On November 20-21, 2017, Tether, the company behind USDT – a digital token backed by fiat currencies like the dollar and euro – disclosed that a hack resulted in the loss of $30.95 million worth of tokens.1 Tether posted an
FinTech Update
Financial Services News for FinTech Companies and Lawyers
FinTech Update, published by Reed Smith LLP, focuses on legal developments and regulatory issues in the financial technology sector. The blog covers topics such as cryptocurrency regulation, securities law as applied to digital assets, initial coin offerings (ICOs), blockchain technology, fraud risk management in digital finance, and compliance with emerging financial regulations. It also addresses cross-border legal challenges, enforcement actions by regulatory bodies like the SEC, and the impact of technological innovation on banking and financial services. The content includes analysis of court decisions, regulatory guidelines, and industry best practices relevant to fintech companies and financial institutions.
Latest from FinTech Update - Page 7
CFTC and SEC Chairs Seek to Apply Existing Laws and Regulations to Digital Assets
By Kari Larsen & Michael Selig
Nine years after Satoshi Nakamoto circulated his whitepaper and introduced the world to bitcoin, regulated bitcoin derivatives are about to be introduced in the United States. CME Group recently announced that it will begin to offer bitcoin futures based on…
SEC Files Complaint Against Trader Involving Bitcoin Conversion Scheme
By Kari Larsen & Michael Selig
On October 30, 2017, the U.S. Securities and Exchange Commission (“SEC”) filed a complaint in federal court against a day trader for allegedly committing fraud and market manipulation during which the trader utilized a digital currency exchange in a supposed…
CFPB Releases Data Sharing Principles for Fintechs and Financial Institutions
By Maria B. Earley & Paul Bond
On October 18, the Consumer Financial Protection Bureau (“CFPB” or “Bureau”) entered into the long simmering debate over consumer-authorized data sharing. This debate pits mainstream financial institutions, which are typically reticent to share customer data with third parties, against data…
CFTC Releases Primer on Virtual Currencies
By Kari Larsen & Michael Selig
On October 17, 2017, the U.S. Commodity Futures Trading Commission’s (“CFTC”) LabCFTC released a primer on virtual currencies, available here. The primer is an “education tool” that provides an overview of the virtual currency landscape and is “not intended…
SEC Creates New Units Focused On Cyber Crimes That Will Cover Crypto Tokens
September 28, 2017
Two months after its Investor Bulletin stating that U.S. securities laws may apply to digital token sales, the Securities Exchange Commission (“SEC”) announced Monday two new initiatives to address cyber-based threats and protect retail investors. The SEC’s…
Suitability of Swaps Documentation to the Blockchain Considered by ISDA
On August 3, 2017, the International Swaps and Derivatives Association (“ISDA”) released a whitepaper that considers whether derivative contracts could operate on a blockchain (the “Whitepaper”).[1] The Whitepaper, titled “Smart Contracts and Distributed Ledger – A Legal Perspective,”…
Illinois Department of Financial and Professional Regulation Issues Regulatory Guidance on Digital Currencies
By Kari Larsen & Michael Selig
On June 13, 2017, the Illinois Department of Financial and Professional Regulation (“IDFPR”) released guidance outlining its policies with respect to the treatment of digital currencies under the Illinois Transmitters of Money Act (“TOMA”). The guidance document offers a clear…
CFTC Launches FinTech Innovation Initiative “LabCFTC”
By Kari Larsen & Michael Selig
On May 17, 2017, Commodity Futures Trading Commission (“CFTC”) Acting Chairman J. Christopher Giancarlo announced an “important step forward” in bringing the CFTC’s regulations into the “digital world of the 21st century.” The CFTC’s new FinTech initiative, LabCFTC, will facilitate…
Conference of State Bank Supervisors Files Lawsuit against OCC to Stop Special Purpose FinTech Charter
On April 26, 2017, the Conference of State Bank Supervisors (“CSBS”), the trade association that represents state banking regulators, initiated a lawsuit against the Office of the Comptroller of the Currency (“OCC”) in the U.S. District Court for the District…