On August 2, 2016, Hong Kong-based bitcoin exchange Bitfinex was the latest target of hackers who stole 119,756 bitcoins, for a total loss of approximately $72 million at that time. Some are estimating it to be as high as $80,000,000. The Bitfinex hack was notable both because Bitfinex is one of the…
On July 25, a Florida Circuit Court judge dismissed state criminal charges against a defendant who attempted to sell bitcoins for $30,000 in cash on the ground that bitcoins are not money. Defendant Michell Abner Espinoza allegedly had agreed to sell bitcoins to an undercover Miami Beach police detective who…
The European Commission recently published a proposal to amend the Fourth Anti-Money Laundering Directive, the legislation that specifies the anti-money laundering, or AML, and counter terrorist financing rules for EU Member States. The proposal seeks to introduce stricter rules on the reporting and identification around the users of virtual currencies,…
There will only ever be 21 million bitcoins, and the rate at which those 21 million bitcoins are generated will decrease periodically by half until all bitcoins are in circulation. More specifically, a user is rewarded with a given number of bitcoins when it discovers (i.e., “mines”) a new block…
The U.S. Commodity Futures Trading Commission (CFTC), showing continued regulatory interest in digital currency companies, issued an Order and settled charges against Hong Kong-based digital currency exchange Bitfinex. The CFTC found that Bitfinex was offering illegal off-exchange financed retail commodity transactions in bitcoin and other cryptocurrencies, and failed to register…
On June 2, 2016, the European Securities and Markets Authority (ESMA) issued a discussion paper seeking feedback from Fintech companies and financial institutions on the possible use of blockchain technology in securities markets, including the potential benefits, challenges and risks involved. The ESMA indicated that the responses will help it…
Bitcoin was born on November 2008 when an anonymous user named “Satoshi Nakamoto” published a post on a cryptography blog linking to a paper the user had written about a decentralized peer-to-peer electronic cash system. After helping establish the fledging currency, the same user disappeared from the bitcoin world with…
On March 29, 2016, J. Christopher Giancarlo, the Commissioner of the U.S. Commodity Futures Trading Commission, or CFTC, spoke at the Depository Trust and Clearing Corporation 2016 Blockchain Symposium. His speech encouraged regulators to treat the development of blockchain technology like they treated the internet by adopting a “do no harm”…
As discussed in a previous post, several states are in various stages of implementing regulations related to digital currency. Below is an updated summary of the actions currently underway. New York Since the final version of New York’s BitLicense was announced in June 2015, surprisingly only a single BitLicense has…
Many of the world’s leading financial services providers have started developing their own blockchains, either to facilitate the potential for creating their own cryptocurrency, to add an additional layer of security to encrypted transactions in fiat currency, or to provide their customers services more cost-effectively than ever before. Companies that…