Matrixport View_Regulation #6

In August we see a clear trend of important industry players leaning into the regulated world. Many well-known exchanges and funds have obtained authorisations or applied licenses in order to operate in jurisdictions other than their original business countries. Most of the authorisations and applications take place in the UK and in the US. From this movement we can naturally assume the implied high market volume expected from these two countries and as well the relatively favourable attitude from the regulators. In addition to this trend of license application, one renowned option exchange imposes an obligatory identity checks on all its clients. All this shows that the whole industry recognises the importance of being compliant and works diligently towards it. Here below is the regulatory landscape in the month of August:

Policies and regulations around the globe:


The Securities and Exchange Commission, or SEC, is now amending its definition of an “accredited investor” to relax the purely wealth-based requirements, after announcing such plans in December 2019. Accredited investors in the U.S. enjoy special privileges with the SEC — namely being able to participate in certain types of simplified securities sales like Regulation D. The SEC noted that previous definitions relied on specific income and net worth criteria, which did not take their actual “financial sophistication” into account. In the case of the U.S., these requirements amounted to either $1 million in net worth or a stable income of at least $200,000 per year. The criteria is now expanded as the “product of years of effort by the Commission and its staff to consider and analyze approaches to revising the accredited investor definition,” SEC chairman Jay Clayton said. Major players in the crypto community have responded to the U.S. Securities and Exchange Commission recently amending its definition of an “accredited investor”. While many gave positive feedback, some say the new rules don’t go far enough.

A proposed tax cut by U.S. President Donald Trump could be a big win — or a relatively insignificant win — for the crypto industry if it is passed. In a news conference at the White House earlier this week, President Trump said that his administration was “very seriously” considering a capital gains tax cut. “We’re looking at also considering a capital gains tax cut, which would create a lot more jobs.” There is a debate over the extent of President Trump’s ability to deliver tax cuts. The long term capital gains rate of 20% is primarily governed by Congress, so to deliver a big cut he’d need to get lawmakers on side via negotiation. Alternatively, an executive order could be used to cut tax bills in a move known as indexing capital gains to inflation. That is where the original purchase price of an asset is adjusted when it is sold, so that no tax is paid on appreciation tied to inflation, according to Bloomberg. This would be of much less benefit to traders, as crypto profits can make CPI look insignificant.

Russia, a major cryptocurrency website in Russia, has got blocked shortly after local lawmakers finally passed the country’s crypto legislation. An aggregator of about 400 local crypto exchange websites, website was blocked by Russian telecom regulator Roskomnadzor on Aug. 26. The website is still available through the use of VPN services as well as mirror websites like, according to a popup announcement on

As Russia is about to officially ban crypto payments within its borders starting on Jan. 1, 2021, some senior executives in the crypto industry to talk about the implications of such a ban. Russia’s primary crypto opponent is Anatoly Aksakov, a member of the State Duma and a key architect of Russia’s crypto ban. In mid-August, Aksakov argued that legalizing crypto payments basically “means the destruction of a financial system.” Major global crypto figures like BitGo CEO Mike Belshe and Binance’s head of operations in Russia and CIS, Gleb Kostarev, concurred that payments in cryptocurrencies like Bitcoin (BTC) pose no threat to Russia’s economy.

Sberbank, a state-owned company and the largest bank in Russia, is considering the possibility of issuing its own token, according to its key executives. Sergey Popov, director of the transaction business at Sberbank, says that Russia’s banking giant is thinking of issuing its own stablecoin that could be pegged one-to-one to the Russian ruble, local news agency Kommersant reported recently.


Cryptocurrency firms in Singapore can now draw upon detailed guidance for their license applications to offer regulated services in the city-state. On Aug. 13, the Association of Cryptocurrency Enterprises and Startups, Singapore (ACCESS), rolled out its new Code of Practice to help these firms in their applications for a payments service license. The license has been mandatory for any entity looking to provide specified payment services — including digital payments and the trading of digital tokens — since Singapore’s Payment Services Act came into force in January of this year. ACCESS had the support of the Monetary Authority of Singapore (MAS) — the country’s central bank and regulatory authority — in preparing the new code of practice. It also consulted the Association of Banks in Singapore to help cement its approach and establish clear practical regulatory guidance for successful license applications. In particular, ACCESS hopes to provide crypto industry players with a standardized and detailed guide to Anti-Money Laundering and Countering the Financing of Terrorism best practices.


The Bolivarian Council of Mayors in Venezuela signed the so-called “National Tax Harmonization Agreement” for 305 municipalities in the country, including the Petro (PTR) as a means to collect payments of taxes and sanctions. The cryptocurrency is becoming increasingly widely used as the result of a new campaign. According to the government, the vice president of Venezuela, Delcy Rodríguez, will be in charge of implementing a single registry of taxpayers through a digital consultation tool. She will also be in charge of creating an information exchange and monitoring system for companies to record payments in the state cryptocurrency.


Cyprus, a major international business center and tax haven, is warning investors against several suspicious websites offering foreign exchange and digital currency investment. The Cyprus Securities and Exchange Commission issued a warning against seven firms that have apparently been operating illegally. Published by the CySEC on Aug. 6, the warning document says that none of the listed companies belong to an entity that has been granted approval for providing investment services. The list notes,,,,,, and


A proposal made by the government of Kazakhstan aims to impose a 15% flat-rate tax on crypto mining. The plan would use any funds accumulated through the tax to deal with the COVID-19 crisis in the country. According to Forbes, the Ministry of the Economy hopes to combat COVID-19 by funding countermeasures through the collection of such taxes. This represents a departure from the nation’s previous statements, which indicated a different stance from the country. Officials stated that approximately 6% of the world’s Bitcoin (BTC) hash rate comes from Kazakhstan.


Peer-to-peer Bitcoin (BTC) marketplace Paxful has reported significant increases in Indian trade volume as the country’s regulatory climate warms to crypto. Speaking to Cointelegraph, Paxful CEO Ray Youssef revealed that monthly new user signups have increased by 28%, adding that Paxful’s community on Telegram is approaching 10,000 members. The surge in sign-ups from Indian traders has followed the Supreme Court’s reversal of the Reserve Bank of India’s (RBI) longstanding ban on banks providing financial services to crypto firms.

Updates and news on the most important players/topics in the industry:


A new report from the Bank for International Settlements (BIS) shows that 2020 is the year that momentum behind central bank digital currencies (CBDCs) has truly taken off. Published on Aug. 24, BIS’ new working paper analyzes the global state of CBDC research and development work, technical approaches and policy stances. The comprehensive research draws on over 16,000 central bank speeches from recent years and assesses existing CBDC designs and motivations behind various countries’ embrace of the new model. “Attitudes about whether central banks should issue them [CBDCs] have changed noticeably over the past year,” the paper’s authors write. Their research includes a striking analysis of public interest in CBDCs over time. BIS’ data shows that in 2020, worldwide internet searches for CBDCs decisively outflanked searches for Bitcoin (BTC) and Facebook’s Libra.

While Facebook’s Libra project might have shaken the United States government the most, the aftershocks were felt all over the world. The European Union was no exception: The publication of the first Libra white paper in 2019 led to the acknowledgment that the EU was not prepared for what appeared to be the first global stablecoin that would have a direct effect on the European financial market, retail payments and its overall economy. In the words of both the European Council and the European Commission (the EU’s supreme political body and executive arm, respectively), “No global ’stablecoin’ arrangement should begin operation in the European Union until the legal, regulatory and oversight challenges and risks have been adequately identified and addressed.

China’s Commerce Ministry announced recently that it will expand the trials of the nation’s central bank digital currency (CBDC) to include Beijing, as well as Tianjin and Hebei provinces. According to an Aug. 14 report by the Wall Street Journal, there is not yet a set time when the expanded pilot program of the Chinese CBDC will begin. Still, the nation’s Ministry of Commerce announced that the policy framework should be complete by the end of 2020.



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