FinCEN Issues Guidance on Virtual Currencies as Congressman Proposes Bill to Outlaw Crypto Purchases

U.S. regulation has certainly dominated the crypto headlines over the past 24 hours. One story came from Congressman Bradley Sherman – a known detractor of bitcoin and cryptocurrencies in general – who proposed the introduction of a bill that would ban Americans from buying cryptocurrency. Then there was the Financial Crimes Enforcement Network (FinCEN), who issued an interpretive guidance on crypto, or “convertible virtual currencies (CVCs)”, as they call them.

Away from regulatory scene, London-based legal technology firm Mattereum announced it teamed up with renowned sci-fi actor William Shatner to showcase a blockchain-enabled technology that promises to disrupt the arts and collectibles market.

Bitcoin (BTC) is showing no signs of wavering after breaking through the $6,000-mark yesterday, a level not breached since mid-November of last year. At the time of writing, BTC is trading at $6,314.13 (+3.55%). Whilst ether (ETH) is also moving higher – $173.84 (+1.31%) – it is, once again, lagging behind the market-leading BTC in relative terms. Finally, the MVIS CryptoCompare Digital Assets 10 Index is tracking at 2896.50, a 2.69% rise over the past 24 hours.

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Congressman Proposes Bill to ‘Outlaw’ Cryptocurrency Purchases

In a Financial Services Committee hearing on Thursday (May 9, 2019), U.S. Congressman Bradley Sherman (D-CA) called on “colleagues to join [him] in introducing a bill to outlaw cryptocurrency purchases by Americans.” Explaining his motivation in front of the Committee, Sherman stated it is partly “because an awful lot of [the United States’] international power comes from the fact the dollar is the standard unit of international finance and transactions.”

To be sure, this is not the first time Sherman has called for a blanket ban on cryptocurrency buying. “We should prohibit U.S. persons from buying or mining cryptocurrencies,” he declared, last July, in front of a subcommittee for the same Committee.

FinCEN Issues New Cryptocurrency Guidance

U.S. anti-money laundering (AML) regulator, the Financial Crimes Enforcement Network (FinCEN), published an interpretive guidance document outlining when, and how, companies, individuals, and platforms native to the crypto ecosystem may be money transmitters pursuant to the Bank Secrecy Act (BSA) and other relevant laws.

Notably, the guidance made explicit interpretations that software wallet providers, multi-sig providers, decentralized exchanges, and other non-custodial services are not regulated as money transmitters under FinCEN, meaning they are not obliged to follow federal AML and know-your-customer (KYC) regulations. For an in-depth rundown of FinCEN’s guidance, CryptoGlobe recommends readers view this extremely helpful annotated version by Katherine Wu, the former director of business development at Messari.

William Shatner Teams Up with Mattereum to Blockchain-ize Captain Kirk

Actor William Shatner, best known for starring as Captain Kirk in the original Star Trek series, is teaming up with London-based legal technology startup Mattereum “to document authenticity of memorabilia and collectibles, on the blockchain,” according to a press release published on Friday (May 10, 2019).

Shatner will appear alongside Mattereum during the upcoming New York Blockchain Week, where they will showcase the firm’s so-called Asset Passport technology, which uses legally-binding smart contracts to ensure the accuracy of records, the statement explained.

As part of the partnership, Shatner will be putting his one-of-a-kind numbered action figure of “Capt. James Kirk in Casual Attire” on an immutable ledger, creating what Mattereum calls a “digital twin.” Notably, Friday’s announcement revealed the famed Star Trek actor will continue working with Mattereum to “create digital twins for science fiction and other collectible memorabilia.”

Venezuelan Petro Price Swings Wildly Off Peg, as Oil Price Plummets

The supposedly crude oil-backed Venezuelan Petro (PTR) cryptocurrency is retaining a value of almost $59 according to the official government calculator, diverging far from the current market price of about $27.70. The Petro is meant to represent the value of one barrel of crude oil.

Screenshot from 2020-03-31 14-18-03.pngSource: https://www.petro.gob.ve/calculadora.html

Crude oil prices have recently collapsed from a double hit: both from the economic impacts of the  COVID-19 pandemic, and from a raging price war between Saudi Arabia and Russia. The price of a barrel of crude recently dropped below $22 for the first time in nearly twenty years.

nearly 20 yearsUSDBRO chart by TradingView

This stark divergence of figures begs the question of how Venezuelan oil is valued. As CryptoGlobe recently reported, Venezuelan president Nicolas Maduro has claimed that the Petro is backed by between five and 30 million barrels of oil. Reuters recently reported that the Venezuelan government actually possessed 39 million barrels of oil.

But in fact, the status of Venezuela’s oil industry has recently become unclear, after a recent (February 2020) New York Times piece reported that “a stealth privatization is taking place” in the potentially oil-rich country. The sole state-owned oil company, PDVSA, set up in 2007, has always had a low production capacity compared to international standards, and in recent years American-sponsored sanctions have crippled what was left of Venezuela’s oil industry.

At any rate, the Maduro government has been largely unsuccessful in finding buyers or markets for the Petro cryptocurrency, after the U.S. outlawed its citizens from trading it. It is nearly impossible to find the token for sale on any cryptocurrency exchange, and thus, nearly impossible to define a market price.

Featured Image Credit: Photo via Pixabay.com