Crypto regulation in the world: weekly digest #22

FTX update

John Ray, the new CEO of the FTX exchange, continues to accuse his predecessor and his team of misusing clients’ funds and transferring them to Alameda Research to solve its financial problems. If this turns out to be true, then Sam Bankman-Fried and his team may still be prosecuted in connection with the loss of billions of dollars belonging to the exchange's clients.

To further investigate this issue, the US Department of Justice proposed that the bankruptcy court of the exchange appoint an independent expert to investigate potential violations that could cause the company to go bankrupt.

Obviously, a detailed study of the exchange’s management actions is important not only in order to bring the perpetrators to justice, but also in order to understand what conclusions market participants and regulators should draw from the events that have taken place. We have already mentioned that the SEC, CFTC, the US Department of Justice, as well as financial regulators in other countries, including the Bahamas, Japan and Turkey, are investigating the activities of FTX and related companies.

The exchange itself filed for bankruptcy under the Article 11 of the US Bankruptcy Code, and its founder Sam Bankman-Fried stepped down as CEO of the company. Since then, he has been actively giving interviews and participating various events, where he apologizes to his clients and assures that he knew nothing about the scale of the company's problems. From our point of view, even this fact indicates that the company was not managed professionally enough.

According to Bloomberg, SBF has been invited to the US Congress to be asked questions about the FTX bankruptcy. Congressional hearings will take place on December 13, and it is not yet known whether the former FTX chief will come in person or speak online. As far as we know, it is still located in the Bahamas, where the exchange was registered.

It also became known that the American division of FTX US is up for sale. Perhaps, foreign investors will be interested in buying it, for whom it is important to get a company licensed in the US to enter the US market.

At the same time, in the US, lawmakers began to criticize the SEC for insufficient regulation of the crypto industry. Since the SEC and CFTC, the two leading regulators of the American financial market, cannot decide which of them and how they will regulate the cryptocurrency industry in the country, according to some representatives of Congress, events such as the collapse of FTX or Celsius will continue to take place.


This week, the Brazilian Parliament approved a bill to regulate the crypto industry. This bill forces companies in the crypto industry to be licensed as a virtual asset service providers (VASP).

The country recognizes most crypto-assets as securities, and the Brazilian Securities and Exchange Commission (CVM) will take care of their regulation. The rest of the digital assets will be overseen by the Brazilian central bank.

A transitional period of 180 days is allotted for adaptation to the new rules. At the same time, many cryptocurrencies operate in Brazil. The largest cryptocurrency exchange in the world, Binance, has several offices in the country, and there are also local platforms such as Mercado Bitcoin, Foxbit, Bitcoin To You and others.

We already wrote that the CVM has issued a guidance note on the regulation of crypto-assets, including which digital asset is considered a security and disclosures to be made.


In Italy, starting from 2023, they lawmakers plan to introduce a tax of 26% on income from cryptocurrencies. At the same time, a threshold of €2000 is set. If the profit does not exceed this amount, then no tax will be charged. Prior to the adoption of the law, income from cryptocurrencies was taxed at a rate of 14%.

Earlier, Portugal, the most cryptocurrency-friendly European country, announced similar measures. The Portuguese authorities have said they plan to levy a 28% tax on profits from digital assets next year.

Against this background, the taxation of operations with cryptocurrencies is on the agenda of the European Union’s lawmakers. The European Commission plans to adopt a draft of new cryptocurrency tax proposals on December 7th. Politicians plan to discuss new rules for taxing cryptocurrencies during 2023 with an eye to their implementation in 2026.

The discussion will include the question of whether a single tax regime for cryptocurrencies should be implemented across the block. The process is likely to be slow, as the representatives of all EU countries need to reach agreement on decision, since taxation is largely dependent on individual members.

Recall that the MiCA bill on unified rules for cryptocurrencies in the EU has not yet entered into force.

News from other countries:

  • The Central Bank of Hong Kong promises to soon develop special rules for regulating stablecoins. The regulator believes that this should increase the security of investors. From our point of view, Hong Kong will soon become a cryptocurrency hub, since cryptocurrencies have been banned in mainland China since the end of 2021.

  • The Bank of England drew attention to the fact that decentralized protocols cannot provide sufficient risk management. The UK regulator believes that a clear legal framework is needed for the whole DeFi sector.

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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