On January 30, 2019, a Florida appellate court reversed the trial court’s dismissal of State v. Espinoza, instead holding that a Bitcoin business was both a money transmitter and a payment instrument seller, subject to Florida’s statutes governing money services businesses. The decision contrasts with recent guidance in Texas and Pennsylvania regarding cryptocurrencies, where virtual currencies in those states were not deemed money under applicable state statutes and businesses that conduct transactions exchanging virtual and sovereign currencies do not generally require a currency exchange license.
Ohio is the first state in the United States to accept tax payments in cryptocurrency. Starting today, December 3, 2018, companies operating in Ohio can elect to pay certain Ohio state taxes in Bitcoin. Many Ohio state taxes are eligible for payment in cryptocurrency, including (among others) sales tax, withholding tax, pass-thru entity tax, and public utilities tax. As long as an entity operates in the state of Ohio and pays Ohio state taxes, the entity is eligible to pay such taxes in Bitcoin.
On November 1, 2018, the New York Department of Financial Services (“DFS”) announced its approval of the first virtual currency license for an operator of Bitcoin teller machines (“BTM”). According to DFS, to date it has now approved 12 charters or licenses for companies in the virtual currency space. Continue Reading New York DFS Licenses First Bitcoin Teller Machine Operator
On Monday, October 22, 2018, Judge J. Paul Oetken of the Southern District of New York granted Alibaba Group Holding Limited’s (“Alibaba”) motion for preliminary injunction in a trademark action against several foreign-based promoters and developers of a new cryptocurrency called “AlibabaCoin.” In doing so, the court considered several novel issues around personal jurisdiction and blockchain. Continue Reading Alibaba Wins Preliminary Injunction Against Developers of Cryptocurrency “AlibabaCoin” In Trademark Dispute
Hunton Andrews Kurth partner Scott Kimpel, chair of the Firm’s blockchain working group, recently participated in a panel discussion hosted by the Washington Legal Foundation regarding the latest legal issues associated with ICOs and security token offerings. Co-panelists included Alan Cohn, formerly of the Department of Homeland Security and Daniel Alter, former general counsel of the New York Department of Financial Services. Continue Reading Initial Coin Offerings: Can Securities Regulators Balance Market Growth and Investor Protection?
As reported on the Hunton Insurance Recovery Blog, in what appears to be a case of first impression, an Ohio trial court ruled in Kimmelman v. Wayne Insurance Group that the crypto-currency, Bitcoin, constitutes personal property in the context of a first-party homeowners’ insurance policy and, therefore, its theft would not be subject to the policy’s $200 sublimit for loss of “money.” Continue Reading “Crypto-Property:” Ohio Court Says Crypto-Currency is Personal Property Under Homeowners’ Policy
On October 11, 2018, the Senate Banking Committee held a wide-ranging hearing entitled “Exploring the Cryptocurrency and Blockchain Ecosystem.” The hearing featured testimony from Dr. Nouriel Roubini, an NYU professor who famously predicted the 2007-2008 financial crisis, as well as a counterpoint from Mr. Peter Van Valkenburgh, the Director of Research from Coin Center. Continue Reading Senate Banking Committee Explores Blockchain
On October 2, 2018, Venezuelan President Nicolas Maduro appeared on national television and announced the official launch of the Venezuelan Petro cryptocurrency. First announced in December 2017, and purportedly backed by the country’s oil and mineral reserves, the Petro is intended to supplement Venezuela’s national currency, the bolívar, which has depreciated at an exorbitant rate in the past year. The International Monetary Fund has predicted that inflation in the country will reach 1 million percent. Continue Reading The Venezuelan Petro: A Blocked and Chained Cryptocurrency in the United States
On September 27, 2018, the Securities Exchange Commission (“SEC”) and Commodity Futures Trading Commission (“CFTC”) charged an international securities dealer with illegally offering and selling to U.S. investors security-based swaps funded with bitcoins and related violations of the Commodities Exchange Act. The broker, 1pool Ltd., a.k.a. 1Broker, and its CEO, Patrick Brunner, were both named in the complaint filed by the SEC with the U.S. District Court for the District of Columbia. Continue Reading SEC and CFTC Charge a Bitcoin-Funded International Securities Dealer
Blockchain, or distributed ledger technology (“DLT”), is already proving to be a game-changer for businesses globally and across sectors. But is it secure? And can insurance help protect against risks and, thus, help advance the development of this technology? Continue Reading Insuring the Blockchain