By: Daniel Knight and Ben Kneebush
On 4 June 2024, the latest chapter in ASIC’s crypto-asset enforcement efforts unfolded with the Federal Court relieving Block Earner from liability to pay penalties in connection with providing unlicensed financial services (ASIC’s media release can be found here).
Read MoreThe Securities and Markets Stakeholder Group (SMSG) of the European Securities and Markets Authority (ESMA) has published a report on initial coin offerings (ICOs) and crypto assets. The goal of the report is to give advice to ESMA on steps it can take to contain the risks of ICOs and crypto assets (on top of existing regulation). The report mainly focuses on risks for investors as the SMSG states that there are no obvious market stability risks yet in this respect.
The first part of the report defines relevant concepts including crypto asset, virtual currency, cryptocurrency, token and ICO. There is taxonomy of crypto assets including payment tokens, utility tokens, asset tokens and hyrbids. The report also includes an overview of recent ICOs and of existing regulations of crypto assets, ICOs and sandboxes in 36 jurisdictions, including the European Union member states and Switzerland. The SMSG gives specific recommendations to ESMA on potential regulatory changes.
By Anthony R.G. Nolan and Russell E. Deutsch
Recently, Commissioner Brian Quintenz of the US Commodity Futures Trading Commission (CFTC) commented that smart contracts that have the defining features of a swap, future or option are subject to CFTC regulation. The Commissioner posited the hypothetical that, after appropriate analysis, the CFTC has concluded that a particular smart contract, e.g., a binary option executed on a blockchain, is within its jurisdiction. He queried: If that contract is executed in violation of CFTC regulations, then against whom should the CFTC bring enforcement action?
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