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AMF President: Crypto Regulators and Innovators May Find a Common Ground After All

During the “Innovation and regulation: The French approach to cryptos” – 3rd Annual Fintech Conference – Brussels, on February 26, the AMF President Robert Ophèle said a speech regarding the future and regulation issues for crypto-assets. We share the keynotes. Although regulations may seem to stifle innovation, the lack of regulations paves way for the fraudsters and hackers. Whenever hackers and con artists thrive, the confidence and trust needed to make innovations successful are destroyed. Straightforward prohibition and administrative burdens are known to discourage innovations through the set up of many safeguard requirements, in the end, emptying any business case. The AMF president expressed that regulation is an important factor for customer protection where financial services are involved. The primary reason why the financial sector is highly regulated is to ensure people, institutions, and governments do not lose their money. The stringent rules also act as a barrier to entry for new competitors. Crypto Innovation With the rise of cryptocurrency, the past ten years have featured the introduction of many new regulations especially in the financial services business including asset management, banking, and post-trade market infrastructures. With many of the large financial institutions influencing most of the created regulations, it makes it hard for any innovative entrants to challenge these incumbents. According to Robert Ophèle, the financial industry is similar to the pharmaceutical industry with few big incumbents that are not very innovative suppressing the smaller innovative start-ups busily developing new products to enhance the industry. In that case, the major financial institutions globally are either developing their in-house digital tokens or collaborating with reasonably successful cryptocurrencies. In the field of financial services, a particular variety of the usual triangle of incompatibility must be implemented to get a viable solution between profitability, innovation, and regulation. A solution is necessary to minimize the cost of financial intermediation to achieve profitability. Finance requires innovation to enhance all the services provided significantly. The European Union has developed a Fintech Action Plan to foster innovations in a regulated environment and Roadmaps are being elaborated. The Commission has invited knowledgeable and experienced authorities at Member State and EU level to take initiatives to foster innovation based on identified best practices. Crypto-mania Have Faded The president indicated, that France has come up with a customized and tailored framework for crypto-assets that are currently not financial instruments at the EU level. Robert Ophèle said: “2019 is the ideal time to set these regulations since the late 2017 and early 2018 crypto-mania seems to have faded away and markets are relatively stable.” The combined market capitalization has plunged by around $700 billion from the 2017 peaks. The value of Bitcoin has epitomized this plunge even as the crypto winter prolongs and the bears rule the markets. The collapse is a natural stage of the crypto innovation process according to the Gartner hype cycle. The current phase of disillusion followed the phase of overly inflated expectations. Gartner hype cycle. Clients use Hype Cycles to get educated about the promise of an emerging technology within the context of their industry and individual appetite for risk. image. In the case of ICOs, many investors and even scammers have found a quicker, cheaper, easier way to raise money while simultaneously avoiding any dilution of the share capital of their company. However, according to the Gartner hype cycle, the phase of disillusion is followed by a slope of enlightenment and the plateau of productivity. Through the Unicorn program, the nature of programs innovated has evolved considerably from just pure tech to many other sectors. The regulators are trying to determine the middle ground by first grasping the structural trends that underlie the entire crypto-asset phenomenon. Considerations First, the importance of the DLT technologies particularly blockchain was brought into the limelight by the popularity of bitcoin. Since then, other DLTs have come up in the public, private, permissioned or permission-less forms. The development of these technologies is, thus, based on network validation. The crypto-assets mostly involve the possibility to transfer value in a secure way through the internet. Some of the notable trends in the crypto field include the platformisation trend, automatization of processes, and the ability to lower the cost while increasing speeds of financial transactions. These trends prove that the entire crypto-asset field has a long-term structural development that may reshape the way capital markets function. An Extensive Legal Framework for Crypto-assets is Being Finalized That conviction led the French government to create an extensive legal framework for crypto-assets that are not yet captured by any of the current regulations. This framework is at the moment being finalized in the French parliament. Some of the innovators are working with the authorities to come up with the best regulations. For the best regulations to be developed, new risks merit an appropriate response, a comprehensive response to the crypto-asset phenomenon should be adopted, and an innovative regulatory approach should be implemented. Since the crypto-asset environment is growing in a large legal vacuum, the optional regime will become the first regulatory strategy to debunk the uncertainty. This new regime, if implemented correctly, will offer better investor protection increasing the rate of innovations without compromising on security. The optional regime also gives the crypto environment time to develop as the authorities also create and strengthen functional and updated legal infrastructure. Lessons For the crypto innovations to succeed as the authorities come up with new regulations continuously, all stakeholders must work together to reduce fraud cases in the industry. More innovative ways to fight fraud are necessary while simultaneously raising investor awareness. Since technology costs are high for everybody, sticking with a status-quo is significantly easier to manage. The learning curve in the blockchain field is quite steep which makes it challenging to have ready solutions for every issue that arises from the outset. The most challenging issue lies in the crypto-assets custody. In the past few months, the security tokens have gained popularity. A new phase of high expectations for the STOs may be looming and needs to be regulated in an innovative-friendly manner. The financial assets tokenization could be beneficial for the long-term structural trend that will transform the global financial industry including the post-trade industry. ESMA explained some of these benefits within its advice on ICOs and all other crypto-assets published in early January. Thus, the European co-legislators should come up with types of activities that qualify as financial activities under the European Union regulatory framework in a DLT framework. Apparently, European Level 1 measures, Regulations instead of Directives, are required to address such issues. Also, the lawmakers should also listen keenly to the legitimate aspiration of traditional market players to guarantee more regulatory stability. Like what you're reading? Subscribe to our top stories amzn_assoc_placement = "adunit0"; amzn_assoc_search_bar = "true"; amzn_assoc_tracking_id = "cryptovibes-20"; amzn_assoc_search_bar_position = "bottom"; amzn_assoc_ad_mode = "search"; amzn_assoc_ad_type = "smart"; amzn_assoc_marketplace = "amazon"; amzn_assoc_region = "US"; amzn_assoc_title = "Shop Related Products"; amzn_assoc_default_search_phrase = "ledger nano s"; amzn_assoc_default_category = "All"; amzn_assoc_linkid = "91b4df01d5c71edac39628ca1a2aa0c4"; The post AMF President: Crypto Regulators and Innovators May Find a Common Ground After All appeared first on - Daily Cryptocurrency News.

Quebec’s AMF Regulator Warns Crypto Mining Contracts May Be Securities

The financial regulator of Quebec recent ruled that a crypto mining contract is a security. This follows a call by the regulator for investors in a crypto company to call them after they issued the company freeze orders. The orders were issued in compliance with existing regulation at the start of February. What Happened? Technologies Crypto Inc took about $300,000 from investors who believed their funds were going into a mining operation. Many have been disappointed. The regulator now wants those who invested in the company to contact them. Many of those who invested their money have not been able to recover it. The announcement wants anyone who was involved with the company in any manner or the two principals to get in touch with them. They have even provided a number. The regulator also issued freezing orders against the company a while back. The company was told it was breaking the law. What it Was Doing The company was trading under “Make It Mine.” It asked for $300,000 from investors. Those backing it thought that the money would be used to fund mining. While some did get their money back, others were unable to get anything back. Attempts at calling the firm have fallen on deaf ears. The orders issued say that the company is not allowed to take any money out of bank accounts. They should also not try to dispose off the mining rigs or partake in securities trading. The implications This means that the regulator considers an investment contract in the crypto world to be a security. Thus the financial regulator can regulate it under securities laws. The regulator can thus assist those who made the investment to recover their funds. Not First Time Acting on Crypto The regulator in Quebec has been known to take action against crypto firms that violate securities laws. It has sought to protect investors from losing their money. A while back, it went after PlexCoin. It later rejected any attempts by the company’s representative to revise the ruling. In its ruling, it concluded that there were holes in the securities laws. Despite this, the regulator concluded the company was dealing in securities. An injunction against PlexCorps and associated entities were issued. Their website was also shut down and all other related sites. Besides that, their Facebook pages were also covered by the orders. In October 2018, the superior court in Quebec ruled that PlexCoin and its founders were in contempt of court. The ruling was issued after it was found the company was still trading in securities and asking for money. Authorities in the US appear to be having a similar issue with the PlexCoin Company. The SEC filed a motion in court asking that its founders be sanctioned. It was still soliciting money from the public despite numerous court orders against it for discovery and accounting of their assets. While the industry is still young, it is nice to see the regulators are taking crypto seriously. This could help to keep cons at bay in the future. Bitcoin (BTC), Ethereum (ETH), XRP (Ripple), and BCH Price Analysis Watch (Feb 14th)
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BitMEX Shuts Down US and Quebec Traders Accounts After Canadian AMF Sends Letter

It looks like the future of BitMEX in North America is bleak. The Block Crypto has recently reported that BitMEX, which is a trading platform that was created to facilitate futures trading with cryptos (mostly Bitcoin) has been on the target of financial regulators from Canada. This has made the company close the accounts in  the United States and the Quebec region of Canada. The Autorité des marchés financiers (AMF) of Quebec has sent a letter to BitMEX asking it to close all accounts linked to people from the region as the exchange was not properly authorized to deal with that. The regulator has started to shut down accounts fro Quebec and in the U.S. before BitMEX did. This will have a major impact on the market, it seems, as BitMEX, at the moment, the largest market for Bitcoin, as informed by CoinMarketCap’s data. Unlicensed companies are having a tough time right now as a lot of countries and agencies all over the globe are cracking down on them. As its activities have been deemed illegal according to the legislation of each country. The regulator has confirmed that BitMEX is not registered with the AMF so it could not offer its services in the region. Now, as a part of its efforts to be more compliant, BitMEX has stated that it does not accept clients from the U.S. or from Quebec. At the moment, BitMEX states that it is not operating unlawfully in any region of the world, but The Block Crypto, which first reported on this story, was unable to confirm whether this was the truth or not.
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AMF Condemns Keplerk’s Plans to Sell Bitcoins via French Tobacco Shops

The nation’s financial regulators have criticized Keplerk, a France-based financial technology (fintech) company, the Autorite des Marches Financiers (AMF)  for allying with tobacco retailers in the country to enable them to sell bitcoin to clients through its bitcoin vouchers beginning from January 2019, according to a Finance Magnates report  on November 26, 2018. Keplerk in AMF Hot Waters As reported...Read More. The post by Ogwu Osaemezu Emmanuel appeared first on BTCManager, Bitcoin, Blockchain & Cryptocurrency News
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Ravencoin Grows 20% And Continues to See RVN Token Surge in the Crypto Market

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Bitcoin [BTC] Futures in good stead against its Spot equivalent: Bitwise Report

Bitcoin [BTC] Futures were thought to be a snippet of the overarching cryptocurrency market, though meager in comparison to the larger spot market. A recent report from Bitwise Asset Management, the crypto-centric investment firm has stated otherwise. In a March 20 report presented to the United States’ Securities and Exchange Commission [SEC], Bitwise analyzed the Chicago Mercantile Exchange [CME], and the Chicago Board Options Exchange, with ten prominent cryptocurrency exchanges’ in terms of their trade volume. Prior to shedding light on their Futures versus Spot findings, it must be noted that the report revealed that 95 percent of the trading volume of unregulated exchanges were seemingly “fake and/or non-economic wash trading”. Taking into account this disparity, the percentage of futures volume to their spot equivalent increases from 1.51 percent to 33.33 percent. Reported Spot volume totaled $6 billion, but after removing the “suspicious exchanges”, the actual volume recorded dropped to $273 million, in comparison to the futures market volume of $91 million. Furthermore, the increase in futures’ volume as a percentage of the spot market has been steadily increasing. From November 2018 to January 2019, the futures market was just over 15 percent, and almost doubled in February 2019 to 33 percent. Since the Futures contracts were approved in December 2017, only on two occasions did the Futures volume, in comparison to the Spot market, shoot above 20 percent; this was in May and August 2018. Futures Volume expressed as a percentage of their Spot Equivalent In terms of their stand-alone trade volume, the CME and the CBOE are in good stead against the world’s top cryptocurrency exchanges. The daily volume the CME, which brings in $84.82 million, ranks second behind Binance’s $110.5 million and ahead of Bitfinex, which records $38.06 million in daily trade volume. The CBOE also fairs well, taking the ninth spot on the ladder, ringing in $6.12 million in daily trade volume. Gemini takes the eight spot with $8.11 million and itBit caps off the top-10 with $5.58 million in daily volume. Notable, among the top-12, eight exchanges are registered within the United States. Despite the CBOE’s comparative success against the spot exchanges’, it has not been performing well against its cross-town rival, the CME. This slump forced the CBOE to delist their Bitcoin Futures [XBT] for March 2019. However, the XBT futures that are yet to expire later in the year will not be off-loaded prematurely. Bitwise also points out that the CME Futures Price tracks the Global Spot Price based on an arbitrage model. Given below is a chart attesting the same: Arbitrage between the CME Futures price and the global Spot price The post Bitcoin [BTC] Futures in good stead against its Spot equivalent: Bitwise Report appeared first on AMBCrypto.

How Cryptocurrency Trading Volume Fiasco Can Lead to Bitcoin ETF Approval

The SEC has held the ETF approval for Bitcoin and Cryptocurrency for a couple of reasons. The most significant reason for the same has been the unregulated marketplace. While decentralization in Bitcoin is an attribute that makes it an ideal asset class, the market places or Exchanges that provide for conversion of FIAT to Cryptocurrency is still controlled by independent entities. A recent report by Bitwise Asset Management published by the SEC inferred that more than 95% of the cryptocurrency volume is being faked. Hence, according to that, the ‘actual spot volume’ on cryptocurrency exchanges is a little above $270 million. Moreover, the reported volume of CME and Cboe Bitcoin Futures is more than one-third of the ‘actual spot volume’ estimated by Bitwise. According to Bitwise Asset Management, This is good news because it means CME— a regulated, surveilled market— is of material size, which important for an ETF. The case of a Bitcoin ETF Approval Now CME Bitcoin Futures reported a spot trading volume of $85 million. Moreover, according to Bitwise Asset Management, the actual trading volume of the Crypto-to-FIAT Exchanges is around $273 million. Hence, according to this statistic the Futures Trading Volume of CME alone accounted for 31.1% of the ‘Actual Exchange Volume.’ Moreover, there are other Bitcoin Futures market active in Europe and Japan as well. Hence, going by the above statistic, it can be said that the institutional investment might be in parity with the unregulated investment in Bitcoin. However, the Exchanges have reported total spot volumes total to the tune of $6 billion. This can necessarily raise doubts on its demand being higher than $100 billion. However, it does not directly affect the total market capitalization of a cryptocurrency.   Parity Between Spot Trading of Bitcoin and Gold The spot trading volume of Gold is 0.55% of its total market capitalization, while according to Bitwise statistics spot ‘actual spot trading on Bitcoin is 0.39%. If the CME Futures volume is included in this data, the percentage will increase to 0.51%. The OTC trading volume on most exchanges is also not added in the Exchange Data. All this suggest that the institutional investment in Bitcoin is considerably more significant than one expects. It is not only healthy in volume but also agrees statistically with the closest relatable asset class, i.e., Gold. Hence, a new form of informational mechanics for the trading of Bitcoin and Cryptocurrency in regulated Exchanges could alleviate the doubts around the Bitcoin ETF approval.   The post How Cryptocurrency Trading Volume Fiasco Can Lead to Bitcoin ETF Approval appeared first on Coingape.

Top 5 Crypto Performers Overview: ONT, ADA, ETC, BCH, IOTA

Top 5 Crypto Performers Overview: ONT, ADA, ETC, BCH, IOTA The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Every investment and trading move involves risk, you should conduct your own research when making a decision. The market data is provided by the HitBTC exchange. […] Cet article Top 5 Crypto Performers Overview: ONT, ADA, ETC, BCH, IOTA est apparu en premier sur Bitcoin Central.
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