Seeds of Wisdom RV and Economic Updates Wednesday Morning 12-04-24
Good Morning Dinar Recaps,
CRYPTO COMPLIANCE ‘NO LONGER OPTIONAL’ UNDER AUSTRALIA’S NEW DRAFT GUIDELINES
Sweeping proposed changes would force most crypto firms in Australia to obtain financial licensing, which some worry could drive innovators offshore.
Crypto exchanges and firms dealing with digital assets in Australia would no longer be able to avoid costly licensing under proposed guidance from the country’s corporate regulator.
On Dec. 4, the Australian Securities and Investment Commission (ASIC) released a consultation paper on proposed guidance for crypto, placing many digital assets under the category of financial products requiring in no uncertain terms that most firms dealing in crypto must be licensed.
“It’s a bit of a wake-up call,” Kate Cooper, CEO of Australia and head of APAC at the Standard Chartered-backed crypto custodian Zodia Custody told Cointelegraph.
“Compliance really is no longer optional for the industry, and a lot of the players, both local and international [...] are going to have to really look at and take an audit of what they’re doing from a custody and compliance management perspective.”
In Australia, businesses offering financial services and dealing in financial products need an Australian Financial Services License (AFSL), while platforms facilitating the trading of financial products may also need an Australian Market License.
The new guidance would require crypto exchanges and many other crypto firms to get one or both licenses.
Some worry that ASIC’s draft guidance could hang crypto startups out to dry and cause an exodus of crypto firms from the country.
“Obviously, the bigger businesses will be better able to withstand all of that regulation, all of that legal cost, compliance cost that is associated with it. Smaller businesses may struggle,” Liam Hennessy, a partner at Clyde and Co law firm and adjunct professor at the University of Sydney, told Cointelegraph.
Joni Pirovich, a crypto lawyer, wrote on LinkedIn that the updated guidance will make launching in Australia “on par or more expensive than launching offshore.”
“From a timing perspective, Australian innovators that want to launch now will likely do so offshore. Those that are based here face a significant step up in compliance costs,” she wrote.
Block Earner co-founder and CEO Charlie Karaboga, who was sued by ASIC for offering an unlicensed crypto-yield product in 2022, said it was an “amazing direction around clarity” but shared concerns about his business, which has just 13 employees, according to Pitchbook.
“I think ASIC underestimates the requirements needed to be met for an AFSL,” Karaboga told Cointelegraph, adding that firms need to hold millions of dollars on their balance sheets.
“Asking us to hold that much money basically could kill all the startups like us.”
“What’s clear is that this guidance will have significant implications for pockets of the local crypto industry,” Swyftx CEO Jason Titman said in a statement sent to Cointelegraph. “We’re not aware of any other countries that regulate exchanges like bourses. Rightly or wrongly, Australia is going it alone.”
ASIC provides much-needed crypto clarity
The silver lining, according to the executives, is that the regulator has finally released much-needed clarity for crypto — even if it is harsh.
“It is a significant piece of regulatory guidance to the market,” said Hennessy. “Anything which gives regulatory clarity is a good thing for the market.”
ASIC is considering a significant expansion of what it considers a financial product or service, including stablecoins, native token staking services, exchange tokens and wrapped tokens.
On the other hand, memecoins, gaming-linked NFTs, Bitcoin and Ether may be able to escape the classification.
“I think it is quite an expansive view that has been taken as to what constitutes a financial product in the market,” said Zodia’s Cooper.
ASIC has invited feedback on the proposed updates until Feb. 28, 2025.
“We want to promote the growth of responsible financial innovation while ensuring consumer protection,” ASIC Commissioner Alan Kirkland said in a statement. “A well-regulated financial system benefits everyone in the community as it supports consumer confidence, market integrity and facilitates competition and innovation.”
“We encourage all stakeholders to engage with the consultation process,” he added.
A final version of the guidance is expected to come in mid-2025 after considering the feedback.
@ Newshounds News™
Source: CoinTelegraph
~~~~~~~~~
XRP LAWSUIT NEWS: CAN GENSLER’S REPLACEMENT PAUL ATKINS DISMISS RIPPLE CASE?
▪️Paul Atkins Appointed SEC Chair: Trump selects pro-crypto figure Paul Atkins as SEC chair, sparking debate on his impact on crypto regulation.
▪️XRP Lawsuit Update: Ripple’s legal battle continues as the SEC appeals the ruling, while Paul Atkins' appointment raises questions on crypto policy.
President-elect Donald Trump has chosen Paul Atkins, a pro-crypto figure, to chair the Securities and Exchange Commission (SEC), according to reports by Unchained.
Current SEC Chair Gary Gensler announced he will step down on January 20 when Trump is inaugurated. Atkins, who served as an SEC commissioner under President George W. Bush, is well-respected in conservative legal circles and among the Republican establishment.
One major case before the federal courts is the ongoing Ripple (XRP) lawsuit, in which the SEC claims Ripple violated securities laws by issuing XRP.
In July 2023, Judge Analisa Torres ruled that XRP was not a security when sold to retail investors on exchanges but was a security in institutional sales.
The SEC initially sought a $2 billion fine against Ripple but was instead given a $125 million penalty. In October 2024, Judge Torres rejected the SEC’s request to appeal, saying they didn’t have strong enough reasons. Despite this, the SEC appealed to the Second Circuit Court, arguing the decision went against Supreme Court rulings.
‘Paul Atkins is not what Trump Needs’
John Deaton recently explained that Paul Atkins would be a very traditional choice, one that Wall Street would likely approve of. He stated that Atkins is someone who respects the SEC and its staff, but what is truly needed is someone who challenges the SEC’s actions.
Deaton believes the SEC has harmed investors, rather than protecting them, and that a change in attitude is necessary. While Deaton would support Atkins if chosen, he feels he’s not the right fit if President Trump aims to bring change to crypto regulation.
Attorney Jeremy Hogan mentioned the cons of Atkins’ appointment and wrote,
“He won’t be the bull in the china shop many in the crypto space want. He will make measured and deliberate changes. Overall, I give his appointment a B+ for the digital asset industry, and that was good enough to get me a law degree so, yeah!”
FAQs
Who is Paul Atkins and why is he important for crypto regulation?
Paul Atkins is a pro-crypto figure nominated as SEC chair by Trump, potentially influencing crypto policies and regulations.
What happened in the SEC vs Ripple case?
The SEC sought a $2 billion fine against Ripple but was given a $125 million penalty. The SEC continues appealing the decision in higher courts.
@ Newshounds News™
Source: Coinpedia
~~~~~~~~~
RIPPLE LABS IS ABOUT TO USE XRP TO TURN REAL ESTATE UPSIDE DOWN | Youtube
@ Newshounds News™
~~~~~~~~~
IRAQI PARLIAMENT MEETING TURNS INSANE! | Youtube
@ Newshounds News™
Source: Seeds of Wisdom Team RV Currency Facts
~~~~~~~~~
Seeds of Wisdom Team RV Currency Facts Youtube and Rumble
Newshound's Podcast Link
Newshound's News Telegram Room Link
Q & A Classroom Link
Follow the Roadmap
Follow the Timeline
Seeds of Wisdom Team™ Website
Subscribe to Seeds of Wisdom Team™ Newsletter
Thank you Dinar Recaps