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Switzerland Parliament Blockchain Act Reform Validates Crypto and Digital Assets

The Swiss parliament has reformed and clarified legislation for blockchain technology and digital currencies (cryptocurrency) activity in the country, bringing digital assets closer to a mainstream means of exchange and investment.

According to a report from Swiss Info, the “Blockchain Act” in Switzerland has been duly reformed by the country’s Senate after the law had was passed through the House of Representatives completely unopposed.

As detailed, the reformed Blockchain Act has brought about key updates, ranging from company bankruptcy to securities trading. Under the new law, a well defined legal basis for the trading of digital-only securities has been created. The reformed law also helps outline the legal processes for reclaiming digital assets from bankrupt companies. From indications, the law should take effect in the first quarter of 2021.

Adjudged to have a fair blockchain and crypto-centric policies, the move by the Senate body in the Alpine country has endeared blockchain stakeholders. “As of next year, Switzerland will have a regulatory framework that is among the most advanced in the world,” said Heinz Tännler, President of the Swiss Blockchain Federation.

The Reformed Law Will Consolidate Switzerland Current Blockchain Growth

Switzerland is renowned as a fast-growing hub for the world’s blockchain industry and the county currently houses about 900 blockchain companies with an estimated total staff of about 4,700 as gleaned from the Swiss Info report. These figures are billed to rise when the new bill comes into full effect.

The currently reformed laws take a deep precedent from the Swiss’ Federal Council’s clamor for better and fair blockchain regulation. With the yearnings heard and the Blockchain Act reformed, the question of its impact hinges on the heart of many.

The new law is expected to stir the highly blockchain and crypto skeptical Switzerland banking sector into seeing the technology and its associated innovations in a new light. Failure to stand up for blockchain and cryptocurrencies can make existing banks to lose customers to Sygnum and Seba Crypto AG, the two blockchain firms that have been granted banking licenses by the country’s top banking regulator, The Financial Market Supervisory Authority (FINMA).

As recently announced, the canton of Zug in Switzerland plans to start accepting taxes in cryptocurrencies from the beginning of next year.

Image source: blockchain.news

India Plans to Ban Private Cryptos like Bitcoin in Favor of National Cryptocurrency

The government of India plans to introduce a legislation in the country’s lower house that would ban private cryptocurrencies like Bitcoin and instead establish a national cryptocurrency.

The lower house of India’s parliament (Lok Sabha) is set to hold a session to lead the ban of private cryptocurrencies while creating a framework for the establishment of an official digital currency to be issued by the country’s Central Bank (the Reserve Bank of India).

The Lok Sabha bulletin, released on Friday, January 29, revealed that one of the aims of the bill is to ban all private cryptocurrencies in the country while providing some exceptions to promote the underlying technology, blockchain.

Due to the recent increase in crypto adoption and trading in the country, the government seeks to ensure that local investors are not exposed to risks.

Apart from that, there are fears that crypto assets are being utilized for money laundering in the absence of any KYC standards. Some of the cryptocurrency exchanges operating in the nation had recently created measures related to KYC.

The proposed bill banning cryptocurrency has already made the crypto industry worrying. Shivam Thakral, CEO of BuyUcoin, the second-largest crypto exchange in India, said:

“We urge the government to take the opinion of all the stakeholders before taking a decision, which may affect the livelihood of the entire workforce employed in digital asset industry in India. We will engage with our peers and other stakeholders to work towards protecting the interest of the industry.”

Rahul Pagidipati, the CEO of Zebpay crypto exchange, said:

“Its (the bill’s) success will depend on the details, particularly the definition of what the bill calls ‘private cryptocurrencies.’

This is not a common term. Bitcoin is not privately owned by anyone. It is a public good, like the internet. Bitcoin and most crypto assets are more like gold and not an alternative to government-issued legal tender. Crypto assets and digital government currency can coexist and together, they can bring tremendous benefits to the Indian economy.”

Crypto’s Uncertain Future in India

However, this is not the first time that India’s lawmakers have taken such a strong stance on cryptocurrencies. In 2018, an Indian government committee headed by economic affair secretary SC Garg with officials from the Securities and Exchange Board (SEBI) and the Reserve Bank of India (RBI) as its members recommended a ban on private cryptocurrencies through a bill, though suggested that blockchain technology be utilized in financial services for better fraud detection, insurance claims management, and loan tracking.

During that same year, the committee suggested the government to examine a digital version of India’s fiat currency and ways to implement it.

So, the current bill is seen as a continuation of the recommendation of the committee led by then economic affair secretary SC Garg.

In 2018, RBI stated that the move to ban all cryptocurrencies was necessary to curb “ring-fencing” of the nation’s financial system. The Central Bank further claimed that cryptocurrencies like Bitcoin cannot be treated as currencies since they don’t exist in physical form or are not made of metal and not stamped by the government. The Central Bank eventually banned cryptocurrency transactions following cases of fraudulent activities witnessed during that year. However, India’s Supreme Court overturned the ban in March 2020, which was a big win for the local crypto enthusiasts and the victory saw a sharp rise in cryptocurrency trading volumes in the country.

Paraguayan Congressmen Propose New Bitcoin Bill

Paraguayan lawmaker Carlitos Rejala has drafted and ready to propose the new bitcoin bill to congress, according to TheStreet Crypto report.

After the leakage of the Bitcoin bill draft disclosed to the public Tuesday, Paraguayan congressmen Carlitos Rejala and his companion’s politicians have created the bill and ready to propose to the congress for regulating Bitcoin and cryptocurrencies in this South-American country, according to local media TheStreet Crypto report Wednesday.

According to the report, the objective of the new bill is to “regulate the activities of production and commercialisation of cryptocurrencies”.

Actors who intend to conduct crypto mining are requested to get virtual assets mining licenses; these mining operations will also be approved and overseen by the authority. The legislation will categorise the mining activities as “innovative and elector-intensive industry”.

Rejala welcomed the proposal on Twitter, saying the proposal will allow Paraguaya to get an advantage from this virtual currency, describing it as a competitive industry and plans to lead in sustainable Bitcoin mining by “safeguarding and optimising renewable energy”.

”The big day has finally arrived. The future is now #Bitcoin.”

Yet, the market tends to remain cautious and polarized about the new bill. “It is important to see if the actual bill turns out to be ‘crypto-friendly’ because in some cases governments have promised to regulate crypto, but the actual legislation was underdeveloped and put excessive scrutiny on companies and individuals,” Kirill Suslov, CEO of trading app TabTrader said.

On the other hand, “Being regulated (the bill) should take away the risk for investors, which makes it easier to attract capital,” said Ruud Feltkamp, CEO of crypto trading bot Cryptohopper.

The market also concerns about the issue of the circulation of Bitcoin. About 90% of Bitcoins in existence haven’t been converted to fiat currency in over a year, according to JPMorgan’s report, which was cited first by Bloomberg. Most of the Bitcoin that people own could be being held in virtual crypto wallets, which means a large part is not being converted to fiat currencies and being locked up in illiquid entities.

Ukraine Parliament Passes Legislation by Legalizing Crypto

The Ukrainian Parliament has passed a bill draft in the second reading Wednesday concerning legalising and regulating cryptocurrency and other virtual assets, such as tokens.

Approved by 276 lawmakers, the bill will take effect and become law after signing by President Volodymyr Zelensky, enabling the protection of virtual assets from fraud.

According to the official data, the daily turnover of virtual assets across the country accounts for $37000. The administration believes the legislation would make crypto safer and more legal to attract more investors to participate.

“Only a few countries in the world have legalised crypto assets — Germany, Luxembourg, Singapore. Ukraine will be one of them,” Mykhailo Fedorov, Ukraine’s Minister of Digital Transformation, said.

In Ukraine, virtual assets in Ukraine are not under the protection of local law. Residents are not allowed to use crypto as a way of payment or exchange goods or services, except the Hryvnia- the legal tender in Ukraine. According to the report, Ukrainians can only trade or conduct exchange crypto through local or Ukraine-registered foreign exchange platforms.

Experts argue that is a crucial milestone to Ukraine, as the bill has interpreted the definition of virtual assets “as intangible assets in the form of digital data”, also define the terminology, such as “wallet” for virtual currency or private key; but also allow the country to regulate the crypto market in the future.

To prevent money-laundering illegal activities, crypto businesses, which intend to register, need to declare their activities to the authority.

Local media, citing an official source, said the Kyiv government plans to open the crypto market for investors and the business sector next year when the tax code and the civil code is amended and ready.

Despite the current regulators, the administration prefers to introduce more watchdogs to issue permits for crypto businesses.

Ukraine intends to escalate the use of crypto across the whole country. Last month, the administration announced plans to pay salaries to workers by central bank digital currency.

US Congressman Proposes Safe Harbor for Digital Token Issuers in a New Bill

A new bill has just been sponsored by an American lawmaker from North Carolina, Patrick McHenry, seeking to grant a safe harbour for some kinds of token transactions and prevent issuers from being sanctioned for not registering with appropriate authorities.

The sponsored bill was christened the “Clarity for Digital Tokens Act of 2021”, and it proposes a number of amendments to the Securities Act of 1933.

Per the bill’s provisions, innovators seeking to establish a decentralized protocol with self-governing capabilities will have up to three years to focus on building out their innovation and not worry about registering with either the Securities and Exchange Commission (SEC) or other such market regulators. Despite the magnanimity of the bill, project owners will need to maintain the utmost transparency by providing essential details such as the protocol tokenomics, codes or tools for verifying transactions, and information detailing the project’s consensus mechanism.

Suppose the bill eventually becomes passed into law. In that case, crypto project owners will need to identify with the need to be protected under the bill, fulfil the requirements, and effectively indicate when they have completed the development of their projects, or when the three years have elapsed.

A number of government authorities and lawmakers have been attempting to contribute to the growth of what they call financial innovation in the US. SEC Commissioner Hester Peirce, also known as “crypto mom”, is also one of the chief proponents of a Safe Harbor for digital currencies. The argument is simple, and it is that the United States can compete and maintain its leading role as a hub for financial innovation when a grace period is introduced to help crypto and blockchain innovators focus on their revolutionary inventions.

The US has been lagging behind other nations, particularly in the longer than usual delay in approving a Bitcoin ETF when other countries, including Canada and Brazil, have nurtured such a highly sought-after investment vehicle. Propositions like the Safe Harbor on digital assets will help lift some of the embargoes that market watchdogs are placing on the nascent digital industry.

London Lawmaker Urges Government to Ban Crypto Ads on Public Transport System

A London Assembly member from the Green Party, Sian Berry, is pushing for a broad crackdown on advertisements featuring digital currencies on the London Transport System.

While the lawmaker said she is not targeting any specific advert, she said it is unethical for the city’s rail and buses to feature unregulated digital tokens.

As contained in one of her tweets over the weekend, Berry said she would recommend removing these ads to London’s Mayor Sadiq Khan. The legislator said in one of the tweets:

“Like gambling ads, which we have finally got the Mayor to remove, there is no way our public services should be used to advertise these unregulated, risky schemes to Londoners. I asked for a ban in July and I am still pushing,”

In late October, Blockchain.News reported on the aggressive ad campaign launched by Floki Inu, a meme coin named after Elon Musk’s pet dog. The coin aims to rival its predecessors, including Dogecoin (DOGE) and Shiba Inu (SHIB). While Floki Inu flooded the London Transport system, it acknowledged in its ad that the token was unregulated in the United Kingdom.

Berry believes this caution is not enough, drawing attention to the anonymous identity of the people behind the project.

“The website promoting Floki Inu coins gives no names of anyone involved,” she said in the tweet.

She also noted that Transport for London (TfL), the public transport regulator, has not made any attempt to do a background check on the digital token to be sure it’s neither a scam nor a pump and dump scheme.

While the TfL said all of the adverts it has accepted on its network have always complied with its policy as well as the Advertising Standards Authority (ASA) ruling, the calls from Sian may stir a new reality that will stump the ad campaign of other intending digital currency projects in the city and country as a whole.

Spanish Lawmaker Tables a Proposal to be Bitcoin Mining Hub after Kazakhstan Internet Shutdown

Maria Munoz, a member of the Congress of Deputies, seeks to make Spain a Bitcoin mining hub while the turmoil is still rocking Kazakhstan.

Munoz pointed out:

“The protests in Kazakhstan have repercussions all over the world including Bitcoin. We propose that Spain position itself as a safe destination for investments in cryptocurrencies to develop a flexible, efficient and safe sector.”

Munoz added that the BTC hashrate was nosedived in just two days based on the internet shutdown experienced in Kazakhstan. Therefore, Spain should position itself to gain a competitive edge regarding Bitcoin mining.

As the second-largest BTC mining hub, Kazakhstan experienced a wave of protests due to high energy costs. As a result, the government imposed a countrywide internet shutdown to tame the unrest, prompting BTC miners to shut down their operations. This caused the hashrate to slip by 19.6% from the peak of 229 EH/s recorded on January 1 to lows of 184.25 EH/s.

The slip in hashrate has also made mining difficulty on the Bitcoin network to hit a 7-month high, acknowledged by market insight provider Glassnode.

The hashrate is used to measure the processing power of the BTC network. It allows computers to process and solve problems that enable transactions to be approved and confirmed across the network.

Meanwhile, JPMorgan Chase sees more crypto adoption happening this year. The leading investment bank noted that Bitcoin was well-designed as a modern store of value, and its robust design was prompting more confidence and value.

Top American multinational investment bank Goldman Sachs echoed similar sentiments and stated that Bitcoin would “most likely” become a bigger proportion over time. Precisely, if Bitcoin were to grab a 50% market share, its price would reach just over $100,000.

Ukraine Legalizes Bitcoin amid Intensified Tension with Russia

Amid inevitable military potential conflicts escalating tension between Ukraine and Russia before the incoming full-blown war, the Ukrainian parliament unanimously voted to legalize Bitcoin and cryptocurrencies by passaging a Virtual Assets law on Feb 17.

The legislation called “Law of Ukraine on Virtual Assets” has been passed with at least 270 votes approval, according to a statement from the Parliament.

The law stipulates the requirements that crypto service providers like exchanges ought to adhere to and the accrued fines in case of violations.

Mykhailo Fedorov, the Ukrainian deputy prime minister, believed that the law would open the nation’s boundaries to crypto companies, given that Ukraine is among the top-5 countries in crypto usage. He noted:

“The new law is an additional opportunity for business development in our country. Foreign and Ukrainian crypto companies will be able to operate legally, and Ukrainians will have convenient and secure access to the global market for virtual assets.”

However, the passage of the bill does not mean the legalization of the adoption with Bitcoin as legal tender. According to Nasdaq.com, citing a report from Bitcoin Magazine, the nation’s financial watchdog, the Securities Commission, will monitor the crypto market and issue permits to service providers.

The passage of the virtual assets law is the country’s second attempt to legalize Bitcoin after the first effort reached a dead end following President Volodymyr Zelensky’s rejection.

The legalization of Bitcoin in the nation comes at a crucial time when tensions with Russia have intensified, given that Russia has marshalled more than 100,000 troops to the border, although Russian claims that have withdrawn some of the troops from the borders.

On the other hand, U.S. President Joe Biden recently noted that Russia was ready to fabricate reasons to invade Ukraine, warning that an attack would emerge in the coming days.

Therefore, volunteer groups and NGOs in Ukraine have been receiving Bitcoin donations to support the army with drones, medical supplies, and military gear.

Brazilian Senate Committee on Economic Affairs Approves Crypto Regulation Bill

Crypto regulation on Brazilian soil gained steam after the senate’s economic affairs committee approved a bill, highlighting the ground rules and day-to-day usage of digital currency funds.

The committee passage is crucial in the legislative process because the bill awaits a vote on the Senate floor. If it sees the light of day, the final stages will entail approval by the lower house and signing into law by President Jair Bolsonaro.

Per the announcement:

“Under the proposal, the federal government decides which body will be responsible for regulating business with cryptocurrencies.”

Senator Iraja Abreu, the bill’s rapporteur, noted that the mandate of regulating cryptocurrencies would be undertaken by the nation’s central bank, which played a critical role in creating the draft.

If the bill is passed into law, Brazil will emerge as the largest Latin American country to set the crypto regulation ball rolling needed to shield investors from risks and avert money laundering practices.

Per the report:

“Virtual asset service providers must prevent money laundering and concealment of assets, while combating criminal organizations, the financing of terrorism and the proliferation of weapons of mass destruction.”

If these rules are violated, the bill guarantees fines and imprisonment.

Nations across the globe are gearing up to the crypto space, with El Salvador already having set foot in the Bitcoin sector by making the leading cryptocurrency legal tender in September last year. Some of the benefits prompted by this move entail El Salvador’s tourism sector surging by 30% as more foreign visitors continue flocking the nation.

On the other hand, Ukraine recently legalized Bitcoin, and this move was seen as a stepping stone towards opening the nation’s doors to crypto companies.

Paraguay Senate Passes Bill to Regulate Crypto Mining and Trading

The Senate of Paraguay, a South American nation, on Thursday, approved a bill to regulate cryptocurrency mining and trading in the country.

The passage of the law is part of an approval made in December last year, but was modified in May by the Chambers of Deputies (the lower house of Paraguay’s bicameral legislature) and therefore returned to the upper chamber (the Senate) for further considerations.

Both chambers have now approved the bill and so it must be submitted to the executive branch, which has the power to approve or veto it.

The proposal modified by the Chamber of Deputies and accepted by the Senate designates the Ministry of Industry and Commerce as the main law enforcement authority to penalize individuals or firms conducting mining or offering crypto services without obtaining legal authorization.

The bill further delegated powers to the Secretariat for the Prevention of Money or Asset Laundering to be in charge of supervising the entire investment process conducted by crypto firms. Besides that, the bill designates The National Electricity Administration to be responsible for enabling the energy supply while the National Securities Commission is tasked with overseeing commercial activities involving digital assets. This involves licensing and overseeing crypto mining companies operating within the country. The proposed law does not make any cryptocurrencies legal tender.

The bill states that individual and corporate mining firms are expected to request for approval to use industrial electricity consumption and then apply for a business license. The proposed legislation also creates a registry for any individual or firm seeking to offer cryptocurrency trading or custody services for third parties.

The new legislation also expects crypto exchanges to register their businesses as virtual asset service providers with the anti-money-laundering agency of Paraguay.

Expanding Crypto Legal Framework

The latest Paraguay’s bill appears to build on previous legislations. In July last year, Paraguay became the second country to propose a bill to make Bitcoin legal tender after El Salvador announced the crypto as legal tender last June.

However, the bill was quite different from that of El Salvador. A leaked draft of Paraguay’s crypto bill showed that the country had no intention of making Bitcoin or any other cryptocurrency legal in the country.

Instead, the nation’s focus was on creating a regulatory framework, especially when it comes to taxation. The aim of the legislation was to create a legal certainty, financial and fiscal in the businesses derived from the production and trading of digital assets.

Unlike El Salvador, Paraguay has had a lot of the same concerns that some other nations have had with crypto entities — that of taxation. The nation wanted to ensure that crypto companies are brought under its tax regime and to have traceability for such transactions and investments.