On October 18, 2022, the European Commission published a report, titled Information Frictions and Public Policies: Approaching the Regulation and Supervision of Decentralized Finance (“DeFi”) (the “Report”). The Report discusses the need to adapt existing policy frameworks to account for the change brought about by DeFi to the underlying information structure upon which financial services are provided.
Continue Reading European Commission Publishes Report on Decentralized Finance

The SEC instituted settlement proceedings against Kim Kardashian on Monday, alleging that the reality television star and entrepreneur violated the SEC’s anti-touting statute when she failed to disclose compensation that she received in exchange for an Instagram post endorsing cryptocurrency tokens.
Continue Reading Kim Kardashian Ordered to Pay Over $1.26 Million for Securities Violation Arising Out of Crypto Endorsement

From IRS rulings that “virtual currency” is taxed as “property” to an SEC lawsuit claiming that digital assets are “securities” under federal law, meteoric growth of the largely unregulated crypto industry has raised numerous questions about whether crypto-related risks are covered by insurance.
Continue Reading California Holds Stolen Cryptocurrency Does Not Qualify as “Physical” Loss Under Homeowners’ Policy

LCX AG, a cryptocurrency exchange based in Liechtenstein, recently lost nearly $8 million in digital assets from a cyberattack. The perpetrator’s identity was unknown. Through the public ledger, LCX found the blockchain address that received the stolen assets, and quickly filed a complaint in New York to freeze certain of those assets. Without any other way to contact the perpetrator, the court permitted LCX to serve the wallet address with an NFT containing a hyperlink to the required legal notice documents. This may be the first example of service-by-NFT.
Continue Reading You’ve Been Served… By NFT?

In one of the first criminal cases brought under US sanctions laws involving cryptocurrency transactions, a federal magistrate judge approved the Department of Justice’s criminal complaint. In the opinion unsealed on May 13, 2022, US Magistrate Judge Zia M. Faruqi ruled that the Department of Justice demonstrated probable cause in accusing an unnamed defendant of transmitting more than $10 million in bitcoin to a “comprehensively sanctioned” country.

Continue Reading Judge Rules in Criminal Sanctions Case Involving Cryptocurrency

A small but growing number of employees are asking for cryptocurrency as a form of compensation.  Whether a substitute for wages or as part of an incentive package, offering cryptocurrency as compensation has become a way for some companies to differentiate themselves from others.  In a competitive labor market, this desire to provide innovative forms of compensation is understandable.  But any company thinking about cryptocurrency needs to be aware of the risks involved, including regulatory uncertainties and market volatility.
Continue Reading Cryptocurrency As Compensation: Beware Of The Risks