Compliant Wednesday
Hey everyone,
Welcome to a new issue of Compliant Wednesday — your five-minute zero-knowledge rollup of crypto policy and regulation news. We batch the most relevant information, so you can stay compliant and decentralized.
In this week’s issue:
- Ronaldo faces $1B lawsuit
- Crypto advocate McHenry not up for re-election
- Australian law firm calls crypto tax law “toilet paper”
- BIS report calls for secure CBDCs
Cristiano Ronaldo is facing a $1 billion lawsuit for allegedly promoting unregistered securities in partnership with cryptocurrency exchange Binance. The lawsuit, filed in the Southern District of Florida, represents consumers who purchased unregistered securities from Binance, with Ronaldo accused of soliciting investments through his promotions and social media presence.
This adds to other legal troubles for Binance, including a previous lawsuit from the SEC and a $4.3 billion settlement for sanctions and money-transmitting violations. Ronaldo partnered with Binance in 2022 for a non-fungible token (NFT) collection, receiving compensation in digital assets through the Binance platforms.
Our take:
This highlights the risks associated with celebrities endorsing cryptocurrency activities and underscores the need for thorough due diligence in such collaborations. The case raises questions about regulatory oversight in the crypto space and the potential impact on both Ronaldo’s reputation and the broader landscape of celebrity endorsements in this industry.
Read more here.
Rep. Patrick McHenry, known as a key advocate for the crypto industry in the US Congress, announced in a post on X that he will not seek another term and will retire in 2024. McHenry’s departure could delay the progress of two crucial crypto bills, one to regulate stablecoin issuers and one to establish rules for the wider crypto markets. McHenry has been a central GOP negotiator for the stablecoin bill, and his sudden departure could diminish his negotiating authority. The industry will miss his bipartisan approach and constructive engagement with the industry.
Our take:
McHenry brought pragmatism on crypto regulation we’ll sorely miss. His departure may empower more extreme voices. Industry needs to double down supporting constructive allies on both sides of the aisle.
Read more here.
An Australian law firm is advising investors to ignore the country’s controversial new guidelines for cryptocurrency taxation, calling them unclear and likening them to “toilet paper.” The Australian Tax Office released non-binding guidance on taxes for DeFi investments, causing confusion and reducing tax compliance in the crypto community.
The founder of Cadena Legal, an Australian law firm, believes a public ruling or proposed legislation is needed to clarify the rules. A potential counter argument is that ignoring the guidelines could result in legal trouble with the ATO.
Our take:
The blunt criticism of Australia’s tax guidance proves terrible policy is a cause for confusion. But defiance also risks retaliation when clarification could be right around the corner. A tightrope walk for Aussie crypto users and emblematic of regulation policies everywhere.
Read more here.
The Bank for International Settlements (BIS) has advised central banks to focus on security from the outset when developing central bank digital currencies (CBDCs). The BIS report highlights the various risks associated with CBDCs, which can range from cybersecurity threats to human error, and emphasizes the need for an integrated risk management framework. The report suggests that risks can be specific to each country and will change over time, necessitating continuous oversight and adaptation.
Our take:
CBDC security emphasis shows lessons have been learned from early crypto stumbles. But air-gapped designs contradict the connectivity promises of CBDCs. You can’t eliminate all risks in complex systems.
Read more here.
And that’s it! Stay compliant, stay regulated and stay tuned for Tech Adoption Friday ✌️
