Category: General Developments/Background

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Blockchain Week in Review: Week of March 11-15, 2019

U.S. Developments Regulatory Updates SEC Chairman Clayton Explains that an Asset Can Lose Its Status of Being Labeled a Security U.S. Securities and Exchange Commission (“SEC”) Chairman Jay Clayton appears to have confirmed SEC-staff analysis of the classification of decentralized digital assets.  Last year, SEC Director of Corporation Finance William Hinman said during a speech … Continue Reading

Blockchain Week in Review: Week of March 4-8, 2019

U.S. Developments Denver to Implement Blockchain-Based Elections for Overseas Voters Denver moves to become the second U.S. jurisdiction to implement a blockchain-based voting system for overseas voters. Active duty military and other eligible overseas voters will be able to use a mobile phone application in the next election to cast their vote on municipal issues. … Continue Reading

Blockchain Week in Review: Week of February 25 – March 1, 2019

U.S. Developments Regulatory Updates CFTC Plans Public Meeting Addressing Fintech, Including Blockchain Technology On March 27, 2019, the Commodity Futures Trading Commission (CFTC) Technology Advisory Committee will host a public meeting  at the CFTC headquarters in Washington, DC. The Technology Advisory Committee plans to use the meeting to listen to presentations and consider actionable recommendations … Continue Reading

Blockchain Week in Review: Week of February 18-22, 2019

U.S. Developments Regulatory Updates SEC Settles Enforcement Action with Gladius Network On February 20, 2019, the U.S. Securities and Exchange Commission (“SEC”) announced the settlement of charges against Gladius Network LLC (“Gladius”) for conducting an unregistered securities offering.  Gladius conducted a presale and public sale of digital tokens called “GLA” in late 2017, raising approximately … Continue Reading

Blockchain Week in Review: Week of February 11-15, 2019

U.S. Developments Regulatory Updates SEC Commissioner Peirce Says Guidance on Crypto Token Sales Is Coming In a speech at the University of Missouri School of Law, Hester Peirce, one of the SEC’s commissioners, said that the agency is working on “supplemental guidance” to help projects determine when securities laws might apply to crypto token sales. … Continue Reading

Blockchain Attacks and the Fight for Immutability

The Ethereum Classic blockchain was the victim of a 51% attack (often called a majority or Sybil attack) last month that reorganized portions of the blockchain and allowed the attackers to double-spend 219,500 ETC ($1.1 million). As a result of this attack, and similar majority attacks over the past year, the concept of immutability within … Continue Reading

Blockchain Week in Review: Week of February 4-8, 2019

U.S. Developments Florida Court of Appeals Rules That Direct Sales of Bitcoin Constituted Money Transmission and the Sale of Payment Instruments Reversing the order issued by the Miami-Dade County Circuit Court, the Florida Court of Appeals issued an opinion on January 30 in the case of Florida v. Espinoza in which the appellate court ruled … Continue Reading

Fintech Regulatory Sandboxes: Update on Arizona’s Sandbox and Other Developments

Arizona’s financial technology (“fintech”) sandbox (“Sandbox”), the first of its kind in the United States, has been open for several months and has accepted three participants.  A month after the program’s launch, Arizona’s Attorney General announced his approval of the first participant, payment platform Omni Mobile, Inc.[1]  Two other companies providing consumer lending services, Sweetbridge … Continue Reading

Blockchain Week in Review: Week of January 28 – February 1, 2019

U.S. Developments Kik Publicizes Response to Possible SEC Enforcement On January 27, the Wall Street Journal published an article describing the impending legal battle over cryptocurrency Kin and its 2017 ICO. That same day, Ted Livingston, the founder and CEO of Canadian company Kik Interactive (Kik) and the developer behind Kin, published the Wells Notice … Continue Reading

Blockchain Week in Review: Week of January 21-25, 2019

U.S. Developments Cboe Withdraws and Then Submits a Proposed Rulemaking for a Bitcoin ETF On January 22, 2019, Cboe BZX Exchange (Cboe) withdrew its proposed rulemaking with the U.S. Securities and Exchange Commission (SEC).  Had the proposal been approved, Cboe would have been allowed to list shares of bitcoin electronically-traded funds (ETFs) backed by VanEck … Continue Reading

Blockchain Week in Review: Week of January 14-18, 2019

U.S. Developments  Flood of State Virtual Currency Legislation Since the start of the new year there have been roughly nine virtual currency bills introduced or passed in four different states. Overall, the bills demonstrate a growing interest among the states in supporting virtual currency businesses through the codification of blockchain terminology for legal effect or … Continue Reading

Blockchain Week in Review: Week of January 7-11, 2019

U.S. Developments Regulatory Updates Texas Clarifies that Stablecoins Backed by Sovereign Currency Qualify as “Money” Under Money Transmission Statute The Texas Department of Banking recently issued a Supervisory Memorandum clarifying how its money transmission statute applies to stablecoins backed by sovereign currency. The Department reiterated—consistent with its 2014 guidance—that Texas’s money transmission statute only regulates … Continue Reading

Takeaways on the Regulation of Crypto Assets from Late 2018 Comments of Several SEC Officials

On Wednesday, December 12, 2018, the D.C. Bar hosted a panel to discuss current developments in the world of crypto.  Among the panelists were two senior SEC officers: Jonathan Ingram, Deputy Chief Counsel, Division of Corporation Finance, and Jennifer Leete, Assistant Director, Division of Enforcement.  Also participating on the panel was Era Anagnosti, a former … Continue Reading

Blockchain Week in Review: Week of December 21-27, 2018

U.S. Developments Congressmen Introduce Legislation to Define “Digital Token” Under the Securities Laws On December 20, 2018, two congressmen introduced the “Token Taxonomy Act” (H.R. 7356) before the 115th Congress in an effort to define “digital token” under the federal securities laws.  H.R. 7356 was introduced by Rep. Warren Davidson (R-Ohio) and Rep. Darren Soto … Continue Reading

French Data Protection Authority Issues Guidance on Application of Blockchain to the GDPR

On September 24, 2018, the French data protection authority, Commission Nationale de l’Informatique et des Libertés (CNIL), became the first data protection authority to issue written guidance on the intersection of the use of blockchain technology and the General Data Protection Regulation (GDPR).  Due to the decentralized and permanent nature of the blockchain, there is … Continue Reading

Blockchain Week in Review: Week of December 3-7, 2018

U.S. Developments SEC Remarks on International Virtual Currency Enforcement On December 5, 2018, Steven Peikin, Co-Director of the Division of Enforcement at the U.S. Securities and Exchange Commission (“SEC”), gave a speech at the IOSCO/PIFS-Harvard Law School Global Certificate Program for Regulators of Securities Markets on the topic of international cooperation in the enforcement of … Continue Reading

Treasury Identifies Iranian Nationals and Their Digital Currency Addresses Used to Facilitate Ransomware Attacks

On November 28, 2018, the U.S. Department of Treasury’s Office of Foreign Assets Control (OFAC), announced an action against two Iranian citizens, Ali Khorashadizadeh and Mohammad Ghorbaniyan, who facilitated the exchange of bitcoin ransom payments on behalf of Iranian malicious cyber actors.  This client update provides an overview of the OFAC action and identifies certain … Continue Reading

2018 Recap: Tokens, Coins, Cryptocurrencies, and Other Digital Assets under the Federal Securities Laws

The following was posted on the Perkins Coie’s Asset Management ADVocate, to read the full post, please click here. 2018 Recap: Tokens, Coins, Cryptocurrencies, and Other Digital Assets under the Federal Securities Laws By Michael S. Didiuk on November 13, 2018 Posted in Compliance In this post we discuss where things stand regarding the treatment … Continue Reading

EtherDelta Founder Sanctioned for Operating an Unregistered Securities Exchange

The following was posted on the Perkins Coie’s Asset Management ADVocate, to read the full post, please click here. EtherDelta Founder Sanctioned for Operating an Unregistered Securities Exchange By Michael S. Didiuk and Conor O’Hanlon on November 9, 2018 Posted in Compliance In this post we discuss how on November 8, the SEC announced an … Continue Reading

2017 Recap: Tokens, Coins, Cryptocurrencies, and Other Digital Assets under the Federal Securities Laws – Facts and Circumstances

The following was posted on the Perkins Coie’s Asset Management ADVocate, to read the full post, please click here. 2017 Recap: Tokens, Coins, Cryptocurrencies, and Other Digital Assets under the Federal Securities Laws – Facts and Circumstances By Michael S. Didiuk on November 12, 2018 This post focuses on the Securities and Exchange Commission’s (“SEC”) … Continue Reading

Blockchain Week in Review: Week of October 22-26, 2018

U.S. Developments Regulatory Updates FATF Issues Virtual Currency Guidance On October 19, the Financial Action Task Force (“FATF”) published the outcomes of its Plenary meeting.  Included in the outcomes of the meeting were new recommendations related to the regulation of virtual currency (the “2018 Virtual Currency Recommendations”).  In addition to the 2018 Virtual Currency Recommendations, … Continue Reading

Chinese Court Recognizes Blockchain-Verified Evidence for the First Time

On June 27, 2018, the Chinese Hangzhou Internet Court announced its decision on a case regarding the infringement of the right of communication through an information network. In a first for Chinese courts, the court accepted electronic data that was stored using blockchain technology as legal evidence. The court also clarified the examination standards for … Continue Reading

SEC Launches FinHub for Engaging with Fintech and Blockchain Companies

On October 18, 2018, the U.S. Securities and Exchange Commission (SEC), announced the launch of the agency’s Strategic Hub for Innovation and Financial Technology (FinHub).[1]  FinHub is a resource for industry engagement between financial technology companies (fintechs), market participants, the public, and the SEC.  This client update provides a high-level overview of the FinHub initiative … Continue Reading

FinCEN Advisory Emphasizes Importance of U.S.-Iran Sanctions and AML/CFT Compliance for Virtual Currency Businesses

On October 11, 2018, the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) released an advisory (the Advisory) intended to help money services businesses (MSBs) and foreign financial institutions better understand how U.S. sanctions on Iran affect their compliance obligations under the Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT) rules and under the … Continue Reading
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