Germany Passes Law allowing Institutions to Invest in Crypto Projects, US Lawmakers Divided On Crypt
The cryptocurrency regulatory landscape is rapidly changing. Unlike ten years ago, financial watchdogs are getting involved. As such, some crypto projects are finding it hard to keep up with the regulatory scrutiny.
For example, BlockFi, a crypto-lending platform, has been asked by regulators in some US states to halt offering its interest-bearing account. Also, Ripple is battling it out with the US Securities and Exchange Commission (SEC). The SEC accuses Ripple of selling XRP to investors without following the securities laws.
On the other hand, a greater regulatory scrutiny has brought relief to other players in the crypto industry.
Germany Passes Law Allowing Institutional Funds to Invest in Crypto
On Monday, August 2, a law allowing institutional funds to invest in crypto took effect. According to reports, the provision gives the funds freedom to invest up to 20 percent of assets under management in virtual currencies.
However, to be part of this bracket, a fund must be what the German law calls Specialfonds.
These funds manage a cumulative $2.1 trillion in assets. Despite the burgeoning popularity among institutional investors, some financial advisors believe German institutions will experiment with crypto for at least half a decade. Analysts hedge the reluctant to invest in crypto projects to largely conservative investors.
Ukraine Preparing to Accept Crypto Payments
According to Oleksandr Bornyakov, the Ukrainian deputy head of the country’s digital transformation ministry commented on a crypto-focused bill targeting to recognize cryptocurrency payments.
Bornyakov revealed that the bill would make it “quite legal to pay” using virtual currencies.
However, the payments must be made through third-parties that convert crypto to government-recognized currencies. Unfortunately, the country wouldn’t recognize crypto as legal tender.
The deputy minister revealed that crypto would be treated the same as the US dollar. He added that his country “does not allow you to pay in dollars, but you can easily pay for purchases with a dollar card.” In doing so, the amount is converted to the local currency “instantly during payment.”
Apart from paying for goods and services, Bornyakov observed that the bill will also recognize other crypto-related activities such as crypto trading.
The new bill came at the heels of another law recently signed by Volodymyr Zelensky, the country’s president. The already signed law permits the Ukrainian central bank to interact with a CBDC (central bank digital currency).
The US infrastructure Bill Continues to Attract Attention
The US Senate is yet to pass an infrastructure bill that has drawn the attention of the cryptocurrency community. The bill contains a section that seeks to raise $28 billion from crypto taxes. Also, it contains crypto reporting requirements that some consider “unworkable.”
On August 7, two senators introduced amendments to the bill seeking to lessen the reporting requirements for cryptocurrency projects and activities such as mining.
According to Digital Chamber’s founder, Perianne Boring, if cloture is declared, “there will be 30 hours of debate left, then they will vote on the base text.” The senate will then vote on amendments later.