World’s first Bitcoin ETF, Reserves of stablecoins held by US banks and $2 Trillion of Financial Crimes
US Banks Can Now Hold Reserves for Stablecoin Issuers
The U.S. Office of the Comptroller of the Currency (OCC) published a letter clarifying that national banks and federal savings associations can now hold reserves for stablecoin issuers in the country.
It’s the same agency that announced several months ago that banks will become allowed to store Bitcoin for clients. Past week, Kraken was the first exchange to receive a charter to operate as a bank.
According to the OCC’s interpretive letter, reserve accounts can either be funded through deposits from stablecoin issuers or deposits from individual stablecoin holders.
As the OCC recently reaffirmed, national banks may provide permissible banking services to any lawful business they choose, including cryptocurrency businesses, so long as they effectively manage the risks and comply with applicable law, including those relating to the [Bank Secrecy Act] and anti-money laundering.
It stressed that banks can hold such reserves provided that ”the issuer has sufficient assets backing the stablecoin in situations where there is a hosted wallet.” The letter responds to questions regarding the application of stablecoin-related bank activities.
Banks Linked to $2 Trillion in Financial Crimes
Thousands of leaked documents from the FinCEN (Financial Crime Enforcement Network) have revealed that some of the largest banking institutions have been helping criminals to move over $2 trillion worth of dirty money around the world in the last five years.
Out of a total of 2657 leaked files, 2121 files were suspicious activity reports (SARS), filed by the banks to notify authorities of suspicious activity on some of their clients’ accounts.
BuzzFeed analyzed the files and made report which states that while banks are obligated to report suspicious activity to financial regulatory authorities, many banks opted to continue allowing certain accounts to launder and move money, even after suspecting them of illegal activity.
Ironically, Bitcoin had been accused for years because of the criminal transactions, referring to Silk Road and such initiatives. But in fact, Bitcoin is a neutral and transparent protocol which does not distinguish senders and receivers.
World’s First Bitcoin ETF Approved with Expected Launch in Bermuda by End of Year
The first-ever Bitcoin ETF will be launched on the Bermuda Stock Exchange (BSX) by Hashdex, This is a regulated Brazilian fund manager. Although it’s not fully clear it wil be a Bitcoin-only fund, the Nasdaq gave their approval for the “Hashdex Nasdaq Crypto Index”.
The news continues Bermuda’s legacy of being a crypto-friendly offshore international business and financial center.
Three million Class E shares will be issued for trading and the exchange-traded fund is expected to go live by the end of 2020.
Hashdex currently boasts $46.4 in assets under management (AUM) across four funds and uses Xapo, Kingdom Trust, and Vo1t for services relating to crypto custody. KPMG is the firm’s auditor.
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