France Exempts Transactions with Cryptocurrencies from Taxes Payment

Maria Rodríguez
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France Exempts Transactions with Cryptocurrencies from Taxes Payment

The idea is to boost cryptocurrency transactions in the country. But this decision does not apply to the payment of Value-Added Tax (VAT), in the case of companies

Following the steps that Portugal took 15 days ago, the French Economy Minister Bruno Le Maire, who is a cryptoactive enthusiast, said that taxes will not be applied to transactions conducted with cryptocurrencies in his nation. It only will apply if the digital currencies come or derive from profits in fiat money.

This decision is similar to the one announced at the end of August by the Portuguese government. The tax authority of that country published an official document in which it explained that cryptocurrencies are seen in that territory as a means of payment and for that reason they are exempt from taxes, in case they do not later become traditional currencies.

The objective is to facilitate and encourage cryptocurrency transactions in the country. This means that as long as the citizens of that country buy or exchange any type of cryptocurrency they will be free of taxes.

What Happens in the Case of Companies?

However, in local media, it was clarified that these types of operations do not apply to the payment of Value-Added Tax (VAT).

These details were explained by the tax agency to clarify doubts associated with the operations of a local company dedicated to mining digital currencies, in this case, cryptocurrencies such as Bitcoin, among others.

According to Bloomberg Tax, the French approach would help with the tracking of transactions, which represents a challenge in the world of cryptocurrencies.

“We believe that the moment the gains are converted into traditional money is the right time to assess tax”, said Le Maire.

In this way, cryptocurrency users should only follow the correct use of cryptocurrencies to avoid VAT in both the purchase and sale processes.

France and Portugal are not the only countries that are working on issues related to cryptocurrency operations and legislation.

Different Regulations

Last August, New Zealand opened its doors and gave cryptocurrencies greater opportunities. In that sense, it allowed income, salary payments and tax provisions in cryptocurrencies.

Also, the decision of that regulatory body suggested that only stablecoins could be used as a means of payment because their value is less volatile than the price of other cryptocurrencies such as Bitcoin.

Similarly, Brazil decreed, at the beginning of last month, specifically on August 2th, those who conduct transactions with cryptocurrencies should declare these operations to the Department of Federal Revenue, in a digital currency market that has a greater number of investors than the Stock Exchange of Sao Paulo.

The Reaction

The community of cryptocurrency users in France has expressed its agreement with the measure.

Le Maire played an important role in the design of the French regulatory framework for cryptocurrencies. For this reason, the official invites other countries of the European Union to follow the steps that his nation has taken, whilst it continues the study of these digital assets to make them part of its financial system in the best possible way.

However, although Le Maire’s policy has been to support Bitcoin, some French ministers decided not to accept Libra, the cryptocurrency of Facebook, for being “a risk to the sovereignty of the government”, since they say it can be used to finance terrorism and money laundering.

By María Rodríguez

Kaleido’s Enterprise Customers will be Able to Privately Transfer Tokens Thanks to New Partnership

Andres Chavez
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Kaleido’s Enterprise Customers will be Able to Privately Transfer Tokens Thanks to New Partnership

Hackers and cybercriminals have been looking for gaining a hold on users’ data and information for years. However, regular people now have to fend off other entities that threaten to sniff on their content, such as government surveillance agencies, big tech companies, and others. Privacy is at a premium these days.

That is why Kaleido’s SaaS (Software as a service) blockchain product will provide users with the opportunity to better protect their privacy with advanced methods. The firm itself made the announcement at the Ethereal Summit Tel Aviv 2019, late last week.

A Strategic Alliance with QEDIT

To be more specific, Kaleido announced a strategic alliance with QEDIT, which is a known developer of privacy-related technology for corporate blockchains. QEDIT has been behind the creation and development of ground-breaking discoveries in its field.

The pact will let Kaleido’s customers to protect sensitive data and information thanks to a zero-knowledge proof (ZKP) cryptography whilst tokens are being traded and digital assets being in the ecosystem.

The technology can be applied broadly, but is especially useful when implemented in two industries: energy and finances. To that end, the firm has been known to be working with giants such as Sony, T-Mobile, Fox, and UnionBank in an effort to develop highly useful blockchain networks and ecosystems.

Tokens Are “A Digital Construct of Real World Assets”

According to Kaleido’s Chief Executive Officer Steve Cerveny remarks to a prominent specialized crypto news site, “tokens aren’t just about crypto anymore; they’re a digital construct of real world assets. They have a shared state and need to move from one party to another. In many cases you would want to obfuscate some amount of information.”

The systems promotes transparency because whilst the operations remain legible in the blockchain and those that participate in the network can verify them with no issues and at any moment, “observers cannot see who sent what, or how much, or to whom,” per Cerveny.

Kaleido is backed by ConsenSys, and helps big corporations and institutions as they move from blockchain pilots to actual production. The network in question promotes privacy and it is also permissioned, which means that the organizations will be the ones determining which data remains public and which information does not.

The Process

It is very easy to use the service: companies will need to sign up their wallets, and then register for the zero knowledge token transfer feature. From there, they will need to transfer their assets to a shielded account, and after that, pressing a button that takes the traders to a private “dark room” is required.

Data researchers and scientists behind the development of zk-SNARK proofs are the ones responsible for the QEDIT’s solution.

Cerveny went on to say that “enterprise tokens are still nascent, but many firms are coming around to how powerful these things are to share state. We’re bullish tokenization will be universally applicable.”

By Andres Chavez

The SEC Says that Much still Needs to Be Done Regarding ETFs

Willmen Blanco
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The SEC Says that Much still Needs to Be Done Regarding ETFs

Progress is being made in the cryptocurrency space to allow the launch of a Bitcoin ETF. However, Jay Clayton says that concerns persist inside the U.S. Securities and Exchange Commission (SEC).

Clayton, president of the SEC, stated that there is progress with the Bitcoin exchange-traded fund, and that the market has taken steps to address the concerns of the SEC. With respect to approving an ETF fund in Bitcoin, he said that there is still work to be done.

Some media such as CoinGape have said that this implies that the waiting time could be lengthened even more.

Good and Bad News

When asked yesterday whether there is progress to allow the launch of a Bitcoin ETF, Clayton replied affirmatively, thus reassuring for the future. In this regard, he said that the SEC is involved in this, but they need to feel comfortable about some things. The first is custody, which is a long-standing requirement in the market, and so having something means really having it.

It seems that not everything in the garden is rosy, due to the persistence of Clayton’s concerns about the decision to approve the aforementioned product.

Clayton noted two reasons for being worried: the lack of an adequate cryptocurrency custody provider and the threat of price manipulation in unregulated exchanges.

The President of the SEC said in November of last year that concerns about price manipulation had been a key obstacle to giving the financial product a green light, along with questions about how custody operates.

On September 9th, Clayton reiterated his concerns by saying that an even more difficult question, given that they trade heavily in unregulated exchanges, is how they can ensure that those prices will not be subject to significant manipulation. He explained that people need to answer these difficult questions for them to be sure that they are offering the right kind of product.

Is the Time Drawing Near?

Clayton’s observations arrived only a few weeks before the SEC’s approval or rejection of a couple of Bitcoin ETF proposals.

Bitwise Asset Management, which submitted one of the proposals with NYSE Arca, has published a series of reports throughout the year to convince the SEC that the market is mature enough to support that product.

VanEck/SolidX submitted the other proposal with Cboe BZX. It should be noted that it had been submitted in 2018, when it was seen as a strong competitor to become the first ETF approved by the SEC. Although it was withdrawn during the prolonged closure of the government in early 2019, it was later resubmitted.

The SEC has postponed decisions on both ETF proposals, but faces a deadline of October 13th for Bitwise and October 18th for VanEck/SolidX.

Significant ETF

An ETF remains essential as futures trading and trust funds have limited market adaptability. ETF shares can be included in the portfolio of an average investor. It can also be included with mutual funds and other benefits.

According to CoinGape, the SEC deals primarily with the risk and security of retail investors. He thus adds that he is taking a slow and calculated approach. Interestingly, the first Gold ETF was launched in 2004 but, given the long story, an ETF for Bitcoin could take longer.

By Willmen Blanco

Gemini Custody, an Institutional Crypto Custody Solution

Willmen Blanco
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Gemini Custody, an Institutional Crypto Custody Solution

Gemini’s offer includes support for new cryptocurrencies, the ability to instantly exchange offline storage and an improved interface.

Gemini Trust Company, LLC (Gemini), is the cryptocurrency exchange and custodian of the Cameron brothers and Tyler Winklevoss. On September 10th, it launched Gemini Custody, a qualified cryptocurrency custodian that will allow customers to instantly exchange assets by offering credits.

It was reported that Gemini Custody supports 18 cryptocurrencies and offers the possibility of incorporating many more soon. Besides, customers can instantly exchange their cryptocurrency in custody on the Gemini exchange without waiting to make transfers outside cold storage.

It should be noted that previously customers had to wait more than one day to access and trade assets. The new system will help customers exchange assets held offline without waiting for access.

Interface and Multi-Accounts

According to the statement, a new interface allows customers to check balances, download account statements, and initiate withdrawals. Gemini added that customers can grant auditors read-only access to confirm balances, transactions and activity.

For its part, the sub-account function gives customers the ability to create and manage multiple accounts with different sets of users, balances and unique and independently verifiable cryptographic addresses, all under a single master account.

White lists can also be configured, which ensures that the user’s cryptocurrencies can only be withdrawn to certain addresses.

Cryptocurrency Variety

Gemini Custody supports 18 cryptocurrencies for custody, among which are Bitcoin, Bitcoin Cash, Ether, Litecoin, and Zcash. It is said that custody support for more cryptocurrencies will come soon.

The tool will also offer support for the following ERC-20 tokens: 0x (ZRX), Augur (REP), Basic Attention Token (BAT), Pan (BRD), Dai (DAI), Decentraland (MANA), Enjin (ENJ), Flexacoin (FXC), Gemini dollar (GUSD), Kyber Network (KNC), Loom Network (LOOM), Maker (MKR), and OmiseGo (OMG).

Security and Usability

Tyler Winklevoss, CEO of Gemini stated that the maturation of cryptocurrencies as an asset class depends largely on the security and soundness of the custodians that own individual and institutional funds. He added that, since the first day, Gemini recognized the need for a world-class custody solution that is safe, compatible and easy to use for both individuals and institutions worldwide.

Jeanine Hightower-Sellitto, Managing Director of Operations at Gemini, said that they have demonstrated a clear and growing demand for cryptography products. However, they have struggled to find a solution that fully meets their complex regulatory and security requirements.

Gemini Custody is the only native crypto solution in today’s market that meets these complex requirements without sacrificing security or liquidity.

Competition Begins

This is just the last move in Gemini’s efforts to provide regulated services to institutions. Additionally, it comes at a time when competition is already appreciated in the custody sector.

Recently, Coinbase has expanded its offer by acquiring the institutional arm of Xapo. At the same time, new players such as Anchorage, Fidelity and Bakkt have entered. However, investors have been asking for solutions that balance security and the ability to trade assets quickly.

The exchange announced in early July that it would apply for a stockbroker license through the Financial Industry Regulatory Authority (FINRA), the self-regulatory organization that oversees securities brokers in the United States.

By Willmen Blanco

U.S. Treasury Says that Libra Must Comply with Respective Laws

Willmen Blanco
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U.S. Treasury Says that Libra Must Comply with Respective Laws

The representative of the agency expressed her concern since, beyond the emphasis on technology; many cryptocurrencies do not implement mechanisms to combat money laundering and other financial crimes.

Sigal Mandelker, Under Secretary of the U.S. Department of Treasury for Terrorism and Financial Intelligence, informed in a press conference that Facebook’s Libra and any other digital currency must meet the highest standards of compliance in terms of the rules and regulations that govern in the United States.

The statements were made during an event related to the use of cryptocurrencies that was taking place in Geneva, Switzerland. The official clarified that this measure applies to all digital currencies in addition to Libra, the latter being the case with the greatest stir because of the position of the country’s legislators headed by U.S Congresswoman Maxine Waters.

In this regard, Mandelker commented that, whether Bitcoin, Ethereum, Libra, or any other cryptocurrency, the U.S. Treasury would give the same massage to all those companies. She explains that the fight against money laundering and terrorist financing must be present in their design from the very beginning.

The meeting, which was held in Geneva, was attended by representatives of the Swiss government, banks and international financial organizations.

Fight against Money Laundering

Disclosing some details about the digital currency ecosystem, Mandelker said that the industry focused its efforts on the construction of a very solid infrastructure, but neglected important aspects in the fight against terrorism and money laundering.

The U.S. Treasury official also expressed her concern about the fact that Switzerland is listed as one of the places with the most permissive laws for the operation of cryptocurrencies. Consequently, she invited the authorities of the European country, and other nations with a similar position, to be very aware of the risks posed by digital currencies in terms of capital legitimacy.

In this respect, Thomas Moser, alternate member of the governing board at the Swiss National Bank, said a few days ago that the entity does not see any problem with the proposal that Facebook plans to promote by early 2020.  He explained that the company is operating in accordance with the legal provisions that apply within the Swiss territory

Data Management

However, beyond the concern about money management, the Swiss Federal Commissioner for the Protection of Data and Information indicated two months ago that the directors of the social network had not provided the agency with further details about the digital currency, especially regarding the mechanisms to protect users’ private information.

The same concerns were expressed by Waters last month during her visit to Switzerland, where she said that she was worried that Facebook was left with all this information, especially after all the legal disputes that it underwent due to the Cambridge Analytica case.

Despite this, the main concern of Waters, and the other members of the Financial Services Committee of the U.S. House of Representatives, is about the effects that Libra has on local and global economy. She considers that this could lead to the eventual loss of power of the US dollar as one of the main currencies for international trade.

By Willmen Blanco

Multimillionaire Bitcoin Owner Avoids Being Robbed by Jumping from a Balcony

Willmen Blanco
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The victim’s personal assets/holdings exceed the amount of 11 million dollars in cryptocurrencies. Many cases of robberies and kidnappings of this type have occurred due to the popularity that Bitcoin has gained.

A Norwegian multimillionaire, who is the owner of a cryptocurrency company, jumped from a second-floor balcony in the City of Oslo, in Norway, after an armed man had tried to rob him. Before the attempted theft, the victim had allegedly boasted about having made a fortune by investing in Bitcoin and other cryptocurrencies in the last decade.

An indictment taken by the Oslo Attorney General’s Office said that the perpetrator knocked on the door of the victim’s apartment while he was brandishing a firearm.

When the victim opened the door, the thief commanded him to lie on the floor under threat that he would shoot him. Instead of doing what he was told, the victim decided to jump from a balcony. It has not yet been reported if he suffered any serious injury as a consequence of the fall.

It was published that the anonymous businessman runs a cryptocurrency company. It was also indicated that his personal assets are estimated at about 100 million Norwegian kronor (equivalent to USD 11.15 million).

The current price of Bitcoin, which is around USD 10,300, is far from its all-time high at the end of 2017, when 1 bitcoin was worth about USD 20,000. However, this cryptocurrency is still a very popular target among criminals, which is why Bitcoin holders should be particularly careful.

It is worth noting that the digital nature of the cryptocurrency par excellence implies that a long and complex password, known as a private key, is all that is needed to transfer funds from one wallet to another. The thief in this case wanted to make the victim give him his private so that he would have access to his Bitcoin holdings.

The Oslo incident is the latest in a series of cases that involve criminals who attack people in an attempt to gain access to their private keys and; thus, their accounts. Besides, they know that the semi-anonymous nature of Bitcoin and other cryptocurrencies makes it difficult for the police to track the transactions.

In 2015, a firefighter from New York City was stabbed by thieves who demanded that he hand over his private keys. Two years later, Ukrainian kidnappers earned more than a million dollars after successfully using ransomware against a cryptocurrency analyst.

At the beginning of this year, three robbers disguised as police officers entered a house in Drenthe, in the Netherlands, and tortured a man with a drill in an attempt to gain access to his cryptocurrencies. The one-hour torment undergone by the victim took place in front of his four-year-old daughter, but in the end it was unsuccessful.

It is true that Bitcoin and other cryptocurrencies are increasingly gaining popularity among investors all over the world. However, it is best to avoid talking about personal holdings, especially in front of unknown or untrustworthy people, to avoid being victims of a robbery or a murder.

By Willmen Blanco

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