Recently there have been a few states that are rolling out positive laws and relaxed regulation around blockchain technology. One of the states leading the pack is Arizona. On April 10th 2018, the Senate passed HB 2601, a bill that expands Arizona’s crowdfunding exemption and defines the difference between a Security Token and Utility Token.
The bill was introduced by Representative Jeff Weninger who has committed a lot of his work recently to bills relating to blockchain and cryptocurrencies. Recently he introduced HB 2434, a bill that created the first ever Fintech Sandbox in the United States, allowing for startups, entrepreneurs and established companies to experiment with products, services, business models and delivery mechanisms without running up costs associated with regulation and obsolete laws.
The new crowdfunding exemption bill aims at placing Arizona as a competitive state for blockchain innovation. The bill defines a security exemption for “crowdfunding” or “virtual coin offerings” wherein the offering qualifies as an intrastate offering. This means that the exemption only qualifies for offerings made in the state of Arizona for Arizona residents. In addition, a purchaser engaging in an intrastate offering that complies with these provisions is not considered an underwriter unless the purchaser purchases more than 50% of the securities or virtual coins offered for sale in the offering.
The bill distinguishes the differences between a Security Token and a Utility Token. If the token is to be used to facilitate a transaction within 90 days it is exempt from being labeled as a Security and is then defined as a Utility Token exempt from securities law.
The bill is very similar to the recent house bill introduced in Wyoming, HB 0070, which grants exemptions to utility tokens in the state as well reading that “a person who develops, sells or facilitates the exchange of an open blockchain token is not subject to specified securities and money transmission laws”.
Both the Arizona bill and Wyoming bill are very different than the way the SEC looks at initial coin offerings. Chairman of the SEC, Jay Clayton, stated during a Senate hearing in February, “I believe every ICO I’ve seen is a security” but has also maintained a position of viewing blockchain technology and cryptocurrency as an innovation that shouldn’t be stifled.
Weninger’s bill has passed through the Arizona Senate and made its way to Governor Doug Ducey’s desk where it awaits his signature into law as of April 10th.
Digital Day 2018 Leads to European Blockchain Partnership
Digital Day 2018 in Brussels, Belgium was highlighted by the new agreement between 22 European countries to make better blockchain regulation. The partnership will allow member states to exchange both experience and expertise in technical and regulatory fields.
This cooperation is a follow up to the Digital Single Market initiative which began in early 2015. The project was notably re-evaluated and revamped around Digital Day 2017 in Rome. Essentially, the initiative is to create a more singular and regulated experience for all Europeans across the web. Their three key figures are to improve access, environment, and economy in order to maximize the public and private sectors of internet usage.
The official press release from the European Commision stresses the applications of blockchain in the financial sector. It calls blockchain a “technology for promoting user trust” through its various uses like a distributed ledger, smart contracts, and even as a payment system.
The Commissioner for Digital Economy and Society, Mariya Gabriel, was excited to present the partnership. She gave a brief speech where she was quoted:
“In the future, all public services will use blockchain technology. Blockchain is a great opportunity for Europe and Member States to rethink their information systems, to promote user trust and the protection of personal data, to help create new business opportunities and to establish new areas of leadership, benefiting citizens, public services and companies. The Partnership launched today enables Member States to work together with the European Commission to turn the enormous potential of blockchain technology into better services for citizens.”
Perhaps the greatest part of this cooperation is the united approach to regulation. With so many countries unsure of how to tackle regulating blockchain technologies, it is highly possible that a fragmented ecosystem may be the result. By joining together, and inviting all of Europe, they can create policies that are accepted across the board. It will also make it that much easier for new blockchain startups to meet a standardized level of compliance.
The 22 countries have joined together for the mass adoption of blockchain technologies in Europe. The official name of the group is the European Blockchain Partnership. Right now it consists of the following countries: Austria, Belgium, Bulgaria, Czech Republic, Estonia, Finland, France, Germany, Ireland, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Norway, Poland, Portugal, Slovakia, Slovenia, Spain, Sweden, and the United Kingdom. However, other countries, members of European Union and of the European Economic Areas are invited to join the European Blockchain Partnership.
The Complete List of Banks That Have Banned Crypto
Last Updated: April 10, 2018
It seems like everyday another bank decides to ban its users from purchasing cryptocurrency. Bans can vary based on the bank. Some banks only ban credit card purchases, others take it a step further and ban debit card purchases. If you’re looking for a bank that will allow you the freedom of investing in cryptocurrency and blockchain projects, we’ve developed a list of all banks that allow crypto purchases and ban crypto purchases.
Bank of America
Bank of America has banned all crypto purchases with credit cards. Their policy currently applies to all business and personal credit cards, but debit cards and ATM cards are not yet effected. The bank has cited anti-money laundering regulations as well as the potential for thieves to convert stolen credit cards into cryptocurrency. They also consider crypto a “material risk to its business”.
Discover Card banned its cards from being used on crypto exchanges. CEO David Nelms’ reason: “It’s crooks that are trying to get money out of China or wherever. Or if someone steals our credit card numbers they’re going to ask for payments in Bitcoin. Those are the only use cases I’m actually seeing today.”
Capital One banned all crypto related purchases with credit cards. The ban began on January 12, 2018 and the bank cited “escalating fraudulent charges and customer complaints” and blacklisted Coinbase and other cryptocurrency exchanges. This was mainly in response to thieves stealing credit card numbers and buying crypto with the cards in order to launder money.
Citigroup has banned all crypto related purchases with credit cards. Company spokeswoman Jennifer Bombardier was quoted as saying “we will continue to review our policy as this market evolves,” providing hope that Citigroup could reverse its decision someday.
JP Morgan Chase
JP Morgan Chase banned all crypto related purchases with credit cards. On January 25, 2018, they started reviewing their policies on credit card purchases of crypto. About a week later, they announced the ban stating that “volatility and risk” led them to the decision. They too have promised a continued review as the market evolves.
Loyds Banking Group has banned its customers from using credit cards in cryptocurrency transactions. They will use an online blacklist that will flag sellers. Debit card transactions are still allowed.
Loyd’s Bank Group is the largest bank in the UK, it’s subsidiaries include:
- Bank of Scottland
This policy applies to all subsidiaries.
After an internal review of their policies, Virgin Money has banned all credit cards from cryptocurrency transactions.
Bank of Montreal has put a full ban on its customers buying cryptocurrency. Their ban includes credit cards, debit cards and Intrac online payment. The decision was made out of fear for the volatile nature of cryptocurrencies. BMO is providing banking services to an upcoming cryptocurrency brokerage, meaning as of right now they are involved in the crypto market while blocking their clients from getting involved.
Royal Bank of Canada
Canada’s second-largest bank has not enacted a full ban, but they are restricting cryptocurrency transactions and only allowing them “in limited circumstances”.
Toronto-Dominion Bank has banned cryptocurrency transactions with credit cards while they conduct a review of the market. A spokesperson told The Globe and Mail: “At TD, we regularly evaluate our policies and security measures, in order to serve and protect our customers, as well as the bank.”
We will continue to update this list as more banks come to decisions on cryptocurrency.
“Spain Is Ready For A Digital Economy” – Spanish Minister of Economy Says Cryptocurrencies Are Not A Threat
“Spain Is Ready For A Digital Economy” – Spanish Minister of Economy Says Cryptocurrencies Are Not A Threat
The G20 summit recently took place this week in Argentina which was one of the most anticipated G20 summits to date thanks to the building uncertainty and suspense around what the sentiment would be like for cryptocurrencies and their regulation.
Roman Escolano Olivares, the Spanish Minister of Economy, broke the tension by stating that not only is Spain and the EU ready for a digital economy, but that they may not be patient enough for other global players to agree on a single coordinated consensus of regulation.
“Spain immediately joins the statements of other European colleagues and we want to move forward without the need to wait for a global agreement. There are huge income distribution problems and the new digital economy can greatly help countries in combating this problem. “
One of the hot topics of the G20 summit was regulation on cryptocurrencies. As the industry matures, regulation is slowly becoming more and more welcomed by the blockchain community as it seems to be a necessary step in order for mainstream adoption to take place.
With that said, cryptocurrency and blockchain heads alike are very weary of this regulation, and think that lawmakers are on thin ice. The general consensus in the community seems to be that regulation to an extent is welcomed in order to mitigate the scams and promote easier mainstream adoption, however the thin line can very easily be crossed if it seems like lawmakers are trying to force cryptocurrencies into centralization.
This will all come down to how the big players view cryptocurrencies, and whether they think of it as a threat or not. The Spanish minister again provided bullish comments by adding:
“The general agreement we have reached, is that right now we cannot think that crypto-assets are a risk to global financial stability, but it’s a subject we need to actively monitor.”
The overall sentiment was extremely positive and should be a welcomed sign of relief for cryptocurrency enthusiasts around the world. If regulation is approached the right way (carefully and quantitatively), it could be the final bolster crypto needs to go mainstream.