, become an expert in scam projects, promoting ICOs and STOs, launching your own campaigns and many more! What are the different cryptocurrency regulations in major countries? Find the answer after reading this article.
Cryptocurrency Regulations across Major Countries
Cryptocurrency and the blockchain industry may seem sufficiently exciting and attractive to you now. After all, you are taking the time and effort to study this course. You may be planning to work in cryptocurrency and the blockchain industry. Of course, we want to encourage you and help you proceed toward your goal. But it is also important you understand the regulations guiding the blockchain industry to help keep yourself out of trouble.
This year, in particular, seems to be the year in which a lot of countries are looking to finally coalesce the regulations relating to the blockchain industry into a workable legal framework. Some countries are more accommodating to cryptocurrency and blockchain technological innovations while others are still more cautious. We will examine how each major country is forming their own regulatory framework for the blockchain industry.
Cryptocurrencies are not considered legal tender in Canada. This was clearly expressed by the country’s Financial Consumer Agency (FCA). Canada, like the US, has yet to clearly define or legislate a framework surrounding cryptocurrencies. But Canada still appears to be among the most transparent of countries for the nation’s interpretation and enforcement of the law surrounding cryptocurrencies (aside from Switzerland). For the time being, Canada has clearly stated its reluctance to adopt cryptocurrency as a legal tender, due to its high volatility. “ “The United States of America (USA)
There are certain laws regarding transactions in virtual currency in the US today but there is still no comprehensive legal framework. The Commodity Futures Trading Commission currently regulates virtual currencies as commodities. The CFTC is the first US regulator to allow for public cryptocurrency trading. The Securities and Exchange Commission requires registration of any virtual currency traded in the US if it is classified as a security (e.g. by the Howey test).
The regulatory authorities have not yet formulated or offered a coherent framework for regulations regarding cryptocurrencies. Typical of most legislators and regulatory agencies in the US, the Securities and Exchange Commission (SEC) has intensified its focus on the pressing need for comprehensive regulation. And it seems everyone is waiting for the right catalyst to coalesce into a usable set of legal guidelines that can protect the investing public and also allow for blockchain and cryptocurrency innovation as well.
If cryptocurrency becomes a form of legal tender in the US, there will likely be stringent laws on its use. However, if cryptocurrency is treated like a security, cryptocurrencies would be regulated under securities law as interpreted by the SEC. Present securities laws place a large number of limitations on who is able to buy securities, how they are traded, and how to ensure transparency in the flow of information relevant to investors. Also note that non-US investors may experience their own difficulties getting a license to trade cryptocurrencies in the country. “ “Japan
Japan has always been one of the most positive and forward-thinking nations regarding cryptocurrencies and the blockchain. Of course, they were cautious at first, and they knew no more than anyone else in government, which means they literally knew nothing. But they took time to research, learn, and develop an approach to regulate the industry without killing it. The official policy is clear: Protect the public interest, but also encourage the growth of the industry with a legal framework that allows for innovation in blockchain and cryptocurrencies.
The situation in China is a sad one. The country has been taking increasingly strict actions to discourage and outlaw any activity related to the blockchain industry. China has banned ICOs, frozen all accounts associated with cryptocurrency, stopped bitcoin miners and even ordered a nationwide ban on all forms of cryptocurrency trading.
China has the strictest laws against cryptocurrency. Yet, despite that fact, as of 2017, 50% of the world’s mining population was from China! If you are involved with the cryptocurrency industry it is strongly advised to stay away from China, and avoid transactions with Chinese business because of the unpredictable and negative legal framework.
“ “The United Kingdom & European Union
Brexit is scheduled to take place in March 2019, yet the UK and the EU still remain united in their regulatory attitude toward cryptocurrencies. There are also reports that the UK and EU are planning to end anonymity for cryptocurrency traders.
The UK and EU are both trying to control all the scams and frauds. They are working with cryptocurrency platforms to stop or at least report all suspicious transactions. This adds a degree of regulatory burden on the exchanges as well as increasing the associated compliance costs. Cryptocurrencies are extremely volatile. They are a high-risk investment. Governments across Europe are greatly concerned about the possibility of both retail and sophisticated investors losing a lot of money.
This has led to a situation similar to that in the US. The regulatory authorities have not yet formulated or offered a coherent framework for regulations regarding cryptocurrencies. There is an intense focus on the pressing need for comprehensive regulation. And everyone is waiting for the right catalyst to coalesce into a usable set of legal guidelines that can protect the investing public and allow for blockchain and cryptocurrency innovation as well. We certainly hope for intelligent and effective legislation from all the major countries. “ “Accommodating & Unaccommodating Countries
Below is a list of countries we have not specifically covered, but they have each taken an active position on a regulatory framework for cryptocurrencies. The following countries are either supportive or at least neutral toward cryptocurrencies:
-Switzerland. -Australia. -Nigeria. -Ghana. -South Africa. -Singapore.
Countries with the most stringent and negative cryptocurrency regulation:
-Venezuela. -South Korea. -India. -Russia.
Did you know?
It is not uncommon to see Bitcoin and other cryptocurrency ATMs throughout Japan.
Exchange robberies and hacks like MtGox, and the recent loss of $530 million NEM coins have led to serious debate in the Japanese government. The industry needs to provide a secure and manageable solution to these problems. Voluntary self-regulation and close cooperation with regulatory authorities is the most favored solution. It seems the regulators are working hard behind the scenes right now leading the industry in the desired direction in typical Japanese fashion. “ “Blockchain Industry Regulations in the USA
Based on the information received from the Columbia Science and Technology Law Review, there was a variety of responses from different government bodies about blockchain regulations. The regulators responses ranged from indifference to suspicion, and to positive expectation and excitement.
The US government has tremendous constitutional power to regulate business and industry, including of course the blockchain industry if it so desires. But basically, the federal government has been relatively indifferent and has even refused to speak on blockchain regulations despite the interest of various federal agencies. As of 2017, eight states in the US were working on bills promoting the use of cryptocurrency and blockchain technologies. It is even reported that a few states have actually begun the final steps before voting and passing legislation into law.
On April 3, 2018 Arizona introduced a law allowing corporations to hold and share data on the blockchain. The governor, Doug Ducey, put forward the legislation after the state began accepting signatures and smart contracts recorded on the blockchain as legally valid documentation. In 2017, Delaware was the first state to pass legislation allowing for shares of stocks to be legally traded on the blockchain.
Other notable developments have occurred in the US at the state or local level. Vermont makes use of blockchain as evidence in trials. Chicago uses blockchain to maintain real estate records. New York is currently evaluating four bills for the application of data storage on the blockchain. “ ” Blockchain Regulations in Europe
The entire European Union has approached blockchain with a positive and welcoming attitude. The EU has taken the position that they want to actively encourage innovation. This philosophy could support the development of cryptocurrencies in two ways:
-Encouraging the exploration of uses testing the impact and effect of the laws in a way that allows for a more finely-tuned and sophisticated understanding for all parties involved.
-Giving entrepreneurs the confidence that their target markets will be more trusting of their solution since they are operating with the explicit legal support of the state.
This approach, along with the EU’s scope as the regulator of 28 different countries, will encourage growth across the entire crypto ecosystem, and may end up transforming Europe into one of the most desirable destinations for blockchain development. Entrepreneurs are likely to move to the EU bloc to access the rich vein of available talent, as well as the positive and supportive laws.
The EU has actually disclosed through its executive arm that it is working on the use of blockchain for distributed ledger based projects. EU officials have constantly stated they are looking for ways to support more innovation with distributed ledger technology. The European Commission said it was “”actively monitoring Blockchain and DLT developments”” and has work in progress to explore “”DLT benefits and challenges as well as fields for application in financial services””.
The official press release stated that the commission clearly wants to “”pilot projects to foster decentralized innovation ecosystems and help reshape interactions between consumers, producers, creators and among citizens, businesses and administrations to the end benefit of society””. “ “Blockchain Regulations in Europe §2
Switzerland has gradually become the favored hub for cryptocurrency and blockchain development in Europe. This position has been enhanced through a Swiss non-profit blockchain and cryptographic technology ecosystem known as the Crypto Valley Association.
The Crypto Valley Association has begun working on the development of an ICO Code of Conduct to take advantage of the ban imposed by China on token crowd sales. They are hoping to capture the Chinese and Asian entrepreneurs searching for a new home.
Other countries are not as accepting of this new DLT technology and have even gone as far as classifying it as illegal and immoral behavior. There have been hyperbolic concerns most notably from China that cryptocurrencies will destabilize world financial markets.
There are various pilot projects and efforts to prove the benefits of cryptocurrencies and the blockchain industry currently being tested all across Europe. Yet even now they are barely scratching the surface of the full potential of the blockchain.
Country-by-Country Cryptocurrency Adoption
Citizens of countries all over the world have varying attitudes about cryptocurrency. These attitudes and sentiments can be very significant to the future adoption of cryptocurrencies because politicians and regulators tend to act in consideration of the collective opinion of the public. Some countries were more accommodating at first but then became stricter, despite positive public interest, basically saying they are still not sure about the possible consequences and benefits of the technology. “ “Country-by-Country Cryptocurrency Adoption
Surprisingly enough this small Baltic nation has gained a reputation for being quick to accept technological innovation. Estonia has a tech-friendly government eager to accommodate the innovative use of cryptocurrency in fields ranging from blockchain technology for healthcare and banking services; and even granting citizens the right to become what is known as “e-Residents”.
As e-Residents, Estonian citizens and businesses are provided with digital business authentication. It is also one of the first countries to employ the use of a blockchain-based e-voting service that enabled people to become shareholders of NASDAQ’s Tallinn Stock Exchange.
This fascinating and highly innovative country is now host to a number of Bitcoin ATMs and startups, like Paxful. They are cryptocurrency friendly, and cryptocurrency user friendly as well. Estonia also has highest internet penetration rates in the world.
Estonia may be a fine place to consider basing your ICO due to the friendly legal and regulatory environment.
This and a lot more you can learn on our website:! “ “Country-by-Country Cryptocurrency Adoption
The United States of America
The USA is the world’s dominant superpower, and it should come as no surprise that it has the highest number of cryptocurrency users in the world. It also has the highest bitcoin trading volume and the highest number of bitcoin ATMs.
Powered by Silicon Valley, which is home to a lot of cryptocurrency and blockchain startups, the US stands at the forefront of all things relating to cryptocurrency worldwide. Many other nations are planning to follow the US lead concerning cryptocurrency regulations. This means the USA will serve as the testing ground for cryptocurrency and crypto-regulation in the years to come. This is likely where the future regulatory framework will take shape.
Bitcoin in particular has shown massive growth in the US. This can only be interpreted as a strong tailwind for a positive regulatory environment because the population at large supports blockchain technology.
For the moment, due to regulatory paralysis and the resultant legal vacuum, ICOs are strongly advised against raising funds or basing operations in the US. The SEC has been particularly strict in its enforcement of securities and investment law which require an ICO to do an oppressive amount of compliance work. “ “Country-by-Country Cryptocurrency Adoption
When it comes to technological advancements and the standard of living of its citizens, Denmark is among the world leaders. It is considered one of the most developed countries in the world. It is also at the forefront of countries looking to reduce the use of cash money and advance to the use of 100% digital currency. As such, sentiment among the general public and political sphere actively supports the adoption of cryptocurrencies as a means of payment. The only question left is which particular cryptocurrency system to adopt. It is still unclear whether bitcoin is the one, or BTC will mainly just be accepted as a means of exchange. There are also discussions in Denmark about when to redesign its national financial system; this would be a “world first”, and a radical leap forward for cryptocurrencies.
Another fascinating thing is that the Danish Central Bank has declared BTC as a non-currency; meaning its use is not subject to the country’s currency regulations. Some of the top bitcoin startups and exchanges such as CCDEK have their foundations in Denmark.
With its open market and encouraging regulatory framework, Denmark might very well rival Switzerland in Western Europe for the position of the continent’s preeminent ICO and blockchain industry hub. “ “Country-by-Country Cryptocurrency Adoption
Sweden is quite similar to Denmark, for its social and demographic climate, and also for the government’s desire to eliminate cash. The Swedish Riksbank recently introduced negative interest rates. This can cause a spike in the demand for coins in the near future as citizens look for the best way to preserve their wealth. Negative interest rates like we have seen in Europe and Japan also, actively corrode savers’ wealth because people are actually paying a percentage of their savings to the central bank to hold their cash, in addition to losing out to inflation at the same time.
Sweden has taken the boldest step yet in all of continental Europe to legalize cryptocurrency. The country legalized the use of BTC and other cryptocurrencies as a means of payment by official public declaration. It is however expected that exchanges should file for a license in accordance with AML/CTF and KYC regulations.
Sweden is also home to a number of cryptocurrency startups such as the Safello Bitcoin exchange, and Stockholm-based KnCMiner. The gradually increasing trading volume of cryptocurrency has been a good indicator of the country’s appreciating demand for cryptocurrencies. “ “Country-by-Country Cryptocurrency Adoption
The Netherlands
The Netherlands is quite fascinating in its own right. How can a country not be referred to as Bitcoin-friendly when it can boast about having its own “Bitcoin City”? There are over 100 merchants that sell goods that can be purchased with cryptocurrency in Bitcoin City.
There are no regulations restricting the use of BTC in the Netherlands under the Act on Financial Supervision of the Netherlands. This explains why a lot of startups, BTC ATMs, and even a Bitcoin Embassy can be found in the heart of Amsterdam (the capital of Netherlands).
The friendly climate for cryptocurrency has led to a lot of very active bitcoin communities across the nation hosting regular meetups and other events. The country’s banking sector has been looking to incorporate BTC and blockchain to reduce costs and improve banking technology. The Netherlands is also a popular location for many important bitcoin conferences and bitcoin companies such as BitPay.
The Netherlands is increasingly becoming a prominent place for ICOs and blockchain related businesses to base their operations. “ “Country-by-Country Cryptocurrency Adoption
Well-known as the home of Nokia, Finland has constantly been at the forefront of technological innovation, just like its other Scandinavian neighbors. The Finnish Central Board of Taxes (CBT) has even gone as far as classifying bitcoin as a financial service, exempting it and cryptocurrency purchases from the VAT. What more could be better for Bitcoin?
Finland also boasts a significant number of BTC ATMs despite its small population. The capital of Helsinki alone is reported to have 10 ATMs for BTC. The country is also home to top exchanges such as FinCCX and As of January 2016, the most expensive bitcoin sale took place in Finland. It involved the sale of a Tesla Model S worth over €140,000 at Auto-Outlet Helsinki Oy.
Canada is home to a variety of bitcoin startups and ATMs. It is considered to be more favorable toward cryptocurrencies than the USA. The country has two cities on its eastern and western coasts, Toronto and Vancouver, that are recognized as “Bitcoin hubs”.
Canada has a vibrant cryptocurrency community and is home to startups such as Decentral, the Vanbex Group and a large number of merchants who accept cryptocurrencies as payment. Vancouver is known to have over 20 ATMs while Toronto is well-known for holding large cryptocurrency conferences.
There has been constant growth in cryptocurrency trading volume in the country. Canada might be the best location in North America to base an ICO or operate a blockchain business due to its supportive regulatory environment and a rich ecosystem for cryptocurrency, with human talent, ATMs and other tools, etc. “ “Country-by-Country Cryptocurrency Adoption
United Kingdom
The UK is one of the absolute top financial hubs in the world. It is also a center of innovation. There are a large number of bitcoin and blockchain related startups, BTMs and active communities. All of the previously listed crypto-friendly features make the UK a very desirable environment for bitcoin. The UK has identified the inevitable need for a new payment solution and is gradually bracing itself for a widespread adoption of cryptocurrency in the future. There are even a few local pubs that accept BTC as a means of payment.
It is also interesting to note that the Bank of England has been closely monitoring bitcoin technology and has requested ideas from citizens on the improvement of its monetary system. Bitcoin is presently seen as “private money” where VAT is imposed from suppliers of goods and services that accept cryptocurrency as payment. Profits and losses incurred from cryptocurrency trading are also subject to capital gains tax, just as in the US.
In the UK, it has become increasingly clear that BTC can be part of a bigger story, and the trading volume indicates steady growth. There are not clear laws against cryptocurrencies at the present time. But the lack of regulatory momentum suggests we may see more positive developments soon. One thing to keep in mind, while the Brexit is still in progress, the British government may be more likely to legislate on non-core issues. “ “Country-by-Country Cryptocurrency Adoption
The major banks in Australia have been quite hostile toward bitcoin, but at least the country has removed the burden of “double taxation” on cryptocurrency. This was good news to the local business community because blockchain startups had begun to leave the country as a direct result of unfavorable taxation and closure of bank accounts.
The use of BTC still remains unregulated, there is no law or regulation restricting the use of cryptocurrencies by Australian citizens. Cryptocurrencies are regarded as a form of property in Australia, and purchases with BTC, for example, are referred to as “barter”.
The Australian Securities Exchange (ASX), you will remember, is transitioning its CHESS verification system to a blockchain solution that should go live at the beginning of 2019. Cryptocurrencies in Australia are seen a lot like they are in the US. Topics like the imposition of capital gains tax, concern about securities law, the legal debate about using cryptocurrency as payment for goods and services, etc., are all problematic for regulators. While the general population is quite comfortable and supportive of cryptocurrencies and blockchain solutions, at the present it is not a high priority for the government to legislate or regulate. “ “Taxation and Cryptocurrency
Tax is of course one of the most important factors in financial matters on both a personal and corporate level. Taxes greatly influence investment decisions and returns, regardless of industry or size. It is one of the first things every individual or group considers before investing. Notably, in Australia and the USA, cryptocurrency gains are treated as capital gains and taxed at up to 50% of the return.
Some countries have low cryptocurrency taxes specifically to encourage the blockchain industry. By offering a more competitive tax rate, countries are implicitly supporting cryptocurrency and actively trying to offer a better return profile than other countries. We will discuss the different taxation regimes in a wide range of countries so you can ascertain the financial advantages and disadvantages of a variety of locations.
Belarus charges 0% in taxation until 2023. That exemption is specifically for cryptocurrency exchanges and transactions. This has been done to help Belarus build a special economic zone, referred to as ‘HTP Belarus’. Their goal is to have an economic zone strong enough to compete with the likes of Silicon Valley.
The government of Belarus has also declared smart contracts as legal documents. Anyone looking to set up a blockchain company or a cryptocurrency startup should seriously consider Belarus. It has a supportive regulatory and legal environment which actively encourages the blockchain industry and does not impose punitive taxes upon those inside the industry.
“ “Taxation and Cryptocurrency
Any and all personal income received from cryptocurrency transactions is tax-free in Portugal at the present moment. Income from cryptocurrency trading is categorized as something legally different from traditional income or capital gains.
The Portuguese government stated clearly that any kind of sale of cryptocurrency does not fall under capital income or capital gain. If an individual is however found to be carrying out professional activity, or any business activity related to cryptocurrencies, that is a different matter and such income will be subject to taxation.
From a personal perspective, Portugal is one of the leading countries where an individual can carry out their cryptocurrency transactions and enjoy a decent standard of living in the same country too. However, for ICO and Blockchain businesses it is not recommended to base your operations in Portugal.
China is famous the world over for being home to some of the largest cryptocurrency mines and many active cryptocurrency investors; yet at the same time China makes it illegal to conduct any cryptocurrency related business or investment.
But China still has an especially attractive environment for investors. Hong Kong runs on a policy of zero VAT or capital gains tax so it is easy to recommend you base your business there. Hong Kong also stands out as a major financial hub in the heart of Asia. “ “Taxation and Cryptocurrency
Actually, Netherlands was the first country to make use of a non-zero tax rate policy for cryptocurrencies. So, it may seem reasonable to expect a discouraging tax situation. But the fact is, Netherland’s tax policy is rather advantageous for cryptocurrency. They have a very simple, low-tax regime.
Cryptocurrency assets need to be declared with the total assets owned by an individual at the beginning of the year to assess their value. Cryptocurrency gains will be taxed at the highest tax bracket for capital income of just around 5%. The Netherlands is strongly recommended as a good country to work and live in, from both a personal and corporate perspective.
Germany is the economic center of the EU. This makes it a great place to start a cryptocurrency or blockchain company. Financial technology has been thriving there for more than ten years, and Germany has favorable cryptocurrency laws too.
Bitcoin and cryptocurrency assets have a 0% tax when used in making payments due to no VAT levied for making payments with BTC, because there is no “value added” through cryptocurrency as a fiscal product.
Germany offers a moderately compelling case for both blockchain business and individuals. While the tax rate on income at the company level is not competitive, the ability to pay for services in crypto as well as hold cryptocurrency assets and sell them at zero percent taxation rate is compelling. “ “Where to Base Your ICO
Let’s talk about the countries that are most accommodating with regard ICOs. Start-up ICO companies, like any company, essentially require three key principles for operation. The first is a sound legal and regulatory framework wherein the rule of law is preserved and business encouraged. The second is the ability to hire or acquire talented individuals to work at the firm. The third and final is the tax system and access to associated financial systems in order to allow the enterprise to succeed.
This country is, perhaps surprisingly, widely referred to as the most digital society in the world. Estonians are known to be pathfinders deeply involved in setting up an efficient, secure, and transparent internet ecosystem.
The country ranks first when it comes to the number of ICOs per inhabitant. It has an incredibly supportive tax regime, actually among the most competitive in the world, as well as a deep pool of talent across all areas of the digital spectrum. Estonia offers possibly the most supportive and friendly regulatory and legal framework in the world for an ICO. This, in combination with a zero percent tax rate at both a personal and corporate level, combine to make Estonia one of the single most appealing locations from which you can launch and operate your ICO. “ “Where to Base Your ICO
Singapore is another important regional hub in Asia for its strong rule of law as well as low taxation. The country offers one of the highest standards of living in the world. It is centrally located in the heart of Asia, so it easy to travel and recruit talent from surrounding countries. At the present there are not any specific regulations targeting the blockchain industry, but it is one of the world’s largest countries by funds raised for ICOs. It has a competitive tax regime in combination with strict AML and KYC. All of these factors make Singapore Asia’s leading location to launch and base an ICO.
The regulatory situation around the world may seem rather complicated. That is because it is. Laws and regulations are changing rapidly all over the world. And the regulatory framework is the most significant point of concern for a startup ICO. You should carefully study not only the current regulations surrounding your particular venture and how its tokenomics affects its classification, but you also need a reasonable sense of where the country is likely to be six months or a year later. Ideally you would base your ICO in a country that is supportive now, and all timeframes into the future with a competitive and legally sound tax system.
Where to Base Your ICO
Slovenia has recently transformed itself into the leading destination for blockchain technology in Europe. The government of Slovenia has placed a strong emphasis on the study of blockchain technology in public administration, and there has been an amazing success rate for ICOs in Slovenia. While the Slovenian government is a leader in terms of adopting cryptocurrencies, its rate of taxation is still considered quite high at 19%, even though that is still lower than other European countries. ICOs are considered to be normal business activities where you are taxed based on the funds received from an ICO less the expenses of doing business.
Switzerland is trying to remain relevant for the blockchain industry and for ICOs. The Swiss finance ministry is actively trying to attract investors to the country. Switzerland is considered a very important crypto location due to fact it was home to four of the largest ICOs in the world. The country is also very attractive to investors because of its friendly regulations and digital expertise. The taxation and regulatory environment is extremely secure and positive towards the cryptocurrency and blockchain industry in general.
Are there successful ICOs that have originated from the specific countries considered? Read the full article to get the answer!
Learn more about our STO and ICO marketing services right now! Contact me via LinkedIn: LinkedIn
submitted by UBAI_UNIVERSITY to u/UBAI_UNIVERSITY [link] [comments]

Cryptocurrencies are largely negative as Bakkt announces official December launch of Bitcoin futures trading

Crypto News

submitted by QuantalyticsResearch to CryptoCurrency [link] [comments]

War against Coinbase (How to fight for your own money)

Thanks "solly122" for starting war against Coinbase and we hope that all victim will be with you in this war.
This is from "solly122" So I've had the same problem with coinbase, account locked for a mistake on their system considering me being in Iran etc. What I did was I reached out to support, they didn't respond and I waited for a long time to get a response which was not the right move.
Here is how you actually get a response from them: open a ticket with them and wait the 72 hours that they promise they will provide an answer. If they don't do so, you need to start the following:
Sincerely, Lisa Skrzycki Attorney Office of Investor Education and Advocacy U.S. Securities and Exchange Commission (202) 551-5953 (direct) (202) 551-6551 (main) (800) 732-0330 (toll free) ref:_00D30JxQy._500t06oF5cAAE:ref
Following the above steps, you will open the magic box and voila! Hope everyone gets what coinbase has withheld from them, thought I should contribute to the community although I didn't get much other than hate from coinba
submitted by sayeed24 to CoinBase [link] [comments]

Cryptocurrency Weekly Recap

submitted by QuantalyticsResearch to CryptoCurrency [link] [comments]

Daily News Discussion, July 20, 2018


Welcome to the Daily Crypto News Update. Please use this thread as a quick overview of recent crypto news posted for the past 24 hours, and join for all crypto discussions!
Please read the disclaimer and rules before participating
Disclaimer: The content of the thread and news should not be relied upon as advice or recommendations of any kind. Use this thread for informational purposes only. It will be your responsibility to take the risk trading based on the recent crypto news. Remember the golden rule - Past results are no indication of future performance.
Rules: The subreddit and Reddit rules are still in force here. Please keep the discussion related to cryptocurrency news only and do not use this thread to solve your technical issues on Bitsgap platform.


That's it for today!
submitted by Bitsgap to Bitsgap [link] [comments]

A better environment for crypto business - the review on the legal systems in six countries

The free conduct of the cryptomarket causes confusion for the government and central banks. The market with $350 billion capitalization and no control is not that much appreciated. So the countries try to find the way to regulate cryptocurrencies. In this article we will outline some examples from the USA, Singapore, Great Britain, Switzerland, Japan and describe what happens in Russia, as well.
The USA: the infrastructure for the ready-to-run project
The legislation in the USA is complex. Every state has its own idea of cryptocurrency and Blockchain. There is still no clear definition for the cryptocurrency: some state courts acknowledge it as money and CFTC - the Commodity Futures Trading Commission - as an asset. ICO in the USA is not so popular due to the strict Securities Regulation. The government keeps a сlose eye on money-laundering and other criminal activities. The so-called “crypto clean-up” operation is in force - recently the Alabama SEC prohibited five ICO suspected foul play.
Donald Trump signed the Federal Act on Compulsory taxation for the cryptocurrency transactions two months ago. Even the one-time transaction from one customer to another is a subject to tax from now on.
But the Blockchain business running is the opposite in America: both technological projects and cryptomarkets and crypto ATMs and even hedge-funds investing in crypto are thriving in such conditions working well under the common economic law system.
The USA have good diversified and comfortable business infrastructure for the projects to run. Nevertheless, Singapore or Cayman islands are better place to issue tokens.
Singapore: the ICO support, bitcoins as goods and crypto sandbox
The Singapore jurisdiction alongside the Swiss is crypto-friendly and promising. The Singapore government openly supports ICO and many projects from all over the world come here for tokens issuance. First, they develop in MAS department for High-Tech projects (with 6 months no license running and other features). Then they come out on the open market with soft laws.
The Singapore IRS determines bitcoins and altcoins as goods and apply appropriate legislation and taxes to them. Tokens of the investment fund or any other system that distributes profits are defined as a security.
The supervisory authorities monitor the cryptocurrency preventing money laundering and financing of terrorist organizations. These are things covered by the legislation on cryptocurrency in Singapore.
To register a limited liability company in Singapore and run for a year will cost $4000 minimum. Singapore tax treatment is comfortable - for example, there is no capital gains tax. If tokens rise up in price 5 times during ICO Singapore tax men won’t show up and make the trader pay extra.
However, the laws will see further development in near future: crypto projects holding tokens as a security will feel less comfortable. Other coins will be stable in crypto-friendly Singapore.
Great Britain: pay taxes and relax
Prudish English lawmakers react on cryptocurrencies with great dignity: they pretend to ignore it. Even if the British financial legislation is reasonable and logical, and the business system in Foggy Albion is trustworthy, many cryptocurrencies still have no legal status. Great Britain is one of the countries where cryptocurrency is like a complex digital code to legislation authorities. It is like the pound sterling would be defined in the Constitution as a piece of paper of n square cm with the picture of Her Majesty. Only the tax services, who calculate taxes for cryptocompanies according to their financial statements, made an attempt of official definition for the cryptocurrency.
It is comfortable to work here: well-developed bank system, working business incubators and Blockchain friendly government. But it is better to run ICO outside the Kingdom: sooner or later their government adopt a bunch of bills on cryptocurrency exchange and who knows how it will turn out for the tokens issued in Britain.
Switzerland: Singaporish but more expensive
The Blockchain is widespread here. The cryptocurrency and ICO status is worked out in detail like nowhere else in the world and there is the Crypto Valley for projects in Canton of Zug where Ethereum, Cosmos Network and 200 more crypto companies established their HQs. Zug proposed to be the world capital of cryptocurrency. People can pay for utilities with cryptocurrencies there.
Cryptocurrency in Switzerland is defined as a security or an asset. During ICO the regulator divides the coins into three categories: cash, utility tokens and token assets. The cash is regulated by the law on illegal transactions in currency and money laundering, ICO of token assets - by the law on Securities and Stock Market.
It is easier to register the “non-profit organization” which will cover the ICO, token management functions and in addition, the technology company management due to the difficulties in Switzerland’s licensing legislation and the high-cost operations. Etherium developed that way.
Low taxes, a stable banking system, the government open to cooperate - all that makes Switzerland a comfortable place for crypto business. But the launch is pretty expensive.
Few of start-ups can afford to register and run their business in Zug: they should open the official residence, introduce the Swiss resident or citizen to the Board of Directors, open the bank account and pay the state fees. No less than $50 000 per year for all expenses.
Japan: a sharp katana of the law
In April 2017 the cryptocurrency was formally recognized as a legal way of payment. Now crypto markets are responding to the Financial Services Agency according to the law. All cryptocurrency operations are officially taxable for some years.
To open the company which makes any transaction with cryptocurrency in Japan you should reserve no less than $100 000, make an external audit and get the license for $300 000. In case of license rejection money are non-refundable.
Local regulators are not so friendly here. They close markets, adopt unpopular and strict laws. Yakuzas cry, honest samurais obey the law, and those who can afford it, quickly leave for Singapore, which is quite close, to run the ICO.
All anonymous cryptocurrencies have become illegal to use since the 18th of June. The Japan Financial Security Agency tries to give no freedom for the fraud and launched the delisting of such big companies as Monero, Dash and ZCash within the local markets.
Russia: out of the dusk into the fog
Russia was considered to be a relatively safe country for ICO because the cryptocurrency was in the grey zone regarding the law. Two years ago the Central Bank of Russia claimed the bitcoin never to be the payment method, the cryptomarkets to be the financial pyramid and warned of the risk to be cheated in fraud schemes.
Today the State Duma is trying to comprehend practice into the law, but with very limited success. There is no clear definition for the cryptocurrency in the highly discussed draft law. The requirement for mandatory personal identification involved in transactions with coins kills the idea of anonymity. People can exchange digital assets only in rubles and foreign currency but not in any other coins and open the e-wallet only via Russian provider.
There are no smart contracts and cryptocurrency fund-raising in the draft law: there is no information about transferring the cryptocurrency in tokens. The new Russian law to be signed can kill the idea of ICO in this country.
There is no law that can solve the problem of accounting and tax issues of digital assets in the country, although Russian tax authorities try their best at getting things organized and taking the profit from crypto companies.
The draft law takes the crypto business in our country out of the grey zone but gives no appropriate answer to any question occurring in trading on the crypto market.
From small Cayman islands to Cyprus, from Korea to Canada, from Chile to Germany - today we observe an interesting process of cryptocurrency and ICO legalization everywhere. We wonder what result we will see and whether the world regulatory system will be able to put everything in order on cryptomarket and make it easy-to-trade on.
The bitcoin cannot be totally forbidden, otherwise, all countries have to negotiate and develop a common regulatory paper. There was no evidence of such unity since the First World War. That’s why the bitcoin has put down its roots for a good long while.
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Coinbase Joins CFTC & Bitcoin ETFs Withdrawn TGOC

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