Comprehensive tightening of encryption market supervision and gradually refinement of NFT/Meta universe included

In 2021, hot spots in the encryption industry such as DeFi, NFT, and Metaverse will spring up like mushrooms, and their vigorous development poses a huge challenge to traditional finance, and the ensuing cryptocurrency supervision situation becomes more and more severe.

Therefore, at the end of the year, supervision is still the main theme of the cryptocurrency market.

Encryption regulation is becoming more and more refined

In addition to the continued high pressure in mainland China, the United States, South Korea, India, Europe and other regions around the world have tightened and gradually refined the supervision of cryptocurrencies.

In the United States, which is actively promoting policy refinement, multiple departments including the SEC have clear regulatory positions: the SEC will launch a discussion on the topic “Helping to ensure investor protection in the face of new technologies at the investor consultation meeting on December 2nd, local time.” The panel discussion on encryption and digital assets of “and market integrity” will focus on the regulatory framework of digital assets, market structure issues and the risks of defining emerging technologies; Fed Chairman Powell has previously expressed support for the call for the establishment of a stable currency regulatory framework… …

On November 24, the South Korean Financial Services Commission (FSC) submitted a report to the National Policy Committee of the National Assembly that it is seeking criminal responsibility for crypto violations. The report pointed out that the illegal income of encryption is the income obtained through price manipulation and inside information. When the illegal gains reach 5 billion won (4.2 million U.S. dollars) or more, they will be sentenced to more than 5 years in prison. The amount is between 500 million and 5 billion won, and the sentence is 3 to 5 years in prison. The amount of less than 500 million won will be punished by imprisonment for more than one year and not more than three years. The fine will be at least three times the amount of illegal income. It is reported that the report will become the basis for South Korea to pass legislation to regulate the crypto market. However, before formal legislation, the country may start discussions on recognizing digital currencies as effective financial assets so that the government can tax the proceeds of encrypted transactions.

According to the “Hindustan Times” reported on November 23, the Indian government will introduce the “2021 Cryptocurrency and Official Digital Currency Regulatory Act” at the winter parliamentary meeting. The bill aims to establish a promotional framework for the central bank of India to issue official digital currencies and ban almost all private cryptocurrencies.

On November 22, the European Central Bank has approved a new electronic payment regulatory framework, which will include the coverage of stablecoins and other encrypted assets. The new regulatory framework assesses the security and efficiency of electronic payments. The European Central Bank will use the framework to monitor companies that support or support the use of payment cards, credit card transfers, direct debits, electronic transfers, and digital payment tokens (including electronic wallets). The framework will also cover services related to crypto assets, such as merchants accepting crypto assets in card payment schemes, and the option of sending, receiving, or paying for crypto assets through e-wallets.

The Central Bank of Russia hopes that those who use cryptocurrency in violation of the law will be held accountable. The Central Bank of Russia (CBR) has been opposed to allowing payments such as Bitcoin. CBR now hopes to introduce legal liability for what it considers to be the “illegal circulation of digital financial assets”. It is worth noting that this move is part of its plan to “create an enabling environment for introducing new technologies and supporting innovation in financial markets”. CBR stated that in order to develop innovative financial instruments, some federal laws must be passed that are aimed at comprehensive legal supervision of digital financial assets and utilitarian digital rights. According to the Central Bank, another issue that needs to be resolved is the taxation of transactions involving these rights and assets, and a procedure should be established.

In the United Kingdom, the deputy governor of the Central Bank Cunliffe is calling for stronger supervision of money market funds.

NFT is also under supervision

Different from the current cryptocurrency that has been hit by regulation, as a brand new concept, NFT is extremely hot this summer. Artists, celebrities, and giant companies have joined the NFT, and the ever-high NFT prices have made them the focus of public attention.

However, the development of unregulated NFTs is a thing of the past. Recently, some countries have included NFTs in the regulatory list.

According to Reuters, on November 25, South Korean regulators have banned NFT game applications linked to physical assets in the country, and said that these new services may encourage youth gambling. Currently, such games can only be accessed overseas. An official from South Korea’s game rating and management department said, “What we prohibit is not blockchain technology, but NFT applications that can be linked to physical assets.”

In China, the regulatory authorities have recently strengthened the supervision of Chinese Internet companies’ issuance of NFTs and the establishment of NFT platforms, and some Internet companies have been interviewed. At present, including Tencent (Magic Core), Alibaba (Ant Tablet), etc., the word NFT has been completely deleted and changed to “digital collection”.

People’s Daily Online published a commentary saying that the current hype about the concept of NFT and meta universe has spread to listed companies and the secondary market. Some behaviors such as rubbing hot spots and speculating concepts are also arousing the vigilance of the regulatory authorities. Industry insiders believe that the domestic legal nature, transaction methods, supervision subjects, and supervision methods of NFTs are not yet clear. NFTs have risks such as speculation, money laundering, and financial productization. They should be cautious about NFT investments and be wary of “drumming and spreading”. Financial scam.

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