Governments’ view on cryptocurrency economy

Skeptical sentiment

1. Indian authorities consider cryptocurrency exchanges a tool of money laundering

At the beginning of this November, the Indian media posted the news that one of the governmental structures in this country strongly recommends prohibiting the work of cryptocurrency exchanges within the state borders to other government branches, as cryptoconverters, they think, are providing environment for money launderers. At the press time, the authorities of India still view cryptocurrency as illegal currency. But, according to the Minister of Finance, the government works on creating recommendations on cryptocurrency regulations.

2. Salvador authorities can condemn you to 15 years in jail for using cryptocurrency

The central bank of Salvador has declared that cryptocurrencies are illegal tools which might jeopardize the economic stability of the monetary system of the country. Those who conduct various operations with coins within the country’s borders are risking becoming sentenced under article on the stealing, extortion and laundering of money to 15 years in prison.

3. New cryptoreality

The regulator of Portugal stated that cryptocurrency is not a currency, as it cannot be used both for credits and savings. There weren’t any harsh claims by the local government in November, although head of the Portugal central bank Hélder Rosalino noted that there is a rise of speculative operations due to the coins supply limit on the cryptomarket, and such operations are stimulating the coins’ price volatility. While the regulator keeps the market under close observation, the law enforcement is assessing the cryptosphere and the presence of money laundering and frauds in it.

4. Nobody is going to regulate cryptocurrencies in South Korea

In the mid-November, the authorities of South Korea stated that they consider cryptocurrency a speculative instrument operating outside the law, and this means there will not be any cryptosphere regulators. But at the end of the same month, the Korean Financial Services Commision (FSC) has declared there will be a developed legislative basis for cryptocurrency exchanges’ regulation in the future, because currently, these exchanges are viewed as unlawful means of investment attraction.

Recommendations

1. ICO for wide audience

Sweden authorities do not forbid projects to attract investments via ICO, but they warn about risks posed by token investments. Firstly, the Swedish FSA (Financial Supervision Authority) thinks there are no guarantees given by anyone that the token or cryptocurrency holder can file a complaint against the issuer of said products. Moreover, there are no legislative rules that require to necessary post all info about the ICO projects by the founders or owners of said projects. Secondly, the price of tokens might not correspond with the fair market cost. Apart from this, nobody must rebuy a token after issuing it on the market. And, thirdly, FSA thinks that some ICO projects might be scams.

2. Global cryptocurrency regulation is a must

Speaking of scams, we can highlight the recent statement from Deputy Finance Minister of the United States Sigal Mandelker, who said that the regulation of cryptocurrencies must be built on a global level to prevent its use for terrorism and other crimes.

3. Mutated binary options

Israel’s securities agency (ISA) views ICOs as the new stage of financial evolution, but it thinks that the cryptocurrency sphere should be thoroughly researched to ensure that Bitcoin is not a mutant form of binary put option. Israel will have the first drafts on cryptocurrency regulation and coin offerings by the end of this year. The Ministry of Finance of Israel has announced the creation of the working group that will research cryptocurrency.

4. ICOs have speculative nature

The European Securities and Markets Authority (ESMA) warned investors on possible funds losses after making ICO investments. The advice of this regulator for ICOs is to tell investors all offering information, and to obey the laws which combat money laundering.

5. Singapore told which tokens can be viewed as securities

Singapore’s Monetary Authority (MAS) told that tokens used for attracting investments will be treated as securities. But tokens which are produced by the collective power of computers are not securities.

With this in mind, the MAS notes that no matter if a token is a security or not, it must be disseminated so that the whole process does not violate legislation on terrorism finance and money laundering.

6. Lost your money? Get on with it

Ewald Nowotny from the European Central Bank top management thinks that cryptocurrency market is not a big environment and it does not pose risks for traditional market. But the regulator’s representative stresses that cryptocurrency investments resulting in losses are quite possible and investors must be ready for this.

7. Japan appoints cryptocurrency market regulator

Now everything connected with cryptocurrency in Japan is regulated by the Financial Services Agency. It plans to reach the balance between development/dissemination of financial innovations and consumer protection. A special attention will be paid to the cryptocurrency exchanges’ frauds detection and prevention of them.

8. The Russian cryptocurrency economy legislation is at stage of public hearing

Before December 11 this year, everybody is welcome to voice and post feedback on the provisions of the Digital Economy program dedicated to regulation of digital infrastructure.

Countries which welcome cryptocurrency

1. Iran plans to decrease dependence from the world’s economy by using Bitcoin and ensure development under the U.S. sanctions

Iranian authorities think that the legalization of cryptocurrency would help to stimulate economy growth and help to improve independence from the world’s fiat leaders (dollar and euro), which is viable when a country is under heavy sanctions. According to the Minister of Information and Communication Technologies of Iran, the organization is currently developing infrastructure for the state use of Bitcoin.

2. Belarus might legalize cryptocurrency converters

If the Republic’s President decides to sign the bill on High-Tech Park, then cryptocurrencies will be available for lawful exchange for fiat money within the state borders of Belarus.

3. Bermuda cryptocurrency investments

The government of Bermuda assesses different variants of cryptocurrency and token regulations to expand the investment opportunities for the state.

We have yet to see how the cryptocurrency regulative systems in the world will develop in the future.