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With SEC Battles Brewing, What is the Path Forward for Crypto Regulations?

In light of Kik’s recent announcement of a crowdfunding campaign to bring about a new Howey Test for cryptocurrencies as well as a statement from SEC Director of Corporation Finance William Hinman regarding the possibility of ICOs being eligible for relief from enforcement, regulatory confusion abounds. What is clear is that regulations are suffocating development […]

The post With SEC Battles Brewing, What is the Path Forward for Crypto Regulations? appeared first on CryptoNewsReview.

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In light of Kik’s recent announcement of a crowdfunding campaign to bring about a new Howey Test for cryptocurrencies as well as a statement from SEC Director of Corporation Finance William Hinman regarding the possibility of ICOs being eligible for relief from enforcement, regulatory confusion abounds. What is clear is that regulations are suffocating development of crypto platforms and ambiguity only makes the situation worse. The question remains: what is the path forward for crypto regulations and how does the blockchain community arrive at an answer?

Here’s What We Know from the SEC

The SEC released a Framework for “Investment Contract” Analysis of Digital Assets that was to supposedly provide clarity as to how token projects would be evaluated. The problem is that according to this framework, just about any token should be categorized as a security. Circle reacted to this in a Medium blog post as follows:

“Since every project is likely triggering one of the factors [listed in the SEC framework], no project — and no exchange that decides to list the project’s tokens — can rely on the guidance to reduce the risk of enforcement. The foreseeable consequence of this is chilling innovation in the U.S. and nudging crypto projects toward jurisdictions with greater regulatory clarity — neither of which is good for U.S. business.”

Other leaders of token projects are feeling justifiably boxed-in by the SEC’s framework as well. It doesn’t seem right for every token to automatically be considered a security. Afterall, currencies such as USD are not securities. Hotel reward points are not securities. Virtual monies in games are not securities. The list goes on.

If we are to read into Hinman’s recent comments at the SEC’s FinTech Forum in Washington, D.C., we could interpret that perhaps the agency realized its error and is attempting to provide hope. Pointing to TurnKey Jets as an example of a project that secured a no-action letter, Hinman said, “even if some aspect of the project was not fully developed, the SEC may have still been willing to provide no-action relief.” Though his comment suggests that the SEC could be forgiving when it comes to evaluating crypto projects whose tokens initially appeared to be an investment contract before evolving into a token with a true use case, most token projects will be hesitant to take the SEC’s word for it.

So, What are Token Projects to Do?

The continued lack of clarity as to how token projects will be categorized by the SEC lead Kik to take drastic measures. The messaging app that raised $98 million in its 2017 ICO received a notice warning that the agency may seek enforcement action and now faces a lawsuit. Kik responded by initiating a campaign to crowdfund $5 million in crypto to fight the SEC in court, ideally resulting in the creation of a new Howey Test for cryptocurrencies. Though the optics of a project that already raised nearly $100 million now asking for more money to fight its own legal battles are a bit dubious, many token projects agree that something needs to be done.

Circle’s team believes, “Congress must pass laws to seize the unique opportunities created by the innovations in crypto and blockchain technologies and businesses.” The company and industry partners support “the Token Taxonomy Act, which among other things would exclude digital tokens from the definition of a security.”

To the positive, Montana passed a bill to exempt utility tokens from securities laws this May; hopefully other states may look to Big Sky Country as an example. Most important for the token economy is that the innovative spirit that brought bitcoin, ethereum, and so many other revolutionary concepts to life will not be held back by the bureaucracy’s lack of understanding and appreciation for the values of decentralization.

Contributed article by Gov van Ek, Co-founder of BitCar

Source: https://cryptonewsreview.com/with-sec-battles-brewing-what-is-the-path-forward-for-crypto-regulations/

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BTG Pactual becomes first bank in Brazil to participate directly in the crypto market

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Financial institutions have been increasingly keen on being part of the booming $2 trillion cryptocurrency market, with over 13 of the world’s largest banks pushing roughly $3 billion in funding so far, into cryptocurrency. The latest major news came from Brazil.

One of the leading Brazilian investment banks BTG Pactual has been trending within the crypto community. It launched a new platform enabling customers to make direct investments in cryptocurrencies. Ergo, making it the first major financial institution in Brazil to participate directly in the crypto market.

According to local news outlet, The Rio Times,

“…the launch of Mynt, a platform that allows BTG Pactual Digital and BTG+ clients to trade directly, cryptocurrencies such as bitcoin and ether.”

Andre Porthilo, BTG Pactual’s head of digital assets, stated,

“At this first moment, we will have the two main assets of the market, but we will include other cryptos for trading over time. We will have a complete platform with blockchain-based assets.”

One thing that remained in common with different banks incorporating these tokens is the fact that they have been responding to “demand from our customers who wish to trade crypto.” This news is no different.

Plans

BTG Pactual CEO, Roberto Sallouti laid out his plan of action with this development. He opined, “As a new asset class, we will also have content to educate and inform our customers about these assets and the technology.”

Needless to say, Brazil has witnessed an immense amount of crypto traction. That said, regulators too have taken steps to curb illicit activities. As asserted by the CEO, the said bank will be regulated by both the Brazilian Securities Commission and the local central bank. Moreover,

“With the support of BTG Pactual, Mynt has fundamental differentials in security and credibility…”

Past

The said bank had previously incorporated digital assets in previous operations as well. In 2019, it launched its real estate-backed security token ReitBZ. This step was executed post-examining digital assets for a couple of years. Just recently, the bank announced collaboration with Gemini, the U.S.-based crypto exchange. Gemini provided custody services to the first Bitcoin fund issued by a Brazilian investment bank.

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Source: https://ambcrypto.com/btgpactual-becomes-first-bank-in-brazil-to-participate-directly-in-the-crypto-market

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Basel Committee Crypto Rules Face Backlash

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The information on or accessed through this website is obtained from independent sources we believe to be accurate and reliable, but Decentral Media, Inc. makes no representation or warranty as to the timeliness, completeness, or accuracy of any information on or accessed through this website. Decentral Media, Inc. is not an investment advisor. We do not give personalized investment advice or other financial advice. The information on this website is subject to change without notice. Some or all of the information on this website may become outdated, or it may be or become incomplete or inaccurate. We may, but are not obligated to, update any outdated, incomplete, or inaccurate information.

You should never make an investment decision on an ICO, IEO, or other investment based on the information on this website, and you should never interpret or otherwise rely on any of the information on this website as investment advice. We strongly recommend that you consult a licensed investment advisor or other qualified financial professional if you are seeking investment advice on an ICO, IEO, or other investment. We do not accept compensation in any form for analyzing or reporting on any ICO, IEO, cryptocurrency, currency, tokenized sales, securities, or commodities.

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Source: https://cryptobriefing.com/basel-committee-crypto-rules-face-backlash/?utm_source=main_feed&utm_medium=rss

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Ethereum NFT Game Sorare Fantasy Soccer Raised $680 Million

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Ethereum NFT game Sorare fantasy soccer just raised $680 million and it is now valued at $4.3 billion while launching a US office so let’s read more today in our latest Ethereum news.

The Ethereum NFT game Sorare fantasy soccer raised $680 million and the french startup now plans to expand into other sports as well as to onboard women’s soccer teams and US office. Sorare is an Ethereum-based fantasy soccer game based on NFT trading cards and grew dramatically in 2021 with a rising base and huge trading volume not to mention the new licensed teams in the mix. Today, however, the startup is using the momentum with the announcement of a new funding round.

NFT Game Founder, scammer, eth, cryptopunks

The $680 million Series B round values the company at $4.3 billion after a $50 million Series A round which was announced back in February and the new series was led by Japanese tech and investment conglomerate SoftBank that has a number of crypto industry dealings through SBI holdings financial services division. Sorare is focused on soccer with players from more than 175 licensed clubs like FC Barcelona, Juventus FC, and Paris Saint Germain FC as some of the most popular. Nicolas Julia, the co-founder and CEO of Sorare said that this week the company plans to expand into other sports and it will open a US-based office in the upcoming months to help “continue to grow with fans and sports leagues.” He continued:

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“We have ambitious plans to keep growing Sorare into a sports entertainment giant. The new funding will be used to help us continue to grow a world-class team, expand to new leagues and new sports, and keep improving our experience for users, including shipping a mobile app.”

nba top shot

Dapper Labs’ NBA Top Shot is similar to Sorare, built around NFTs and based on professional athletes. An NFT acts like a deed of ownership to a scarce digital item so in the case of Sorare, it’s a digital trading card that can be purchased and resold with each available in limited quantity. One NFT card can even reach $290,000. Unlike Top Shot, however, Sorare has an ongoing game component and is similar to other fantasy sports in that you can choose your top players each week as well as the leagues with other users. Sorare also has close ties with Ubisoft as it took the accelerator program this year.

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Source: https://www.dcforecasts.com/ethereum-news/ethereum-nft-game-sorare-fantasy-soccer-raised-680-million/

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