The Securities and Exchange Commission (SEC) is considering licensing cryptocurrency in Ghana to enable all forms of crypto to be considered as a legal tender –that is to say, legit money for use within the nation’s borders. This has always been the aim of cryptocurrency everywhere in the world, digital assets like bitcoin were invented to give people direct access and control over their finances.
According to News Ghana, Ghana may sooner or later receive a regulatory framework as touching cryptocurrency that would enable bitcoin startups and exchanges operate legally without the threat of a potential regulatory stern.
The Regulation and State Of Cryptocurrency in Ghana
2019 is turning out to be a year of crackdown for the SEC. Since late 2018, the organization has been stern on crypto companies that refuse to appropriately register their operations.
Just like many central banks in Africa, the central bank of Ghana has warned citizen against transacting in crypto due to the risk of being scammed involved. The Secretary to the Bank of Ghana – Frances Van-Hein Sackey in response to the GCCH scam, said: “Anyone who does business with these entities does so at his or her own risk and the Bank of Ghana will not be liable for the refund of any deposit lost by a depositor.”
The recent state of cryptocurrency in Ghana, however, could change if the SEC regulates the sector, according to a report by GhanaWeb. SEC ‘Ababio in a statement said that Ghana’s Economic and Organized Crime Office (EOCO) is probing three cryptocurrency companies whose operators are currently missing in action.
What Does This Step By SEC Mean For Ghana?
According to Richard Gardner – CEO of Modulus, the step taken by Ghana’s SEC is meritorious since regulation of the cryptocurrency will provide standard rules for exchanges to operate by. In his opinion, this will make the industry viable while also protecting the people from exchanges that engage in, abusive trading, market manipulation, and money laundering.
Gardner further stated that the public and private sectors should combine forces towards creating these regulations.
“The best way to regulate an industry, especially one which is so technical, is to bring together those involved in the private sector, along with those from the public policy side. Together, we can usually find a way to encourage industry growth while protecting consumers,” – says Richard Gardner.
Cryptocurrency Adoption in Africa
Fascinatingly, there has been a lot of progress occurring in the Africa crypto space. There are reports that South Africa’s central bank is actively studying cryptocurrency and may institute guidelines to foster innovation. Blockchain technology and cryptocurrency are also embraced in Eastern Kenya, Zimbabwe and the Western state of Nigeria.
Picture Credit: Coinjournal
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ICO Rating To Pay Settlement Charges to US SEC of $268,998 For Undisclosed Paid Reviews
The Securities and Exchange Commission of the United States has announced that ICORating an ICO ratings provider firm has agreed to pay a settlement charge of $268,998.
In an investigation carried out by SEC’s Ashley Ebersole and Louis Gicale supervised by Melissa Robertson, the rating organization was found to have received payments for giving ratings to cryptocurrency projects. A violation of the securities law.
The Russian organization had decided to pay the sum because it failed to disclose payments received from issuers for publicizing their digital asset securities offerings.
According to SEC, between the period of December, 2017 and July 2019 the organization produced research reports and ratings of “blokchain-based digital assets” coins/tokens that were securities. These research were published on the organization’s website and social media.
Based on securities law, promoters are expected to disclose compensation received for publishing investments so that potential investors will be know what they are seeing is a well paid promoted offering.
According to SEC, ICO Rating violated the anti-touting provisions of Section 17(b) of the Securities Act of 1933. The organization has agreed to cease and desist from committing or causing any future violations of these provisions though it did not admit or denied the SEC findings.
The settlement of $268,998 is made up of prejudgment interest of $106,998 and civil penalty of $162,000
According to its website, ICO Rating addresses itself as “a rating agency that issues independent analytical research” with the mission “to help the market achieve the necessary standards of quality, transparency and reliability”
We Will Regulate Cryptocurrencies Using Electronic Financial Transactions Framework -Mike Pompeo
The US Secretary of State Mike Pompeo has said that, to regulate cryptocurrencies, the same framework that was used for other electronic financial transactions today should be adopted.
This he made known in an interview with CNBC where he also talked about the ongoing trade war with China and the administration’s position on the issue.
Mike Pompeo’s position on cryptocurrency regulations came as a response to a question raised by the CNBC interviewer when he asked “so how do you regulate these things like Libra or a Bitcoin? What do you do? It’s – Bitcoin’s going to be tough to regulate. It’s already out of the bag, isn’t it?”
Answering, Mike submitted that “The same set of requirements that apply to things flowing through SWIFT or flowing though our financial institutions ought to apply to those transactions as well. I concede it will be difficult to do, but the theory, the regulatory theory, that we ought to apply is that one.”.
Responding to a question about cryptocurrency as a tool for financing terrorism and the fact that prior cryptocurrencies, nefarious activities had been sponsored with cash – dollar, Pompeo gave an affirmation that indeed crime has been perpetuated with the USD in time past, so it is not peculiar to cryptocurrencies only.
Mike believes a world where financial transactions are harder to trace would be less secure. The solution to this is the protection/preservation of a global financial system. He cited the lack of financial tracking capabilities as at 9/11 and 15years prior
Recall that US Secretary of Treasury, Steve Mnuchin had in a press conference held in the White House in July, expressed concerns over the Libra saying it could be used for money laundering or financing terrorism.
He said the US will not allow digital assets service providers to operate in the shadows and using cryptocurrencies for illicit activities will invite the full effort of the US Treasury and regulators. He maintained that the United States has been at the forefront of regulating entities that provide cryptocurrencies.
According to him, while the government welcomes innovation that may improve the efficiency of the financial system and expand access to financial services, Libra poses a threat to the financial stability and integrity of the US financial system since cryptocurrencies has been exploited by many players to facilitate illegal activities such as cybercrime, tax evasion illicit drugs, human trafficking etc.
Libra: Big Tech shouldn’t be given more Power over Public infrastructure like the Financial System.- Senator Sherrod Brown
Facebook doesn’t Understand Powerful Tools Like Monetary Policy.
Facebook has come under criticism over the years it has commenced operation. It has also been caused appear before Regulators in time past and today sets another in the history of the social media giant.
The Facebook Libra hearing is currently ongoing in Washington DC with many questions being thrown at the representative of Facebook and Libra David Marcus.
As the US senators put forth their concerns to the Libra representative, opinions are being expressed by stakeholders to the integrity of the US government financial system stability of the US Economy.
Commenting on the Libra, a Senator from Ohio, Senator Sherrod Brown has said that big tech (firms) should be given more power over public infrastructure like the financial system. This is gave reason by saying the big tech and big banks aren’t accountable to the public.
The concern is coming as a result of the firm (Facebook) history with user’s data. The social media giant already enjoys a dominating presence globally with its product platforms such as the Messenger, Instagram, WhatsApp apart from the Facebook site itself.
Senator Sherrod opined that: it would be crazy to give Facebook a chance to experiment with people’s bank account and use powerful tools they don’t understand like monetary policy, to jeopardize hardworking Americans ability to meet their needs.
Secretary of the US Treasury had earlier expressed his concerns over the Libra that it could be used for money laundering financing terrorism. These are valid reasons why Congress had to request to halt the LIbra and Facebook appear before it else it will risk the creation of a new Swiss based financial system that is too big to fail.
On being Swiss based, David Marcus of representing Libra in the hearing, had early confirmed that they Libra will comply with FinCEN. Libra will be subject to KYC/AML regulations.
When asked about the dominance of Facebook in the Libra association, Marcus replied that Facebook will have same rights as others in the Libra association.
Senator Sherrod Brown maintains that Libra is a recipe for more corporate power over markets and consumers, and fewer and fewer protections for ordinary people
US Treasury believes Libra could be used for Money Laundering or Financing Terrorism
The 77th Secretary of the US Treasury had in a Press Conference held in the White House made known government position on the Facebook attempt into cryptocurrency. In the Conference, the Secretary expressed the concerns over Facebook Libra and Calibra saying it could be used for money laundering or financing of terrorism.
Facebook has since last year 2018 been preparing for its move into cryptocurrency by hiring engineers, a move after it had place a ban on crypto ads a year before. In June 2019, the social media giant released its white paper outline its goal to build a new financial system using the blockchain with massive corporations ranging acting as validators.
The attempt to create its “globalcoin” attracted backlash from the crypto community and as well as countries of the world which say the move as a threat to their local currency. Chiefly amongst the latest move by a foreign nation is the India’s decision to have nothing to do with Libra within its sovereign borders.
Facebook upon releasing the Libra white paper received a correspondence from the US Congress signed by Maxine Waters amongst others asking it to halt Libra or risk the emergence of a new Swiss financial system that is too big to fail. Congress requested Facebook to appear before it. The date is set for July 16, however, and top US officials are expressing their position on the Libra and its fate appears hanging.
The 45th Leader of the free world has few days ago said the Facebook Libra will have “little standing”. A comment which US Treasury Secretary Mnuchin credited as the President’s personal opinion and not that of the State. However, in the Press Conference today, the Secretary said the Treasury has very serious concerns Libra could be used for money laundering or financing terrorism.
“……..the overall goal is to maintain the integrity of the financial system and protect it from abuse.” – Steve Mnuchin
And as cryptocurrencies has been exploited by many players to facilitate illegal activities such as cybercrime, tax evasion, illicit drugs, human trafficking, While the US government welcomes innovations that may improve the efficiency of the financial system and expand access to financial services, Libra poses a threat to the financial stability and integrity of the US financial system.
Facebook is currently trading as at press time at $203 showing a closing loss of 0.47% after opening at $204 and reaching a height of $205.53 today.