Indian Central Bank Makes a Case Before Supreme Court Against Allowing Crypto Use

Indian Central Bank Makes a Case Before Supreme Court Against Allowing Crypto Use

India’s central bank told the country’s supreme court on Friday that “allowing dealings in cryptocurrencies like bitcoin would encourage illegal transactions.” Other crypto petitions being heard include one asking the government to “take emergency steps to restrain the sale and purchase of illegal cryptocurrencies.”

Also read: Yahoo! Japan Confirms Entrance Into the Crypto Space

RBI’s Argument

The Reserve Bank of India (RBI), the country’s central bank, appeared before the supreme court Friday to defend its position regarding cryptocurrencies. RBI issued a circular on April 6 banning financial institutions under its control from providing services to crypto companies.

According to the Economic Times, the central bank told the court:

Allowing dealings in cryptocurrencies like bitcoins would encourage illegal transactions and it has already issued a circular prohibiting use of these virtual currencies.

Indian Central Bank Makes a Case Before Supreme Court Against Allowing Crypto UseRBI explained that crypto is “a stateless digital currency” that operates independently of a central bank such as itself, thereby “rendering it immune from government interference,” the news outlet noted.

The Financial Express elaborated that the central bank believes “it is necessary to regulate the bitcoin and other cryptocurrencies to check illegal transactions which will impact the international flow of funds.” Senior counsel Shyam Divan, appearing for RBI, reiterated that the central bank has a particular stance and other departments may have other positions.

Petitions Being Heard

Petitions against the RBI crypto banking ban are not the only ones that the supreme court is hearing. The Economic Times described:

Some petitions challenged the use of virtual currencies and alleged that they posed grave dangers to the traditional economy and they also sought framing of guidelines to regulate them … They also sought a direction for the Centre to take emergency steps to restrain the sale and purchase of illegal cryptocurrencies.

Indian Central Bank Makes a Case Before Supreme Court Against Allowing Crypto UseThe Hindu pointed to one particular petition, filed by father and son Siddharth Dalmia and Vijay Pal Dalmia. “Mr. Dalmia, in his plea, has sought a direction to the Centre to take steps to restrain sale and purchase of illegal cryptocurrencies like bitcoins, which were being traded openly for ‘illegal activities’ like funding terrorism and insurgency,” the publication wrote.

The supreme court already heard the duo’s initial petition in November last year and subsequently issued notices to various government departments including RBI. The central bank responded at the time that it had warned people against the usage and risks associated with crypto. However, the Dalmias were not happy with RBI’s reply and filed a new petition, pointing out the inadequate action by the central bank.

At the hearing on Friday, the supreme court gave the government until September 11 to respond to all petitions.

What do you think of RBI’s view and action? Let us know in the comments section below.


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Facebook Unbans Cryptocurrency Ads

Facebook Unbans Cryptocurrency Ads

Facebook is lifting its ban on cryptocurrency ads which went into effect in January. After months of evaluation, the company decided to allow some crypto ads on its platform. Advertisers must submit a request form with details of their businesses and the types of crypto content to be promoted.

Also read: Yahoo! Japan Confirms Entrance Into the Crypto Space

Facebook Unbans Crypto Ads

Facebook’s Product Management Director, Rob Leathern, posted updates Tuesday to the company’s “prohibited financial products and services policy.”

Facebook Unbans Cryptocurrency AdsIn January, Facebook announced the policy to “prohibit ads that promote financial products and services that are frequently associated with misleading or deceptive promotional practices, such as binary options, initial coin offerings, and cryptocurrency,” Leathern explained. “This policy is intentionally broad while we work to better detect deceptive and misleading advertising practices… We will revisit this policy and how we enforce it as our signals improve.”

Citing that the company has been studying the best way to refine this policy over the past few months “to allow some ads while also working to ensure that they’re safe,” he elaborated:

Starting June 26, we’ll be updating our policy to allow ads that promote cryptocurrency and related content from pre-approved advertisers. But we’ll continue to prohibit ads that promote binary options and initial coin offerings.

Which Ads are Allowed?

Leathern clarified that there are some restrictions so not all ads will be allowed. “We’ll listen to feedback, look at how well this policy works and continue to study this technology so that, if necessary, we can revise it over time,” he wrote, adding:

Advertisers wanting to run ads for cryptocurrency products and services must submit an application to help us assess their eligibility — including any licenses they have obtained, whether they are traded on a public stock exchange, and other relevant public background on their business.

Facebook Unbans Cryptocurrency Ads
Request form provided by Facebook.

The application form entitled “Cryptocurrency Products and Services Onboarding Request” consists of six questions.

The first question plainly asks “why are you applying?” The applicant can choose between three options or provide their own reason. The first option is “Cryptocurrency products and services.” The second option is “Education on cryptocurrency” and the third option is “Cryptocurrency industry news.” However, the company reiterated, “As a reminder, initial coin offerings (ICOs) are prohibited under our Prohibited Financial Products and Services Policy.”

The second question asks whether the applicant has a Facebook Ad Account ID. Those who do not must create an ad account. The third asks about the applicant’s website domain and business details such as any licenses or regulatory certification the business holds, and if the business is a public company listed on a stock exchange.

Facebook Unbans Cryptocurrency Ads

The fourth asks for business information including an address. The fifth question asks for a brief description of products or services or other crypto-related content the site intends to promote while the final step requires the applicant to agree to the “Facebook Cryptocurrency Ads Addendum.”

In addition, the form asks the applicant to declare their domain(s) used in the crypto-related promotion:

You must verify your domain(s) associated with this application…we reserve the right to deny any application or withdraw eligibility at any time without notice. Eligibility may be subject to such conditions and restrictions as Facebook may decide.

What do you think of Facebook allowing approved crypto ads? Let us know in the comments section below.


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Japan Set to Finally Reject a Cryptocurrency Exchange

Japan Set to Finally Reject a Cryptocurrency Exchange

After approving 16 cryptocurrency exchanges, the Japanese financial regulator is reportedly set to reject a crypto exchange application for the first time. The applicant is an exchange which has been suspended twice from carrying out any crypto activities and received two business improvement orders.

Also read: Yahoo! Japan Confirms Entrance Into the Crypto Space

The First Rejection

The Japanese Financial Services Agency (FSA) is reportedly preparing to reject an application to operate a crypto exchange in the country. “The first time it has done so,” Nikkei reported, adding:

The decision follows the ministry’s conclusion that Yokohama-based FSHO lacks the necessary systems to operate its business…By barring an exchange operator that it has found to be substandard, the agency aims to demonstrate its determination to re-establish a sound currency trading environment in Japan.

Japan Set to Finally Reject a Cryptocurrency ExchangeFSHO is a “deemed dealer” or “quasi-operator” of cryptocurrencies in Japan, meaning it has been allowed to operate a crypto exchange while its application with the FSA is being reviewed. There are 16 deemed dealers altogether. However, the agency said recently that 8 of them have indicated that they will withdraw their applications.

Meanwhile, Japan has 16 fully-licensed cryptocurrency exchanges and about 100 companies are seeking to enter the space including Yahoo! Japan, Line Corp, and Coinbase.

Suspended with Corrective Orders

Japan Set to Finally Reject a Cryptocurrency ExchangeBesides Coincheck which was hacked in January, FSHO is the only other crypto exchange in Japan to receive two punishment orders from the FSA. The first was on March 8 and the second on April 6.

In the March order, the agency suspended all of FSHO’s businesses related to cryptocurrencies from March 8 to April 7 and issued the company a business improvement order. The company was told to correct four areas of operations such as to “Build a position to securely manage user information.” The improved measures taken were to be submitted to the agency by March 22.

Rejection to Follow Second Suspension

In the April order, the agency again suspended all operations relating to cryptocurrencies of the company from April 8 to June 7 and issued another business improvement order.

Japan Set to Finally Reject a Cryptocurrency ExchangeThis second order contains five business improvement areas, some of which were the same as those in the first order. Among new areas are the “Establishment of an effective management system including money laundering and terrorist financing” and a risk management system. The company was supposed to report the changes to the agency by May 7.

Based on its review, the FSA found that “the exchange did not sufficiently verify the identity of customers in transactions where crime is suspected, or in cases where customer deposits may be diverted,” Nikkei summarized, adding that:

The suspension period is due to end Thursday, after which the agency will bar the exchange from operating and deny its registration.

What do you think of the FSA finally rejecting a crypto exchange registration? Let us know in the comments section below.


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Vietnam Proposes Import Ban on Bitcoin Mining Equipment

Vietnam Proposes Import Ban on Bitcoin Mining Equipment

Vietnam’s Ministry of Finance has officially proposed that the country bans the import of cryptocurrency mining equipment. Bitcoin mining rigs are currently easily imported into Vietnam. This proposal follows the largest crypto fraud case in the country involving over $656 million and more than 32,000 victims.

Also read: Yahoo! Japan Confirms Entrance Into the Crypto Space

Ministry of Finance’s Proposal

Vietnam Proposes Import Ban on Bitcoin Mining EquipmentIn the recently released report containing the opinions of the ministries involved in the management of bitcoin and other cryptocurrencies in Vietnam, the country’s Ministry of Finance proposes suspending the importation of mining equipment, according to local media. This report, referred to as Document 5964 / BTC-TCHQ, has been submitted to the country’s prime minister. Zing.vn publication elaborated:

According to the Ministry of Finance, mining machines are not on the list of goods banned from importation and are not subject to the list of specialized management or unsafe goods, so enterprises are easily allowed to complete the import procedures.

Vietnam Proposes Import Ban on Bitcoin Mining EquipmentThe ministry outlined in its report that the use of mining equipment for bitcoin, litecoin and other cryptocurrencies in the country is difficult for the authority to manage. “From there, it is easy for people to use [cryptocurrencies] as a currency or another method of payment,” the City Economic News Kinhte & Dothi quoted the ministry. “This is in violation of the amended government Decree 101 on non-cash payments,” Zing.vn conveyed.

The publication also noted that data from the General Department of Vietnam Customs shows that “from 2017 to half of 4/2018, the country imported about 15,600 mining machines,” adding that most of them were imported into Hanoi, Ho Chi Minh City, and Da Nang. Last year, more than 9,300 rigs were imported into Vietnam and over 6,300 rigs were imported in the first four months of this year.

Decision to Ban Mining Imports

The ministry also referred the case where Modern Tech Corp in Ho Chi Minh City was “accused [of] over VND 15 trillion [~US$656 million] of fraud by more than 32,000 people through its Ifan and Pincoin virtual currency investment models.” According to the ministry, protecting the Vietnamese people from similar scams in the future “requires state management agencies to take strict control measures with the import and use of this commodity.” The Vnexpress reiterated:

To prevent other possible events, in the immediate future, the Ministry of Finance proposed to apply the import suspension measures for the above types of mining equipment.

The Vietnamese Prime Minister Nguyễn Xuân Phúc recently signed a directive to strengthen “the management of activities related to bitcoin and other virtual currencies,” as news.Bitcoin.com previously reported.

What do you think of the proposal to ban mining rig imports? Let us know in the comments section below.


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South Korean Lawmakers Draft Bill to Legalize Some Initial Coin Offerings

South Korean Lawmakers Draft Bill to Legalize Some Initial Coin Offerings

A group of South Korean lawmakers is working on a bill to legalize initial coin offerings (ICOs), providing they meet certain conditions under the supervision of the government. Meanwhile, the current ICO ban in the country has driven many domestic corporations to raise capital overseas.

Also read: Yahoo! Japan Confirms Entrance Into the Crypto Space

Bill to Legalize ICOs

South Korean Lawmakers Draft Bill to Legalize Some Initial Coin OfferingsRep. Hong Eui-rak of the South Korean ruling Democratic Party “is leading the move championed by 10 other lawmakers” to legalize ICOs, the Korea Times reported. “They are working to have a bill backing the move endorsed this year.”

During the ICO and blockchain technology forum at the National Assembly on Wednesday, Hong said that “the bill was based on a joint study by his office and the Korea International Trade Association (KITA),” according to the publication. “This is the first parliamentary challenge to the government’s ban on domestic initial coin offerings imposed late last year to cool speculative investment in digital currencies such as bitcoin.” The news outlet then quoted Hong saying:

The bill is aimed at legalizing ICOs under the government’s supervision.

The lawmaker elaborated, “The primary goal [of the legislation] is helping remove uncertainties facing blockchain-related businesses.”

Not All ICOs Will Be Legalized

However, the publication emphasized that:

The bill does not seek [to legalize] unlimited ICOs, but ones initiated by public organizations and research centers committed to promoting and developing blockchain technology.

According to the bill, approved ICOs will be subject to tight supervision by the Financial Services Commission (FSC) and the Ministry of Science and ICT, the news outlet conveyed.

South Korean Lawmakers Draft Bill to Legalize Some Initial Coin OfferingsSouth Korea banned all ICOs last year. However, the financial authorities were reportedly talking to the country’s tax agency, justice ministry, and other relevant government departments last month about a plan to allow ICOs in the country providing certain conditions are met.

Meanwhile, domestic companies have been setting up subsidiaries and launching their token sales abroad, in countries such as Singapore, Hong Kong, Switzerland, and Japan. Chat app operators Kakao Corp and Naver, for example, have set up subsidiaries in Japan. Hyundai BS&C, an affiliate of Hyundai Group, launched its ICOs in Switzerland. Recently, one of the country’s largest crypto exchanges, Bithumb, also unveiled its plans to launch an ICO in Singapore.

However, the FSC has reiterated that regardless of where the ICOs are, Korean companies could still be subject to domestic regulations. While the “current laws [in Korea] do not prohibit ICOs from abroad,” FSC Chairman Choi Jong-ku emphasized, “it is highly likely to violate current legislation.”

Do you think South Korea will soon legalize ICOs? Let us know in the comments section below.


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US State Shuts Down Cryptocurrency Mining Company

US State Shuts Down Cryptocurrency Mining Company

A U.S. state has issued a cease and desist order to a company purportedly engaged in cryptocurrency mining. This order follows a temporary cease and desist order to the company two months ago which it did not respond to.

Also read: Yahoo! Japan Confirms Entrance Into the Crypto Space

Cease and Desist Order

The U.S. State of North Carolina issued a cease and desist order to Power Mining Pool (PMP) last week. After some investigation, the state’s Securities Division declared:

The Securities Division found that PMP is violating the Securities Act by: a. offering unregistered securities in the form of ‘mining pool shares;’ b. offering securities while it is not registered to do so; and c. making material misstatements when offering securities.

US State Shuts Down Cryptocurrency Mining CompanyThe order mandates the company and any person, employee, officer, director, entity, or independent contractor under its direction or control to permanently cease and desist from selling securities in the state until the security is registered or exempt.

They also must not act as a securities dealer, salesman, or agent unless registered with the state. Furthermore, they must not engage in fraud in connection with the offer or sale of any security, or violate other provisions and rules of the state.

This order follows a temporary cease and desist order issued by the same division on March 2. However, the company has neither responded to the order nor requested a hearing. Instead, its website, which is its principal place of business, went offline on March 6, the order revealed.

US State Shuts Down Cryptocurrency Mining Company

Questionable Operations

The State of North Carolina described PMP as an online business that is unregistered in any jurisdiction, without a physical place of business and “The individuals who managed PMP are not identified.”

The company represents that it owns and operates mining rigs capable of mining seven different cryptocurrencies 24 hours a day, 7 days a week. It also represents that these rigs track the profitability of each of the seven cryptos and automatically “switch resources away from less profitable coins.”

US State Shuts Down Cryptocurrency Mining CompanyPMP also offers mining pool shares to investors to mine on their behalf. “Investors who purchase mining pool shares must first purchase bitcoin with their fiat currency, such as the U.S. Dollar or Euro,” the order detailed. “Next, PMP directs investors to deposit their bitcoin into PMP’s bitcoin wallet in order to set up an account on the PMP website.” The company then claims to mine cryptocurrencies on investors’ behalf and purported to pay investors the fiat value of the coins mined.

Investors can also “trade the mined coins for bitcoin.” PMP claims that it will pay the investors “on any profits we make in the trading pool” every three hours.

The Secretary of State of North Carolina wrote:

The mining pool shares are securities and are not registered with the Administrator…PMP willfully fails to disclose material facts when offering the mining pool shares.

What do you think of North Carolina shutting down Power Mining Pool? Let us know in the comments section below.


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India Divided on Whether to Ban Crypto Use

India Divided on Whether to Ban Crypto Use

As India works on the bill to regulate cryptocurrencies, each government department has its own opinion on whether to ban the use of crypto, including bitcoin. The Finance Ministry, the Reserve Bank of India (RBI), the Income Tax Department, and the Special Investigation Team have voiced their opinions on the upcoming bill.

Also read: Russian Regulators Draft Law to Restrict Crypto Mining, Payments, and Token Sales

No Consensus Among Regulators

India Divided on Whether to Ban Crypto UseIndia is preparing a bill on the regulation of cryptocurrency. “The bill has been drafted and consultation has been started with the concerned agency,” the Navbharat Times reported last week. The news outlet quoted sources explaining that the regulators are divided on whether to ban the use of cryptocurrencies such as bitcoin.

“The finance ministry is in favor of regulating [cryptocurrency],” sources said. The Income Tax Department, on the contrary, is not in favor of regulation, the news outlet conveyed, and quoted sources explaining:

The regulation of virtual currency is almost impossible and it promotes the use of black money.

India Divided on Whether to Ban Crypto UseThe RBI “is also not in favor of banning virtual currencies,” but sources pointed out that “the current form of the bill proposes to ban virtual currency businesses.” However, there may be exemptions for “issuing crypto tokens in exchange for assets.”

Meanwhile, the Indian Special Investigation Team (SIT) “wants to ban the use of bitcoins” after discovering at least four cases where the digital currency was used to pay for drugs, the Sunday Guardian reported. The SIT comprises of officials from the Narcotics Control Bureau (NCB), the Enforcement Directorate (ED), the Central Bureau of Investigation (CBI) and the Income Tax Department.

India Divided on Whether to Ban Crypto UseThe SIT has previously asked the ED, NCB and the Income Tax Department “to take adequate measures to prevent the use of cryptocurrencies,” the publication noted, adding that the Team “has called for a second round of meetings to be held in Delhi next month, where the officials from all the aforementioned agencies will review the use of cryptocurrencies.”

Experts Say Crypto Ban Not Very Feasible

The debate is also taking place in the private sector. Sarvesh Tyagi, a Delhi-based cyber law expert, told the Sunday Guardian that “it is doubtful that the SIT will succeed in banning the use of cryptocurrencies. Ban is not a solution. We need a regulatory authority.” She elaborated:

A blanket ban on the use of cryptocurrencies is not a very feasible solution as drug smuggling is a big problem, and in most cases, these transactions have nothing to do with use of cryptocurrencies.

Crypto Businesses Fight Back

The RBI announced earlier this month for banks and payment gateways under its control to stop providing services to businesses dealing in cryptocurrencies. “Banks have already sent notices to exchanges,” Sathvik Vishwanath, CEO of a leading Indian exchange Unocoin, told news.Bitcoin.com.

India Divided on Whether to Ban Crypto UseThe RBI allows banks “about 3 months of time to end the relationships” with crypto businesses, he noted, adding that crypto companies “will be attempting to challenge the [RBI] order” in the Supreme Court as a consortium.

One company, Kali Digital Eco-Systems, has already appealed to the High Court in Delhi against the recent RBI crackdown. The company is behind the upcoming crypto exchange called Coinrecoil.

On Sunday, the company announced that Delhi High Court has accepted its petition against the Indian regulators, adding that:

Hon’ble High Court of Delhi has issued a notice to the Reserve Bank of India, the Union of India through Secretary, Ministry of Finance and GST Council. The next hearing in this case is on May 24, 2018.

What do you think of the Indian regulators’ divided opinions on how to regulate cryptocurrencies? Let us know in the comments section below.


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Central Bank of Iran Bans Banks from Crypto

Central Bank of Iran Bans Banks from Crypto

Iran’s central bank has issued a statement banning the country’s banks and financial institutions from dealing with cryptocurrencies such as bitcoin, citing money laundering and terrorism financing risks. However, the local crypto community in Iran believes that the ban will not affect them and some exchanges continue to operate normally.

Also read: Russian Regulators Draft Law to Restrict Crypto Mining, Payments, and Token Sales

Banned by Central Bank

Central Bank of Iran Bans Banks from CryptoThe Central Bank of Iran (CBI) has issued a statement on Monday banning the use of cryptocurrencies including bitcoin by banks and financial institutions. This announcement came “amid ongoing debate over how best to regulate the technology,” the AFP elaborated.

According to the CBI, “the government’s money laundering committee had taken the decision in late December and it was now being put into effect,” the news outlet conveyed and quoted the central bank explaining:

All cryptocurrencies have the capacity to be turned into a means for money laundering and financing terrorism and in general can be turned into a means for transferring criminals’ money.

The central bank noted that banks and financial institutions in Iran were informed a few days ago, Mehr News reported.

The ban comes at a tenuous time for the Iranian economy. Between now and May 12, both the EU and the US are expected to decide on a new round of economic sanctions targeting Tehran. This could restore the harsh international controls on Iran that were lifted in the 2015 nuclear treaty between Iran and six major powers, including the US.

Effects of Crypto Community in Iran

Monday’s announcement follows another prohibition recently announced by the central bank, banning foreign fiat currency exchanges.

Central Bank of Iran Bans Banks from Crypto
Mohammad-Javad Azari Jahromi.

The Iranian government has mixed views on cryptocurrency, however. In February, the country’s telecom minister, Mohammad-Javad Azari Jahromi, tweeted the news that his ministry and the CBI are investigating the prospect of running their own initial coin offering (ICO) together. The resulting cryptocurrency would serve as “an experimental model for the country’s banking system,” he believes.

While many people in Iran see cryptocurrencies as a way to overcome problems with international sanctions and the country’s banking system, there are also those who fear “the technology could undermine the country’s already weak banking system and exacerbate capital flight,” the AFP explained.

Central Bank of Iran Bans Banks from Crypto“Iranians working in the fledgling private cryptocurrency market said the ban was unlikely to affect their operations,” the publication further described. A local crypto exchange Coinex has, however, halted activity on its platform in response to the central bank’s action, citing “we always want to make sure we comply with the law,” Hadi Nemati, who works for the exchange, told the news outlet. “But I have seen other crypto exchanges were still working normally,” he clarified, adding:

This ruling referred directly to banks, financial institutions and currency exchangers that work with the central bank…In my opinion, it doesn’t include the general public — it’s not a total ban on cryptocurrencies.

What do you think of the Iranian central bank’s action? Let us know in the comments section below.


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Hanoi Prohibits Use of Cryptocurrencies in E-commerce Transactions

Hanoi Prohibits Use of Cryptocurrencies in E-commerce Transactions

The Hanoi Department of Industry and Trade has prohibited organizations and individuals involved in e-commerce business in the city from using bitcoin and other cryptocurrencies. This follows a directive signed by the country’s prime minister intended to strengthen the legal framework of cryptocurrencies.

Also read: Yahoo! Japan Confirms Entrance Into the Crypto Space

Banning Crypto Use in E-commerce

The Hanoi Department of Industry and Trade announced on Saturday that it has sent document No. 1638 / SCT-QLTM to “organizations and individuals directly or indirectly related to e-commerce business in Hanoi [to] not use bitcoin and other virtual currencies (cryptocurrencies) to settle e-commerce transactions online.” Citing that if violations are detected, “they shall be strictly dealt with according to the provisions of the law,” the regulator wrote:

The Department of Industry and Trade requires organizations and individuals who are directly or indirectly involved in e-commerce business in Hanoi to strictly abide by the above-mentioned regulations and do not use bitcoin and other virtual currencies….in payment of e-commerce transactions, online purchases and sales, [and] payment [of] online services in contravention of Vietnamese law.

Vietnamese Law on Crypto

Hanoi Prohibits Use of Cryptocurrencies in E-commerce TransactionsCiting provisions of the government’s Decree No. 101/2012 / ND-CP on non-cash payment instruments, the document reiterates, “bitcoin and other similar virtual currencies are not legal means of payment in Vietnam; The issuance, supply, use of bitcoin and similar virtual currency is prohibited in Vietnam.”

Violations are subject to a “fine of between VND 150,000,000 [~US$6,608] and 200,000,000 [~$8,810] for individuals and for organizations with two times the fine level for personal,” the document emphasizes. Furthermore, as of January this year, issuing and using cryptocurrencies “may be subject to criminal prosecution.”

Hanoi Prohibits Use of Cryptocurrencies in E-commerce TransactionsLast week, the Vietnamese Prime Minister Nguyễn Xuân Phúc signed a directive to strengthen the management of activities related to bitcoin and other cryptocurrencies. This follows reports of the country’s “biggest digital money fraud in history,” which duped approximately 32,000 Vietnamese out of VNĐ15 trillion (~$658 million). The police are currently investigating the case.

Meanwhile, the Justice Ministry, the State Bank of Vietnam (SBV), and related agencies are working on the regulatory framework for cryptocurrencies. According to the Ho Chi Minh City Customs Department, the number of bitcoin mining rigs legally imported into the country has skyrocketed since last year, prompting the department to propose a ban on their imports. Earlier this year, the department revealed that, in the first three weeks of January, almost 8,000 mining rigs were legally imported into the city.

What do you think of Hanoi prohibiting the use of crypto for e-commerce transactions? Let us know in the comments section below.


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Indian Crypto Exchanges Strategize to Challenge RBI Crackdown

Indian Crypto Exchanges Forming Strategies to Challenge RBI Crackdown

Indian crypto exchanges are devising strategies to challenge and respond to the Reserve Bank of India’s order to prohibit banks from servicing businesses dealing in cryptocurrencies. News.Bitcoin.com talked to Sathvik Vishwanath, CEO of a leading Indian exchange Unocoin, to find out more details.

Also read: Japan’s DMM Bitcoin Exchange Opens for Business With 7 Cryptocurrencies

Going International

Indian Crypto Exchanges Strategize to Challenge RBI CrackdownFollowing the announcement by the Reserve Bank of India (RBI) last week, many crypto exchanges are reportedly looking to “move their head offices to jurisdictions outside India,” according to the Economic Times. The news outlet reported that among the exchanges considering moving overseas are Unocoin, Zebpay, Coinsecure, Buyucoin and Btcx India.

The central bank has mandated banks and payment gateways under its control to stop providing services to businesses dealing in cryptocurrencies. “This will impact nearly 50 lakh [5 million] Indians who have invested in cryptocurrencies, as well as India’s crypto exchanges,” the publication noted.

Vishwanath confirmed to news.Bitcoin.com that:

Banks have already sent notices to exchanges. But they have provided some breathing room as the mandate from RBI provides the banks itself about 3 months of time to end the relationships.

Among the locations that exchanges are considering are Singapore, Delaware, and Belarus, the publication added. Shivam Thakral, the CEO of Buyucoin exchange, was quoted explaining, “We have to move our company to some foreign country where regulations allow opening of bank accounts plus we won’t be dealing in fiat currency. It will become a global operation rather than an India centric operation.”

Indian Crypto Exchanges Strategize to Challenge RBI CrackdownAs for Unocoin, Vishwanath described, “We do not have any solid plan for what we do want to do internationally yet.”

Grant Thornton Advisory director Riaz Thingna believes that “Indian investors may be able to continue to invest with the platforms through innovative structures” even if the exchanges move abroad. While expecting crypto trading volume from India to “surely go down,” she said “profits from businesses originating from India may escape tax in India as the exchanges would not have a permanent establishment in India after the move,” the news outlet conveyed.

Challenging RBI’s Decision

Indian Crypto Exchanges Strategize to Challenge RBI CrackdownMoney Control reported this week that some of the largest Indian crypto exchanges are also considering challenging RBI’s order in the Supreme Court. “Startups like Unocoin, Coinsecure and Zebpay have expressed their reservations with the order and going by the statements they are considering to mount a legal challenge in the Supreme Court,” the news outlet wrote. Coinsecure revealed that they are discussing the matter with industry stakeholders such as the Blockchain and Cryptocurrency Committee of India and the Internet and Mobile Association of India, the publication detailed.

Vishwanath explained to news.Bitcoin.com:

As a consortium, we will be attempting to challenge the order but this alone will not provide any relief to the industry due to delays and summer holidays associated.

While Zebpay acknowledged that “sudden disruption in banking services could affect our ability to service deposits and withdrawals,” CEO Ajeet Khurana tweeted, “No way I am stopping. We will continue to do what is best for our customers, and what is best for our country. [I] am studying the present situation and will react shortly, and we will emerge stronger.”

Vishwanath elaborated:

Every industry player is figuring out their own strategy but none of that info is there in the public domain yet. In our case, we will continue to operate the trading platform and exchange but we would need to tweak it a bit to adapt to the new regulatory stance.

What do you think of Indian crypto exchanges’ strategies to respond to the RBI’s order? Let us know in the comments section below.


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Corporations Bypassing Korean ICO Regulations With Overseas Subsidiaries

Corporations Bypassing Korean ICO Regulations With Overseas Subsidiaries

Major corporations in South Korea are increasingly establishing cryptocurrency subsidiaries and launching initial coin offerings outside of the country due to prohibitive regulations. They are seeking opportunities in countries like Japan, Switzerland, Singapore, and Gibraltar.

Also read: Japan’s DMM Bitcoin Exchange Opens for Business With 7 Cryptocurrencies

Regulations Driving Away Businesses

An increasing number of corporations in South Korea are establishing cryptocurrency and blockchain subsidiaries abroad due to restrictive regulations. Money Today elaborated:

Korea’s largest Internet and mobile companies have left Korea one after another as they entered virtual currency and blockchain businesses.

Corporations Bypassing Korean ICO Regulations With Overseas SubsidiariesMany companies are leaving Korea because the government has banned initial coin offerings (ICOs), the news outlet noted and recalled financial authorities declaring last September, “We will ban ICOs in all forms, regardless of technology or terminology.”

Former lawmaker Jeon Ha-jin was quoted by the publication, “global blockchain companies are watching Korea, but the government has kicked out opportunities.” Calling for full legalization of ICOs, he conveyed that the government’s ban on ICOs has blocked funding for companies entering the crypto and blockchain space.

Corporations Seek Opportunities Abroad

Corporations Bypassing Korean ICO Regulations With Overseas SubsidiariesRecently, the parent companies of the two most popular chat apps, Line’s Naver and Kakao Corp, announced that they have established crypto and blockchain subsidiaries in Japan. The operator of Kakao Talk established a blockchain subsidiary called Ground X. Naver established a subsidiary called Line Financial which has applied for a license to operate a crypto exchange with the Japanese Financial Services Agency (FSA).

In March, Business Korea reported that South Korean healthcare companies are increasingly launching their ICOs abroad including Zikto, My23 Healthcare, and Medibloc, adding:

Domestic companies are leaving South Korea and setting up a subsidiary overseas, like Singapore and Gibraltar, to run ICOs.

Hyundai BS&C, an affiliate of South Korean conglomerate Hyundai group, also recently launched its ICO in Switzerland.

Corporations Bypassing Korean ICO Regulations With Overseas SubsidiariesKorean startup Theloop, a subsidiary of Dayli Financial Group, launched an ICO and set up a foundation in Switzerland as well. Dayli Financial also owns one of South Korea’s largest crypto exchanges, Coinone.

Park Chang-ki, chairman of Governtech and founder of major financial information portal,  Paxnet, also established a foundation in Switzerland and launched an ICO.

While token sales are currently banned in South Korea, the Korea Times reported last month that the government may be allowing them in future regulations. “The financial authorities have been talking to the country’s tax agency, justice ministry and other relevant government offices about a plan to allow ICOs in Korea when certain conditions are met,” the news outlet quoted an anonymous source.

What do you think of companies leaving South Korea to set up crypto subsidiaries and launch their ICOs abroad? Let us know in the comments section below.


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Kazakhstan Preparing to Prohibit Crypto Trading and Mining, Says Central Bank

Kazakhstan Preparing to Prohibit Crypto Trading and Mining, Says Central Bank

The chairman of the central bank of Kazakhstan said that the bank has prepared legislation to prohibit the sale and purchase of cryptocurrencies in the country as well as any kind of crypto mining, citing several risks he sees.

Also read: Japan’s DMM Bitcoin Exchange Opens for Business With 7 Cryptocurrencies

National Bank’s Crackdown on Crypto

Kazakhstan Preparing to Prohibit Crypto Trading and Mining, Says Central BankThe chairman of the National Bank of Kazakhstan Daniyar Akishev said on Friday that “Kazakhstan intends to prohibit the purchase and sale of cryptocurrencies and any kind of mining of cryptocurrencies” in an interview with Ria Novosti.

The publication quoted the central banker stating:

In Kazakhstan, the National Bank is very conservative about this issue [cryptocurrency]. I welcome only rather stringent restrictions, that is, we want to prohibit the purchase and sale of the national currency for cryptocurrency. We want to prohibit the activity of exchanges on this segment and any kinds of mining.

Risks the Central Bank Sees

Akishev claims to see a lot of problems concerning cryptocurrencies, especially pertaining to the protection of customers’ rights.

Kazakhstan Preparing to Prohibit Crypto Trading and Mining, Says Central Bank
Daniyar Akishev.

He was quoted by the news outlet declaring his intention to “minimize the risks associated with the national market,” adding that “but for sure, not one central bank has full functionality to administer this market [cryptocurrency] in a cross-border market, so at the very least, we must stop this risk through the national currency.”

Another major risk, he described, “is the possibility of [using] cryptocurrency to commit illegal activities,” the publication noted, and quoted Akishev asserting, “Cryptocurrency is an ideal tool for money laundering and for avoiding taxation.” He noted that the central bank’s position on crypto “is supported by the majority of state bodies of Kazakhstan,” and was quoted by Ria Novosti saying:

We have prepared amendments to the legislation that should lead to this tightening.

In October of last year, Akishev said that the central bank proposed to restrict some activities relating to cryptocurrency in the country “to protect the public from speculative risks.” He said at the time, “we sent our proposals to the government, in which we suggest carrying out a series of tougher measures, including prohibiting the exchange of the national currency for cryptocurrencies, prohibiting the activities of some companies that generate cryptocurrencies and so on.”

Meanwhile, interest in cryptocurrency in the country has jumped 15-fold early this year compared to the previous year, according to Yandex. Citizens are also searching 10 times more for terms related to video cards, crypto mining, as well as how to mine.

What do you think of the central bank of Kazakhstan’s action? Let us know in the comments section below.


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Russia Drafts Law to Criminalize the Use of Cryptocurrencies as Money

Russia Drafts Law to Criminalize the Use of Cryptocurrencies as Money

The Russian Ministry of Finance is drafting a law to criminalize the use of cryptocurrencies as money substitutes. The Bank of Russia and the finance ministry have previously opposed the use of cryptocurrency in this way, citing that only rubles can be used for payments of goods and services in Russia.

Also read: Indians Look to Buy Bitcoin Overseas as Regulations Tighten

Money Surrogate Bill

The Russian Ministry of Finance proposed last week to “criminalize the turnover of money surrogates,” including cryptocurrencies, Interfax reported. Deputy Finance Minister Alexei Moiseev revealed during Vnesheconombank‘s conference that his ministry has “prepared a draft law on criminal liability for the turnover of money surrogates,” Business FM elaborated, adding:

The ministry assumes serious responsibility, right up to criminal ones, for arranging schemes, issuing money substitutes and receiving them…This concerns the payments in cryptocurrency.

Russia Drafts Law to Criminalize the Use of Cryptocurrencies as MoneyMoiseev further clarified that “the text of the bill on monetary surrogates is not exclusively devoted to cryptocurrencies,” noting that only the Russian ruble can be used to pay for goods and services, as declared in the Russian constitution. While “Monetary surrogates are prohibited,” the publication explained that the laws have not specified penalties for violations. “The consequences of the violation of this principle have not been reflected anywhere for many years. The Finance Ministry decided to fill this gap” the news outlet detailed.

Prohibiting the Use of Crypto as Money

Although there have been many positive developments for cryptocurrencies among Russian lawmakers this year, the Ministry of Finance and the Bank of Russia have never wavered from their stance on cryptocurrencies as money surrogates. The head of the central bank, Elvira Nabiullina, has repeatedly said that the regulator is against “cryptocurrency as private money and money surrogates,” Interfax described, adding that “under the definition of money surrogates there are also cryptocurrencies.” Moiseev expressed last week:

There is the ruble, and everything else is a surrogate.

Russia Drafts Law to Criminalize the Use of Cryptocurrencies as Money
Alexei Moiseev.

The finance ministry has also recently proposed “to legislatively prohibit the use of cryptocurrency as a surrogate for payments in the territory of Russia,” the news outlet wrote.

According to Moiseev, many Russian companies that accept bitcoin use services that instantly convert cryptocurrencies into rubles. Citing that these companies receive only rubles, he confirmed that “Such operations will not be closed.”

The finance ministry recently submitted the bill on digital financial assets, amid its disagreement with the central bank on “the exchange of cryptocurrency for rubles and other assets.” The Ministry of Finance was quoted emphasizing that it “must finalize the draft law, which will define the concept of ‘money surrogates’ in the legislation and establish responsibility for their use as a means of payment,” concluding that:

This is necessary to protect the ruble as the single legal [means of] payment in Russia.

What do you think of this draft law? Let us know in the comments section below.


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Korean Government Officials De Facto Banned from Holding and Trading Crypto

Korean Government Officials De Facto Banned from Holding and Trading Crypto

The South Korean government has reportedly de facto banned all government officials from holding and trading cryptocurrencies. Even if their crypto activities are not related to their jobs, public officials can still be subject to disciplinary actions.

Also read: Indians Look to Buy Bitcoin Overseas as Regulations Tighten

Public Officials De Facto Banned from Crypto

South Korea has reportedly “issued a ban on virtual currency holdings and transactions to all government officials,” Maeil Business Newspaper reported.

According to the document entitled “Virtual currency holdings and transaction-related information for civil servants,” the publication elaborated:

The personnel department requested that they [civil servants] refrain from holding and trading virtual currency even if there is no job relevance…This is the first time the government has formulated a virtual currency ban for all public officials.

Disciplinary Actions Encouraged but Not Defined

Korean Government Officials De Facto Banned from Holding and Trading CryptoThe publication quoted the personnel affairs department explaining that if employees trade digital currencies for their personal benefit, they “are in violation of the prohibition of forbearance obligations under the civil servants’ law,” especially if trading is done during work hours. “Even if there is no job relevance,” the officials “could be subject to discipline,” the news outlet conveyed and quoted a high-ranking official explaining:

The disciplinary issue is not a quantitative cut, but a problem of interpretation of the law. Each ministry should judge the possibility of discipline.

Additional Efforts

The Korean Financial Services Commission (FSC), the Fair Trade Commission, and other related departments have already warned their employees “to refrain from investing in virtual currency,” the news outlet added. Furthermore, the head of the Office of Policy Coordinator, Hong Nam, told all public officials to do the same in January.

Korean Government Officials De Facto Banned from Holding and Trading Crypto
The Blue House.

Last month, the Korean Anti-Corruption & Civil Rights Commission issued the “Code of Conduct Guide to Cryptocurrency” to all government departments and public agencies.

This document adds cryptocurrency to Article 12 of the Civil Servant Code of Conduct, prohibiting public officials from using “the information learned during their duties to assist in trading or investing” in cryptocurrency. In addition, the FSS, which is an independent agency, said that it will review its own code of conduct.

Earlier this year, a bill was introduced to require public officials to declare their cryptocurrency investments. It followed accusations that some government employees were involved in insider trading using undisclosed knowledge of future regulations as well as market manipulation.

Do you think Korean government officials should be banned from holding and trading crypto? Let us know in the comments section below.


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Bangladesh Authorities on “Hunt” for Bitcoin Traders

Bangladesh Authorities on "Hunt" for Bitcoin Traders

Bangladesh – one of the few countries presently attempting to enforce a ban on cryptocurrency trading and use – has announced that several major state institutions will begin ramping up efforts to crack down on bitcoin adoption among Bangladeshi citizens.

Also Read: Indians Look to Buy Bitcoin Overseas as Regulations Tighten

Bangladesh Central Bank Warns Financial Institutions Against Cryptocurrency Users

Bangladesh Authorities on "Hunt" for Bitcoin TradersBangladesh Bank officials have again issued a warning pertaining to cryptocurrencies, this time seeking to deter the country’s banks from providing services to bitcoin users.

An official from the Bangladesh Financial Intelligence Unit (BFIU) told reporters that “Banks and other financial organizations of the country have been ordered to maintain a strict vigil on cryptocurrency trading. A circular will soon be sent out detailing the matter,” adding “There is no way to purchase these currencies legally through banking channels. Cybercrime investigators are working on the matter.”

Bangladeshi Authorities on “Hunt” for Bitcoin Traders

Bangladesh Authorities on "Hunt" for Bitcoin TradersInvestigators from the BFIU are reported to “have already begun to look for bitcoin traders,” with the Bangladesh Telecommunication Regulatory Commission (BTRC) allegedly aiding said investigations. Officials representing the BFIU and BTRC have held four meetings regarding cryptocurrency so far.

Nazmul Islam, the assistant deputy commissioner of Bangladesh’s cybercrime unit, stated “We have already located a few bitcoin users, and are on the hunt for more, along with a few web pages which are being checked for authenticity. Investigating cryptocurrency trading is a complex matter.”

A high ranking official from Bangladesh’s central bank also indicated that the country’s Foreign Exchange Police Department, among other state institutions, is actively monitoring bitcoin – with a report soon expected to be delivered to the Ministry of Home Affairs regarding the impacts and potential policy ramifications of virtual currencies.

Cryptocurrency Use Prohibited in Bangladesh

Bangladesh Authorities on "Hunt" for Bitcoin TradersLocal media has reported that “the trading and usage” of cryptocurrency remains “rampant” in Bangladesh, despite the central bank’s announcement at the end of 2017, revealing the country’s prohibition on bitcoin use.

In addition to groups devoted to facilitating peer to peer trading proliferating on social media platforms, Dhaka Tribune states “Localbitcoins.com says that [crypto]currencies are being traded in Bangladesh through banks, bKash, Rocket, and other methods of mobile banking.”

What is your response to Bangladeshi authorities seeking to “hunt” bitcoin traders? Share your thoughts in the comments section below!


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Bank of Thailand Bans Banks From Cryptocurrency Activities

Bank of Thailand Bans Banks From Five Cryptocurrency Activities

The Thai central bank has prohibited financial institutions in the country from five key cryptocurrency activities, including banning customers from buying cryptocurrencies with credit cards.

Also read: Japan’s DMM Bitcoin Exchange Opens for Business With 7 Cryptocurrencies

Banks Banned From 5 Crypto Activities

Bank of Thailand Bans Banks From Five Cryptocurrency ActivitiesThe Bank of Thailand (BOT) issued a circular on Monday asking “financial institutions not to get involved in cryptocurrency transactions for fear of possible problems from the unregulated trading,” Reuters translated.

Mr. Wisit Santiprabop, the central bank’s governor, signed the circular which outlines five key cryptocurrency activities banks are banned from:

Investing or trading in cryptocurrency, exchanging cryptocurrencies, creating platforms for cryptocurrency trading, allowing clients to use credit cards to buy cryptocurrencies, and from advising customers on cryptocurrency investing or trading.

Bank of Thailand Bans Banks From Five Cryptocurrency Activities
Circular excerpt explaining the five crypto activities banks are banned from.

The central bank stated that “cryptocurrencies were not legal tender in Thailand,” the publication conveyed, adding that “it was worried that they may be used in illegal activities such as money laundering or supporting terrorism.”

Recently, the Thai government announced that it will not ban cryptocurrencies and is developing a regulatory framework for them.

Banks Complying

Bank of Thailand Bans Banks From Five Cryptocurrency ActivitiesMs. Prasanee Auiyamaphan, a Bangkok Bank Executive Assistant, was quoted by Voice TV saying that the bank has “no policy to provide [crypto] exchange services,” emphasizing that cryptocurrencies cannot be exchanged for cash at her bank.

Bank of Thailand Bans Banks From Five Cryptocurrency ActivitiesMr. Thana Thienachariya, Senior Executive VP and Chief Marketing Officer at Siam Commercial Bank said that its subsidiary, Digital Ventures Co. Ltd., has previously formed a strategic alliance with Ripple to offer a payment service between Japan and Thailand. He added that his bank will be discussing this issue with the central bank.

Bank of Thailand Bans Banks From Five Cryptocurrency ActivitiesMr. Thakorn Piyapan, Head of Krungsri Consumer Group and an executive of Digital Banking and Innovation at Bank of Ayudhya said, “although the bank will use the transfer service across the country through Ripple,” it is cooperating with the BOT and “does not provide any [cryptocurrency] services at all.”

He explained that there are some areas that banks need to examine before being able to comply. For example, to prevent customers from buying cryptocurrencies using credit cards, he elaborated:

In Thailand, people are buying digital currency. So the bank is asking for time to check the type of transactions that customers [make when they] swipe cards that are associated with digital currency. If applicable, the bank may have to suspend the service.

Recently, banks in the US and well as the UK have also banned their credit card customers from buying cryptocurrencies.

As for cryptocurrency traders, Poramin Insom, managing director of the Thai crypto exchange TDAX, said that “there is no impact on people who are investors of cryptocurrencies,” the news outlet quoted him. However, he explained, “TDAX is affected by this announcement, which makes the process of opening an account with the bank take longer. Bank of Thailand requests more documents.”

What do you think of the Bank of Thailand’s action? Let us know in the comments section below.


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