In our August 9 blog post, we discussed the Bitfinex hack that rattled the bitcoin markets and raised serious questions about the security of bitcoin wallets and allocating risk in this new age of cyber theft. Through a simple phishing email that contained a virus, hackers were able to gain access to…
California first proposed a licensing framework for digital currency companies in February 2015, though the bill was inactive by September 2015. Just last week, California legislators introduced a bill that was amended from the original bill in February 2015. Known as AB 1326, the amended bill proposed the enactment of…
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…
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,…
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”…
Digital currencies like Bitcoin seem tailor made for social peer-to-peer payment applications. Transactions denominated in or convertible to digital currency could be withdrawn and transmitted by users at virtually no cost—only a small transaction fee. Digital currency can then be converted using a myriad of exchanges, which navigate banking regimes….
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…