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Regulation

Vietnam Becomes the Latest to Ban Bitcoin, but in China, the Rules May Be Changing

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Vietnam became the latest nation state to launch an attack on cryptocurrency, as regulators sided with the alarmists without providing much of a rationale.

Vietnam Issues Ban

The ban, which applies to all cryptocurrencies not deemed legal tender, was issued via formal statement by the State Bank of Vietnam. The punishment for accepting or offering payments in bitcoin can run more than $8,000 USD.

Vietnam’s central bank says only traditional forms of payment are accepted within its borders. This includes cash, checks, credit cards and other electronic payments.

The state-run bank has issued the following statement, according to Mirror:

“Bitcoin virtual currency and other similar is not lawful means of payment in Vietnam; The issuance, supply, use of bitcoin and other similar virtual currency as a means of payment is prohibited in Vietnam.”

The announcement, whenever it was made, had very little impact on cryptocurrency trading. At press time, bitcoin (BTC/USD) was trading at $6,162 for a gain of $57.

The bulls blew the door wide open this weekend, sending bitcoin north of $6,300 for the first time ever.

Chinese Ban? Let’s Move to Hong Kong

Now that China’s Communist Party gathering has come and gone, sanity appears to be returning to public discourse. That is, according to a recent report from CNLedger, which our pals at CCN.com recently covered.  The trusted news sources have revealed that OKEX is expected to launch its peer-to-peer OTC bitcoin trading platform shortly.

As it turns out, OKEX and several other leading blockchain companies like BTCC and Huobi-Pro are located in Hong Kong. Theoretically, their presence in the Special Administrative Region allows them to circumnavigate the mainland’s recent ban on everything crypto-related.

It should be noted that OKEX is offering a bitcoin-to-crypto trading platform. Regardless of what Beijing thinks, it might not be a good idea to launch this platform on the mainland. That’s because the Chinese government recently blocked a major port for MetaTrader4, which is the engine of the online forex community.

Regulators have apparently shut down port ‘443’, which is used for secure web browser communications. The port also happens to be the one MT4 brokers use to connect to their trading server.

The port probably inhibits the government’s ability to spy on traders, or at least monitor their data flows (like that’s different?). There’s reason to believe this ban could extend to other trading platforms that utilize a similar standard.

Last month, China broadened its online censorship by blocking WhatsApp, the popular messaging platform acquired by Facebook for way too much. The ban was another blow to the social networking giant, as it too is banned on the mainland.

Featured  image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.7 stars on average, based on 773 rated postsChief Editor to Hacked.com and Contributor to CCN.com, Sam Bourgi has spent the past nine years focused on economics, markets and cryptocurrencies. His work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Avid crypto watchers and those with a libertarian persuasion can follow him on twitter at @hsbourgi




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Regulation

SEC Releases ICO Guidelines; Too Little, Too Late for Cryptocurrency Investors?

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The U.S Securities and Exchange Commission has released a guide for would-be cryptocurrency creators and investors; but a over a year on from the heady peak of the ICO craze, is it too little, too late?

SEC Offers ICO Guide

The SEC’s newly released guide to initial coin offerings features five main points, many of which will already be familiar to anyone keeping up with the SEC saga.

  • ICOs Can Be Securities Offerings

This one is hardly a surprise, however, it may be the first time that it has been stated officially by the SEC. Up until now all we had to go by were the ‘unofficial’ utterings of SEC figures at various talks and conferences.

“ICOs, based on specific facts, may be securities offerings, and fall under the SEC’s jurisdiction of enforcing federal securities laws.”

  • They May Need to Be Registered

ICOs that are securities most likely need to be registered with the SEC or fall under an exemption to registration.”

Another somewhat obvious statement, however, the vague wording present here suggests the SEC might not be completely sure on what qualifies as a security and what doesn’t.

  • Tokens Sold in ICOs Can Be Called Many Things

This is one aimed specifically at the ‘utility’ tokens out there, such as the recently reviewed Bitcoiin (B2G). When the New Jersey Securities Bureau slapped a cease and desist order on the B2G team, they responded by claiming they had no obligation to the Bureau due to the B2G token being a utility token, and not a security.

“ICOs, or more specifically tokens, can be called a variety of names, but merely calling a token a “utility” token or structuring it to provide some utility does not prevent the token from being a security.”

  • ICOs May Pose Substantial Risks

“While some ICOs may be attempts at honest investment opportunities, many may be frauds, separating you from your hard-earned money with promises of guaranteed returns and future fortunes. They may also present substantial risks for loss or manipulation, including through hacking, with little recourse for victims after-the-fact.”

  • Ask Questions Before Investing

The final point suggested by the SEC perhaps shows just how nebulous the entire space is right now. If 20% of the SEC’s big ICO guide is dedicated to ‘ask questions’, then maybe they don’t actually have much to say on the matter to begin with.

“If you choose to invest in these products, please ask questions and demand clear answers.”

Too Little, Too Late?

The difference between the cryptocurrency space this year compared to last year is night and day. In January of 2018 over $1.5 billion was raised via ICOs within the space of thirty days.

Fast forward to 2019, and that number stands at $30 million – a 98% drop off in twelve months. As is often the case with regulators, the SEC appears to be closing the stable door after the horse has bolted. That said, the process of reigning those horses back in (by ordering mass refunds, for example) could yet prove to be a messy one.

Disclaimer: The author owns Bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.5 stars on average, based on 147 rated postsGreg Thomson is a full-time crypto writer and digital nomad. He eats ICOs for breakfast and bleeds altcoins. Wherever he lays his public key is his home.




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ETFs

As Race for Bitcoin ETF Heats Up, SEC Identifies Cryptocurrency as a Top Priority in 2019

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The crypto boom of 2017 caught federal regulators by surprise. The subsequent crash of 2018 forced them to closely examine the market, including the sale, trading and management of cryptoassets. Now, the U.S. Securities and Exchange Commission (SEC) is prepared to take a proactive approach to monitoring the nascent asset class at a time when more issuers are throwing their weight behind a crypto-backed exchange-traded fund (ETF).

Crypto Becomes a Priority

In the newly released 2019 Examination Priorities, the SEC’s Office of Compliance Inspections and Examinations (OCIE) has identified cryptocurrencies as one of six regulatory focal points this year. More attention and resources will be directed at the digital asset market due to its its rapid growth and perceived risks to retail investors.

“Given the significant growth and risks presented in this market, OCIE will continue to monitor the offer and sale, trading, and management of digital assets, and where the products are securities, examine for regulatory compliance,” the report said.

The regulator added that it will conduct high-level inquiries on market participants “offering, selling, trading, and managing these products…” Market participants include broker-dealers, trading platforms and investment advisers.

The report was released less than six weeks before the SEC is set to make a decision on a highly regarded bitcoin ETF. Although the agency has rejected more than a dozen crypto ETF applications, a joint proposal put forward by VanEck and SolidX is believed to have the best shot of being approved.

That’s because the proposed product includes safeguards to protect retail investors against fraud and manipulation. It also proposes to hold a repository of physical bitcoin as opposed to futures contracts and other derivative-based products. More on this story can be found here: SEC Delays Decision on VanEck SolidX Bitcoin ETF Until Next Year.

A crypto startup by the name of Bitwise Asset Management has also applied for bitcoin ETF product with the SEC. Like the VanEck-SolidX product, the Bitwise application is attempting to address the myriad of regulatory concerns put forth by the SEC in its previous rulings on crypto-backed ETFs.

If Bitcoin ETF Doesn’t Happen by February, How Will it Affect the Market?

Japan Not Considering Bitcoin ETF: FSA

Reports that Japan was considering approving a bitcoin ETF were quickly shot down this weekend by a spokesperson from the country’s Financial Services Agency (FSA). As Bitcoin.com and CCN report, the FSA representative said, “There is no such fact that we are considering approving ETFs which track crypto-assets at present. We are not currently considering approving them.”

Last week, Bloomberg and several other sources reported that Tokyo’s financial regulators were exploring the possibility of a crypto ETF tied to bitcoin futures. The speculation put the regulator in the same boat as the SEC, which has been reluctant to approve a bitcoin fund but has nevertheless invited public dialogue on the matter.

At present, Japan does not believe there is “constructive and social significant of trading cryptoassets derivatives,” the spokesperson said.

Japan was one of the first countries to approve and regulate cryptocurrency markets, but a series of high-profile attacks on domestic exchanges forced regulators to adopt more stringent measures. Exchanges have also come together to develop a self-regulatory group to prevent further attacks from undermining the market.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.7 stars on average, based on 773 rated postsChief Editor to Hacked.com and Contributor to CCN.com, Sam Bourgi has spent the past nine years focused on economics, markets and cryptocurrencies. His work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Avid crypto watchers and those with a libertarian persuasion can follow him on twitter at @hsbourgi




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Altcoins

EOS Price Analysis: Cardano Founder Charles Hoskinson Warns of Regulatory Action Against EOS

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  • Charles Hoskinson projects some form of action from the SEC on EOS.
  • EOS/USD enjoys a relief rally on Wednesday, as price moves further north following recent bounce.

The EOS price hasn’t done much but decline of late. Back in August, EOS/USD entered into a very stubborn narrowing range. The price had been confined within this mode of trading right up until November. The range was seen from the $6 territory down $4 area. On the 19th November, EOS/USD bears had finally pushed for a breakout to the downside, from this mentioned range-block. Following this fall, the price plummeted over 60%, over the course of 3 weeks.

Cardano Founder Hoskinson Expresses EOS Regulatory Concerns

The Cardano (ADA) founder, Charles Hoskinson, has beliefs that EOS chief developer of the network is likely to face strong action from regulatory bodies. The SEC would be a potential regulator that investigates their $4bln ICO, as he has described as “egregious.”

Speaking at a press conference in Edinburgh, Charles Hoskinson has made a projection that the Securities and Exchange Commission will look at taking firm measures against Block.One. He believes that this would be done due to the way it had run and hosted the EOS ICO.  Hoskinson further detailed how the EOS token sale sits within the remit of the regulators for them to review the potential for harm of retail investors in the United States.

Charles Hoskinson Anticipating SEC Action on EOS

Hoskinson predicted that the SEC will likely bring punitive measures against Block.One for the way it ran the EOS Initial Coin Offering. The IOHK leader explained that EOS’ token sale falls well within the regulator’s remit to take action against any financial activity which harms US retail investors.

There were several fundamental issues with the EOS ICO, which clearly raise red flags, from Hoskinson’s view. He expressed for particular focus on the amount they had raised over the course of a year, in addition to their “utter lack of respect” for investors. Hoskinson said, the SEC “needed” to take action.

Technical Review – EOS/USD

EOS/USD daily chart

Most recently, the price has managed to stabilize, which could be due to sellers exhaustion. A bounce was seen on 7th December, after falling to a low of around $1.55. The bulls are attempting to make a convincing push back into the $2 territory. Demand in the near-term should now be observed from that recent low, $1.55 up to $1.80.

It is interesting to note the area of which EOS/USD received some comfort on 7th December (this is a known acting support). Back in November 2017 during the big bull run, the price consolidated within the mentioned demand zone for a brief period. This came before continuing its strong move to the north.

Downside Observations

EOS/USD daily chart

Should the near-term area of support fail to hold, then there could be some devastating moves to the downside. A breach of the $1 mark could very well be seen. The next major demand area will be within the depths of $0.90 region. EOS/USD had last traded down here again within the early part of Nov 2017 bull run.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.6 stars on average, based on 126 rated postsKen has over 8 years exposure to the financial markets. During a large part of his career, he worked as an analyst, covering a variety of asset classes; forex, fixed income, commodities, equities and cryptocurrencies. Ken has gone on to become a regular contributor across several large news and analysis outlets.




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