U.S. Rep. Warren Davidson (R) has announced plans to introduce legislation that would clearly regulate cryptocurrencies and Initial Coin Offerings (ICOs), local Ohio news agency Cleveland.com reports Dec. 3.

According to Cleveland.com, Davidson announced his intention to introduce new legislation at the Blockchain Solutions conference. The bill would create an “asset class” for cryptocurrencies and digital assets, which “would prevent them from being classified as securities, but would also allow the federal government to regulate initial coin offerings more effectively.”

This development would bring clarity to U.S. crypto regulation. Currently, state regulatory agencies classify tokens differently in ways that place them under their jurisdiction.

The Securities and Exchanges Commission (SEC) stance is that most cryptocurrencies are securities. The Commodity Futures Trading Commission (CFTC), on the other hand, treats cryptocurrencies as commodities.

In other words, the CFTC states that Bitcoin (BTC) has more in common with gold than with currencies or securities since it is not backed by a government and does not have liabilities attached to it. The Financial Crimes Enforcement Network (FINCEN), the agency managing anti-money laundering (AML) and know your client (KYC) standards, views crypto as money.

The U.S. Office of Foreign Assets Control (OFAC), which enforces economic sanctions, views crypto as money and blacklists wallets of sanctioned persons. Lastly, the Internal Revenue Service (IRS) treats cryptocurrencies as property, meaning that profits from selling them are subject to capital gains tax.

A group of U.S. Congressional representatives sent a letter in September to the SEC Chairman Jay Clayton calling for “clearer guidelines between those digital tokens that are securities, and those that are not.”

The same month, over 45 representatives of major crypto companies and Wall Street firms attended a Congressional roundtable discussion on cryptocurrency and ICO regulation. During meeting, which was hosted by Davidson, experts expressed concerns about a lack of regulatory clarity in the industry and discussed “token taxonomy.”

Davidson has previously demonstrated his support for the crypto industry, suggesting that the ICO market needs “light touch” regulation. A spokesman for the U.S. representative said in November that Davidson is working on a bill that, once law, would treat ICOs as products rather than securities at the federal and state level, effectively “sidestepping” security laws.

As Cointelegraph reported yesterday, seven Ohio funds will hand over $300 million to blockchain startups by the end of 2021. Of this money, $100 million will be invested by nonprofit JumpStart.

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Malaysia will enact regulations for cryptocurrency and Initial Coin Offerings (ICO) in Q1 2019, local English-language news media outlet The Star reported Nov. 28.

The publication quoted finance minister Lim Guan Eng, who said Wednesday said the country’s regulator, the Securities Commission (SC), had updated him with a timeframe for the new rules.

The move will form “part of the SC’s efforts to facilitate alternative fundraising avenues and new investment asset classes,” The Star added.

Malaysia has taken a piecemeal path to regulation of its domestic cryptocurrency industry, originally beginning the process in late 2017.

Authorities have sought to control the sector in the meantime, Lim telling parliament that entities wishing to issue cryptocurrencies must consult the country’s central bank, Bank Negara Malaysia.

“I advise all parties wishing to introduce Bitcoin (style) cryptocurrency to refer first to Bank Negara Malaysia as it is the authority that will issue the decision on financial mechanism,” Cointelegraph reported him as saying Monday.

This month, a Malaysian politician had also recommended putting on hold approval for a government-backed cryptocurrency issuance project until the regulations came into force.

Malaysia has sought to foster its relationship with blockchain this year, November also seeing the Education Ministry set up a university degree verification system using the technology.

This post is credit to cointelegraph

A new World Trade Organization (WTO) report illustrates the burgeoning effect of DLT on global trade with an estimation that the technology could add USD 3 trillion to the global economy by 2030.

WTO’s findings, entitled ‘Can Blockchain revolutionize international trade?’, incorporates not only the effects of blockchain on world trade but also how other sectors such as finance, logistics and transportation, could be impacted by DLT.

This is the second of such reports regarding blockchain technology released by the WTO. Last month, Bitcoin News covered its findings on The future of world trade: How digital technologies are transforming global commerce’. In this report, WTO Director-General Roberto Azevêdo was particularly encouraged by the potential of smaller enterprises to profit from the utilization of DLTs, commenting:

“Beyond easing trade in goods, digital technologies can facilitate services trade and enable new services to emerge. The Report predicts that the share of services trade could grow from 21% to 25% by 2030. Other effects could include, for example, blockchain helping smaller businesses to start trading by supporting them in building trust with partners around the world.”

This latest report continues to outline DLT’s disruptive and influential potential in supply chain logistics; an aspect of the technology recently criticized by Ethereum co-founder Vitalik Buterin, suggesting that lower costings due to emerging technologies such as blockchain will enable smaller businesses to enter the market.

The report also touched on securing and protecting international property rights through blockchain and the building of new trade deals as a result of the efficiency, transparency and cost effectiveness of DLT. These deals could be worth up to USD 1 trillion.

The WTO does offer a note of caution going forward, suggesting that energy consumption, hacking and scalability issues need to be addressed: The report stated:

“…blockchains are highly resilient compared to traditional databases due to their decentralized and distributed nature and the use of cryptographic techniques, they are not completely immune from traditional security challenges…”

The report concludes that international trade may be transformed over the next 15 years but this can only happen with “smart standardization — and smart standardization can only happen through cooperation”.

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Earlier this year, Spain’s tax collection department launched an investigation – which aimed to identify cryptocurrency-related businesses that would have to pay taxes on their capital gains on the investments and revenue they generated from crypto-related activities.

According to local news outlet, El Pais, Spain’s treasury department had requested in April that digital currency and blockchain-focused firms report their earnings and cryptoassets holdings to the nation’s tax authorities.

There were over 60 different institutions that the Spanish treasury had contacted – in order to obtain information regarding how much the institutions had earned from cryptoassets. These organizations included 40 companies that accepted crypto payments, 16 large banks, and several firms that served as intermediaries for crypto transactions (ATM operators, payment technology providers, exchanges).

15,000 Businesses To Pay Taxes On Crypto-related Revenue

El Pais has now reported that Spain’s treasury department has received financial information from local crypto-related companies – which includes about 15,000 firms that owe taxes on their digital currency earnings.

As detailed by local news outlets, any capital gains Spanish firms have made on cryptoassets are subject to a 19 to 23% tax rate. The exact rate is calculated by taking into account the size of a company’s capital gains from its cryptocurrency-related business.

At present, it’s unclear how Spain’s authorities will be collecting taxes as digital currency traders and companies that provide crypto-related products and services claim that filing taxes on their earnings can be a very complicated process.

As CryptoGlobe reported in early October, cryptoasset investors have to gather and sift through their digital currency transaction logs (when filing taxes) – which can be quite challenging as they may have used multiple exchanges or platforms.

Not So Simple To File Taxes On Crypto Earnings

Moreover, crypto investors have to identify trades and separate them from non-taxable transactions such as those that only involve transferring funds from one wallet to another.

It is also difficult for a country’s tax collection department to hold people accountable and make them accurately report and pay taxes they might owe on their crypto-related earnings. Unlike traditional stocks, which pay dividends to their holders, most cryptoasset investments do not offer such returns. So, it may be more challenging for tax authorities to accurately determine how to collect taxes on digital assets.

Additionally, it’s not clear whether Spain’s tax department is willing to accept cryptocurrency as payment from people filing taxes on their earnings from digital assets. Even if authorities accept crypto as tax payment, it may be quite difficult to determine the exact amount that somenone would pay – as digital currency prices have begun to fluctuate wildly again.

This post is credited to cryptoglobe