Regulation
Crypto Haven Dubai Turns Strict on Marketing Crypto Investments
Crypto Haven Dubai has recently decided to shift gears and tighten the noose when it comes to marketing crypto investments in the country. This is the first such measure from the UAE as its crypto landscape sees rapid growth amid crypto-friendly rules, also attracting a large number of crypto investments.
Dubai Regulator Updates Guidelines on Crypto Investments
In the latest development, Dubai’s Virtual Asset Regulatory Authority (VARA) updated its marketing guidelines for cryptocurrency investments. This requires firms to provide clear risk disclaimers for their advertisements.
Starting next week October 1, virtual asset service providers (VASPs) operating in the United Arab Emirates will have to prominently state that “virtual assets may lose their value in full or in part, and are subject to extreme volatility”.
These rules are part of VARA’s “Marketing Guidance Document,” and will govern other aspects of how VASPs market their services. Furthermore, these guidelines will ensure that firms provide clear, consistent messaging thereby helping them to navigate through Dubai’s regulatory framework confidently. In a historic ruling last month, the Dubai Court allowed companies to pay salaries in crypto.
Additionally, these measures will protect investors by raising awareness of the risks associated with virtual asset investments. Speaking on the development, VARA noted:
“The updated regulations place a strong emphasis on the accuracy of marketing communications, the avoidance of misleading information, and the protection of consumer interests. They apply to all entities involved in marketing virtual assets or related activities, regardless of their licensing status with VARA.”
Crypto Investment Services on the Rise
As we know, investor interest in crypto has surged significantly moving beyond simple trading and investment platforms. As a result, the demand for more sophisticated crypto investment products has been growing in Dubai. Thus, with the new marketing guidelines, VARA seeks to bring a standardized approach for licensed entities to adhere to their messaging. These rules will also be applicable to some of the best exchanges in UAE and Dubai.
VARA offers multiple licenses for entities based on the categories they wish to operate in. Last year, the authority established deadlines for virtual asset service providers (VASPs) to apply for and obtain the appropriate licensing to comply with regulations.
Matthew White, CEO of the regulator told Bloomberg: “VARA is dedicated to creating a regulatory environment that not only protects consumers but also supports the growth and innovation of the virtual assets sector”.
Bhushan Akolkar
Bhushan is a FinTech enthusiast with a keen understanding of financial markets. His interest in economics and finance has led him to focus on emerging Blockchain technology and cryptocurrency markets. He is committed to continuous learning and stays motivated by sharing the knowledge he acquires. In his free time, Bhushan enjoys reading thriller fiction novels and occasionally explores his culinary skills.
Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
Wyoming Senator, Cynthia Lummis, an advocate for digital assets, has criticized the US Securities and Exchange Commission’s (SEC) handling of cryptocurrency regulations. Speaking on CNBC’s Squawk Box, Lummis criticized SEC Chair Gary Gensler for his attitude towards the cryptocurrency market saying it was counterproductive and problematic.
Senator Cynthia Lummis Critiques US SEC’s Crypto Regulation
During the interview, the Senator stressed that the US crypto industry has many problems, which are only accentuated by the current tactics of the SEC. Lummis took aim at SEC Chairman Gary Gensler for his approach to regulating the sector, which she said involved using enforcement actions instead of clear guidelines.
She pointed out that this has resulted in a lot of uncertainty, with many digital asset companies ending up mired in legal disputes instead of being offered clear rules to follow.
According to Senator Cynthia Lummis, the SEC has been a significant hindrance to the further development of the cryptocurrency sector despite the need for regulatory certainty. She pointed out that the current legal framework is insufficient and incapable of catching up with the advancement, especially considering the EU which adopted a complete set of crypto laws in 2023. Lummis noted that the United States might lose its position in the global financial services market if such shortcomings in regulation are not filled as soon as possible.
“Crypto Assets Should Fall Under CFTC Oversight”
Lummis also touched on the category of digital assets and shared her view that Bitcoin and Ethereum are commodities and should fall under CFTC jurisdiction instead of the SEC.
She noted that the SEC strategy, which has tended to categorize digital assets as securities, does not apply to decentralized cryptocurrencies such as Bitcoin and Ethereum.
Senator Cynthia Lummis also stressed that Congress should step up and come up with proper legislation that would state the scope of different agencies concerning digital assets. She noted that despite the fact that there are still some assets that can be regulated by the CFTC, there is a need to have a clear and current framework for the regulation of the market. She also pointed out that the Howey Test, which is a legal test applied to ascertain whether an asset can be considered a security, may require an update in view of the current developments in the crypto market.
Gary Gensler’s Stance on BTC and ETH
In contrast with Senator Cynthia Lummis, SEC Chair Gary Gensler has maintained that the U.S. already has crypto regulations in place. During an interview, Gensler responded to criticism from industry stakeholders, arguing that “not liking the rules is not the same as there being no rules.”
He insisted that the SEC is focused on protecting investors, noting that many crypto firms have benefited from public interest in digital assets without providing proper disclosures.
Gensler affirmed that Bitcoin is not a security, a stance shared by his predecessor Jay Clayton. This distinction, Gensler noted, allowed the SEC to approve the launch of Bitcoin Spot Exchange-Traded Funds (ETFs) earlier this year. However, Gensler has remained largely silent on the classification of Ethereum, though its treatment as a commodity has been inferred from regulatory decisions regarding Ethereum ETFs.
Lummis Calls for Changes in Crypto Regulation
According to the Wyoming Senator, these gaps can only be closed by legislation. She cited her plan with Senator Kirsten Gillibrand to change the wash sale rule in order to increase the funding for the CFTC and its capacity to regulate the digital asset space.
This proposal, she said, would allow for a more comprehensive approach to regulating the crypto space without jeopardizing its potential.
In addition, Senator Cynthia Lummis and a number of other lawmakers have also expressed concern about the SEC’s Staff Accounting Bulletin 121 (SAB 121) that forces crypto custodians to include customer assets as liabilities. In a letter to Gensler, lawmakers demanded that SAB 121 be withdrawn stating that it places undue regulatory restraints on the crypto industry.
Kelvin Munene Murithi
Kelvin is a distinguished writer with expertise in crypto and finance, holding a Bachelor’s degree in Actuarial Science. Known for his incisive analysis and insightful content, he possesses a strong command of English and excels in conducting thorough research and delivering timely cryptocurrency market updates.
Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
- UK Gambling Commission charges Sorare for providing unlicensed gambling services.
- The United Kingdom’s Gambling Commission has been investigating Sorare for three years.
- Sorare denies wrongdoing, asserting it is not a gambling platform under UK law.
The United Kingdom’s Gambling Commission has taken legal action against Sorare, a blockchain-based fantasy sports platform, accusing the company of operating unlicensed gambling facilities.
Sorare, headquartered in France, offers non-fungible tokens (NFTs) tied to fantasy sports teams and athlete collectibles. Following the Gambling Commission’s move, the platform is set to appear in a UK court on October 4.
The Gambling Commission opened its investigation into Sorare in October 2021 but has largely kept its findings under wraps.
As of July 2023, the Commission had not made its conclusions public, instead stating that it would engage in further dialogue with operators and third parties before reaching a final verdict.
The upcoming court battle represents the culmination of nearly three years of regulatory scrutiny.
What is Sorare?
Sorare, founded in 2018, allows users to collect and trade digital cards in the form of NFTs. These cards represent real-life athletes, and users can create fantasy teams to compete based on the players’ real-world performances.
The platform covers multiple sports, including football, basketball, and baseball. Player performance in actual games directly impacts the fantasy teams, making the platform interactive for users.
Sorare’s NFT cards can be traded or sold, sometimes reaching values in the hundreds of thousands of dollars.
Sorare denies any wrongdoing
In response to the charges, Sorare has firmly denied any wrongdoing.
In a public statement issued by the company’s spokesperson, Sorare has argued that it is not a gambling platform under UK law and criticized the Gambling Commission for misinterpreting its business model.
As quoted by The Guardian, the spokesperson said, “We firmly deny any claims that Sorare is a gambling product under UK laws. The Commission has misunderstood our business and wrongly determined that gambling laws apply to Sorar.”
Sorare has faced legal challenges before, including a similar case in France. In that instance, the company reached a settlement before the matter could proceed to court.
Initially, Sorare only accepted cryptocurrency payments for transactions on its platform. However, in 2023, the company expanded its payment options to include traditional fiat currencies in an effort to increase user adoption.
The outcome of the UK case could have significant implications for Sorare and the broader NFT gaming industry, which continues to blur the lines between collectibles, gaming, and gambling.
The U.S. Securities and Exchange Commission (SEC) announced today that it has settled charges against Mango DAO, Blockworks Foundation, and Mango Labs LLC for their involvement in the unregistered sale of crypto assets on the Mango Markets platform.
The SEC’s enforcement action targets the sale of MNGO governance tokens and alleges that these entities failed to comply with federal securities laws, depriving investors of essential legal protections.
US SEC Settles With Mango Markets
According to the SEC, Mango DAO, a decentralized autonomous organization, and Blockworks Foundation, a Panamanian entity, raised more than $70 million from unregistered offers and sales of MNGO tokens beginning in August 2021.
The tokens, marketed as governance tokens of the Mango Markets platform, were sold to hundreds of investors worldwide, including in the United States. The SEC’s complaint argues that by bypassing registration requirements, the entities did not provide investors with the disclosures and safeguards mandated by U.S. securities laws.
MNGO tokens were promoted as governance tokens intended to provide holders with decision-making power within the Mango Markets ecosystem. However, the SEC maintains that their sale should have been registered under the Securities Act of 1933, as the tokens were deemed to be securities.
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Kelvin Munene Murithi
Kelvin is a distinguished writer with expertise in crypto and finance, holding a Bachelor’s degree in Actuarial Science. Known for his incisive analysis and insightful content, he possesses a strong command of English and excels in conducting thorough research and delivering timely cryptocurrency market updates.
Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
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