Regulation News
CLS Global Clarifies Position Amid SEC, FBI, DOJ Takedown of Fraudulent Crypto Firms
Published
3 hours agoon
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adminIn response to recent actions by a U.S. prosecutor and the U.S. Securities and Exchange Commission (SEC) against several cryptocurrency firms, including CLS Global, the company has issued a statement addressing the situation. CLS Global has contacted U.S. authorities in order to establish a constructive and cooperative dialogue with the hope of resolving the cases, addressing any misunderstandings, and taking any appropriate remedial steps to mitigate risks in the future.
Strict Policy Against U.S. Market Engagement
According to the company, CLS Global has maintained a policy of seeking not to operate within the United States market or conducting business with U.S. citizens, entities, or users. This policy has been in place since the company’s establishment
Filipp Veselov, CEO of CLS Global, was quoted as saying, “Our company has always aimed to maintain a policy that prohibits engagement with U.S. clients, entities, or users. We take our compliance obligations very seriously and have worked to ensure our operations remain separate from U.S. markets and regulatory jurisdictions.” Veselov added, “However, we recognize that there may be areas where we can improve our processes, and we are open to constructive dialogue with regulatory authorities.”
Steps Towards Resolution and Compliance Enhancement
In response to the current situation, CLS Global has outlined several steps it is taking:
- Reaching Out to US Authorities: The company reports that it has initiated communication with the US authorities to address any concerns or misunderstandings. CLS Global believes that through open and transparent dialogue, progress can be made towards a resolution.
- Reviewing Client Agreements: CLS Global states that it is in the process of reviewing and enhancing its client agreements to ensure they clearly communicate the company’s policies regarding U.S. persons and entities.
- Assessing Exchange Partnerships: The company is reportedly evaluating its operations on various cryptocurrency exchanges, with a focus on those with robust Know Your Customer (KYC) protocols, to further mitigate potential risks.
CLS Global’s Forward-Looking Statements
CLS Global has affirmed its commitment to operating within the bounds of applicable laws in the jurisdictions where it conducts business. The company has assured stakeholders that it will strive to honor its obligations to clients and partners while working through this process.
“We are taking this situation very seriously and are committed to engaging in constructive discussions with regulatory authorities to address any concerns,” Veselov stated. “Our goal is to ensure full compliance and transparency in our operations, and we are open to considering any necessary adjustments to our practices.”
The company has also expressed appreciation for the patience and understanding of its clients, partners, and stakeholders as it works to address this situation. CLS Global has indicated that it will provide updates as appropriate and remains committed to maintaining open lines of communication throughout this process.
About CLS Global
CLS Global is a leading cryptocurrency market-making firm, specializing in providing bespoke liquidity solutions for crypto projects worldwide. Renowned for its innovative approach, robust compliance framework, and client-centric operations, CLS Global operates at the forefront of the digital asset industry.
Coingape Staff
CoinGape comprises an experienced team of native content writers and editors working round the clock to cover news globally and present news as a fact rather than an opinion. CoinGape writers and reporters contributed to this article.
Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
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Denmark To Implement World’s First Crypto Unrealized Gains Tax
Published
2 days agoon
October 24, 2024By
adminDenmark is set to pioneer an unprecedented tax reform by introducing a tax on unrealized capital gains for cryptocurrencies, starting January 1, 2026. This bold move aims to integrate cryptocurrencies such as Bitcoin into the existing financial taxation framework, treating them similarly to other investment assets.
The Tax Law Council has recommended this tax to apply to future acquisitions and cryptos acquired as far back as Bitcoin’s inception in January 2009.
Denmark To Introduce Tax on Crypto Unrealized Gains
According to the press statement, Denmark will impose a 42% tax on unrealized capital gains for all crypto assets. This crypto tax will apply to assets like Bitcoin, which are not backed by any physical assets or fiat currencies. Consequently, the law if passed will bring these digital assets under the same taxation rules as traditional investments.
The government intends to align the crypto taxation with the existing rules for other investment types, such as stocks and bonds.
Moreover, the new tax policy will affect crypto purchased as far back as the genesis block of Bitcoin in 2009. Hence, anyone holding cryptocurrencies will be subject to this 42% tax rate on unrealized gains, regardless of whether they sell their holdings.
Tax Minister Rasmus Stoklund expressed support for the developments stating,
“Throughout recent years, there have been examples of Danes who have invested in crypto-assets being heavily taxed. That is why I am pleased that the Tax Council has today submitted some elaborate and up-to-date recommendations. The council’s recommendations can be a way to ensure more reasonable taxation of crypto investors’ gains and losses.”
Regulatory Challenges and Investor Impact
The introduction of this crypto tax will address the complexities of taxing digital assets. The decentralized nature of cryptocurrencies has made taxation difficult for both authorities and crypto holders. To solve this, Denmark plans to introduce additional regulatory measures.
The Danish government announced that starting in 2027, they will exchange data on Danish crypto investors internationally. They also plan to introduce a bill in early 2025 requiring crypto service providers to report customer transactions. This will help Denmark regulate approximately 300,000 Danes who own crypto-assets and curb potential tax evasion.
In addition, the government will allow investors offset losses from one crypto against gains in another, as well as gains on financial contracts. This approach will correct the current taxation system’s asymmetry, which heavily taxes investors on gains.
These developments coincide with Italy’s efforts to tighten its control over digital assets. Recently, Italy announced plans to increase its capital gains tax on cryptocurrencies, raising it from 26% to 42%. This change is part of Italy’s broader effort to boost government revenue by taxing profits from cryptocurrency investments.
Ronny Mugendi
Ronny Mugendi is a seasoned crypto journalist with four years of professional experience, having contributed significantly to various media outlets on cryptocurrency trends and technologies. With over 4000 published articles across various media outlets, he aims to inform, educate and introduce more people to the Blockchain and DeFi world. Outside of his journalism career, Ronny enjoys the thrill of bike riding, exploring new trails and landscapes.
Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
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Ripple CLO Reveals The Likely Outcome Of The SEC Appeal
Published
5 days agoon
October 20, 2024By
adminStuart Alderoty, the Chief Legal Officer (CLO) of Ripple, recently provided an insightful perspective on the ongoing legal battle between Ripple and the U.S. Securities and Exchange Commission (SEC). As the case progresses, Alderoty suggests that the possibilities range from a full affirmation of Judge Torres’s decision by the Second Circuit to a potential expansion of her rulings.
A less likely outcome, according to Alderoty, could see the case remanded back to Judge Torres for further deliberation.
Ripple CLO Stuart Alderoty Shares Major Insight Ahead of SEC Appeal
In a recent post on X platform, Alderoty suggested that the Second Circuit, might either affirm the decision by Judge Analisa Torres or possibly expand on her ruling. Further, Ripple CLO expressed confidence in the XRP company’s position, noting that the best outcome the SEC could hope for would be a remand to the lower court.
He highlighted the improbability of the appeal succeeding in overturning Judge Torres’s original decisions, suggesting that the best the SEC could hope for would be a remand.
Such a scenario would reopen Ripple’s original defenses, including the “Fair Notice” defense. This defense questions whether a party of ordinary intelligence would have known that their actions were against the law. Alderoty said,
“ The SEC could end up arguing to Judge Torres that she wasn’t a person of ‘ordinary intelligence’ when she ruled against them. Awkward.”
Additionally, the Ripple CLO drew an analogy between the SEC’s persistent legal pursuit and the literary work “Moby Dick,” with SEC Chair Gary Gensler cast in the role of Captain Ahab. More so, Ripple CLO humorously added that the situation now mirrors comedic elements similar to the movie “My Cousin Vinny.” This light-hearted comparison underscores the perceived overreach and determination of the SEC in its regulatory enforcement against Ripple.
Previous Rulings and Community Reactions
In the earlier stages of the litigation, the court ruled in favor of Ripple, rejecting the Securities and Exchange Commission’s arguments regarding XRP status as a security. Most recently, Alderoty shared updates with the XRP community, reassuring them that the verdict that “XRP is not a security” remains unchallenged. This clarification boosted community sentiment, with expectations of a potential rebound in XRP price.
In addition, legal analysts like James Murphy and Fred Rispoli, along with former Securities and Exchange Commission lawyer Marc Fagel, have commented on the proceedings. They highlighted that while the SEC opted not to appeal the decision on disgorgement during the remedies phase, the final judgment remains open for argument in the appellate briefs.
However, despite the Ripple vs SEC legal challenges, the impending launch of its RLUSD stablecoin could elevate XRP price towards $2 milestone.
At press time, XRP price is $0.54, marking a 3.5% increase over the past week. The cryptocurrency’s market cap stands at $30 billion, with a 24-hour trading volume of $622 million.
Ronny Mugendi
Ronny Mugendi is a seasoned crypto journalist with four years of professional experience, having contributed significantly to various media outlets on cryptocurrency trends and technologies. With over 4000 published articles across various media outlets, he aims to inform, educate and introduce more people to the Blockchain and DeFi world. Outside of his journalism career, Ronny enjoys the thrill of bike riding, exploring new trails and landscapes.
Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
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Lawyer Calls Out Mistakes In Brad Garlinghouse & Chris Larsen’s Deal
Published
6 days agoon
October 19, 2024By
adminFred Rispoli, a lawyer in the Ripple vs SEC case, has criticized Brad Garlinghouse and Chris Larsen for agreeing to drop only some of the charges that the U.S. Securities and Exchange Commission (SEC) has leveled against them. According to Rispoli, the executives should have sought for the dismissal of all the charges instead of coming to a partial settlement.
Fred Rispoli Criticizes Brad Garlinghouse and Chris Larsen’s Deal
Through a series of posts on the X platform, Fred Rispoli, a lawyer, pointed out what he called blunders in the legal approach that Garlinghouse, Ripple’s CEO, and Larsen, the company’s executive chairman, took.
He personally expressed concern with their decision to drop some of the claims while not seeking a full trial on the “aiding and abetting” charges raised by the US SEC.
In the view of Rispoli, Ripple’s leaders were in the best position to defend themselves against the SEC’s allegations, especially the “Institutional Sales” claim, which would only hold if there was evidence of recklessness. He stated that the agency lacked compelling evidence to meet that burden, and a jury would likely have been frustrated by the SEC’s case, possibly resulting in a unanimous verdict in favor of Garlinghouse and Larsen.
Missed Opportunities for Key Testimonies in Ripple vs SEC Case
Rispoli also added that had Ripple CEO Brad Garlinghouse and Larsen proceeded to trial, there was a possibility that potential witnesses would have come into the picture. He said that the SEC’s former chairman Jay Clayton and its former co-director of the corporation finance division Bill Hinman, alongside other industry players, might have been called to give evidence.
These testimonies in the Ripple Vs SEC case could have given a clue on internal SEC determinations regarding the classification of cryptocurrencies, specifically XRP.
Additionally, a trial would have allowed presenting some documents that were previously shielded from discovery. Rispoli noted that this could have been advantageous for Ripple and other digital currency companies in the future as the data disclosed could be applied in legal concerns with the US SEC.
Ripple’s Cross-Appeal and the SEC’s Latest Move
In response to the SEC’s ongoing attempts to appeal certain aspects of a 2023 judgment given by the U.S. District Judge Analisa Torres, Ripple Labs filed a cross-appeal. In her decision, Torres stated that Ripple’s sales of XRP to retail investors on digital platforms were not securities sales.
However, the regulator is now appealing other parts of the decision in the Ripple Vs SEC case, including the firm’s institutional sales, and the distribution of XRP for non-cash considerations.
Stuart Alderoty, Ripple’s legal chief, also sounded optimistic about the case stating that the agency’s appeal would not go well. “I felt good about our case in the Southern District of New York. I feel even better about our case in the Second Circuit,” Alderoty said in a recent interview.
US SEC’s Filing Deadline and Response
Some controversy had arisen regarding whether the SEC filed its brief within the time allowed for filing an appeal. Some of the X users argued that the agency failed to file its Form C within the 14 days’ period for filing the appeal in the Ripple Vs SEC case. The form itself had been submitted on October 16 while the Second Circuit’s docket reflected the filing as having been made on October 17 thus raising questions as to the validity of the filing.
🚨NEW: In response to my question about what happened with the filing deadline and for an explanation as to the date on the Form C not matching the time stamp, an SEC spokesperson told me:
“It was filed on time.”
Listening to @MetaLawMan on @AbsGMCrypto this morning, he said… https://t.co/cygihF4KQM
— Eleanor Terrett (@EleanorTerrett) October 18, 2024
When asked about the deadline of the filing, the US SEC spokesperson said, “It was filed on time.” Meanwhile, despite all this, the US SEC’s appeal doesn’t challenge the part of the decision that states that XRP sales to retail investors through exchanges are not securities. That decision is still valid, still leaving the court’s finding that XRP is not a security when sold to retail investors intact.
Kelvin Munene Murithi
Kelvin is a distinguished writer with expertise in crypto and finance, holding a Bachelor’s degree in Actuarial Science. Known for his incisive analysis and insightful content, he possesses a strong command of English and excels in conducting thorough research and delivering timely cryptocurrency market updates.
Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
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