Ether-secured loans and blockchain solutions announced; New Guide to Cryptography from CFTC, WEF, Basel, Texas and El Salvador Ministry of Justice Confiscated Bitcoins with Ransomware | BakerHostetler



Bank offers ether-secured loans, auctions and real estate sales accept cryptocurrency

From Jordan R. Silversmith

Anchorage Digital Asset Bank recently announced that its institutional clients will now be able to receive Ethereum-backed loans through the bank’s finance arm, which will provide access to a US dollar-backed Ether (ETH) line of credit. According to the press release, the new proposal will allow crypto funds investing in ETH to receive USD funding without liquidating ETH-based holdings.

A major British auction house recently announced that it would accept cryptocurrency as a form of payment for Banksy’s millions of works. The auction house has joined several other major competitors that are now accepting cryptocurrency as a form of payment. The auction will be held in Hong Kong dollars and the winner will have the option to pay in dollars or cryptocurrency. The exchange rate for Bitcoin, ETH and Hong Kong dollar will be listed on the US cryptocurrency exchange on the day of the auction, and the seller will bear the risk of exchange rate volatility. Cryptocurrencies are also entering the real estate market: a penthouse in Miami was recently sold for $ 22.5 million in crypto, making it the most expensive known residential crypto-real estate transaction in the US to date.

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Supply chains innovate with blockchain, China launches copyright blockchain

From Veronica Reynolds as well as Daniel Richardson

This week, a leading Spanish seafood company announced a partnership with a multinational technology company to track seafood products using a blockchain-based network designed to track food throughout the supply chain. The goal of a seafood traceability system is to enhance the sustainability of the seafood industry by creating reliable records of seafood production from origin to consumer. The global chemistry provider also recently announced a blockchain-based supply chain initiative. The chemistry provider plans to use blockchain technology to create secure digital records and ensure product traceability and authenticity.

The Austrian energy provider has partnered with a major European blockchain front-end company to launch MyPower, an energy tokenization platform this week. According to the press release, the blockchain-based MyPower platform tokenizes solar photovoltaic (PV) assets and allows energy consumers to acquire stakes in photovoltaic installations, allowing consumers to participate in energy production as well. Consumers receive tokens based on the energy produced by photovoltaic plants and can use the tokens for a variety of purposes, including paying electricity bills.

In addition, overseas, the China Copyright Society (CSC) has reportedly launched the China Copyright Chain to facilitate copyright protection in the country. According to reports, the recently launched blockchain platform could “document evidence of digital assets, track infringement activities, collect evidence online, issue notices to remove pirated products, and help courts resolve copyright disputes and process claims.” Blockchain-verified evidence became legally binding in China in September 2018, and internet courts in some Chinese cities have reportedly begun using blockchain technology to hold meetings and document court records.

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CFTC and WEF Comment on DeFi, Basel Considers Crypto Assets Vulnerability

From Teresa Goody Guillen

Commodity Futures Trading Commission (CFTC) Commissioner Berkowitz addressed DeFi products this week in a keynote speech at the Asset Management Derivatives Forum 2021. The Commissioner said he considers the unlicensed DeFi derivatives markets a “bad idea” and added, “I also I don’t understand how legal they are ”according to the Commodity Exchange Act (CEA). He explained that the CEA stipulates that (1) futures contracts must be traded in a designated contract market (DCM) licensed and regulated by the CFTC; (2) it is illegal for anyone other than an eligible party to the contract to enter into a swap unless the swap is entered into in accordance with or in accordance with DCM’s rules; and (3) any entity that provides trading or processing of swaps must be registered as DCM or as a Swap Execution Facility (SEF). Berkowitz pointed out that DeFi markets, platforms or websites that are not registered as DCM or SEF are illegal and warned of the volatility in financial markets created by DeFi.

The World Economic Forum (WEF), in collaboration with the Wharton Blockchain and Digital Asset Project, recently published a white paper, the DeFi Policy-Maker Toolkit, with the aim of identifying potential policy approaches and important considerations for the DeFi context. The paper explains that financial regulatory regimes differ by jurisdiction and explores how to regulate and assert jurisdiction over DeFi activities. The toolkit provides (1) an overview of the DeFi space and the main classes of DeFi protocols, (2) the potential benefits and challenges associated with DeFi, (3) a detailed breakdown of the risks that DeFi can pose, and (4) the potential legal and regulatory responses to DeFi …

The Basel Committee on Banking Supervision held a public consultation this week on preliminary proposals for a prudential approach to the risks of banking with cryptoassets. The committee proposes to submit proposals for proposals by 10 September. The proposals divide cryptoassets into two broad groups: (1) those that are eligible for treatment under the existing Basel structure as amended, and (2) those that are subject to a new conservative prudential regime (such as Bitcoin). The press release states that banks’ current exposure to cryptoassets is limited, but continued growth and innovation in cryptoassets and related services, along with growing interest from some banks, could heighten concerns about global financial stability and risks to the banking system in the absence of said prudential regime.

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Texas Adopts New Blockchain Law, El Salvador Announces Bitcoin Tender

From Teresa Goody Guillen

Texas Governor Greg Abbott recently signed legislation to create a legal framework for cryptocurrencies and blockchain. The new law amends the Texas Unified Commercial Code to better adapt commercial law to blockchain and digital assets, formally define virtual currencies, and offer individuals and businesses a legal environment for cryptocurrency investments. Abbott tweeted, “Blockchain is a fast-growing industry in which Texas needs to get involved.” According to Review of national legislationApproximately 25 states are considering blockchain and / or digital asset measures in their 2021 legislative sessions.

El Salvador’s Legislature this week voted in favor of President Naib Bukele’s proposal for the country to accept Bitcoin as legal tender. The approved bill will reportedly oblige all businesses to accept bitcoin for goods or services, but the government will act as a pillar for organizations that are unwilling to bear the risk of an unstable cryptocurrency. The government is expected to set up a trust at the Development Bank of El Salvador to instantly convert bitcoins to US dollars for sellers. Government officials from El Salvador are planning to meet with the International Monetary Fund to discuss the plan.

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Justice Department Protects Bitcoins From Ransomware Attacks As Cryptocurrency Continues

From Joanna F. Wasick

On Monday, the Department of Justice (DOJ) announced the seizure of $ 2.3 million in bitcoin paid to a hacker group known as DarkSide, which carried out a ransomware attack on the Colonial Pipeline in early May, resulting in a critical infrastructure shutdown. The Justice Department reportedly discovered the funds by tracking multiple bitcoin transfers, as well as detecting and using attackers’ private keys – the rough equivalent of the password required to access assets from specific bitcoin addresses. Ransomware reports continued this week, with a major New York City newspaper reporting that the world’s largest meat company paid $ 11 million in Bitcoin at the end of May in a ransomware attack.

Late last week, the Ministry of Justice announced that a Latvian citizen was facing federal court on multiple charges related to her role in the cybercriminal organization responsible for creating and deploying Trickbot, a type of malware designed to steal financial information and deploy bitcoin ransomware. Authorities allege that the man and his group operated in Russia, Belarus, Ukraine and Suriname and were primarily targeted at victims’ computers in hospitals, schools, utilities and government offices, including in the United States.

Earlier this week, Europol announced the arrest of approximately 800 criminals and the seizure of more than $ 48 million in various fiat currencies and cryptocurrencies in a law enforcement operation known as the OTF Greenlight / Trojan Shield. According to a press release, since 2019, the FBI, with the assistance of the Australian Federal Police, has developed and secretly operates an encrypted device company called ANOM, which has grown to serve over 12,000 encrypted devices for over 300 crime syndicates around the world. The FBI and 16 countries used information from 27 million messages received and verified from devices, leading to arrests.

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