Update: Governor Newsom signed Assembly Bill 39, establishing the Digital Financial Assets Law on October 13, 2023. In signing, he called for more clarification in the regulatory process and in legislation. See his signing statement here.
The California Department
On the Chain
On the Chain, published by Orrick, focuses on legal and regulatory developments in blockchain technology, digital assets, and cryptocurrency. The blog covers topics such as digital asset regulation and licensing requirements, securities law implications for tokens, compliance with anti-money laundering and money transmission laws, and the impact of evolving SEC regulations on crypto trading platforms. It also addresses venture capital investment considerations specific to blockchain startups, including governance, token rights, and due diligence. Additionally, the blog discusses practical legal issues like token warrants, insider trading policies, and the intersection of fintech and blockchain regulation.
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Latest from On the Chain
6 Questions Blockchain Founders Should Ask When Launching a Product or Token
As any founder knows, operating in the blockchain space requires navigating a myriad of regulatory regimes. While every product and token are different, below are 6 key questions that any founder should ask themselves as they launch their product or…
Crypto Regulation Marches On With Potential Consequences for Trading Systems
By Soo Hwang
A flurry of recent activity has reinforced the SEC’s commitment to regulate crypto assets, including trading systems that trade crypto asset securities.
WHAT HAPPENED?
The SEC shared additional information in April 2023 on whether and how its proposal to expand…
5 Ways Venture Investment in Blockchain Differs from Investment in Traditional High-Growth Startups
Venture investments in blockchain companies are often similar to investments in traditional, high-growth technology startups. However, there are a few differences any company or investor should know about:
- Board Seats: Lead investors in venture backed companies often require a right
…
5 Things to Know About Token Warrants
Venture capital investors in blockchain companies often require formal rights to receive tokens or other digital assets created by those companies. Typically, these rights are provided through an instrument called a “token warrant.” While token warrants are most frequently issued…
Cooperatives: An Ownership Model for Digital Networks
Japanese: 協同組合――デジタル・ネットワークのオーナーシップのモデル
Chinese: 合作社：数字经济的新所有权模式
Turbulence in crypto and blockchain has shed light on a question that has received increasing attention: how web3 companies share ownership in digital networks, including through tokens.
As the industry wrestles with this question, builders and…
CFPB Makes an Entrance: Crypto Products Targeted
Ending doubts regarding its interest in the space, the Consumer Financial Protection Bureau (CFPB) has for the first time publicly acknowledged its investigation of a crypto company — and it’s likely a sign of things to come.
The agency hinted…
SEC Provides Expectations About Public Company Disclosures Regarding Crypto Ecosystem Impact
By Alice Hsu
What Happened
The Division of Corporation Finance of the Securities and Exchange Commission (“SEC”) issued a sample letter on December 8, 2022, highlighting considerations that public companies that are in, or connected to, the crypto industry should keep in mind…
European Crypto Regulation on the Verge of Enactment
By Daniel Jones
The EU’s Markets in Crypto-Assets (MiCA) regulations are now all but final and may take effect this year. MiCA will provide new regulatory frameworks, including licensing and disclosure obligations, for participants in the cryptocurrency ecosystem, including token issuers, financial intermediaries…
Federal Reserve Requires Banks to Provide Notice Regarding Crypto-Asset-Related Activities
Federal Reserve Requires Banks to Provide Notice Regarding Crypto-Asset-Related Activities
The Federal Reserve Board (“FRB”) announced a significant shift requiring FRB-supervised banking organizations to disclose any current crypto-asset-related activity and to notify FRB in advance of entering into any such…