A slew of regulatory happenings are in the works. First, the Bahamian central bank plans to issue the first CBDC this October while the Indian legislative body is considering a ban on crypto trading.
Further, the latest SEC injunction into an allegedly unregistered token sale could set a grave precedent, argues Commissioner Hester “Crypto Mom” Peirce.
CBDC first The Central Bank of the Bahamas has confirmed it is moving ahead with the nationwide launch of its digital currency, called the “Sand Dollar,” sometime in October. Approximately $48,000 worth of the new central bank digital currency (CBDC) – pegged to the U.S. dollar-tracking Bahamian dollar (BSD) – will enter circulation initially with commitments to mint and remove BSDs as necessary. A mobile-based wallet app will also be rolled out. If it sticks to its October release, the Sand Dollar will likely become the first CBDC to launch anywhere in the world – it has been suggested China won’t launch its own digital yuan initiative until the Beijing Winter Olympics in 2022, CoinDesk’s Paddy Baker reports.
‘Chilling effect’ Online gaming and gambling platform Unikrn will pay a $6.1 million settlement – “substantially all of the company’s assets” – for conducting an allegedly unlicensed initial coin offering (ICO) in 2017, according to the U.S. Securities and Exchange Commission (SEC). The securities regulator said Unikrn’s $31 million fundraise was in violation of registration requirements, though Commissioner Hester M. Peirce has offered a dissenting opinion that the token startup wasn’t accused of committing any fraud. Further, this injunction will have a chilling effect on innovation on the part of other firms. Unikrn will continue to offer its services supported by major currencies, including fiat currencies, bitcoin (BTC), bitcoin cash (BCH), ether (ETH) and USDC, among others.
Leaked legislation A leaked legislative draft shows the European Commission is thinking seriously about aligning its oversight over the cryptocurrency and digital asset industry with standing regulations for traditional financial instruments. Europe’s Markets in Crypto-Assets (MiCA) will provide legal certainty around crypto assets, though may also stifle innovation, CoinDesk’s Ian Allison reports. Europe’s MiCA is due this September, but will not likely be transitioned into European Union law until 2022 at the earliest. Siân Jones, senior partner at XReg Consulting, said the bill takes particular focus on stablecoins, which could affect development in projects as diverse as the multi-asset-backed Libra project and the nascent decentralized finance (DeFi) ecosystem.
Another ban? India may ban cryptocurrency trading, according to a recent Bloomberg report. According to sources close to the matter, the federal cabinet is weighing a new bill that seeks to impose limits on trading activity, similar in function to a Reserve Bank of India ban that was repealed by the nation’s supreme court in March. The news comes amid a flurry of crypto activity and as the government explores potential use of blockchain technology to manage land records, pharmaceutical drugs supply chain or records of educational certificates.
Similar standards Bank regulators in 48 U.S. states, Washington, D.C., and Puerto Rico plan to make compliance for cryptocurrency companies simpler by consolidating supervisory exams. The Conference of State Bank Supervisors (CSBS), a coordinating body for state regulators, said the new regime for money service businesses (MSB) will introduce the standards to streamline compliance and enable firms like Coinbase to work across multiple states, instead of going through the time and expense of getting regulated in each and every one, CoinDesk’s Paddy Baker reports.