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☆ Crypto insurer Evertas authorized to offer largest single crypto insurance policy
▼ + stars: | 2023-06-02 | by ( Gertrude Chavez-Dreyfuss | ) www.reuters.com time to read: +3 min

"This is the single largest policy that can be approved from one insurance company," Evertas chief executive officer J. Gdanski told Reuters. The $420 million coverage applies to crime-related policies involving the theft of private keys - or codes used to authorize transactions or prove ownership - held by a custodian. The previous single policy limit for Evertas was $5 million. Being a coverholder gave Evertas the authority to write crypto insurance on behalf of Arch, one of Lloyd's syndicate members, part of a group of insurance entities that band together to provide coverage for large risks. The London insurer has also authorized Evertas to provide insurance on crypto mining hardware of up to $200 million, also the largest single policy coverage, Gdanski said.

Persons: Evertas, J, Gdanski, Gertrude Chavez, Dreyfuss, Alden Bentley, Mark Potter Organizations: YORK, Insurance, Reuters, Evertas, Arch Capital, TRM Labs, Thomson Locations: London, Gdanski

☆ Cryptos have no intrinsic value and trading in them should be regulated like gambling, UK lawmakers say
▼ + stars: | 2023-05-17 | by ( Ryan Browne | ) www.cnbc.com time to read: +3 min

Trading in cryptocurrencies is akin to gambling and should be treated as such, British lawmakers said. Unbacked tokens like bitcoin and ether aren't underpinned by underlying assets and have "no intrinsic value," lawmakers on the U.K. Treasury Select Committee said in a report published Tuesday. The Treasury committee said it was concerned by government proposals to regulate consumer crypto trading as a financial service. This, lawmakers said, would create a "halo" effect that leads people to believe crypto trading is safe and protected, when this is not the case. Blair Halliday, U.K. managing director for top U.S. crypto exchange Kraken, said: "We fundamentally disagree with the Treasury Select Committee's conclusion that cryptoassets have no intrinsic value.

☆ EU states approve world's first comprehensive crypto rules
▼ + stars: | 2023-05-16 | by ( Huw Jones | ) www.reuters.com time to read: +2 min

(Reuters) - European Union states on Tuesday gave the final nod to the world’s first comprehensive set of rules to regulate cryptoassets on Tuesday, piling pressure on countries such as Britain and the United States to play catch up. REUTERS/Dado Ruvic/IllustrationAn EU finance minister meeting in Brussels approved rules that were thrashed out with the European Parliament, which gave its approval in April. Regulating crypto has become more urgent for regulators after the collapse of crypto exchange FTX. Crypto firms say they want certainty in regulation, putting pressure on countries to copy the EU rules, and on regulators to come up with global norms for a cross-border activity. The United States has focused on using existing securities rules for enforcement action in the sector while it decides on whether to introduce bespoke new rules and who would apply them.

☆ Global securities watchdog to propose rules for cryptoassets
▼ + stars: | 2023-05-16 | by ( ) www.reuters.com time to read: +2 min

LONDON, May 16 (Reuters) - Global regulators will shortly propose the first set of international rules for cryptoassets, including how existing norms could apply to the sector, a top regulator said on Tuesday. The European Union on Tuesday approved a first set of comprehensive rules, a step firms said would attract them to set up shop in the bloc. "Once finalised the recommendations will deliver a first globally coordinated set of rules for crypto-assets," Jean-Paul Servais, chair of global securities regulatory body IOSCO told an event held by the Managed Funds Association in Paris. IOSCO members, such as the U.S. Securities and Exchange Commission, Japan's Financial Services Authority and regulators in Britain, Germany and France commit to applying the body's recommendations. Servais, who also chairs Belgium's securities watchdog, also said that private finance will be a new priority for IOSCO's work this year.

☆ Crypto should be regulated as gambling, UK lawmakers say
▼ + stars: | 2023-05-16 | by ( Huw Jones | ) www.reuters.com time to read: +2 min

LONDON, May 17 (Reuters) - Bitcoin , ether and other cryptocurrencies should be regulated as gambling given they are potentially used by fraudsters and pose significant risks to consumers, a panel of UK lawmakers said in a report on Wednesday. Britain is planning its first rules for cryptoassets, which currently only comply with anti-money laundering safeguards. Around 10% of UK adults hold or have held cryptoassets, according to official figures. The European Union approved the world's first set of comprehensive rules for crypto markets on Tuesday. The underlying technology used by cryptoassets has the potential to improve efficiency in payments, the report said.

☆ EU Council adopts first legal framework to regulate crypto sector
▼ + stars: | 2023-05-16 | by ( ) www.reuters.com time to read: 1 min

BRUSSELS, May 16 (Reuters) - The European Council on Tuesday said it had adopted the world's first comprehensive set of rules for cryptoassets regulation (MiCa). MiCA, which was already approved by EU member states and the European parliament, requires crypto firms to be authorised by the EU to serve customers in the bloc, and to comply with safeguards against money laundering and terrorism financing. Reporting by Bart Meijer; Editing by Alex RichardsonOur Standards: The Thomson Reuters Trust Principles.

☆ Crypto firms call for global consensus instead of "fire hose" of rules
▼ + stars: | 2023-05-10 | by ( Huw Jones | ) www.reuters.com time to read: +2 min

Apart from compliance with rules to stop money laundering and terrorist financing, crypto firms are largely unregulated in many parts of the world. "If we built a good regulatory regime, people would come. We are shooting ourselves in the foot by not having a regulatory regime in the U.S.," Peirce said. U.S. Congress needed to decide which regulatory body has authority over crypto, Peirce added. Global standards and harmonisation as much as possible are key, said Sarah Pritchard, executive director for supervision at Britain's Financial Conduct Authority.

☆ Crypto must end anonymity for illicit finance, U.S. regulator says
▼ + stars: | 2023-04-25 | by ( Huw Jones | ) www.reuters.com time to read: +2 min

LONDON, April 25 (Reuters) - Anonymity is allowing crypto assets to finance illegal activities, a top U.S. regulatory official said on Tuesday, posing national security risks that must be addressed. "It's essential for governments and particularly the industry to address that which makes crypto so attractive to illicit finance, and that is the allure of anonymity," she said. Legally compliant crypto companies should not be using "mixers" or software tools that effectively anonymise users by pooling and scrambling cryptocurrencies from thousands of addresses. Compliant crypto companies must show they have internal controls to prevent money laundering and terrorist financing. "It's possible for all crypto companies to distance themselves from mixers and anonymity enhancing technology while still providing customers financial privacy," Romero said.

☆ EU parliament backs world's first comprehensive rules for cryptoassets
▼ + stars: | 2023-04-20 | by ( Huw Jones | ) www.reuters.com time to read: +1 min

LONDON, April 20 (Reuters) - The European Parliament on Thursday overwhelmingly backed the European Union's first set of rules to regulate cryptoasset markets. Parliament voted by 517 in favour and 38 against to approve the world's first comprehensive set of regulations for issuing and trading cryptoassets such as bitcoin. "This regulation brings a competitive advantage for the EU," said Stefan Berger, the lawmaker who steered the rules through parliament. "The European crypto-asset industry has regulatory clarity that does not exist in countries like the U.S.," Berger said. Parliament also backed new rules for tracing transfers of cryptoassets like bitcoins and electronic money tokens.

☆ EU urges others to copy its rules for cryptoassets
▼ + stars: | 2023-04-19 | by ( Huw Jones | ) www.reuters.com time to read: +2 min

LONDON, April 19 (Reuters) - The rest of the world should copy European Union rules for cryptoassets to create a robust global approach that protects consumers and financial stability, the EU's financial services chief said on Wednesday. The crypto sector has been rocked by the failure of crypto exchange FTX and other collapses, sending benchmark bitcoin prices tumbling, though it has begun to recover. "I hope that our rules could become a model for other countries," EU financial services commissioner Mairead McGuinness told the parliament. Crypto firms authorised in one EU state would be allowed to offer their services across all 27. McGuinness said the commission will study whether further rules are needed for decentralised finance, and for lending and borrowing in cryptoassets.

☆ LSE teams with digital trading platform to offer bitcoin futures and options
▼ + stars: | 2023-04-13 | by ( Huw Jones | ) www.reuters.com time to read: +2 min

LONDON, April 13 (Reuters) - London Stock Exchange Group has teamed up with Global Futures and Options (GFO-X) to offer Britain's first regulated trading and clearing in bitcoin index futures and options derivatives, the companies said on Thursday. GFO-X, which is licensed by the UK's Financial Conduct Authority, is a start-up platform aimed at global institutional investors who want to trade digital asset derivatives. LSEG's Paris-based LCH SA clearing unit will introduce a new, segregated clearing service, DigitalAssetClear, for cash-settled dollar-denominated digital assets traded on GFO-X. "GFO-X is taking the first steps to extracting efficiencies from new technologies within a traditional market structure, with the goal over time of delivering 24/7 trading to global regulated digital asset markets," GFO-X said in a statement. Frank Soussan, head of LCH DigitalAssetClear, said bitcoin index futures and options are a rapidly growing asset class, with increasing interest among institutional investors.

☆ G20 financial watchdog seeks to learn from latest banking turmoil
▼ + stars: | 2023-04-12 | by ( Huw Jones | ) www.reuters.com time to read: +2 min

LONDON, April 12 (Reuters) - The G20's financial watchdog on Wednesday said rules it introduced after the global financial crisis had prevented contagion from the latest banking sector turmoil, but it would remain vigilant as the outlook has become more challenging. Unlike other market shocks, the latest episode originated in the financial sector, and therefore "put to the test" the G20's financial reforms, FSB Chair Klaas Knot said in a letter to G20 finance ministers and central bankers meeting in Washington. He said "rapid and effective" actions by authorities in Switzerland, the United States and other jurisidictions maintained global financial stability. "Without these reforms, the stress faced by individual banks could have led to broader contagion within the financial system," Knot said. The outlook for financial stability had become more challenging, Knot said, and the need for financial authorities to learn lessons and act upon them was "all the greater".

☆ U.S. says decentralized finance services being used for illicit transfers
▼ + stars: | 2023-04-06 | by ( ) www.reuters.com time to read: +2 min

WASHINGTON, April 6 (Reuters) - North Korea, cybercriminals, ransomware attackers, thieves and scammers are using decentralized finance (DeFi) services to transfer and launder their illicit proceeds, the U.S. Treasury Department warned on Thursday. In a new illicit finance risk assessment on decentralized finance, the Treasury found that illicit actors are exploiting vulnerabilities in U.S. and foreign anti-money laundering and combating the financing of terrorism (AML/CFT) regulation and enforcement as well the technology underpinning the services. DeFi services that fail to comply with these obligations to prevent money laundering and terrorism financing pose the most significant illicit finance risk in this domain, the assessment found. "Our assessment finds that illicit actors, including criminals, scammers, and North Korean cyber actors are using DeFi services in the process of laundering illicit funds," the Treasury's Under Secretary for Terrorism and Financial Intelligence, Brian Nelson, said in the statement. Nelson added that the private sector should use the findings of the assessment to inform their risk mitigation strategies and to take steps to prevent illicit actors from using decentralized finance services.

LONDON, March 10 (Reuters) - Zodia Custody, a crypto custodian owned by Standard Chartered (STAN.L), said on Friday it has registered its Irish unit with Luxembourg's financial regulator. The registration will allow Zodia to provide digital asset custody services for financial institutions in Luxembourg, the company said. According to the regulator's website, Zodia will be subject to supervision from the watchdog for compliance with rules around anti-money laundering and combating the financing of terrorism. "There is a massive opportunity for financial institutions to offer a range of products and services related to cryptoassets," John Cronin, chief executive of Zodia Custody Ireland, said in a statement on Friday. Reporting by Elizabeth Howcroft; Editing by Shounak DasguptaOur Standards: The Thomson Reuters Trust Principles.

☆ UK regulator cracks down on illicit London crypto ATMs
▼ + stars: | 2023-03-08 | by ( ) www.reuters.com time to read: +2 min

[1/2] Signage is seen for the FCA (Financial Conduct Authority), the UK's financial regulatory body, at their head offices in London, Britain March 10, 2022. REUTERS/Toby Melville/File PhotoLONDON, March 8 (Reuters) - Britain's markets regulator and police have swooped on suspected illegal crypto cashpoints (ATMs) across east London as authorities step up attempts to disrupt unregistered businesses deemed high risk for consumers. The inspections were conducted under money laundering regulations, which allow officers to enter premises without a warrant, observe activities, seek explanations about documents or information and take copies. Crypto ATMs (CATMs) allow people to buy or convert money into cryptoassets. "But there is also definitely an element of fear and uncertainty about what the FCA is going to do next."

☆ EU calls for fast-track crypto capital rules for banks
▼ + stars: | 2023-02-20 | by ( Huw Jones | ) www.reuters.com time to read: +2 min

LONDON, Feb 20 (Reuters) - Tough capital rules for banks holding cryptoassets must be fast-tracked in the European Union's pending banking law if Europe wants to avoid missing a globally-agreed deadline, the bloc's executive has said. The global Basel Committee of banking regulators from the world's main financial centres has set a January 2025 deadline for implementing capital requirements for banks' exposures to cryptoassets such as stablecoins and bitcoin. "Banks have expressed interest in trading crypto-assets on behalf of their clients and to provide crypto-assets-related services." Basel's standards are applied in the EU with a law, and a delay could mean that banks have to wait longer to enter the cryptomarket as separate EU rules for trading cryptoassets come into force in 2024. To enforce Basel's crypto rules, the EU could either propose a new law, or expand the banking law it is now finalising as called for by the European Parliament.

☆ G20 watchdog homes in on decentralised finance after FTX crash
▼ + stars: | 2023-02-16 | by ( Huw Jones | ) www.reuters.com time to read: +4 min

FSB member countries will now "proactively" analyse vulnerabilities from DeFi as part of regular monitoring of crypto markets, the report said. The collapse of FTX last November exposed vulnerabilities in intermediaries and DeFi, the report said. FSB DeFi Graphic 1SUPERVISION GAPSThe most worrying vulnerability in DeFi relates to "mismatches" in liquidity from different maturities in liabilities and assets, the report said. Until the sharp retreat in bitcoin prices and the FTX crash, regulators had largely focused on cryptoassets rather than related technology. FSB DeFi Graphic 2Reporting by Huw Jones Editing by Helen PopperOur Standards: The Thomson Reuters Trust Principles.

Owners of crypto assets that use a "proof-of-stake" blockchain can stake some of their assets to potentially take part in the process of validating transactions. In exchange for their work, validators get transaction fees and/or newly created crypto assets. Lawmakers have stepped up calls for regulation after crypto firms' customers were left with large losses. Revolut said customers' staked funds would be held with "trusted custodians" but did not specify who these custodians were. Asked how the firm established the trustworthiness of the custodians, a spokesperson told Reuters that Revolut completed its own due diligence.

☆ Britain presses on with proposals for a digital pound
▼ + stars: | 2023-02-06 | by ( ) www.reuters.com time to read: +3 min

[1/2] Pound coins are seen in the photo illustration taken in Manchester, Britain September 6, 2017. BoE Governor Andrew Bailey said the implications of a digital pound - including privacy issues - had to be considered. Prime Minister Rishi Sunak asked the BoE to look into the case for a CBDC when he was finance minister in 2021. Unlike cryptoassets, the digital pound would be issued by the central bank and not the private sector and its value would be fixed. Instead they would have accounts with private digital wallet providers, which would provide digital pounds over public infrastructure.

☆ Britain's finance ministry sets out draft rules to regulate cryptoassets
▼ + stars: | 2023-02-01 | by ( ) www.reuters.com time to read: +2 min

LONDON, Feb 1 (Reuters) - Britain's finance ministry set out draft rules to regulate cryptoassets on Wednesday, saying ongoing turbulence in the sector and the collapse of exchange FTX highlighted risks that need addressing. "Our view is that this reinforces the case for clear, effective, timely regulation and proactive engagement with industry," Financial Services Minister Andrew Griffith said in proposals put out to public consultation. "This includes a proposal to bring centralised cryptoasset exchanges into financial services regulation for the first time, as well as other core activities like custody and lending," Griffith added. After the three-month consultation, there will be secondary legislation later this year along with detailed rule proposals for public consultation from the Financial Conduct Authority. HMT crypto graphicReporting by Huw Jones; editing by Jason Neely and Sharon SingletonOur Standards: The Thomson Reuters Trust Principles.

☆ Britain sets out plans to regulate crypto industry in wake of FTX collapse
▼ + stars: | 2023-02-01 | by ( Ryan Browne | ) www.cnbc.com time to read: +6 min

In a widely-anticipated industry consultation launched Tuesday, the government proposed a number of measures aimed at bringing regulation of crypto asset businesses in line with that of traditional financial firms. A big theme that emerged in 2022 was the rise of risky loans made between multiple crypto firms and a lack of due diligence done on the counterparties involved in those transactions. The collapse of FTX has added urgency to global regulators' attempts to govern the regulation-averse crypto space. The regulatory move comes as crypto firms in both the U.K. and beyond are feeling the chill of a deep downturn known as "crypto winter." Global crypto hub ambitionsThe U.K. wants to become a leader in crypto and blockchain technology on the global stage.

☆ Industry body clarifies what happens when crypto derivatives crash
▼ + stars: | 2023-01-26 | by ( Huw Jones | ) www.reuters.com time to read: +2 min

LONDON, Jan 26 (Reuters) - An industry body set out a global framework on Thursday for trading derivatives linked to cryptoassets to avoid FTX-style collapses sowing confusion over ownership. The International Swaps and Derivatives Association (ISDA) published guidance for trading digital asset derivatives to clarify what happens when things go wrong in an underlying market, such as the collapse of crypto exchange FTX. While most of the recent problems have occurred in the spot cryptocurrency market, many of the legal uncertainties could affect digital asset derivatives too. It will now include the body's first standard documentation for trading digital asset derivatives, initially covering non-deliverable forwards and options on Bitcoin and Ether. It could be expanded in future to cover additional product types, including tokenized securities and other digital assets executed on distributed ledger technology (DLT), ISDA said.

☆ EU lawmakers back 'prohibitive' capital rules for cryptoassets
▼ + stars: | 2023-01-24 | by ( Huw Jones | ) www.reuters.com time to read: +2 min

LONDON, Jan 24 (Reuters) - European Union lawmakers backed a draft law on Tuesday to implement the final leg of post-financial global bank capital rules, adding "prohibitive" requirements to cover risks from cryptoassets. The European Parliament's economic affairs committee approved a draft law to implement Basel III capital rules from January 2025, though backing several temporary divergences to give banks more time to adapt. EU states have already approved their version of the draft law, and lawmakers will now negotiate a final text with member states, with further tweaks expected. EU states have taken a more accommodative approach to when foreign banks serving customers in the bloc should open a branch, or convert a branch into a more heavily capitalised subsidiary, with EU lawmakers on Tuesday taking a harder line. The EU is keen to build up "strategic autonomy" in capital markets as it faces a competing financial centre on its doorstep after Brexit.

☆ EU lawmakers to vote on tighter crypto, ESG rules for banks
▼ + stars: | 2023-01-23 | by ( Huw Jones | ) www.reuters.com time to read: +2 min

One amendment states that banks would have to apply a risk-weighting of 1,250% of capital to cryptoassets exposures, meaning enough to cover a complete loss in their value. This is in line with recommendations from the global Basel Committee of banking regulators in December. The amendment requires the EU's executive European Commission to publish a report by June 2023 analysing the possibility of introducing prudential limits on banks' exposures to shadow banks. The draft law introduces a new "fit and proper" regime for appointing bankers, with amendments saying there should be targets for a bank's management body. After Tuesday's vote the lawmakers and EU states will thrash out a final deal which would come into effect in 2025.

Jan 16 (Reuters) - Major markets such as the United States need new statutory definitions of digital assets to provide regulatory clarity for the sector, Jeremy Allaire, CEO of USDC stablecoin issuer Circle said on Monday. Allaire said blockchain technology itself should be viewed similarly to an operating system, while individual use cases should be regulated separately. "New definitions ... would help provide more clarity on which regulators are involved in what activity," Allaire told the Reuters Global Markets Forum on the sidelines of the World Economic Forum's annual meeting in Davos. The European Union is leading in developing digital asset regulations, he said, with the region's Markets in Cryptoassets (MiCA) rules expected to come into effect in 2024. "We're quite optimistic that MiCA will create the conditions for a thriving competitive market in the EU," Allaire said.

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