Global Regulatory Scrutiny Intensifies on Crypto: SEC, IMF, and ASIC Making Major Moves
Summary:
The US Securities and Exchange Commission (SEC) has been given penalties by a district court over its case against Debt Box. In separate legal developments, multiple organizations have supported Coinbase’s appeal for clearer crypto guidelines with the SEC. Meanwhile, the SEC has sought an increase in federal budget for 2025 to handle changes in the market, including cryptocurrencies, and has issued subpoenas to companies linked to attempts of labeling Ether as a security. The International Monetary Fund (IMF) has asked Pakistan to charge capital gains tax on cryptocurrency investments. In Nigeria, Binance has been directed to provide comprehensive user data and is under criminal investigation for tax evasion. And, the Australian Securities and Investments Commission (ASIC) is developing regulatory reforms aimed at the crypto sector.
A US district court has slapped the Securities and Exchange Commission (SEC) with penalties for dubious behaviour in its case against Debt Box. Initially, the SEC proposed to drop the case without being held accountable, but Judge Robert Shelby did not approve of this and criticised the agency for intentionally misleading the court with false evidence aimed at procuring a temporary restraining order and freezing Debt Box's assets in August 2023. The key proof that the regulatory body introduced lacked a solid grounding, despite being put forward in a deliberately deceptive manner, according to Judge Shelby.
Amid these developments, support for Coinbase's appeal for clear crypto regulation has been expressed by several advocacy groups via amicus briefs. Organizations including the Crypto Council for Innovation, Satoshi Action Fund, Texas Blockchain Council, investment company Paradigm, digital asset firm Lejilex, and the U.S. Chamber of Commerce laid out separate briefs to the U.S. Court of Appeals for the Third Circuit, criticizing the SEC for not offering lucid regulations for crypto businesses in the United States. These fillings also stated that an unfriendly regulatory environment might force these companies to take their operations abroad.
Conversely, the SEC's regulatory oversight hasn't slowed down. The body appealed to the Congress on March 19 for an additional $158 million from the 2025 federal budget to cope with rapid market changes, including the volatility of the crypto market. In its budgetary plan for the fiscal year 2025, the SEC asked for over $2.5 billion, which is a hike from its $2.4 billion request for 2024.
In addition, the SEC issued instructions to firms regarding Ether (ETH), to identify it as a security. Several US firms received formal requests for their financial records and documentation related to transaction with the Ethereum Foundation. This move seems to be part of SEC' campaign to categorize ETH as security, a development that took place after Ethereum shifted from proof-of-work to proof-of-stake in 2022.
The IMF is advising Pakistan to impose taxes on cryptocurrency profits. The Federal Board of Revenue (FBR) in Pakistan has been asked by the International Monetary Fund (IMF) to impose capital gains tax on cryptocurrency investments to be eligible for a $3 billion bailout package. The IMF advised the Pakistani government to revise crypto tax rates in order to collect annual taxes on real estate capital gains, whether the proprietor decides to hold or sell the property. This change is aimed at imposing stricter tracking and reporting mandates on property developers, enforced by substantial penalties for failure to comply, effectively inaugurating new property tax regulations.
Nigeria has mandated Binance to disclose all data of its users and begun a criminal trial as well. A Nigerian High Court has ordered Binance Holdings to supply all data and information linked to Nigerian users, to the Economic and Financial Crimes Commission. Moreover, allegations of tax evasion have resulted in the Nigerian government starting criminal proceedings against the exchange. Nadeem Anjarwalla, a top official at Binance, allegedly avoided custody using a counterfeit passport, say reports in a local newspaper citing inside sources. Along with a colleague, Anjarwalla has been under apprehension in a guesthouse in Nigeria's capital, Abuja, for several weeks.
The Australian Securities and Investments Commission (ASIC) is constructing targeted regulations for cryptocurrencies. ASIC Chief Alan Kirkland remarked that the focus will be on anticipated regulatory outcomes when establishing a slew of regulatory reforms for the crypto sector. During his address at Blockchain APAC's Policy Week event, Kirkland underscored the necessity of resolving the 'regulatory trilemma' related to digital currencies, touching upon consumer protection, maintaining market integrity, and promoting financial innovation. He added that since 2016, the ASIC offered unofficial regulatory guidance to over 900 entities.
Published At
3/25/2024 11:00:00 PM
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