Australia’s Major Banks Decide Against Bitcoin Buying Ban

Australia’s major banks, ANZ, NAB, and Westpac, confirmed they have no plans to ban customers from purchasing Bitcoin or other cryptocurrencies. This is a different approach than that of UK-based Lloyds Banking Group, and US banks JP Morgan, Bank of America and Citi.

Previously, large banks around the world decided to ban customers from using credit cards to purchase crypto in an effort to defray the potential cost of defaulted debt should markets crash.

ANZ told ABC the bank “does not prohibit customers buying digital or cryptocurrencies, or accepting them as a form of payment.” Despite that fact, the bank does monitor transactions for suspicious or fraudulent activity.

Westpac simply has no restrictions regarding cryptocurrency purchases at this time.

As for National Australia Bank, a spokesperson said, ”ASIC advises that, as most of the virtual currency exchange platforms are generally not regulated, customers may not be protected or have any legal recourse if the platform fails or is hacked.” Because of that, occasionally card transactions are denied if the bank feels the customer is at risk of fraud.

Some people wonder if these recent bank policies are truly for customer protection. In fact, it’s possible that banks are trying to keep themselves in business as cryptocurrency threatens to make them obsolete. Even so, banks are unable to stem the flow of money into the crypto marketplaces as people rush to get in on the wave of the future.

 

Can Crypto Self Regulate? CTFC Commissioner Wants Industry To Try

No doubt, Crypto regulations are here to stay. Now it’s a question of who will create the governing rules?

At yesterday’s Senate hearing, details about how and why crypto regulation is necessary were discussed at length. Overall, the tone of the hearings was cautiously optimistic, which is reasonably good news for investors and those considering investing.

After the hearing, Brian Quintenz, a member of the Commodity Futures Trading Commission suggested perhaps the industry could and should regulate itself.

On Tuesday at a cryptocurrency event in New York, Quintenz pointed out, ”One of the other takeaways from yesterday was you didn’t hear either chairman say ‘no, absolutely not, this is not safe, we must stop this at all costs.’ No one said that.”

The reason Quintenz and others felt that the industry should self-regulate is due to the nature of how long passing and enacting new regulations about cryptocurrency in the U.S. will take. That, combined with the fact that the market is worldwide, means that digital currencies might do well in self-regulating ahead of government regulations. In that way, they can help set the framework for possible future laws surrounding the new technology.

Adam White, the general manager of the Coinbase’s GDAX, also said that the group plans to be open to working with the government on the issue. He said, ”I think we embrace regulation at Coinbase. We recognize that regulations are a complementary part of the financial system in many ways.”

Others in the marketplace also embrace regulation like Ripple andBitPesa.

Ultimately, investors shouldn’t fear regulation, and instead, they should seek to back entities and cryptocurrencies who openly work with governments for realistic regulation as the entire system moves forward and grows.

 

 

Hong Kong To Delist ICO Tokens Deemed Securities

Hong Kong made strong moves to step up regulation on initial coin offerings (ICOs), which it deems securities.

Hong Kong’s Securities and Futures Commission (SFC) released a statement revealing it sent warnings to seven exchanges that were based in or strongly connected with Hong Kong warning them to delist tokens affiliated with ICOs.

According to Coindesk, the move was part of a larger push for the SFC to warn consumers about the risks of cryptocurrency investing.

The statement said, ”Most of these cryptocurrency exchanges either confirmed that they did not provide trading services for such cryptocurrencies or took immediate rectification measures, including removing relevant cryptocurrencies from their platforms.”

In addition to the exchanges, the SFC also contacted seven ICO organizers who are soliciting investments using coins the commission considers to be securities.

Ashley Alder, the SFC’s Chief Executive Officer said, “We will continue to police the market and enforce when necessary. But we are also urging market professionals to do proper gatekeeping to prevent frauds or dubious fundraising and to assist us in ensuring compliance with the law.”

It looks like, at least in Hong Kong, that ICOs fall under securities regulations, and will have to operate as such. ICOs are also seen as securities in many other places throughout the world although many investors enjoy them as a way to grow their crypto portfolios while supporting ideas and technologies they feel are strong.

Gibraltar To Create World’s First ICO Rules

While Initial Coin Offerings (ICOs) have caused issues around the world with government concerns about if they’re securities or not, Gibraltar announced it will create the world’s first set ICO rules.

According to a Reuters report, Gibraltar will introduce regulations for ICOs. Furthermore, these regulations could set the tone for what other countries throughout the world choose to do. So far, the U.S. applied existing securities rules to ICOs while China set a ban on ICOs.

The way an ICO works is that a company offers its tokens in exchange for cash or cryptocurrency investments. Traditional investing gathers funds in exchange for shares in the company as opposed to tokens, which are often called altcoins.

An incredibly popular way to fund ventures, ICOs raised $3.7 billion raised in 2017. This explosion in popularity caused governments and central banks became concerned about protecting ICOs investors.

The Government of Gibraltar along with Gibraltar Financial Services Commission (GFSC) will meet to draft a complete set of ICO guidelines. The regulations will cover the promotion, sale, and distribution of ICOs connected with the British territory.

Sian Jones, a senior adviser to the GFSC, said, “One of the key aspects of the token regulations is that we will be introducing the concept of regulating authorized sponsors who will be responsible for assuring compliance with disclosure and financial crime rules.”

Regulations establish disclosure rules so that anybody purchasing tokens will receive adequate and balanced information about the investment.

Other countries like Britain and Singapore look toward creating regulations for ICOs in the near future as well.

In many ways, clear regulations could relieve investors who have had the threat of bans or regulations lingering for months.

CFTC and SEC Warn Against Crypto Pump And Dump Scams On Social Media

Both the  Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC) warned against cryptocurrency pump and dump scams.

On Thursday, The CTFC issued a release detailing the possibility of scams with pumping and dumping coins. The released joined its earlier warning this month about investing in crypto retirement accounts, according to Coinbase. This warning comes after an earlier SEC warning of similar scams surrounding Initial Coin Offerings (ICOs).

The CTFC’s statement said, ”Customers should not purchase virtual currencies, digital coins, or tokens based on social media tips or sudden price spikes. Thoroughly research virtual currencies, digital coins, tokens, and the companies or entities behind them in order to separate hype from facts.”

This sage advice serves any crypto investor well. Typically you don’t know who’s behind a keyboard pumping something up online.

In its statement, the CTFC outlined how a scam of this type might look.

It wrote, “Some pump and dumps use false news reports, typically about a famous high-tech business leader or investor who plans to pour millions of dollars into a small, lesser-known virtual currency or coin. Other fake news stories have featured major retailers, banks, or credit card companies, announcing plans to partner with one virtual currency or another. Links to the phony stories are also accompanied by posts that create false urgency and tell readers to buy now.”

The good news is that although its scope is limited, the CTFC intends to seek out and stop those who use these types of methods.

Crypto Trading Ban? South Korea Minister Says They Won’t

Another day, another cryptocurrency dip based on a possible government ban or new regulation news.

A South Korea lawmaker question about the government’s plans for industry regulation sparked fears of an outright ban, which happened recently in China. However, the country’s finance minister soothed concerns of a ban.

According to Reuters, Kim Dong-yeon said, “there is no intention to ban or suppress cryptocurrency [market].” Instead, he clarified, “Regulating exchanges is [the government’s] immediate task.”

The country recently increased scrutiny of cryptocurrencies and added new rules that forbid the use of anonymous trading accounts, which means that users must become verified using their real names or face penalties for non-compliance.

Because South Korea is one of the world’s biggest bitcoin and altcoin trading markets, concerns of a ban led to a brief crypto selloff amid fears before the country moved to help calm the markets.

This type of near-daily volatility provides investors who can stomach steep drops an opportunity to buy low in hopes that prices stabilize and rise as government positions on crypto become clearer.

Misinterpreted Speech Leads To Bitcoin Selloff

Even something as minor as a misinterpretation of a government official’s speech is enough to spark a Bitcoin selloff these days.

India’s finance minister Arun Jaitley spoke to parliament on February 1, and he referred to cryptocurrency as an “illegitimate activities”  and promised a government crackdown, according to Coin Telegraph.

Jaitley said, “The government does not recognize cryptocurrency as legal tender or coin and will take all measures to eliminate the use of these cryptoassets in financing illegitimate activities or as part of the payments system.”

His comments were misinterpreted as an outright ban on crypto in India, which caused Bitcoin to fall below $9,226 on Thursday amid the uncertainty.

India’s leading Bitcoin company, Unicoin, tweeted that the announcement did not revise the government’s cryptocurrency stance.

Bitcoin interest in India remains high since the country reformed its currency. As for the government’s official policy on crypto, despite some warnings against it, nothing is formalized after two years of sporadic attempts.

Despite the misinterpretation of Jaitley’s statements, at this time, the government of India made no change in its policy regarding cryptocurrencies, which could mean a quick rebound in prices today.

U.K. Based Lloyds Banking Group Blocks Credit Card Bitcoin Purchases

In somewhat bad news for Bitcoin and the crypto market, U.K.’s Lloyds Banking Group barred customers from purchasing cryptocurrency using credit cards.

The bank joins U.S. financial firms Bank of America, Citigroup, JP Morgan, Capital One and Discover that recently announced similar bans.

According to a BBC report, this new ban hits 8 million credit card customers of Lloyds Bank, Bank of Scotland, Halifax and MBNA. The good news, however, is that customers may still use their debit cards for the transactions.

As of February 5, 2018, the entire crypto market is more than 50 percent lower than its all-time highs in early January 2018. The sharp decline could be what prompted the bank to make such a move in order to prevent its customers from accruing huge debts as losses mount.

In explanation, a Lloyds spokeswoman said: “We continually review our products and procedures and this is part of that.”

This change in policy joins other crypto policy changes in China where the government may prevent its citizens from investing in overseas exchanges for crypto trading.

Crypto Falls On News Of China Blocking Overseas Trading

News from Chinese government negatively affected crypto trading on Monday. Reports reveal that the government plans to block its citizens from accessing overseas exchanges.

According to a Coindesk report, this move is a further crackdown on policies that started about a year ago.

A Financial News report tied to China’s central bank said, ”To prevent financial risks, China will step up measures to remove any onshore or offshore platforms related to virtual currency trading or ICOs.”

Several months ago China formally banned ICOs as a form of illegal financing, and this latest crackdown further calls into question the state of crypto in China — one of the world’s largest markets.

The government is targeting offshore exchanges that cater to its citizens after it formally closed exchanges in China last fall.

Right now it’s unclear if this ban is temporary or permanent.

This news added with the additional bad news of major banks banning users from using credit cards to buy cryptocurrency, caused BTC prices to fall to under $7,400.

Crypto Collapse? Taiwan Official Warns Government To Prepare

While many in cryptocurrency for a while feel that the blockchain is here to stay, at least one Taiwan government official believes the recent meteoric rise combined with the sharp downturn in prices is a sign of an impending collapse.

Coindesk reports that  Shih Jun-ji, vice president of Taiwan’s executive branch of government, warned the government to prepare policies now in the event that the digital currency collapses completely.

Shih’s concern is that a collapse could lead to financial instability for Taiwan, and he wants to ensure that the government remains stable in case the entire marketplace crashes.

The reason for such concern is that when Bitcoin traded around $10,000 its market capitalization equaled $170 billion which is two times Taiwan’s budget and nearly all the total assets of all the banks in Taiwan combined.

While nobody knows for sure if crypto is in a bubble and if or when that bubble will pop, the currencies are incredibly volatile, and at least one government official wants Taiwan to prepare in advance should the worst occur.

Other countries are also looking at possible policies in the event of a complete bust.