Putin approves inclusion of digital ruble within Russian tax code

Taiwan to review crypto ETFs amid developments overseasThe Financial Supervisory Commission (FSC) in Taiwan has disclosed its close examination of foreign cryptocurrency futures products and exchange-traded funds (ETFs), signaling a potential shift in its regulatory approach.According to a report in Chinese-language financial newspaper, Taiwan’s Commercial Times, the FSC aims to gradually ease restrictions, aligning its stance with global market conditions.Photo by bordercollie 1712 on UnsplashResponding to crypto ETF activity internationallyThe Taiwanese regulator is carrying out this exploration against the backdrop of significant global developments. The possibility of the Federal Reserve cutting interest rates and the upcoming review by the U.S. Securities and Exchange Commission (SEC) of the spot bitcoin ETF in January next year are key factors influencing the FSC’s considerations.The anticipation surrounding the Bitcoin halving in April, combined with speculation that a spot bitcoin ETF approval is imminent in the U.S., have contributed to a 145% surge this year in Bitcoin’s unit price, adding momentum to that regulatory contemplation in Taiwan. There has been speculation that BlackRock, the world’s largest fund manager, is already preparing for the approval of its iShares Bitcoin Trust ETF.Recognizing the potential impact of a Bitcoin index stock fund, contingent on SEC approval and subsequent public investment permission, the FSC is closely monitoring global trends.Closer to home, it emerged last month that Hong Kong’s Securities and Futures Commission (SFC) is actively exploring the possibility of permitting retail participation in a spot crypto ETF. Domestic investment banks in Taiwan, attuned to these developments, have expressed longstanding interest in introducing similar crypto products.The FSC draws parallels with global counterparts, citing the proliferation of cryptocurrency futures products and ETFs in various markets.Cautious regulatory reviewAdopting a phased approach, the FSC emphasizes self-discipline and standards in relaxing regulations around crypto ETFs. This cautious strategy aligns with Taiwan’s historical prudence, previously observed in the delayed approval of cryptocurrency ETFs and blockchain ETFs due to concerns over volatility and speculative nature.As Taiwan contemplates a significant move into the cryptocurrency ETF domain, industry players remain cautiously optimistic. While some had considered private placements for overseas cryptocurrency ETFs, challenges such as tightened regulatory supervision and concerns over errors and price lags prompted a reevaluation.Earlier this month, ETF issuer ProShares launched its short Ether-linked ETF product on the New York Stock Exchange’s Arca, using the ticker symbol SETH. Spot bitcoin ETFs have been launched in Canada, Germany, Australia and Brazil. The products have also been made available via tax havens such as the Cayman Islands, Jersey, Liechtenstein and Guernsey.The regulator in Taiwan hints at a potential strategy involving “cryptocurrency concept ETFs.” These funds could invest in cryptocurrency-related software and hardware vendors, offering investors exposure to the industry without direct linkage to cryptocurrency price fluctuations.

Experts Discuss Korean Security Token MarketSince the Korean financial regulator released regulatory guidelines on security tokens in February, many have anticipated that the introduction of security tokens would transform the concept of investment and give rise to new market strategies based on blockchain technology.©Pexels/PixabayIndustry professionals have expressed their opinions on the matter in interviews with media outlets.Token issuance and distributionPark Hyo-jin, vice president at Sejong Telecom, in a recent interview with Korean media outlet Digital Today, expressed his disappointment about the Korean government’s decision to separate token issuance from token distribution. Sejong Telecom is the developer and operator of the blockchain-based real estate fractional investment platform Bbric.According to Park, the capital market law separates token issuance from token distribution in order to prevent conflicts of interest, as interested parties may attempt to control financial products according to their own preferences. However, things are different with security tokens, Park believes. With the help of blockchain technology, a mainnet can issue and distribute tokens without intermediaries.Higher investment limitsPark emphasized the importance of increasing investment limits and cited the small size of the Korea New Exchange (KONEX), a stock exchange for small enterprises, as a reason for its lack of activity. He added that higher caps would result in positive ripple effects.Regarding real estate security tokens, Park doesn’t expect more profitable products, but sees that more investment choices will be available. He is particularly interested in investment contract securities. One such example is renting a piece of land to farmers to distribute harvest profits.Connection with virtual assetsThe security token market will face limitations if it’s not connected with its virtual asset counterpart. He mentioned the need for a digital asset law to create an ecosystem that links security tokens with virtual assets.Meanwhile, in an interview with Economic Review, Lee Kun-ho, former CEO of KB Kookmin Bank, showed a somewhat pessimistic view about the Korean security token market while admitting its potential.Various uncertaintiesIn his opinion, while real estate holds potential as a security token investment, government policies may introduce uncertainties. Likewise, the markets for music and artwork are also subject to unpredictability. Consequently, security token strategies in these areas could encounter limitations.Lee also sees that some of the services don’t necessitate blockchain technology. It is unlikely that any clear winners will emerge in the short term; therefore, it is vital for the industry to approach this issue with prudence, he added.

Pakistan Implements Ban on CryptocurrencyPakistan has moved to ban cryptocurrency once more, with the country’s Minister of State for Finance and Revenue, Aisha Ghaus Pasha disclosing the move last week.According to multiple local media reports within Pakistan, on May 16 Ghaus Pasha stated at a session of the Senate Standing Committee on Finance and Revenue, that cryptocurrencies are banned and “will never be legalized in Pakistan.”Photo by Hamid Roshaan on UnsplashFATF Grey ListGhaus Pasha supported this position by outlining that the Financial Action Task Force (FATF) had set the banning of crypto as a condition for Pakistan’s removal from its “Grey List.”FATF is an initiative of the G7 group of countries, first established in 1989. Its mandate is to develop policies geared towards combating money laundering, and most especially, terrorist financing. The FATF grey list includes those jurisdictions who are deemed to require increased monitoring relative to their efforts to keep money laundering and terrorist financing to an absolute minimum.Pakistan had found itself on the FATF grey list over the course of a number of years. That meant reputational damage on an international basis, together with loss of investor confidence. It also signals the likelihood of weaknesses in a country’s financial system and in its financial controls. The categorization would have had an impact on the country’s ability to access international finance, impacted trade relations, and involved increased compliance costs.Against that background, there may be a certain logic to the Finance Minister’s stance, despite it naturally being distasteful to those of us that support the development of decentralized systems, blockchain, and cryptocurrency. After an extended period on that Grey List, Pakistan was only removed from it in October of last year.Currency devaluationNotwithstanding that, governments in the developing world may have added incentives in banning cryptocurrencies. Their currencies are oftentimes unstable, and the Pakistani rupee is no exception. Cryptocurrencies like bitcoin find their greatest use case in countries that have their currencies devalued or economies that fall into the trap of hyperinflation relative to the sovereign currency.In Pakistan’s case, the rupee plummeted to a record low against the US dollar in January. Naturally, that hurts ordinary citizens and provides the conditions under which people are more likely to investigate decentralized cryptocurrencies. On that basis, we shouldn’t be surprised to learn that the Pakistani government’s decision to ban crypto was publicly supported by Sohail Jawad, Director of the State Bank of Pakistan (SBP).Pakistani banks are naturally following the government and the central bank’s lead, in implementing the ban. One circular obtained by CoinDesk stated: “As per regulatory instructions from the State Bank of Pakistan (SBP), any remittance of foreign exchange directly/indirectly outside Pakistan to overseas foreign exchange trading, margin trading, and CFD trading apps/websites/platforms through any payment channel is not allowed/permitted by SBP and such payments are inherently risky and illegal.”Community reactionNaturally enough, the crypto community internationally and locally, is not enamored by the move. However, people who have been in the space over the last few years are accustomed to ever-changing stances taken by governments as a reaction to a technology that they simply don’t know how to deal with.Waqar Zaka, a Pakistani who works within the Web3 space commented previously on a ban that was implemented in Pakistan in 2017, only later to be found to be unconstitutional. Another Pakistani community member took to Twitter in taking a stand against the decision. Others still immediately considered how they could circumvent the ban.Crypto has always benefited from jurisdictional arbitrage, and while bans are not in any way helpful, in the longer run, they will never stop the roll out and further development of this innovation.