Trump Picks Crypto Advocate as Acting Chief of Staff
The departure of General John Kelly from the White House and the chaos in replacing him as White House chief of staff has seemingly brought an unexpected perk to the crypto community. Bitcoin advocate Mick Mulvaney was chosen Friday to serve as acting chief of staff.
The former representative from South Carolina was instrumental in creating the Blockchain Caucus, which is a group of legislators seeking to encourage new technologies like cryptocurrency via lawmaking.
While a member of the caucus, Mulvaney helped to draft two pieces of legislation to support the growth of the blockchain industry. House Resolution 1108 (2018) proposed increases in research in blockchain technology. House Resolution 7002 (2018) would amend the E-SIGN Act to "confirm the applicability of blockchain to electronic records, electronic signatures and smart contracts."
NBCNews is reporting that Mulvaney was offered the position on a permanent basis but declined. It is unclear if crypto is currently a policy priority for either Mulvaney or Trump.
Report: 87 Percent of Trading Volume of Top Crypto Exchanges Could Be Fake
One of the silver linings of the recent market crash has been news that daily trading volume is up. But a recent report published by the Blockchain Transparency Institute, a mysterious organization that published its first report in August, suggests that over 87 percent of the transactions from the 25 top crypto exchanges could be fraudulent. The report alleges that these exchanges could be involved in "wash trading."
A "wash trade" is a form of market manipulation where a financial instrument is bought and sold simultaneously, artificially increasing trading volume without moving the asset. By overstating their trading volume, exchanges gain leverage over coin networks, allowing them to charge higher listing fees for tokens and ICOs.
Of the top 25 exchanges listed by CoinMarketCap, the report claims that only two are not involved in some form of "wash trading" – though both those named, Binance and Bitfinex, have previously courted controversy for their practices. Per the report, most of the exchanges are likely embellishing their trade volumes by 70 percent, with average daily trades equaling approximately $324 million – as opposed to the claimed $2.5 billion.
Hong Kong Moves to Tighten Crypto Rules
The Nikkei Asian Review is reporting that Hong Kong is moving to tighten its cryptocurrency stance, potentially closing the oversight oasis that Chinese crypto firms have been enjoying.
Cryptocurrency is effectively banned in China. However, as part of its "one country, two systems" legal autonomy from mainland China, Hong Kong has allowed crypto to flourish and has become a leading marketplace for ICOs. However, concerns about money laundering has led regulators to act.
Per the Hong Kong Securities and Futures Commission (SFC), investment funds will need to be licensed if more than 10 percent of the managed assets are from cryptocurrencies. Such funds will only be allowed to sell related products to professional investors.
The regulations will also require that companies only issue ICOs for tokens that meet SFC requirements, such as existing for at least 12 months. The regulation will also establish a "regulatory sandbox" for exchanges to test products before deciding to seek a license.
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