Telegram ICO: A Two-Phase Offering Does Not Inoculate an ICO from Federal Securities Law
A two-phase offering of this kind, whether styled as a SAFT (Simple Agreement for Future Tokens) or otherwise, does not inoculate an ICO or the issuer from the application of the federal securities laws. The SEC examines the facts and circumstances of a token offering at all relevant times, looking to the economic reality of the transaction or transactions, whatever they may be called.
European Union unsure how to regulate Facebook's Libra
The EU cannot work out exactly what Libra is according to a memo by European Commission executive vice-president, Valdis Dombrovskis. Dombrovskis refers to the "need to ensure clarity" about what Libra is, but that the information provided by Facebook is not sufficient. Libra is descibed as a "moving target" that does not easily within existing EU law.
The judge assured Telegram’s lawyer Alexander Drylewski that he is mindful of the looming April 30 deadline. A clause in the Gram purchase agreements specifies that ICO participants can claim a refund on their investment should Telegram fail to launch the TON before that date. However the date was originally set for October 2019.
The Riksbank to test technical solution for the e-krona
The Riksbank is conducting a pilot project with Accenture aimed at developing a proposal for a technical solution for a digital krona (“e-krona”). The technical solution will be based on Distributed Ledger Technology.
US Court Tells Telegram and SEC to Focus on 'Economic Realities' of Gram Token Sale
Castel reserved judgment on the preliminary injunction and assured Telegram’s lawyer Drylewski there would be a judgment in the case before April 30, when gram investors expect to see the TON blockchain launched. Telegram consented to prolonging the preliminary injunction after Castel explained that not consenting would mean the court would make a decision immediately.
FSB Chair sets out focus for Saudi Arabian G20 Presidency
The Financial Stability Board published a letter from its Chair Randal K. Quarles to G20 Finance Ministers and Central Bank Governors ahead of their meetings in Riyadh later this week. The letter notes that the global financial system is constantly facing new challenges. Technology is changing the nature of traditional finance; the non-bank sector has grown and requires deeper understanding and coordination among the supervisory and regulatory community. Pressures that can lead to market fragmentation exist. Concurrently, important supervisory and regulatory issues require attention, including stablecoins, cross-border payments, and "Tech" (particularly BigTech, RegTech, and SupTech).
CFTC Letter Provides Little Clarity in Telegram’s Battle With SEC
Following a request by the New York Southern District Court, a division at the U.S. CFTC has filed a letter with the court expressing its views on the complicated case involving Telegram’s digital currency Gram. According to the letter a “digital currency like Gram is a commodity” instead of a security. https://www.docdroid.net/okmUUBS/cftc-letter-in-telegram-case.pdf
Cleveland Fed on Modernizing the US Payments System
The status of the U.S. dollar as a global reserve currency, the stable demand for U.S. bank notes, and the mature, developed nature of the U.S. financial system are all distinguishing factors that would need to be taken into account when considering the benefits vs. the costs of central bank digital currency in the U.S.
How do we give the general public access to a non-cash financial instrument that is as safe and liquid as cash and which provides a similar degree of privacy, finality and instantaneity? That is the key question of CBDC... Either the central bank itself issues e-money, or it merely safeguards the funds that commercial e-money issuers collect from their customers. The latter option is much easier to implement while delivering practically the same outcome. In effect, the central bank would become not just a central bank but also a kind of central e-money institution.
Central Bank Digital Currency: A Provocation of a Paradigm
"In principle, individuals should have the ability to interface directly with the central banks as they do with physical money and not be forced to use commercial banks. Even if consumers voluntarily choose to perform a majority of their financial interactions through commercial banks, the option to exit the relationship should be maintained. Otherwise, the government would be removing consumer choice and mandating patronage of a highly concentrated sector."
Cryptocurrency, Stablecoins and Blockchain: Exploring digital money solutions for remittances and inclusive economies
This paper analyzes remittance operations with and without cryptocurrency and blockchain technologies in general and present pros and cons of Libra for cross-border payments and money transfers. We also present a brief discussion on challenges posed by global cryptocurrencies to central bank governing bodies all over the world and policy implications arising out of potential conflicts between sovereign currencies and future of global cryptocurrencies such as Libra.
This paper presents a model where persistent trade shocks and search frictions create demand for a basket-backed stablecoin, such as Mark Carney’s “synthetic hegemonic currency” or Facebook’s recent proposal for Libra.
China Is Scrubbing Cash Notes to Stop Virus Spreading
The People’s Bank of China has ordered commercial banks to take used bank notes out of circulation and disinfect them to fight the spread of COVID19. The disinfected fiat cash will also need to be kept in quarantine for a period of 7 to 14 days before it can be reintroduced to the public.
IMF economist Marco Gross and Oxford University researcher Christoph Siebenbrunner emphasise the importance of thinking about how loans would be granted in a world of central bank digital currencies (CBDCs). They argue that a CBDC, if paying interest, could lead us at least partially towards the kind of “full money” system envisioned in the Chicago Plan of the 1930s, in terms of its implications for central banks’ control over the economy.
US Intelligence Officials Are Funding Research on Dollar-Crushing 'Black Swan' Events
The U.S. Office of the Director of National Intelligence (ODNI) wants to sponsor a post-doctoral researcher to study what would happen if the U.S. dollar lost its status as the world’s reserve currency.
Complete Bahamian digital dollar roll-out by year-end
The digital Bahamian dollar will be rolled-out throughout all islands during the 2020 second half after being introduced to Abaco by the end of February.
TON Developers, Investors Back Telegram in SEC Fight
Undeterred by the U.S. Securities and Exchange Commission’s lawsuit against Telegram, developers and investors in the company’s blockchain project have formed a nonprofit for community governance.
Could a Digital Dollar Compete on Privacy? Fed Chairman Powell Hints It Might - CoinDesk
In testimony before Congress this week, Powell was asked whether the Fed had any “visibility” into China’s progress developing a central bank digital currency (CBDC). “Yes, we certainly have that,” Powell said. “But they’re in a completely different institutional context. For example, the idea of having a ledger where you know everybody’s payments, that’s not something that would be particularly attractive in the United States context. It’s not a problem in China.”
China Files 84 Patents For Central Bank Digital Currency
According to the Financial Times, China’s central bank has filed 84 patents relating to its plans to launch a digital currency electronic payments DCEP system. The number of CBDC-related patents by the PBOC came after an investigative study by the U.S. Chamber of Digital Commerce.
Libra Minus Facebook: Why Celo Is 2020's Buzzy Token Project
The team behind Celo, C Labs, is combining the ethereum and Libra models with a $30 million war chest from the likes of Polychain Capital and Andreesen Horowitz (a16z).
Tether tries once again to prove it's not being used by criminals
Blockchain forensic company Chainalysis today announced that Tether is now using its AML compliance solution dubbed “Know Your Transaction Token.” The solution monitors the full lifecycle of a token from issuance to redemption.
This is interesting, because we have yet to learn of one person who has actually redeemed their tethers for cash, but let’s put that aside for now. "
Circle Sells Crypto Investing App Business to Voyager Digital
After initially focusing on retail-oriented crypto businesses, Circle has been pouring more resources its so-called stablecoin known as USDC. In December, the Boston-based company sold its Circle Trade over-the-counter trading business to crypto exchange Kraken. It previously unloaded its Poloniex exchange.
Central Bank Digital Currency: Central Banking For All?
The introduction of a central bank digital currency (CBDC) allows the central bank to engage in large-scale intermediation by competing with private financial intermediaries for deposits. Yet, since a central bank is not an investment expert, it cannot invest in long-term projects itself, but relies on investment banks to do so. We derive an equivalence result that shows that absent a banking panic, the set of allocations achieved with private financial intermediation will also be achieved with a CBDC. During a panic, however, we show that the rigidity of the central bank’s contract with the investment banks has the capacity to deter runs. Thus, the central bank is more stable than the commercial banking sector. Depositors internalize this feature ex-ante, and the central bank arises as a deposit monopolist, attracting all deposits away from the commercial banking sector. This monopoly might endangered maturity transformation.
New Canadian Dollar-Pegged Stablecoin QCAD to be Regulated by FinTRAC
Major Canadian investment fund manager 3iQ and blockchain firm Mavennet co-launched a new regulated stablecoin pegged to the Canadian dollar (CAD). Developed by Canada Stablecorp, a joint venture between 3iQ and Mavennet, QCAD is the latest CAD-based stablecoin and was officially launched on Feb. 11.
Built on the Ethereum blockchain, the QCAD stablecoin is the work of Canada Stablecorp, a joint venture between Canada's largest cryptoasset manager 3iQ and blockchain player Mavennet Systems.
Refusing to buckle to SEC, Telegram releases TON whitepaper
Telegram has been locked in a fierce legal battle with the US SEC, which wants to block the company’s initial coin offering and halt the launch of its Telegram Open Network, or TON, blockchain. But that hasn’t stopped the social network from pushing ahead with the technical details of its project. On Feb. 3, Telegram issued the latest version of its whitepaper for its TON blockchain.
"Libra’s current trials may mean that its introduction has been delayed. Many consider that it is by no means guaranteed to operate at all. But central banks are well aware that even if Facebook does not manage to bring its project to fruition, sooner or later someone else will succeed, and will introduce a private sector digital payment system. And the issues and implications for central banking, the commercial banking system and the wider economy that their current research has highlighted will not go away."
