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Staking services in Switzerland: Sharpened #FINMA industry guidelines nicely wrapped up. Thx Jakob Bosshard Whether one likes or dislikes the guideline's directions > it definitively helps institutional adoption of #DigitalAsset mgmt. and leveraging #defi services in #Switzland. Exciting times, more to come, stay tuned ... #Staking #web3

🥁 The future of staking services in Switzerland 🥁 🎸 Zurich based law firm Homburger has published an article on FINMA's directives regarding staking services within Switzerland's regulatory landscape as per the revised decision of FINMA back in December. It gives a lot of context to what this means and how we got here, worth reading. It unpacks the obligations imposed on custodians handling crypto assets, particularly in scenarios of custodian insolvency. The focus lies on staking service providers' classification as deposit takers or fiduciaries, stemming from the interpretation of their roles in managing staked assets. 🎸 The guidance introduced by FINMA stems from discussions triggered by the "DLT Act" in August 2021. This act amended relevant Swiss financial laws to establish a legal framework for segregating crypto assets held in custody in case of custodian insolvency. The crux of the debate revolved around categorizing staking providers, considering the varying forms of staking offered in the market. Staking involves blocking native crypto assets to validate blockchain processes, potentially resulting in rewards or penalties based on validation accuracy. 🎸 Earlier discussions by FINMA hinted at the possibility of staked assets not being immediately available for clients in the event of custodian insolvency, potentially necessitating banking licenses or increased capital requirements for custodian banks. However, due to widespread criticism, FINMA engaged in roundtable discussions and surveys with industry stakeholders to reevaluate the treatment of staked crypto assets in case of insolvency. The resulting guidance from FINMA focuses on three custody tiers for crypto assets and emphasizes the immediate availability obligation. It outlines criteria for different staking service providers and delineates conditions for their qualification as fiduciaries or deposit takers. Additionally, it sets out stringent requirements for licensed and unlicensed providers and for banks delegating staking services to third parties. 🥁 The article underscores the urgency for compliance among regulated banks engaging in staking services. It advises these institutions to assess third-party providers, review and update contractual agreements, enhance risk disclosure practices, and establish or update Digital Asset Resolution Packages (DARPs). Compliance with these guidelines becomes crucial for regulated banks to ensure that staked crypto assets don't factor into risk-weighted assets for capital adequacy. 🥁 https://lnkd.in/d-qJhtAA #web3 #digitalassets

Key Update for Crypto-Asset Trading Platforms on Stablecoins Compliance The Canadian Securities Administrators (CSA) have released an important update for crypto-asset trading platforms concerning value-referenced crypto assets (VRCAs), commonly referred to as stablecoins. As these assets gain popularity, it's critical for platforms to ensure they comply with the latest regulatory requirements, especially when VRCAs are classified as securities or derivatives under Canadian law. Here are the key points to consider: 1. Classification as Securities or Derivatives 2. Registration Requirements for Platforms 3. Disclosure Obligations 4. Due Diligence on Issuers 5. Risk Management and Custody Controls 6. Consult CSA Guidance Final Thoughts This update underscores the CSA’s commitment to enhancing transparency and protecting investors in the rapidly evolving crypto space. Platforms operating in this market must take proactive steps to understand and comply with the legal obligations surrounding VRCAs. For more information, check out the full CSA release here https://lnkd.in/gqJ2ET-r Disclaimer: The information provided in this post is for informational purposes only and does not constitute legal, financial, or professional advice. Please refer to the full regulatory texts and guidelines for detailed information and consult with a qualified professional for specific advice tailored to your situation. — Gopi PD

We are thrilled to announce today our new strategic partnership with DLT Finance AG as we continue our mission of accelerating the European adoption of crypto assets. Through our partnership, German clients will be served a localized and tailored trading experience that is powered by DLT Finance, a brand of DLT Securities GmbH and DLT Custody GmbH offering leading BaFin-licensed digital asset prime brokerage and custodian services. Starting around July 10, 2024, we expect to offer German clients access to a range of innovative crypto products via a dedicated offering powered by DLT Finance. Once the partnership is live, DLT Finance will provide localized expertise and infrastructure to serve millions of Germans with secure and compliant crypto services. This provides confidence to crypto investors in Germany that we can meet their evolving trading needs as #MiCAR is implemented across Europe. Read more here: https://lnkd.in/eZZmW5kq Kraken Digital Asset Exchange 🚀🚀🚀

On Monday, the CFTC announced a simultaneous filing and settlement of charges with Falcon Labs, the Seychelles-based subsidiary of FalconX. This case was less notable for breaking new ground in the legal status of crypto, as the CFTC used its existing and well-known authority to regulate futures and swaps. Rather, it was notable for the jurisdictional theory the CFTC offered: given US persons had access to offshore derivatives platforms via Falcon Labs, they were able to bring the charge. This was likely helped by the fact that another subsidiary of FalconX, the parent entity, is a CFTC-registered swap dealer. This is another reinforcement of the drumbeat from the CFTC, the SEC, and the DOJ: if US persons have access to a platform, they will bring cases where there is wrongdoing. It does not matter if the entity is offshore, or the vast majority of clients are elsewhere. Once US persons are involved, which in crypto despite a range of controls is almost always the case, US regulators care. We hear the same from our offshore clients whether funds, exchanges, or projects who do recognize the near inevitability of US regulatory scrutiny.

When we talk about tradeFI and how we as fund managers you think about risk, insitional standard and diversification. Great summary here Diversification in custody is an important idea, and many people were quick to predict that other issuers will follow Valkyrie's lead. But as that happens, and as assets under management grow within other funds, the dearth of available custodians should be a concern. The intrigue: When we asked McClurg how many qualified custodians there are for bitcoin, he said there technically aren't any. Be smart: A qualified custodian is a technical term covered by securities rules that shields securities held in custody of a bank from a bankruptcy court if the bank ever goes belly up. It's known as being "bankruptcy remote." Bitcoin, however, is not a security, so it wouldn't be covered. (For what it's worth, that designation promises nothing; see: Prime Trust.) Crypto custodians, by contrast, are usually state-chartered trust companies like Coinbase Custody Trust and Fidelity Digital. Flashback: In 2020, the SEC had a consultation on the definition of qualified custodian as it applied to digital assets. Coinbase and Fidelity Digital argued that it should apply to state-chartered trusts. Anchorage, a digital-assets custodian with a federal OCC charter, argued against broad designation. Valkyrie picked its custodians after evaluating for standards like security issues (hot and cold storage) and proof-of-reserves, and by kicking the tires of the overall business, according to McClurg. Coinbase, its original custodian, and BitGo, its new one, were among the best of a handful of shops that met the firm's standards, he added. Yes, but: Though they don't have a qualified custodian designation, what Coinbase and BitGo do have are special purpose vehicles to hold client funds, McClurg said. That doesn't guarantee that the BTC they hold will be bankruptcy remote, but there are other industry bankruptcy cases, where such structures were protected, he explained.(Axios)

📢 FINMA's Guidance on Staking Services: Navigating the Crypto Custody Landscape 🚀🔐 The Swiss Financial Market Supervisory Authority (FINMA) has released comprehensive guidance on staking services, shedding light on its supervisory approach to safeguard customers from potential risks. Here are the key takeaways: 1. Protection in Insolvency: - FINMA emphasizes the need for staked crypto assets to be continuously held in readiness for customers. - In case of a staking service provider's insolvency, staked crypto assets must be isolated from the bankrupt estate and returned to the custody account customers. 2. Legal Ambiguities: - Staking services have introduced complexities in interpreting existing laws, particularly regarding the custody of crypto assets. - A legal grey area exists concerning the protection of staked crypto assets during a staking service provider's insolvency. 3. Capital Requirements: - Staking activities will not trigger capital requirements for supervised institutions, given the implementation of effective risk-mitigation measures. - Institutions must inform customers about associated risks to ensure transparency. 4. Risk Factors Associated with Staking: - Technical Risk: Potential malfunctioning of staking processes and the risk of crypto assets being slashed in case of validator node misconduct. - Counterparty Risk: Uncertain legal landscape, especially in bankruptcy scenarios, and risks associated with entities outside Switzerland's jurisdiction. - Market Risk: Possibility of delays in liquidating staked crypto assets in volatile markets, especially during the unstaking process with lock-up or exit periods. FINMA's guidance aims to provide clarity within the regulatory framework, acknowledging the evolving nature of crypto custody. Stay informed, stay secure! 🌐💰 #CryptoRegulation #FINMA #StakingServices #CryptoCustody #InvestorProtection #law #swissbusiness #finance #lawfirms

📣 Rolling out thUSD for Expenses Starting with the next batch of contributor payments, all Threshold Guild Committee members and contractors will receive their payments in thUSD. This change stems from TIP-79 — a proposal to use the thUSD protocol for expenses. The proposal has been thoroughly discussed and approved by T token holders via governance, marking a significant step in our journey to forge our own playbook for DAO treasury best practices. In the next phase of the TIP-79 rollout, slated to be completed before the end of this month, the Treasury Guild will migrate the majority of payments to service providers, such as tBTC Beta Stakers, Guardians, Minters, and Bootstrap Providers, to thUSD. Read our blog post for more details! If you’re part of another DAO and interested in learning more about thUSD payments for contributors, drop a note in the Threshold Discord. https://lnkd.in/geb7FDWk

#News #PaoloArdoino #TetherReserve #TetherUSDT Tether CEO: Big Four Audit Is Our Top Priority: Tether’s CEO indicated that none of the Big Four firms want to audit the stablecoin giants since they have much larger clients, with over 100,000 customers. There have been numerous inquiries concerning Tether’s treasury reserves despite its USDT stablecoin acquiring a substantial portion of the market. Tether has flooded the market with an additional $2 […] The post Tether CEO: Big Four Audit Is Our Top Priority appeared first on Coinscreed.

💡 How to implement a regulatory compliant structure to register as a VASP ACM (All Crypto Mechanics) is an ambitious venture started in 2023 to provide an easy access to exciting crypto-related services. ACM trusted LegalBison to ensure the full compliance of their desired operations with global regulations. In this successful collaboration story, we uncover how LegalBison: ✅ Designed a friction-less corporate structure for ACM ✅ Ensured the compliance of the project with the applicable regulations ✅ Assisted in registering as a VASP ✅ Permitted the access to banking services 👉 Discover how acm_finance serenely launched their blockchain-based services with the assistance of LegalBison.com: https://lnkd.in/ex83MRfu With Andreas Fleischhacker, Benjamin Jakob, Aaron Glauberman