Crypto regulation in the world: weekly digest #8


Last week, the U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC) added the Tornado crypto mixer Cash to its SDN list. At the same time, one of the alleged developers of the smart contract, Aleksey Pertsev, was arrested in the Netherlands. He is suspected of concealing criminal financial flows and facilitating money laundering. After the announcement of the sanctions and the arrest news, active discussions began in the crypto community about the legality of the actions of the US authorities.

Human rights activists from the non-profit organization Coin Center , after analyzing this decision, came to the conclusion that OFAC has exceeded its legal authority.

Sanctions should be directed against specific beneficiaries, and not against a smart contract itself – a some kind of program available to any user. Obviously, it is necessary to separate the concepts of "enterprises" and "applications". Tornado Cash team has developed the mixing service, an open source application that anyone can install and run.

Coin Center believes that this decision can be challenged in court and are studying the prospect of such a claim. This week the US Federal Reserve Board published new information for banking institutions that plan to conduct transactions with digital assets.

According to the regulator's website, before carrying out cryptocurrency operations, financial institutions must notify the Board of their intentions, assess whether the planned activity related to cryptocurrencies is fully legal and determine whether any documentation is required to be provided to regulatory authorities.

Banks that already carry out cryptocurrency transactions must notify the US Federal Reserve. It is notable, that in the scope of regulation of digital financial assets and cryptocurrencies, the Securities and Exchange Commission (SEC) and the Commodity Futures Commission (CFTC) play a leading role. Perhaps the Fed may also pay more attention to these issues in the future.


Canadian Securities Administrators Association (CSA) mandated digital asset companies to comply with investor protection requirements, even if they are just waiting for a license. As required by the regulator, platforms for trading crypto assets must commit to comply with the terms and conditions regarding the protection of investors, even during the period of consideration of their applications for registration and obtaining a license. This requirement complements the securities law guidance provided last year by the CSA and the Investment Industry Regulatory Organization of Canada (IIROC).

Last year, the CSA published guidelines for cryptocurrency companies. Some marketing strategies have been deemed irresponsible by Canadian regulators, as advertising for crypto -currency products may encourage investors to act rashly.


The European Central Bank (ECB), as well as the Fed, outlined its plan to regulate crypto currency activities carried out by financial institutions. As banks increasingly wish to start products related to cryptocurrencies, the ECB is faced with the task to ensure the consumer’s safety.

First of all, the ECB draws attention to issues of the adequacy of the proposed business model for working with cryptoassets in in the context of all bank activities, mandatory compliance with the AML/CFT policy and the sufficiency of staff qualifications.

We continue to highlight the news of the world of crypto regulation worldwide. Stay tuned for the latest news!

The TokenScope Team
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