Regulatory Dynamics

1. The research and development of digital currency is included in the national planning.

The recently released full text of the "14th Five-Year Plan" proposal mentions "steadily advancing the research and development of digital currency." The proposal points out the need to establish a modern central banking system, improve the monetary supply regulation mechanism, promote the research and development of digital currency, and enhance the market-based interest rate formation and transmission mechanism.

2. Hong Kong plans to establish a licensing system for virtual asset service providers.

The Hong Kong Special Administrative Region Government's Financial Services and the Treasury Bureau recently released a consultation document seeking public opinion on amending relevant laws. The document proposes the establishment of a licensing system for virtual asset service providers, stipulating that those engaging in virtual asset trading platform activities in Hong Kong must apply for a license from the Securities and Futures Commission. Engaging in related activities without a license could result in a 7-year imprisonment and a fine of 5 million. Licensed institutions that violate anti-money laundering requirements may face up to 2 years of imprisonment and a fine of 1 million.

3. Russia may require the declaration of cryptocurrency transaction income.

The State Duma of Russia is discussing a new bill that may require Russian citizens to declare their "electronic" asset earnings and holdings on overseas platforms. If a citizen's annual trading volume on foreign digital platforms exceeds $7,730, they will need to report it to the tax authorities. The bill may also grant legislators and tax authorities the authority to regulate cryptocurrency wallets and trading accounts.

4. The Netherlands issues cryptocurrency platform licenses for the first time.

The cryptocurrency exchange BLOX has obtained a license to operate in the Netherlands, becoming the first approved retail cryptocurrency platform in the country after the implementation of the EU's 5th Anti-Money Laundering Directive. The company allows consumers to invest a minimum of 1 euro in Bitcoin. In the Netherlands, all companies engaged in cryptocurrency-related business must register with the central bank.

5. South Korea plans to strengthen cryptocurrency regulation.

The Financial Services Commission of South Korea is seeking to amend the law to require domestic virtual asset service providers to report customer names. The amendment defines virtual asset service providers as entities engaged in virtual asset trading, custody, and digital wallet services. This means that relevant institutions must use real-name accounts when trading with customers and must meet multiple compliance requirements.

6. Venezuela launches state-owned cryptocurrency exchange

Venezuela has launched a state-owned cryptocurrency exchange called VEX, supporting trading of Petro, Bitcoin, Litecoin, and DASH against the Bolívar. The exchange uses P2P technology and can be accessed through the government-issued cryptocurrency wallet application PetroApp.