By Elif Hilal Umucu
Disclaimer: All opinions of the author are their own
“The smallest part of your brain / is where something holy / resides: …” Sneha Subramanian Kanta
ABSTRACT
Contrary to what is known, cryptocurrencies such as bitcoin and altcoins have not only attracted the public's attention as new means of payment. This technology is driven by financial applications built on top of these currencies, potentially revolutionizing the consumer and investment markets.
The most notable and economically relevant of these applications are tokens sold through initial coin offerings (ICOs). The content and scope of these ICOs require a multidisciplinary view.
More than $6 billion in revenue has been generated through ICOs in the first quarter of 2018 alone. Entrepreneurs in the crypto-asset ecosystem sell tokens they have built on the blockchain. Investors receive tokens that can be understood as cryptographically secure coupons with a set of rights and obligations. But is there any law that will protect the investor? Or legislation?
This article discusses the European Union and the US Securities Commission (SEC) perspective on tokens, coins and other crypto assets developed on the blockchain. In particular, the content of the ICO process of a newly developed project in the web3 world is discussed.
Keywords: ICO, Initial Coin Offering, Blockchain, Smart Contracts, Whitepaper, Crypto, Crypto-assets, MiCA, Howey Test
1. Introduction
Although the concepts of Bitcoin and Blockchain have been mixed a lot lately, these definitions have slowly started to find their place in the regulations.
As blockchain-enabled products and cryptoassets have become more common, investors have turned to tokens and ICOs. In the Web3 world, investors have begun to receive cryptographically secure tokens with a set of rights and obligations. This process is usually done online without the involvement of investment banks or professional venture capitalists and is usually completed within minutes for successful ICOs.
The easy structure that enables the distribution and collection of funds takes place on the Ethereum Blockchain, which we know as the internet of web3. The whole process is handled by smart contracts run on the Ethereum blockchain (or any other blockchain).
Understanding the workings of tokens is especially important for product developers seeking funding from ICOs: if they are under a legal obligation to issue a prospectus, but fail to do so, they are subject to full prospectus obligations with potentially major negative financial consequences. (This will be called a whitepaper in the following pages.)
On the one hand, there are entrepreneurs trying to develop projects and taking steps to develop blockchain technology, on the other hand, there are government institutions trying to protect investors and customers. Currently, courts will have to decide on the applicability of the prospectus/whitepaper arrangement regardless of the level of sanction imposed by public authorities. However, the link between ICOs and EU securities regulation depends, first of all, on a mantra at its current stage of development: things are complex and uncertain.
2. Developments from the World!
The European Union Banking Authority (EBA) released a Crypto Asset Report in 2019. According to this report, EBA evaluated crypto assets in 3 different categories:
payment
swap
currency unit
Later, they added 2 more categories to this classification:
crypto assets with investment properties
crypto assets that provide rights/benefits to the user
Later, the draft of European Union, -Markets in Crypto Asset Regulation- was published as a draft in September 2020; according to this draft, crypto assets were classified in 3 different ways:
Asset-referenced tokens
E-money tokens
Utility tokens
After these classifications, in July 2020, American national banks were allowed to store crypto assets by The Office of the Comptroller of the Currency (OCC).
3. Why are these classifications important?
Because according to international regulations, first of all, the class of crypto assets should be determined and processed accordingly. As we will see later in the article, the obligations that coins and tokens are subject to are not the same. Tokens are already a huge framework on their own. There are dozens of different tokens.
4. ICO’s
This concept, which appears as an Initial Coin Offering, is used very similarly to an IPO (initial public offering). Since late 2016, ICOs have quickly become the primary focus of attention on financial regulators' priority list. An initial Coin Offering (ICO), also called Initial Token Offering ("ITO") or Token Generation Event ("TGE"), can be summarized as a new method by a group of developers or a group of founders to raise money through offerings and sales. An ICO to people; provides an opportunity to get involved and invest in a project before entering the stock markets. So what does this mean? One way to crowdfund a project in the cryptocurrency space (especially token projects) is an ICO. An ICO provides a source of capital to the project or startup.
Since its inception, many ICOs have been used for fraudulent transactions and for very wrong purposes. Because investors and entrepreneurs trust the project with the ICO process. There are too many fraudulent ICOs with the goal of using potentially innocent investors’ money. But the truth is, if you invest in the right ICO at the right time, chances of becoming an early investor in the next Google, Facebook, or Bitcoin are a real possibility.
What do ICOs provide to investors? Crypto tokens can be “used to access the platform, use the software or otherwise participate in the project”. Investors can even expect “return on investment” or “participation” from the returns provided by the project.
Once minted, virtual coins or tokens can be resold to others on a secondary market on virtual currency exchanges or other platforms. From a documentation perspective, the bulk sale of crypto tokens usually precedes the publication of a detailed document by ICO developers, often referred to as a 'white paper', which may look similar to a prospectus, defining the protocol, the targeted network. The purpose and technical description of the project, the rights associated with it and the use cases of the crypto token to be issued.
5. ICO Risks
Some ICOs offer huge bonuses and other incentives to attract investors. For example, you can get some tokens for free with your initial investment. While this encourages investors to enter an ICO, it poses a risk as some investors may sell the coin or token as soon as it is listed on an exchange, leading to a price drop.
Moreover, if you are a big investor in an ICO if the project claimed to give you some tokens and they didn’t, there isn’t much alternative you can go for. (MiCA regulation mentioned the necessity of a Whitepaper for these situations. There is now an alternative solution in Europe)
But there have also been very successful and promising ICOs. There is a concept in the blockchain ecosystem, DYOR, which means you have to do your own research and decide for yourself whether the project is trustworthy. Then it’s up to you to invest or not. For example, do not make the mistake of investing by relying on someone else’s word, even if it is a famous YouTuber or Influencer. ALWAYS make your own decision based on the information you have gathered for yourself.
The first way to understand ICOs is to scrutinize the words and understand the project. For a comprehensive understanding, there are a few points to consider when analyzing ICOs.
Two common mistakes made with ICOs should be avoided:
Crypto tokens generated on the Blockchain through an ICO should not be automatically viewed as equivalent to securities. The lack of clarity by regulators about potentially qualifying a crypto token as “security” has created a false belief among many that crypto tokens have always been securities and that ICOs imply the issuance of securities. However, there are many types of markers. You can see these different types of tokens below.
Usage Token
NFT Token
Community Token
Equity Token
Work Token
Asset Token
Utility Token
Security Token
ICOs should be distinguished from public offerings. IPOs and ICOs are different and therefore have different procedures. An ICO does not automatically have to comply with traditional IPO regulations and therefore ICOs may not meet the same terms and requirements. As stated later, it will depend on the type of ICOs involved and the decisions of the relevant financial regulator. To understand this last point, a comparative study of law is required here again. The complexity lies specifically in defining what constitutes a 'token'. Also important is the type of assets that are sure to be tokens.
The legal status of the “token” is still unclear around the world and should be subject to many regulatory initiatives in the months and years to come. Each issued token will have its own characteristics and will give third parties exclusive rights to each ICO project.
6. ICO PROCESS
1- Advance planning process
2- Actual planning (Token, Whitepaper, Website, Communication, etc.)
3- Before the ICO
4- After the ICO
5- Managing the post-ICO project and sustainability
Advance Planning Process
This process is the first phase of an ICO project. There are a few questions to consider first:
— What is the purpose of your token? Is there any utility you want to do with the token project?
— Are you sure you want to do an ICO? And are you ready for the risks involved?
Token
— What is the purpose of your token?
— What function or purpose will you serve? Who will benefit from it?
— Is the token a must for your project or is it absolutely necessary? Or can your project go into effect without a token?
— Why does your project need to be on the blockchain? Or does it have to be on the blockchain?
— Can you describe a viable economic model for the project?
It would be useful to add a small footnote here. If your project doesn’t need to be built on a blockchain protocol, you should think hard before moving forward. For example, the computational costs of building a project or app on Ethereum are much more expensive than something like AWS.
You better have a strong reason to build a decentralized app versus a centralized app.
When you are ready and committed to an ICO, the key components of planning are:
offer
whitepaper
token design
legal status/type
serious measures against inevitable hacking attacks
preparation for communication (website, loose, social, press, interviews…)
Token & Coin
When a classification is required, the most common issue, even in regulation studies, is the classification of the asset in question. When the crypto asset is a token or a coin, different paths are followed. That’s why it’s really important to know this distinction.
As it can be understood from this title, Token and Coin expressions are different concepts from each other. They belong to different classifications. They may show common features, but they are different.
A small classification is below with an image, but the diversity in this list is increasing day by day, so this is not limited to just that.
Blockchain technology is a huge universal cluster. When we look at this set, we encounter too many subsets. Tokens and Coins can also be expressed as two separate subsets of this set.
Although these two terms are sometimes used interchangeably, it is important to remember that they are different in meaning and functionality.
TOKEN
In the simplest and most concise terms, the concept of Token also appears as Jeton. So what exactly do we mean?
Digital crypto assets representing a certain value or utility on a blockchain
A digital tool created by blockchain technology
Some kind of crypto asset
Transferable digital properties on the blockchain
It is possible to add many more definitions to this list, but it is important to understand the gist here. The important thing is to understand what it does and what it is used for 📘
Now, besides the above, I will introduce a technical definition. Then it will be very easy for you to grasp the distinction between coins and tokens.
Token is a crypto asset that does not have any Blockchain infrastructure of its own and therefore uses the Blockchain of another Coin (existing on another chain).
There is also the purpose of use, of course, here we will learn the concept of Whitepaper. The explanatory report, which is expected to write the features of this token by the entrepreneurs who make a Token project using blockchain technology, is called a Whitepaper. (It also has an incredible importance in regulations).
The extent to which the Token is used is specified in the Whitepaper where the issuer (producer) of the Token is introduced.
In other words, details such as the function, usage functions, content, roadmap, supply, use cases of any token should be explained and written by the founder of the token project in the Whitepaper.
Let me tell you about the importance of this, for the buyers of the token, trust is required. Why do people invest? Because they trust the project and the future of the project. One of the best ways to ensure this is to take the whitepaper seriously and write it honestly. Especially for buyers and investors, the reliability and honesty of the project are important.
COIN
You will remember this concept from Bitcoin. The words Coin and Token are used for very similar meanings. I explained the main difference above. Crypto assets traded on their own blockchain are coins. How is Coin defined?
Digital representation of value that can be used as a payment method
Currency-like digital value with its own blockchain
Crypto assets produced with a cryptographic encryption method and have purchasing power
While the token exists on another blockchain (eg Ethereum) Coins have their own chains.
After the first cryptocurrency and crypto asset bitcoin emerged, thousands of projects emerged. Some as tokens, some as coins. These crypto assets that have different functions and duties after Bitcoin are called altcoins (alternatives).
Token Types
Usage Token
NFT Token
Community Token
Equity Token
Work Token
Asset Token
Utility Token
Security Token
...
...
The Security Token is a type of token that will appear continuously from now on and can be separated more easily from the others in terms of regulation. Because thanks to the SEC and Howey testing, it is easy to detect. The SEC defines whether an asset is a security token by asking only 4 questions 🙂 On the other hand, the security token constantly appears in lawsuits as it is considered to be real money/stock.
Regulatory Challenges?
Classification
It is still unclear how to classify it, especially if there is a dispute regarding crypto assets, for example, are cryptocurrencies movable? Is it a security? is it money? Is it a capital market instrument?…. We can multiply such questions. For example, is it more correct to evaluate crypto assets with money characteristics according to the provision of electronic money instead of qualifying them as goods?
As you can see, there are too many question marks and uncertainties about classification even at the very beginning. 😒
Not Local, Global 💬
Another problem is that crypto assets emerge on an international rather than national scale.
✅A crypto asset project developed in Turkey can be recognized all over the world within three weeks. Or the opposite could be said. For example, it may be possible that a crypto project produced in Singapore or Estonia will soon be recognized by the whole world and started to be traded ✌🏻
✅When it comes to custody services of crypto assets, appointing certain institutions is actually against decentralization, which is a completely different problem in essence.
✅The first state to tax crypto assets in 2018 was the state of Ohio in the USA. but when we look at the general picture, these assets will need to be classified again in terms of taxation. for example, they may qualify as money, investment vehicles, securities, commodities, or otherwise.
When we think within the scope of tax law, in order for an asset or a transaction to be taxable, its legal nature must first be revealed.
There is a great report published by IOSCO in 2020. You'll find this report here.
In the report, IOSCO makes a great point and says that even when talking about crypto assets, the thing to remember is that it is not just one kind of asset. In other words, there are many different types and functions of crypto assets. For this reason, when it comes to regulation or legislation, the type, function, structure, task, and scope of the crypto asset should be examined.
As I mentioned in previous articles, even when we say tokens, dozens of tokens come to our minds. Or to put it simply, even though Bitcoin and Ethereum did not appear to have the same function, they have many different features from each other.
For this reason, it is best to evaluate a crypto asset on its own axis and categorize it on a case-by-case basis.
✅ For example, the first team to attribute value to crypto assets is actually the whitepaper writers, in a way, to what extent and to what extent will they be responsible?
✅ Austria, Canada, and Indonesia describe crypto assets as commodities, while Spain, Sweden, Switzerland, and the UK refer to them as intangible national assets. In the US, there is already no common cross-state consensus.
✅ The concepts that will take the discussion to another point are hot and cold wallets. If it is decided to tax crypto assets, the storage and transfer features of wallets will be on the agenda again.
Or another point, the earnings that are defined as income according to the Income Tax Law are as follows:
-business earnings
-agricultural earnings
-fees
-self-employment earnings
-real estate capital gains
-securities
-other earnings and revenues
Howey Test and SEC
SEC is United States Securities and Exchange Commission. The Digital Assets Framework, the SEC’s long-awaited guide to blockchain projects, is only eleven pages and has been written using plain English to make it user-friendly and accessible. In this article, I will be discussed the content of this framework, the decisions of the SEC, and most importantly how the Howey Test is used to find security tokens.
The Howey test, named after William Howey, who was sued by the SEC in 1946, appears as a Regulation that sheds light on the ICO and web3 ecosystem. Pursuant to Section 2(a)(1) of the Securities Act of 1933, securities such as stock exchanges, notes, books, debentures, and stocks that qualify as “investment contracts” shall mean all securities (produced, invested, sold. .) must register with the Securities and Exchange Commission (SEC) in the US.
Howey was a citrus magnate. In addition to large orange groves in Florida, guests had a hotel in the area where they drank a lot of orange juice. Guests would receive a glass of orange juice upon check-in. In addition, clients had the opportunity to invest in some of Howey’s orange groves.
If you bought a “share” in the orange groves, Howey’s workers would tend the orange trees, pick the oranges and sell the produce. They claimed that as the price of oranges skyrocketed, the land would become more and more valuable, so customers began to see it as a great long-term investment. However, no client has mentioned this to the SEC or gone and informed about this investment.
On the one hand, this seemed reasonable. People always invest in real estate with the expectation that it will increase in value, right? On the other hand, something looked suspicious! Like the promise of future profits and the fact that they offer customers nothing but orange juice?
Regardless, the SEC argued that it’s not a real estate investment, it’s more like a stock investment. The Howey test was first introduced in 1946 in the Supreme Court, SEC v. W.J.Howey Co. was the subject of the case. And it has continued to be used ever since.
Especially during the ICO process, the SEC spends serious time on projects and examines which project aims for what. For example, whitepapers have a very important aspect. This is exactly what we call “information asymmetry”. In other words, the SEC examines whether the planning specified in the whitepaper and the timeline of the project in real life are compatible.
For example, if investors and managers are making reports to hide their massive losses, that’s a problem. For example, this information-asymmetry issue by giving a great example. Roadmaps are shared to eliminate hesitations and build trust while starting and progressing the ICO process.
As the previous SEC chairman and current SEC chairman have pointed out, they view many ICOs as securities offerings. IEO’s are only ICOs on exchanges and IDOs are only ICOs on DEXs, so they all carry the same regulatory risk in the eyes of the SEC.
INOs (Initial NFT Offerings)
Modern NFTs looked more like art or products to me than securities. However, this doesn’t mean that many of them will not be considered securities in the future. The SEC spends a lot of time and effort on this right now.
The SEC seems to be trying to have as broad coverage as possible for NFTs, airdrops, and ICOs…. If I were an ordinary person who hadn’t looked at the SEC, I would say NFTs are clearly not securities. However, the SEC is being very meticulous about this and we may soon see some NFTs on the SEC’s radar as well.
What Was EU Crypto Asset Regulations Before MiCA?
Before the MiCA was adopted in the EU, a few key points in the DRAFT text were as follows:
The regulation will directly apply to all 27 existing EU Member States.
It will not need to be enforced in national law.
It will also affect any firm, company, or start-up that wishes to do business in the EU; Customer research from anywhere outside the EU (including, for example, the US, UK, and Singapore) will be considered a regulated activity.
Before MiCA was the main legislation to deal with crypto assets, the EU’s revised Financial Instrument Markets Directive 2014/65 and Financial Instrument Markets Regulation 600/2014 were the most important (collectively known as “MiFID II”).
The provisions of MiFID II provide requirements and regulatory obligations for “investment firms” that provide financial instrument-related services.
— Legal Entities Qualified as Investment Firms
In fact, to qualify as an investment firm under MiFID II, a business will be involved in certain investment activities related to financial instruments. Therefore, it is crucial to evaluate on a case-by-case basis whether a crypto asset qualifies as a financial instrument.
If a particular crypto-asset is found to qualify as a financial instrument, the issuer (and any entity involved in the provision of services or activities related to that crypto-asset) will likely be subject to a number of regulatory requirements and obligations.
— Evaluation of a Crypto Asset as a Financial Instrument
When assessing whether a crypto-asset qualifies as a MiFID II financial instrument, the recommendation issued by ESMA is to consider “the precise facts and circumstances of the crypto-asset (nature, rights attached to it, negotiability in the capital market, etc.) and national law.”
Also, in January 2019, ESMA published a study on how and when EU regulators interpret crypto assets as categorized as financial instruments. The research explained what the functionality of a particular crypto asset looks like. For example, this research includes explanations such as how the key factor is taken into account of a particular coin looks. Additionally, while certain crypto assets may not begin as MiFID II financial instruments, they may qualify as such later in time as a result of their use or function.
In light of this, the assessment of when a crypto-asset becomes a financial instrument may be different at the beginning and different at the end. The fact that there are also different categories of financial instruments (for example, dozens of different tokens) complicates such assessments.
— Financial Instrument Categories
While a comprehensive list of those classified as financial instruments under MiFID II can be found in Annex 1, Part C of the Financial Instrument Markets Directive 2014/65, common examples of financial instruments covered by MiFID II are as follows:
1. transferable securities (such as shares, bonds, and other securities giving the right to buy or sell such transferable securities)
2. money market instruments;
3. units in collective investment undertakings
4. Options, futures, swaps, and other derivative contracts
If a crypto-asset qualifies as a financial instrument, any person or entity providing investment services related to that crypto-asset would likely need to be authorized under MiFID II and regulated by its provisions.
— Interpretation Difficulties Between Member States
As explained, there are several categories of financial instruments that a particular crypto-asset can fall into (most likely unintentionally). Complicating this situation is the sheer abundance of more than 17,000 crypto assets, according to a recent publication (March 2022) by the European Supervisory Authorities.
In particular, it is possible for a crypto-asset to display components of hybrid, multi-purpose, and simultaneously different categories of crypto-assets. For this reason, it is very difficult to classify crypto assets.
BUT THESE WERE TALKED BEFORE THE MICA DRAFT WAS ACCEPTED, MICA CHANGED MANY THINGS.
The definition of a crypto-asset as a financial instrument or a transferable security depends on how the concept of a ‘transferable security’ is applied in the Member State concerned.
Therefore, it is possible for the same crypto-asset to be considered ‘transferable security or other financial instruments in one jurisdiction and another. Such a situation manifests itself as market fragmentation in the so-called EU single market. Aiming to harmonize
crypto-asset regulation across the EU, the MiCA regulation is a great method and resource for solving these problems.
Regulating Securities Tokens Under Proposed MiCA Regulations
MiCA’s assessment (published by the Commission in conjunction with MiCA) explains the definition of ‘security tokens’, defined as crypto assets that qualify as financial instruments under MiFID II. This assessment states that crypto assets that qualify as financial instruments will continue to be regulated under current Union legislation, regardless of the technology used for their issuance or transfer after the MiCA comes into force.
What Are Other Existing Legislation Related to Crypto Assets?
📌 Crypto Assets Covered by the Electronic Money Directive II (EMD2)
MiFID II is not the only piece of legislation that can fall within the scope of crypto assets. Some crypto-assets, so-called stablecoins, may qualify as electronic money under EMD2 if they meet all the elements of the definition in the directive (especially if they offer users a product directly on the reserve that supports the ‘stable coin’). In such a case, launching these crypto assets in the EU requires an e-money license.
📌 Crypto Assets under the Second Payment Services Directive (PSD2)
The other current legislation crypto service providers should be aware of is the Second Payment Services Directive (PSD2). A crypto-asset service provider operating regulated payment services may require authorization as a payment institution under PSD2 (or as an EMD2 electronic money institution, depending on its business model), unless there is an exemption from regulation.
Expected Regulation MiCA (European Union Crypto-Asset Markets Regulation — Markets in Crypto-assets Regulation
MiCA stands for Markets Regulation in Crypto Assets. This regulation is a recommendation by the EU Commission, largely in response to calls from the crypto world for a regulatory framework.
As part of the EU Commission’s “Digital Finance Strategy”, MiCA proposes a comprehensive and harmonized framework for digital assets. There has been a draft for MiCA for years and finally, MiCA has published a magnificent Regulation recently.
On June 30, 2022, after two years of debate and arguments, EU officials announced that they had reached an agreement on landmark Crypto Asset Markets (MiCA) regulations!
This legislation focuses on regulating crypto-assets such as stablecoins and crypto-asset service providers called CASPs (crypto-asset service provider SO here actually includes Exchanges). Meanwhile, the Financial Action Task Force calls CASPs VASPs, preferring to use them as virtual asset service providers. Let me share an incredibly useful document about VASPs and FATF right away.
MiCA defines CASPs as “any person whose profession or business is to professionally provide one or more crypto-asset services to third parties.”
MiCA’s definition of CASP has some similarities with FATF’s definition of VASP. however it has been broadened to allow it to encompass more entities, yet know that they are still trying to explain the same concept in different ways.
MiCA has 4 broad goals in the accepted draft:
To draw legal clarity and demarcation for crypto assets not covered by current EU financial services legislation
Establishing uniform rules for crypto asset service providers and issuers at the EU level
Changing existing national frameworks applied to crypto assets that are not covered by current EU financial services legislation
Establishing special rules for so-called ‘stablecoins’, including when e-money
MiCA has defined three Crypto asset types :
1-Entity-based tokens: These are tokens that aim to maintain a stable value “referring to several currencies that are legal tender, one or more commodities, one or more crypto assets, or a basket of such assets.”
These tokens can be used as a means of payment to purchase goods and services and as a store of value!
2- E-money tokens: This is another name for single-fiat stablecoins. These are crypto-assets of stable value based on a single fiat currency that aims to operate similarly to electronic money. Stablecoins, for example, are meant to be integrated into gold, dollars, or other assets.
3- Utility/service tokens: These are issued for non-financial purposes to provide access to an application, services, or resources digitally and are accepted only by the issuer of this token. These tokens have a non-financial purpose related to the operation of a digital platform and digital services.
While MiCA broadly covers cryptocurrencies along with stablecoins, it does not apply to central bank digital currencies (CBDCs) and does not issue security tokens that could qualify as securities or other financial instruments!!
While there are discussions about emerging technologies such as decentralized finance (DeFi) and immutable tokens (NFTs), both are excluded from this version of MiCA.
The most important things we need to know:
Global standards are set with MiCA. Understanding the state of crypto-assets has brought transparency and clarity to the industry regarding the scope of regulations.
The final adopted version of the law is aimed to enter into force in 2023! In addition to this situation, it is also said that additions and subtractions will be made with innovations.
Agreed that any asset-backed stablecoin issuer should write WHITEPAPER, publish it, notify the authorities of the situation and KEEP RESERVES AT INSTITUTIONS LIKE BANK.
The most important result, in my opinion, is the whitepaper here!
Also, after local authorities approve a crypto business according to EU regulations, this CASP (exchanges) will be able to expand their operations to other EU countries without having to obtain additional licenses, a process called passports .
CASP Approval
CASPs, aka global crypto exchanges, will face capital requirements and will need to establish policies and procedures to allow the trading of crypto assets on its platform. (Let’s think about it this way, it is aimed to prevent the increase of cases such as fraud in the stock market and to protect investors/customers)
According to the announcement, “According to the interim agreement reached today, crypto asset service providers (CASPs) will need the authorization to operate within the EU. National authorities will need to issue permits within a three-month timeframe”. Therefore, the expectations are that the CASP approval and registration process will not be a long and difficult process.
Also, one of the most controversial points came when Ernest Urtasun, a member of the European Parliament, tweeted that the agreement would impose a strict limit on the use of stablecoins :
According to Urtasun’s tweet, “large” stablecoins will be limited to €200 million in daily trading volume. The exact nature of this remains unclear, but regardless of how exactly it is implemented, such a cap would drastically change the way stablecoins are used and could have a negative impact as well. To put this in perspective, as of July 1, 2022, Tether’s global 24-hour trade volume was $53.5 billion. So there are doubts about its a
About the Author
Entering her Blockchain and Technology Law career with cryptography, Elif Hilal developed her own encryption method when she was only 10 years old. She then began to learn encryption mechanisms and the science of cryptography. She found the way to communicate with computers by learning to code, she learned to code when she was a freshman at university. While she was a university student, she had the chance to work as a blockchain researcher in the Digital Transformation Office of the Presidency of the Republic of Turkey. In addition, she was elected as the Microsoft Turkey Student Ambassador and represented her country many times in the international arena.
Elif Hilal, has been working on Blockchain for about 6 years.
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