Crypto Regulation

SEC approval for crypto ETF

By Dr. Frederic Peine on 11. January, 2024

Yesterday, on January 10, 2024, the US Securities and Exchange Commission (“SEC”) made the long-awaited decision by the crypto scene to allow the listing and distribution of exchange-traded funds (“ETFs”) that track the price of the cryptocurrency Bitcoin, so-called Bitcoin spot ETFs. Specifically, 11 of these Bitcoin spot ETFs were approved by SEC, including those from major market players such as BlackRock, Ark Investments and Fidelity. The approval decision was preceded by a false report shortly before the SEC decision, which once again led to considerable market distortions. The approval took a year-long coordination process between the parties involved and the SEC, including a legal dispute in the USA last year regarding the approval of a Bitcoin spot ETF, in which the SEC was ordered by the court to review its legal assessment of Bitcoin spot ETFs. With the approval decision, the SEC has now complied with this, but has also pointed out, that Bitcoin is speculative and volatile and that Bitcoin has already been used to finance illegal activities in the past. The SEC is still not a supporter of Bitcoin. Nevertheless, the general expectation in the market is now a significant increase in crypto investments and a correspondingly strong rise in market capitalization, as institutional investors are now also more likely to have access to crypto investments (via ETFs).

The Bitcoin Spot ETFs approved by the SEC are not initially available in Germany. The approval only applies to the USA. It remains to be seen what impact the SEC decision will have on the German regulatory practice of the German supervisory authority (BaFin) in the future. Under the current legal situation, a comparable structure is not possible for ETFs launched and domiciled in Germany, as here in Germany ETFs are prohibited from investing in just one asset.

You can find the link here.

Stability through regulation

By Renate Prinz on 15. May, 2023

Posted In Banking Law, Crypto Regulation, MiCAR

The financial industry is once again facing uncertainty and turbulence, caused in particular by the demise of some banks and problems in the crypto scene. In view of the current regulatory density, the question arises whether this is sufficient to ensure the stability of the financial industry and whether it can actually help to create market security and trust. Renate Prinz classifies the current developments in the Börsen-Zeitung.

Click here to read the full article in German.

Understanding the regulatory landscape for crypto-assets in Germany and the EU

By Renate Prinz on 11. November, 2022

Posted In Crypto Regulation

Currently, you can read summaries and briefings about the new crypto asset market regulation (“MiCAR”) everywhere. Certainly MiCAR has the potential to give the EU crypto market a huge boost. From what we have seen so far, regulation for new business models, especially in the fintech market, is not as bad as everyone has assumed so far.

Renate Prinz puts the developments in FinExtra in perspective. Click here for the article.

McDermottTech 2022 – Recap

By Annabelle Rau | Renate Prinz on 21. October, 2022

Posted In Crypto Regulation, Events

From crypto, NFTs and blockchain technologies, to ethics in artificial intelligence, outsourcing and cloud deals, to trends in IP protection and enforcement in the metaverse: Together, we discussed some of the latest global trends in the technology industry at this year’s McDermottTech.

Interested in the content of our panels? Click here for the videos of our panels. You can also download the PowerPoint presentation here.

FinTech Market: Regulation of crypto assets in Germany and the EU

By Annabelle Rau | Renate Prinz on 21. September, 2022

Posted In Crypto Regulation

In this webinar, Renate Prinz and Annabelle Rau provide an overview of the current regulatory land-scape for crypto assets and crypto service providers in Germany, also taking a look at the European level, where uniform legislation for the regulation of crypto-assets is coming soon. The following fur-ther topics will be covered:

Regulatory classification of crypto-assets in Germany.
Licensing requirements in connection with crypto-assets and crypto-services
Overview of the regulatory requirements for entities regulated in Germany
Draft European crypto regulation, in particular the Markets in Crypto-Assets Regulation (“MiCAR”).
Passporting of licenses within the EU

Click here to watch the video.

Interested in the presentation used in the webinar? Contact us to receive a PDF of the presentation.

Article in Libra: EU creates uniform rules for dealing with crypto assets

By Annabelle Rau | Renate Prinz on 16. September, 2022

Posted In Crypto Regulation

In their latest article for “Libra – das Rechtsbriefing”, Renate Prinz and Annabelle Rau present the main contents of the new “Markets in Crypto-Assets Regulation” (MiCAR), which the European Council, the EU Parliament and the EU Commission recently agreed on.

Click here to read the entire article.

EU Trilogue agreed on Markets in Crypto Assets Regulation (“MiCAR”)

By Annabelle Rau | Renate Prinz on 11. August, 2022

Posted In Crypto Regulation

The trilogue agreed on the final text for the Markets in Crypto Assets Regulation (“MiCAR“) on June 30, 2022, which now needs to be adopted by the member states (click here for the press release).

MiCAR will for the first time create a single European legal framework for crypto assets, crypto issuers and service providers. Crypto assets have been regulated in a predominantly inconsistent manner in Europe to date.
MiCAR provides for specific requirements for Utility Token, Value-Referenced Token and E-Money Token. It does not include Security Tokens, which are already subject to existing EU financial services regulations, and Non-fungible Tokens (“NFTs”), unless they fall under one of the crypto asset categories.
In addition, MiCAR regulates regulatory requirements for crypto issuers (e.g., obligation to prepare a white paper) and crypto service providers (e.g., requirement for licensing and ongoing conduct of business obligations).
New compared to the draft version is, for example, that companies on the crypto securities market are now required to submit a statement with information on their environmental and climate footprint. The content, methods and presentation of the statement will then be specified by ESMA (European Securities and Markets Authority) via technical standards.

The final text of MiCAR has not yet been published. The regulation is expected to enter into force at the end of the year, and the provisions will then be directly applicable in all EU member states after a transition period of 18 months following entry into force.