We are back with another insightful edition of Veriscope Regulatory Recap! This week, we bring you crucial updates on MiCA, recent crypto regulatory moves from the UAE and Thailand, Japan’s appeal to global regulators worldwide, and the crypto industry’s presence at the World Economic Forum 2023. So, without further ado, let’s dive straight into it.
Some of the world's major decision makers spent last week in Davos for the World Economic Forum Annual meeting. Although the participation from the crypto industry might have looked muted this year in line with the broader crypto market conditions, in reality, it was more focused, stressing concrete discussions around CBDCs, digital identities, and tokenized economies.
Jeremy Alaire, CEO of Circle, the firm issuing popular stablecoin USDC, said on the sidelines of WEF Davos 2023, "I hope there's an increase focus on utility value and practical applications of the technology, and less focus on retail investors chasing memecoins."
Raghuram Rajan, Ex-chief of India’s Central Bank, too, was quick to point out that crypto winter will help highlight the true potential of virtual assets.
Despite the challenges the industry faced, Casper Labs got a filled house, and the Filecoin Foundation’s reception witnessed more than promising footfall. Even more exciting was the participation of regulators and policymakers who spoke extensively about their experience of using blockchain in public institutions.
With increasing tokenization on cards, the panel participants were optimistic about the future of a tokenized economy, where carbon credits, government bonds, forex, and other real-life assets, including housing and electricity, will be traded on the Blockchain.
Overall, the general sentiment from Central Banks to governmental authorities was that the role of the blockchain was already too deep-rooted. Diverse agencies, associations, and global bodies were ready to leverage the growth expected from tokenization, resetting the entire crypto industry to a superb growth phase.
Click here to read more about crypto industry’s presence at the World Economic Forum 2023.
The crucial Markets in Crypto Asset (MiCA) Regulation EU voting has been delayed to April 2023. Originally scheduled to happen in December last year, it is the second time that votes on MiCA have been postponed.
The delays have been apparently due to translation issues. . The 400-page-long text of the legislation needs to be available in all 24 official languages of the European Union.
The introduction of the MiCA regulation is the most crucial development in the European crypto market in recent times. Not only will it shape the future of the crypto and digital assets industry across 27 member countries of the Union, but it will also influence the global virtual assets regulatory development.
The UAE Minister of State for International Trade recently revealed that the Gulf nation is putting in sincere efforts to become a global crypto hub with friendly regulations and adequate security measures.
In the State’s first regulatory framework for the crypto industry at a federal level, the UAE cabinet has already announced an independent regulatory body for virtual assets and related service providers.
The companies that won’t comply with the new rules by the UAE cabinet may have to pay fines of up to US$2.7 million.
Thailand’s Security and Exchange Commission has introduced regulations for crypto custody providers. They have asked crypto custody service providers to introduce a digital wallet-management system.
According to the Thailand SEC, this is crucial for ensuring the safety of customers’ assets. The regulations provide detailed policies and guidelines for managing digital wallets and keys. It also lays out the framework for digital wallet design.
While efficient management of wallets and keys is a must, the Thailand SEC has also asked custodians to have a contingency plan ready for events that could affect the system.
Japan’s top financial regulatory authority, the Financial Services Agency (FSA), has appealed to regulators worldwide to see crypto exchanges through the prism of bank-level regulations.
The appeal has been aimed at all regulatory counterparts in the United States, Europe, and other regions, as Japan believes this would make crypto-compliance effective and efficient.
The FSA also advocated for establishing multinational resolution mechanisms while coordinating events that could destabilize the national and global financial ecosystem, such as the collapse of FTX.
It has emphasized that regulators should direct crypto exchanges to step up consumer interest and enforce necessary inspection and compliance protocols.
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