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Disgruntled Investor Appeals to U.S. SEC Guidelines in Class Action Suit...

After about a year without traction, a class action suit against Ripple has opted to cite SEC guidelines in arguing that XRP is a security. XRP investor Bradley Sostack has amended a class action suit against Ripple, in which he alleges that the company misled investors and proceeded to sell XRP as an unregistered security, in violation of federal law. Sostack submitted his latest filing on Aug. 5 to a United States district court in California. According to a report by CoinDesk on Aug. 13, the original class action suit was filed about a year ago, but had yet to gain traction as a class action suit. However, Ripple now must reportedly respond to this latest action by some time in mid-September. Appeal to SEC guidelinesCrucially, the report notes that Sostack’s latest complaint cites guidance issued by the United States Securities and Exchange Commission arguing that XRP counts as a security. Jake Chervinsky, who serves as general counsel to Compound, remarked: “The Complaint reads l..

Australian Securities Regulator Releases Cryptocurrency, Mining, ICO Guidelines

The Australian Securities and Investment Commission published new initial coin offering and cryptocurrency guidelines. The Australian Securities and Investment Commission (ASIC) published new initial coin offering (ICO) and cryptocurrency guidelines on its official website on May 30. The regulator detailed the prerequisites that a cryptocurrency business needs to follow in order to comply with both the Australian Corporations and ASIC Acts, but did not cover regulations enforced by other national institutions. Notably, the guideline specified that if a crypto asset is a financial product, then the issuer and firms dealing with it are required to hold an Australian financial services license. The report also notes that miners will be considered part of the clearing and settlement process in at least some instances: “Where miners and transaction processors are part of the clearing and settlement (CS) process for tokens that are financial products Australian laws apply.” The regulator al..

2019 AP Stylebook Provides Guidelines for Writing Blockchain-Related Terms

The Associated Press has announced that its 2019 AP Stylebook has a new section on cryptocurrency. Major New York news outlet, the Associated Press (AP) has announced that its latest version of The Associated Press Stylebook and Briefing on Media Law has a new section on cryptocurrencies in an official Twitter post on May 29. According to the new AP style guidelines, which constitute a popular standard for professional publications, writers should capitalize the names of cryptocurrencies when referring to them as a system but should keep the first letter lowercase when referring to token payments. They provided the following two sentences as examples: “The government wants to regulate Bitcoin, Ethereum and other cryptocurrencies. He bought a vacuum cleaner online using bitcoins.” This example in the Twitter post is pulled from the 2019 AP Stylebook’s entry on cryptocurrency. One of the other recommendations from its cryptocurrency entry is to avoid referring to cryptocurrency as “cryp..

Mauritius Financial Regulator Issues Guidelines on Security Token Offerings

The Mauritius Financial Services Commission has issued a guidance note concerning security token offerings. The Mauritius Financial Services Commission (FSC) has issued a second guidance note concerning security token offering (STO) regulation, dated April 8. In the document, the FSC declared that security tokens are considered digitally represented securities as defined in the Securities Act of 2005. As a consequence, when STOs are conducted in or from Mauritius, the offering is regulated by local security regulations, including the requirement for a prospectus. The regulator also notes that, while no STO can take place without its prior approval, there are exceptions for when a token issuer needs authorization. Those exceptions include offerings meant for sophisticated investors, expert investors, expert funds, professional collective investment schemes and specialized collective investment schemes. The FSC also highlights that carrying out financial services without a license is..

Community-Led Pan-African Blockchain Standards Org Publishes Draft ICO Guidelines

ADAF is a project that aims to establish compliance-focused, cross-border blockchain standards for the African continent. The African Digital Asset Framework (ADAF) — a project that aims to establish compliance-focused, cross-border blockchain standards for the African continent — published the first version of its guidance for initial coin offerings (ICO) on March 25. ADAF is supported by the African Digital Asset Foundation (which shares the same acronym) — a non-profit organization and open-source project founded in November 2018, which aims to encourage self-regulation and foster the establishment of legal and technical standards that would support digital trade between the African continent and the diaspora. According to an official blog post accompanying the new standard, entitled “Consumer Protection Guidelines on Token Generation Events, version 0.1,” the document was prepared by an open source community of 17 companies, which together represent 14 countries under the aegis of..

Post-Trade Market Infrastructure Giant DTCC Publishes Guidelines for Tokenized Securities

Global post-trade market infrastructure giant The Depository Trust & Clearing Corporation (DTCC) has published guiding principles for the post-trade processing of tokenized securities. The Depository Trust & Clearing Corporation (DTCC), a global post-trade market infrastructure giant, has published a white paper outlining guiding principles for the post-trade processing of tokenized securities. News of the white paper was announced in an official DTCC press release on March 13. The paper — targeted at regulators and other market participants — identifies the characteristics that are unique to the emerging tokenized security asset class and its market structure. In the press release, DTCC proposes that: “The market for trading crypto assets that are security tokens where the post-trade processing uses distributed ledger technology (DLT), has created a need for safety, security and reliability around these transactions to protect market stability.” DTCC deems that global policy standard..

The SEC’s Guidelines and Statements Show That It’s Slowly Learning to...

The SEC is still wary of ICOs, but recent changes to its guidelines show it’s learning to accept them. Initial coin offerings (ICOs) may be less fashionable than security token offerings (STOs) right now, but that hasn't stopped the United States Securities and Exchange Commission (SEC) from keeping its beady eye trained firmly on them. Ever since it published its investigation into the decentralized autonomous organization (DAO) in July 2017 and declared that ICO tokens can be (and often are) securities, it has been producing a variety of guidelines and warnings on ICOs for investors. Initially, its notices were used to emphasize the potentially fraudulent or dangerous nature of initial coin offerings, with its first-ever Investor Bulletin on ICOs concluding with a summary of "potential warning signs of investment fraud." However, even if it followed this up with a number of investor "alerts,” its current guidelines have taken a more balanced tone, treating ICOs as an establishe..

Japan: Crypto Industry Trade Group JCBA Issues Guidelines for ICO Regulation

A Japanese crypto industry association has proposed recommendations on ICO regulation In order to promote domestic blockchain and cryptocurrency-related businesses, the Japan Cryptocurrency Business Association (JCBA) has published its "Recommendations on New ICO Regulation" on Friday, March 8. The recommendations on Initial Coin Offerings (ICOs) regulations issued by the JCBA — a local industry trade group — focus on three main topics: the expansion of cryptocurrency in Japanese domestic exchanges, as well as the definitions of and regulations for utility tokens and security tokens. The proposed regulations suggest distinguishing between security and utility tokens and making the former subject to the Financial Commodity Exchange Act. As the announcement stresses, JCBA started its ICO Review Group at the end of last year and the issued document is primarily addressed to the country’s Financial Services Agency and businesses involved in the cryptocurrency industry. It also adds: “Base..

FATF Issues Preliminary Guidelines on Digital Assets to Combat Money Laundering

The Financial Action Task Force has updates its guidelines on digital assets to combat money laundering and terrorism financing. The Financial Action Task Force (FATF), an intergovernmental organization that develops policies against money laundering, has published preliminary guidelines for cryptocurrencies on its website on Thursday, Feb. 28. The FATF held a meeting on preliminary crypto requirements on Feb. 22. According to the organization, the new text of the Interpretive Note to Recommendation 15 — which contains requirements for regulating and supervising digital asset services providers — has been finalized. However, the FATF expects to benefit from private sector consultations that are scheduled for May, asking entrepreneurs to send their comments to the organization by Apr. 8. Once the recommendation is finalized, it can be formally adopted by the FATF. The final meeting is scheduled for June 2019. Firstly, the task force urges countries to follow guidelines to prevent money..

Apple Notes Blockchain Guidelines in Recent SEC Filing

A recent SEC filing revealed Apple’s involvement in the development of blockchain standards for mineral supply chains. Tech giant Apple has mentioned its work in forming the Blockchain Guidelines of the Responsible Minerals Initiative (RMI) in a filing with the United States Security Exchange Commission (SEC). The document, entitled “Conflict Minerals Report” was published on Feb. 15. In general, the document pertains to Apple’s business practices and ethics in sourcing minerals for its various consumer electronic devices. Apple states that it is “committed to going beyond the minimum requirements in order to meet and exceed internationally accepted due diligence standards and protect people in its supply chain…” Last year, Apple came under scrutiny for its plans to source cobalt — a necessary mineral for smartphones — directly from mines in Congo. While Apple is ranked highly among tech companies in terms of human rights abuses in its supply chains, “the bar is low,” according to hum..
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