Regulation
India Crypto Regulation Depends On DEA Release In September
India is gearing up for a significant move in its crypto regulation effort as the Department of Economic Affairs (DEA) prepares to release a crucial consultation paper between September and October 2024. This document is expected to serve as a cornerstone for shaping the country’s future approach to digital currencies. Some sources have revealed the government’s intent to actively engage stakeholders and refine its regulatory stance.
India Seeks Public Input For Crypto Regulation
The upcoming paper will seek feedback from various stakeholders. This reflecting the government’s commitment to creating a strong framework for crypto regulation. Moreover, the initiative aligns with the broader global effort, particularly within the G20, to establish a unified approach to regulating these assets.
In October 2023, Finance Minister Nirmala Sitharaman highlighted the G20’s consensus on the need for coordinated regulation across countries. She emphasized that while global cooperation is essential, each country must also tailor its legislative measures to address local challenges.
“Given the understanding that globally now all of us are on the same page about how regulations can happen, countries and their specific legislative arrangements will also have to be worked out,” Sitharaman stated. Her remarks underscore the dual approach India is taking. It includes working in align with international bodies while also addressing domestic regulatory needs.
The DEA’s paper will be instrumental in gathering insights and opinions on how to effectively regulate crypto assets in India, according to a CNBC report. Economic Affairs Secretary Ajay Seth, in an interview in September 2023, noted that the government would carefully consider the recommendations before finalizing its policy direction.
Seth also emphasized the importance of addressing the unique risks that cryptocurrencies pose to emerging economies like India. Seth’s comments come against the backdrop of India’s evolving stance on crypto regulation.
In 2023, during its G20 presidency, India played a pivotal role in endorsing guidelines from the International Monetary Fund (IMF) and the Financial Stability Board (FSB), which advise against blanket bans on crypto activities. These guidelines have influenced India’s current cryptocurrency regulation.
Current Regulation & Divergent Views Of Authorities
The country currently focuses on anti-money laundering (AML) and counter-terror financing (CTF) measures, extended to crypto assets and intermediaries since March 2023. Furthermore, the upcoming consultation paper will address key policy questions, including the scope and extent of regulation in the crypto space.
The latest update comes at a time when Indian authorities are grappling with differing views on how to handle private virtual asset trading. The Securities and Exchange Board of India (SEBI) is reportedly more open to allowing such activities. Meanwhile, the Reserve Bank of India (RBI) remains cautious, citing concerns about potential macroeconomic risks.
This internal debate is not new. India’s approach to cryptocurrencies has seen several shifts since the Supreme Court’s 2020 decision to overturn the RBI’s 2018 ban on crypto-related financial services. A bill proposing a ban on private cryptocurrencies was drafted in 2021 but was never introduced, signaling the government’s cautious stance.
However, recent developments suggest a move towards a more nuanced regulatory framework. In July 2024, the RBI and SEBI joined forces with other government bodies to work on a comprehensive crypto policy for India. Furthermore, netizens expect the DEA’s upcoming consultation paper to reflect the G20-endorsed IMF-FSB framework. This marks a significant step towards a balanced and inclusive approach to crypto regulation.
Also, it’s important to note that the latest decision comes amid a critical juncture as the largest Indian crypto exchange, WazirX, faced a hack recently. On July 18, WazirX faced a $230 million security breach. Currently, investigations are underway but WazirX received a “clean chit” via a recent forensic report.
Kritika Mehta
Kritika boasts over 2 years of experience in the financial news sector. Currently working as a crypto journalist at Coingape, she has consistently shown a knack for blockchain technology and cryptocurrencies. Kritika combines insightful analysis with a deep understanding of market trends. With a keen interest in technical analysis, she brings a nuanced perspective to her reporting, exploring the intersection of finance, technology, and emerging trends in the crypto space.
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.
The United States District Court for the Northern District of Texas dismissed Consensys Software Inc.‘s case against the Securities and Exchange Commission. This was after a long legal battle to determine the status of Ethereum and other similar software products.
Texas Court Ends Consensys Suit Against SEC
The U.S. District Court in Fort Worth has thrown out the allegations made by Consensys against the Securities and Exchange Commission in a recent legal move. The court, presided over by Judge Reed O’Connor, ruled on procedural grounds. The judge determined the claims concerning Ethereum classification and the regulatory approach to MetaMask were not ripe for judicial review. This decision effectively puts an end to the current litigation initiated by Consensys in April of this year.
The dismissal focused particularly on the lack of final agency action from the SEC, which the court noted was a requisite for a substantial legal challenge. This procedural dismissal indicates that despite the issues raised, the court decided not to proceed with evaluating the merits of the case.
Legal Battle Over Ethereum and MetaMask
Initially, Consensys challenged the SEC’s classification of Ethereum and its derivatives as securities. The complaint highlighted concerns over the SEC’s focus on MetaMask, a software service provided by Consensys that facilitates crypto transactions and staking.
Despite an earlier notification in June about the SEC dropping its investigation into Ethereum, the broader implications of this regulatory scrutiny remained a contentious issue.
Subsequent to the initial lawsuit, the SEC initiated a separate enforcement action in June, accusing Consensys of operating its MetaMask swaps service without proper registration.
In addition, according to Judge O’Connor, this case lacked the necessary finality from the Securities and Exchange Commission side to be considered ready for court adjudication.
Reactions and Future Regulatory Steps
The court’s decision to dismiss on procedural grounds does not conclude the legal issues surrounding the regulation of Ethereum and other blockchain technologies.
More so, Consensys has expressed its intention to continue advocating for blockchain developers and to challenge the SEC’s actions in other jurisdictions, indicating that the struggle over crypto regulation in the U.S. is far from over. The case’s dismissal in Texas does not preclude the blockchain company from pursuing other legal avenues to address their grievances.
In addition, most recently, a US Bankruptcy judge Brendan Shannon approved Terraform Labs plan to liquidate its assets following an ongoing SEC lawsuit.
Ronny Mugendi
Ronny Mugendi is a seasoned crypto journalist with four years of professional experience, having contributed significantly to various media outlets on cryptocurrency trends and technologies. His work includes notable contributions to Cryptopolitan and Coingape News Media, where he shares his insights on the latest developments in the cryptocurrency market. Outside of his journalism career, Ronny enjoys the thrill of bike riding, exploring new trails and landscapes.
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.
AI News: The United Nations has issued seven recommendations for reducing the risks of artificial intelligence (AI) based on input from a UN advisory body. The final report of the council’s advisory body focuses on the importance of developing a unified approach to the regulation of AI and will be considered at a UN meeting scheduled for later this month.
AI News: UN Calls for Global AI Governance
The council of 39 experts noted that large multinational corporations have been able to dominate the development of AI technologies given the increasing rate of growth, which is a major concern. The panel stressed that there is an ‘unavoidable’ need for the governance of artificial intelligence on a global scale, since the creation and use of artificial intelligence cannot be solely attributed to market mechanisms.
According to the UN report, to counter the lack of information between the AI labs and the rest of the world, it is suggested that a panel should be formed to disseminate accurate and independent information on artificial intelligence.
The recommendations include the creation of a global AI fund to address the capacity and collaboration differences especially in the developing countries that cannot afford to use AI. The report also provides recommendations on how to establish a global artificial intelligencedata framework for the purpose of increasing transparency and accountability, and the establishment of a policy dialogue that would be aimed at addressing all the matters concerning the governance of artificial intelligence.
While the report did not propose a new International organization for the regulation, it pointed out that if risks associated with the new technology were to escalate then there may be the need for a more powerful global body with the mandate to enforce the regulation of the technology. The United Nation’s approach is different from that of some countries, including the United States, which has recently approved of ‘a blueprint for action’ to manage AI in military use – something China has not endorsed.
Calls for Regulatory Harmonization in Europe
Concurrent with the AI news, leaders, including Yann LeCun, Meta’s Chief AI Scientist and many CEOs and academics from Europe, have demanded to know how the regulation will work in Europe. In an open letter, they stated that the EU has the potential to reap the economic benefits of AI if the rules do not hinder the freedom of research and ethical implementation of AI.
Meta’s upcoming multimodal artificial intelligence model, Llama, will not be released in the EU due to regulatory restrictions, which shows the conflict between innovation and regulation.
“Europe needs regulatory certainty on AI”
An open letter signed by Mark Zuckerberg, me, and a number of European CEOs and academics.The EU is well positioned to contribute to progress in AI and profit from its positive economic impact *if* regulations do not impair open…
— Yann LeCun (@ylecun) September 19, 2024
The open letter argues that excessively stringent rules can hinder the EU’s ability to advance in the field, and calls on the policymakers to implement the measures that will allow for the development of a robust artificial intelligence industry while addressing the risks. The letter emphasizes the need for coherent laws that can foster the advancement of AI while not hindering its growth like the warning on Apple iPhone OS as reported by CoinGape.
OpenAI Restructures Safety Oversight Amid Criticism
In addition, there are concerns about how OpenAI has positioned itself where the principles of safety and regulation of AI are concerned. As a result of the criticism from the US politicians and the former employees, the CEO of the company, Sam Altman, stepped down from the company’s Safety and Security Committee.
This committee was formed in the first place to monitor the safety of the artificial intelligence technology and has now been reshaped into an independent authority that can hold back on new model releases until safety risks are addressed.
The new oversight group comprises individuals like Nicole Seligman, former US Army General Paul Nakasone, and Quora CEO Adam D’Angelo, whose role is to ensure that the safety measures put in place by OpenAI are in line with the organization’s objectives. This United Nations AI news comes at the heels of allegations of internal strife, with former researchers claiming that OpenAI is more focused on profit-making than actual artificial intelligence governance.
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.
- SEC reportedly seeks an extension to February 2025 for it to provide case documents to Coinbase.
- Coinbase, Binance and Kraken all facing SEC lawsuits.
The US Securities and Exchange Commission has filed for an extension from the court, asking for more time as it looks to provide documents related to its case against crypto exchange Coinbase. Cointelegraph reported this on Sept. 19
SEC asks for extension
Court documents filed on Sept. 18 reveal that the SEC wants the court to extend the timeline for them to furnish Coinbase with key material by four months.
The regulator filed its request at the US District Court for the Southern District of New York, and if granted, will see it have until February 2025 for the deadline to share over 133,000 documents.
SEC’s court filing comes a month to the end of the initial timeline on Oct. 18, which is when the securities watchdog was to hand over documents as part of the case’s discovery proceedings phase. According to the regulator, an extension will allow it to produce the necessary documents.
SEC has sued several crypto companies
These latest developments in the SEC vs. Coinbase lawsuit adds to several others in recent months and weeks. It includes court filings and verdicts in the regulator’s cases against crypto exchanges Binance and Kraken, which are the other major industry players in a legal battle with the SEC.
Both the courts and US lawmakers have taken issue with the SEC’s use of the term “digital asset securities’. This is part of the main allegations against crypto exchanges, with the regulator alleging securities laws violations by these firms.
The term ‘digital asset security’ does not appear anywhere in any law enacted by Congress or in any rule promulgated by the SEC or in any decision rendered by the Supreme Court. It appears nowhere in the 2 million pages of the Federal Register. If it comes from neither statute… pic.twitter.com/ucSaCzEvOU
— Rep. Ritchie Torres (@RepRitchie) September 19, 2024
In 2020, the agency sued Ripple Labs over the XRP cryptocurrency – a case that dragged for three years before a notable ruling in July 2023 declared XRP not a security. The regulator also reached a $4 billion settlement with Terraform Labs.
A judge denied Kraken’s motion to dismiss the SEC’s lawsuit agaisnt the exchange in August this year.
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