Binance Listing Effect on Cryptocurrency Price

This article analyzes the effect of Binance listings on a cryptocurrency’s price. During 2018, Binance has generally been the first or second highest overall volume cryptocurrency exchange in the world. Such high volume can increase demand for a cryptocurrency and thus increase the price of the cryptocurrency, especially on the day of the Binance listing.

General findings:

  • The average maximum profit potential from Binance listings is 109%.
  • The average percentage price change from a week before Binance listing to a week after Binance listing is 32%.
  • All 15 cryptocurrencies increased in value on the day of Binance listing compared to the day before Binance listing.
  • 13 of the 15 cryptocurrencies decreased in value on the day after Binance listing. Profits are usually highest buying before Binance listing and selling on the same day of Binance listing.
  • 8 of the 15 cryptocurrencies maintained an increase in value from a week before Binance listing to a week after Binance listing. 7 of the 15 cryptocurrencies decreased in value from a week before Binance listing to a week after Binance listing. This could be attributed to overall crypto market sentiment. Cryptocurrencies generally maintained the most value over the two week period when Bitcoin prices were rising or stable.

Data analysis:

The data contains fifteen cryptocurrencies listed on Binance from February 2018 to May 2018. There are five data price points for each cryptocurrency: 1 week before listing; 1 day before listing; day of listing; 1 day after listing; 1 week after listing. There are two data percentage points for each cryptocurrency: Maximum % Gain (how much total profit could be made from buying low and selling high) and; 2 Week % Change (the difference in price from 1 week before listing and 1 week after listing). Each data set contains a Bitcoin 2 week change percentage to help people identify the overall crypto market sentiment during the 2 week period. Each data price point uses the cryptocurrency daily high price.


U.S. Congress Officially Supports Blockchain Technology

The March 2018 United States Joint Economic Committee Report officially endorses the future of blockchain technology and cryptocurrency in the U.S. Chapter 9 of the report discusses blockchain, and is titled “Building a Secure Future, One Blockchain at a Time.” Chapter 9 begins by saying Blockchain is “not only nearly invulnerable to cyberattack but is revolutionizing the way the world conducts commerce and shares information.”

General Report

In the report’s general opening, Congress acknowledges, “it is important to proceed with prudence and provide proper guidance to the market… and not prejudge or hinder technological developments.” They continue, “The new technology also may be attractive for Government to use, improving efficiency in its own operations.” See p. 20-21. It appears Congress is looking to regulate Blockchain in a way that allows technological innovation to flourish and become integrated with already existing markets. That is incredible news for the future of crypto and blockchain in the U.S.

Congress sees valuable uses for blockchain in the medical sector. The report acknowledges that blockchain could help coordinate health records by reducing paperwork burdens and preventing medical errors. p. 22. It also acknowledges blockchain technology could provide powerful solutions for portability, enabling medical records to be carried on smartphones and mobile devices with very little risks of vulnerability to cyberattacks. p. 198.

Congress sees Blockchain’s revolutionary uses for enabling global economic participation. The report views blockhain as “a secure transmission and recordkeeping technology in its infancy with vast potential to revolutionize the forms in which we transact and document commercial activity of virtually any kind around the world.” p. 166. 

Chapter 9 Report

The Ch. 9 report lays out three main points about blockchain. p. 201

  1. Blockchain is a potential tool for securing America’s digital infrastructure, protecting against economic losses, cyberattacks, and threats.
  2. Blockchain technology became mainstream in 2017, and provides both cybersecurity and many other potential benefits.
  3. Blockchain technology could revolutionize the world’s digital landscape and economy. Blockchain innovations and markets present U.S. institutions with unique regulatory challenges.

Growing Public Interest In Cryptocurrency

The report calls 2017 “The Year of Cryptocurrencies.” It shows how “Bitcoin” searches skyrocketed, while “blockchain” and “Ethereum” moved out of relative obscurity. The report also shows how the Dow Jones Industrial Average (DJIA) grew over 24% and the S&P grew over 17%, but that cryptocurrency growth made stock market gains seem meager in comparison. p 202-203


Pages 205-207 impressively and accurately define blockchain technology and cryptocurrencies. “Blockchain is the distributed ledger technology that underlies digital currencies such as Bitcoin. A ledger is the accounting tool that tracks the movement of money from one person or account to another. Conventionally, such records are stored in central locations like banks, headquarters, and Paypal servers. Blockchain revolutionizes ledger technology with a network of distributed ledgers. Instead of one central, authoritative record of all transactions or information, blockchain creates potentially thousands of identical ledgers in computers and servers all over the world.” The definition goes on to define Proof-of-Work (PoW) consensus, and discuss the differences and uses of Bitcoin and Ethereum.

Cryptocurrency As Actual Currency

Pages 207-209 discuss the challenges cryptocurrencies face to be accepted as actual currency. The report’s conclusion is that cryptocurrencies resemble real assets or commodities more than currencies, though their future role could expand to include functioning as mediums of exchange. Currency must serve three functions: medium of exchange, unit of account, and store of value. The report shows Bitcoin’s limitations as a medium of exchange, citing long transaction times and high fees, and further acknowledging that protocol improvements and off-chain solutions could speed up processing times and reduce transaction fees to help move cryptocurrency into the realm of actual currency. The report also mentions that extreme volatility impairs cryptocurrencies’ use as money. Compared to the annual U.S. dollar loss value of about 2% to inflation, cryptocurrency values are much more unpredictable. The report suggests decreasing volatility would help cryptocurrency be used more successfully as actual currency.

Initial Coin Offerings (ICOs)

Pages 209-212 discuss ICOs and their recent explosion in growth. It acknowledges that “[a]n ICO consolidates two important elements of building a new economic ecosystem, obtaining funding and creating a network.” The report says how ICOs do not offer equity and are much less expensive than an Initial Public Offering (IPO). The report also estimates that most ICO projects will likely fail, as most startups do, but the ones that survive could transform the way the internet and technology works for decades to come.

Blockchain Innovations

Pages 212-215 discuss blockchain innovations and uses. The article importantly distinguishes that cryptocurrency headlines often only focus on financial applications but miss the digital revolution with blockchain’s technological applications. The report again mentions how blockchain could be used for health care providers, patients, and policymakers to store medical records digitally and securely. New blockchain products help coordinate payment (healthnexus), monitor and reward patients for following clinical recommendations (RoboMed Network), track pharmaceuticals along the supply chain (MediLedger), identify specific supply chain problems such as those associated with the opioid crisis (BlockMedx), and protect Americans’ private medical data. As a side note, I find the report’s mention of these specific blockchain projects interesting. Maybe the government is considering moving towards adopting and using specific blockchain projects.

The report also mentions that ” [f]rom applications ranging from management of the electrical grid and utilities to how companies manage global supplies, the potential for blockchain is truly revolutionary. Pages 214-215 continue to give examples of blockchain’s technological value.

Problems and Misuses

Pages 215-218 discuss issues with blockchain and cryptocurrency, along with potential misuses. The report acknowledges theft from centralized exchanges as a potential issue, citing Coinbase as a potential vulnerable storage space for cryptocurrency, and using the Mt. Gox exchange hack as a historical example of the risk. The report also mentions that some economists estimate that about 25% of all users conduct illegal transactions on Bitcoin. The report continues to mention how rapid appreciation in value of cryptocurrencies and ICOs contributed to unease about blockchain technology, causing wild volatility and speculative bubbles to arise in the market. The report also mentions DogeCoin as a “warning sign” in the market, because it is a “joke,”, but fails to realize that 1 DOGE always equals 1 DOGE.


Pages 218-225 discuss the future of Cryptocurrency and Blockchain regulations.

Securities Regulation

The SEC has recently started pursuing more enforcement actions against new tokens for both securities registration issues and fraud. Securities as defined by the Securities Act is a contract, transaction, or scheme whereby a person: 1) invests her/his money in 2) a common enterprise, and is led to 3) expect profits 4) solely from the efforts of the promoter or a third party. Tokens can be classified as securities, but can also be exempt under the definition and qualify instead as utility tokens. Regulations may be needed to further clarify how cryptocurrencies fall under the Securities Act.


The report acknowledges that questions remain about how to tax cryptocurrencies. It makes distinctions between the U.S. dollar and foreign currency (taxed as property rather than currency). Currently, cryptocurrency is taxed as property under U.S. tax laws, making transactions and appreciations in value subject to income and capital gains taxes. The report acknowledges that the current tax structure could freeze investment and exploration into new virtual currencies, especially for smaller transactions such as coffee purchases (people apparently really want to buy coffee with cryptocurrency). Congressional representatives Schweikert and Polis introduced a bill proposing a solution – the Cryptocurrency Tax Fairness Act of 2017 – that would exempt taxation for virtual currency purchases under $600. The bill has yet to become law, but the report estimates that as virtual currencies continue to become more popular, more bills on the topic will be introduced.

Money Transmission

The report discusses the issue of transmitting money for virtual currency, and that it currently could require money transmitters to obtain licenses to operate separately in every U.S. state (except Montana). The report presents solutions, such as the Uniform Law Commission, a nonpartisan commission to create consistent state laws that could draft and approve legislation that would clearly and uniformly define what virtual currency businesses need to file to become money transmitters. However, that solution could take years for the legislation to be enacted in all U.S. states. The report encourages Congress to look at many solutions to this problem, and will present a rigorous cost-benefit analysis. As a side note, money transmitting for virtual currency is incredibly important to allow mass-adoption of cryptocurrency. It is often difficult to transfer fiat money into cryptocurrency. There are many steps involved in the process, and it can be slow, technical, challenging, and uncertain. Finding a good solution to the money transmission problem is going to be a major step in opening the cryptocurrency market, bringing down barriers of entry, and increasing market-place demand.

Future Regulatory Questions

The report encourages Congress to find solutions that balance the needs of consumer protection, security, and entrepreneurship. It pushes for a common and coordinated regulatory framework that creates clarity in the industry. It recommends regulations that are not overly prescriptive or constraining, so blockchain technology will be allowed to reach its full potential.


The conclusion on pages 225 and 226 makes four recommendations:

  1. Policymakers and the public should become more familiar with digital currencies and other uses of blockchain technologies, which have a wide range of future application.
  2. Regulators should continue to coordinating with each other to guarantee coherent policy frameworks, definitions, and jurisdictions.
  3. Policymakers, regulators, and entrepreneurs should work together to ensure developers can quickly deploy blockchain technology to protect Americans from fraud, theft, and abuse, while ensuring compliance with relevant regulations.
  4. Government agencies at all levels should consider and examine new uses for blockchain technology to help make the government function more efficiently.

Overall, this is an enormously positive endorsement from the U.S. Congress. We will likely see cryptocurrency and blockchain technology flourish throughout the United States. It is a bright future for Americans involved in blockchain technology and the cryptocurrency marketplace.

Risks of Centralization in Crypto – Ripple and NEO

The crypto community often praises decentralization as one of blockchain’s strongest features. According to Ethereum creator Vitalik Buterin, “Blockchains are politically decentralized (no one controls them) and architecturally decentralized (no infrastructural central point of failure) but they are logically centralized (there is one commonly agreed state and the system behaves like a single computer).”

While Bitcoin and Ethereum are widely considered decentralized networks, their Proof of Work (PoW) consensus leaves questions in the overall strength of their decentralization. Ethereum is moving toward further decentralization by implementing Proof of Stake consensus (PoS) through its Casper project. However, developers are now creating newer consensus protocols that offer even more solutions to problems with network centralization.

As  blockchain technology grows, we are beginning to see concrete examples of why decentralized networks offer more security and functionality than centralized networks. Centralization creates issues with both network control and functionality, and can have a negative impact on the value of the cryptocurrency itself.

Political Decentralization – Issues With Centralized Coin Control – Ripple

Lawsuit – R3 v. Ripple

In 2017, R3 sued Ripple in Delaware and New York for breach of contract. According to R3, Ripple violated its agreement with R3 to supply R3 with the option to purchase up to 5 billion XRP coins at a price of $0.0085 each ($42.5 mil total) at any time before the end of 2019. XRP coins are currently trading around $0.70.  5 billion XRP is now worth about $3.5 billion, an 82x increase in value from the contract price. Ripple responded to the lawsuit by convincing the Delaware court to dismiss the Delaware suit, and petitioned for the case to be heard in Ripple’s home state of California. However, a California court of appeals recently ruled that it would not hear the legal dispute. The final outcome will be decided by a New York court, where New York based company R3 will have a home court advantage. Ripple did file a counter-claim against R3 for entering the contract in bad faith and using the partnership to steal Ripple’s expertise in order to develop a competing product. It will be up to the New York court to resolve the claims between both parties.

Centralized Coin Management

Ripple maintaining centralized control over most of its coins and agreeing to sell them under contract could cause serious consequences for the value of XRP.

At launch, Ripple created  a total of 100 billion XRP. 20 billion XRP were given to the founders, and the remaining 80 billion were transferred to Ripple Labs to “incentivize market maker activity to increase XRP liquidity and strengthen the overall health of XRP markets.” In 2017, Ripple decided to commit 55 billion XRP (89.17% of its remaining 61.68B XRP holdings) into escrow in order to remove uncertainty that Ripple may liquidate its entire holdings – a move that would over-supply the market with XRP and dramatically drive XRP price value down. Ripple placed the 55 billion XRP in escrow, allowing 1 billion XRP to unlock on the first of each month until 55 months pass. All unsold, unlocked XRP would be replaced back into escrow until month 55.

While Ripple’s decision to lock most of its coins in escrow increased transparency and calmed XRP holders, it left billions of XRP under Ripple’s control and allowed Ripple to sell up to 12 billion more XRP each year. The overall issue of Ripple’s centralized coin management is now at play in a lawsuit that could be dangerous for the value of XRP. If Ripple loses its suit to R3, the possibility arises that the court could order Ripple to allow R3 to exercise its option to purchase 5 billion XRP for cheap. R3 could then liquidate its 5 billion XRP instantly, causing an over-supply of XRP in the market and decreasing XRP price – the problem that XRP holders were initially concerned about. Another possibility is that Ripple could end up liable for damages to R3 for the value of the contract. The New York court would have to decide if Ripple would be liable for the XRP’s current value or past value. A third possibility is that Ripple escapes R3’s suit altogether.


While many cryptocurrencies are concentrated in a small group of wallets, the control and distribution mechanisms of the cryptocurrency is often decentralized to many individuals and entities. Ripple maintains centralized control over an overwhelming majority of coins, and its poor business decisions or legal liabilities could create a negative impact on the value of the coin. Even if Ripple wins its lawsuit against R3, Ripple may continue to enter into contracts and sell XRP, placing potential strains on the value of XRP for any missteps Ripple makes.

Architectural Decentralization – Issues With Centralized Infrastructure – NEO

NEO’s current centralized infrastructure is causing issues with the functionality of its network, also harming the value of the NEO coin. As mentioned above, a properly decentralized blockchain is protected from failing nodes by decentralizing infrastructural points of failure.

Network Failure

On March 4, NEO’s network froze completely because of a single failed node. The failed node caused all remaining nodes to wait indefinitely for a reaction from the failed node. NEO restarted the failed node, but it did not become part of the pending consensus immediately, requiring all nodes to restart through a “forced changeview.” The network failure caused a several hour delay before the network began working again. Currently, NEO’s consensus nodes are operated under NEO’s control, and not by the users themselves. NEO has a relatively small number of nodes compared to many other decentralized blockchains. In October, 2017, NEO was running only 13 nodes. It appears the number of NEO nodes has over doubled since then, but the centralization issues remain.

Synchronization Problems

On March 10, NEO’s network had more problems with block generations occurring long times apart, and network transactions never arriving at their destinations. Funds took much longer to transfer between addresses than usual. Node synchronization issues appeared to partially cause NEO’s second round of network issues. While synchronization issues can be common for a blockchain, a decentralized architecture with a high number of nodes usually prevents synchronization issues from ever causing legitimate problems for the network.


NEO plans to further increase its amount of nodes, and will allow users to run their own nodes in the near future. However, NEO is currently a good example of why decentralization plays a fundamentally important role in blockchain infrastructure. At the end of February, one NEO was trading for over $140. Two weeks later, after encountering numerous network problems, one NEO is trading for about $72, and at about  64.5% of its Satoshi value from the end of February.

Explaining the March Crypto Crash

Cryptocurrency markets are crashing and you may be asking why.

Update 2: Binance announces they have localized irregular trades and will reverse them. Funds are safe because of their alarm system.

Update: Binance announces all funds are safe. Irregularities in trading activity triggered automatic alarms. The investigation continues.

  1. Many user accounts on Binance have been compromised. Binance is one of crypto’s largest and highest volume exchanges. The compromised accounts executed trades at many times above market value for certain coins. Viacoin (VIA) specifically saw abnormal volume increases to over 9,675 BTC in a 24 hour period on Binance. For perspective, Ripple, crypto’s third highest market cap coin, (XRP) had a 24 hour BTC volume of 5,887 on Binance. VIA saw a temporary value increase of over 11,225% in just two minutes.  Currently, it appears someone has taken control of users’ accounts that use API software (usually to allow trading bots to buy and sell) in order to execute over-valued trades and steal cryptocurrency from Binance users. Binance has temporarily frozen cryptocurrency withdrawals and we are still waiting for an official announcement on this issue.
  2. Rumors that Japan will penalize many of its exchanges can create uncertainty in the market. Japanese Yen makes up over half of the entire cryptocurrency market’s trading volume.
  3. In the past few months, now-bankrupt cryptocurrency exchange, Mt. Gox, has sold and liquidated about $405 million in Bitcoin (BTC) and BitcoinCash (BCH), possibly over-supplying the market and driving prices down. Billions of dollars of BTC and BCH still may be liquidated, pending approval of Japanese bankruptcy courts.
  4. Since February, the U.S. stock market has experienced a sharp decline in value. Although the crypto market only has a weak positive correlation with the U.S. stock market, it may continue to drive fear and uncertainty in the crypto market as well.
  5. The United States Securities Exchange Commission (SEC) announced that many crypto exchanges may be operating unlawfully by allowing trades in unregistered securities. The SEC is concerned that many crypto exchanges may appear as SEC-regulated when they are not. The announcement may create uncertainty for the future of exchanges operating in the U.S.

Follow us on Telegram and Twitter for more updates.

Bitcoin’s Downtrend Reversal Ceilings

Bitcoin is in a downward trend at the moment. Each day that goes by, Bitcoin’s trend reversal ceiling moves down slightly – about $122 per day. When Bitcoin breaks through the downtrend ceiling (green line), we will hopefully begin to see more growth and a strong market recovery. At Bitcoin’s current price (about $9,650), the downtrend reversal would occur on March 9, 2018. For Bitcoin to begin an upward reversal today, it would need to break about $11,258 and hold there for some time. The other daily ceiling reversal limits are listed on the chart.

Cryptocurrency Laws and Regulations by Country

This article details cryptocurrency laws and regulations, sorted by country. I give each government a rating: Friendly, Neutral, or Hostile. Each section is divided by global region. Because government laws and regulations often change, I plan to release updates to this article every 2-3 months.

Findings: 15 of the 22 listed governments regulate cryptocurrency in a relatively friendly manner. 5 of the 22 governments were relatively neutral. 2 of the 22 governments were hostile. The overall outlook for cryptocurrency trading becoming a legitimate global institution looks good.

Other resources for information on this topic: Perkins Coie Law Firm, Wikipedia, Bitcoin Bans


North America

United States – Friendly

The U.S. has been taking an approach to foster innovation and growth of blockchain and cryptocurrency while protecting investors from high risks and fraud.

On February 6, 2018, the Securities Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) spoke about cryptocurrency in front of Congress. Christopher Giancarlo, chairman for the CFTC, took the position that “we owe it to this new generation to respect their enthusiasm for virtual currencies, with a thoughtful and balanced response, and not a dismissive one.” Now we will have to wait for the U.S. Congress to make a move on how to regulate Cryptocurrency.

The CFTC recently released a statement against “pump-and-dump” schemes that are currently prevalent in the cryptocurrency community. The CFTC will pay bounty rewards for people who provide original information that leads to successful enforcement actions of pump-and-dump schemes.

A couple months earlier, in December 2017, the SEC released a statement on Cryptocurrency Initial Coin Offerings (ICOs). The SEC took the position that ICOs are subject to U.S. Securities regulations, meaning only accredited investors may participate in ICOs that are not (and almost never are) registered with the SEC. The SEC’s policy is intended to mitigate risk to investors, protect investors from fraud, and hold cryptocurrency projects potentially liable for selling non-registered securities to U.S. investors.

Back to February 2018, Wyoming’s House of Representatives unanimously passed two favorable blockchain bills. HB 70 defines utility tokens (cryptocurrency) as neither traditional money nor a security if it meets certain conditions: it cannot be marketed as an investment opportunity, it is exchangeable for goods or services, and the developers do not enter into an agreement to repurchase the tokens with the intent to manipulate the price. HB 19 will allow cryptocurrency exchanges to re-open in Wyoming after the Wyoming Money Transmitter Act created difficulties for exchanges to operate in Wyoming. Wyoming is also considering other bills that will reduce cryptocurrency taxes, and authorize the state government to use blockchain technology to store records and utilize smart contracts.

Also in February 2018, the Arizona Senate passed a bill that would allow residents to pay income taxes with Bitcoin and other state-recognized cryptocurrencies. Arizona and Wyoming are both creating policies that will spur technological innovation and cryptocurrency trade within their states.

Currently, The Internal Revenue Service (IRS) treats cryptocurrency as property, which subjects it to many taxable trading events. Trading cryptocurrency to fiat, trading cryptocurrency to cryptocurrency, and spending cryptocurrency are all taxable events that may moderately burden cryptocurrency trading.

Canada – Friendly

The Financial Consumer Agency of Canada (FCA) publishes online information regarding digital and cryptocurrencies. The FCA explains aspects of decentralization, peer-to-peer transactions, digital wallets, wallet security, and the risks of using digital currency. They further maintain that digital currencies are not legal tender, and that profits made from digital currencies are subject to Canada’s Income Tax Act. Goods and services exchanges for cryptocurrency must be reported as income for tax purposes, and transactions between cryptocurrencies are considered commodity transactions, and must be reported.


China – Hostile

China is notorious for some of the world’s largest bitcoin mines. In 2017, China banned cryptocurrency trading on Chinese exchanges and made ICO fundraising illegal, curving market demand, and causing a large overall downtrend in the cryptocurrency markets. Many Chinese residents turned to using foreign exchanges to trade cryptocurrency instead. Now, news is circulating from the People’s Bank of China (PBOC) that China may block all access to domestic and foreign cryptocurrency exchanges and ICO websites. It is unclear how much of an effect further Chinese cryptocurrency bans would have, but it could possibly continue to fuel negativity in the market.

Despite China’s harsh stance towards private cryptocurrency trading, the PBOC has been conducting research into issuing its own state-run cryptocurrency.

South Korea – Neutral

The cryptocurrency market’s all-time highs in January 2018 were quickly silenced, in part from fears that South Korea may ban cryptocurrency trading in a manner similar to China. News sites published articles mistakenly claiming there would be a total trading Ban in Korea, causing havoc in the cryptocurrency markets. The reports of a total ban were later discredited when more facts surfaced that the South Korean Ministry of Justice announced plans to ban cryptocurrency trading without the consent of other government agencies involved in regulations.

Later in January, South Korea proposed new rules to prevent anonymous trading and impose penalties for failing to comply. South Korean lawmakers also increased pressure on exchanges to pay corporate and local income taxes. Foreigners were also banned from trading on South Korean exchanges.

In February 2018, South Korea began to lighten its stance on cryptocurrency trading. Government representatives have pledged their support for regulated cryptocurrency trading. Exchange representatives said that the government will encourage banks to work with exchanges. It appears that South Korea is moving forward to permit regulated cryptocurrency trading.

Japan – Friendly

Currently, Japanese Yen accounts for over 36% of Bitcoin’s trading volume, more than every other currency. USD is second at just over 31%. Japan’s high demand for cryptocurrency is supported by a well-regulated legal system that supports the industry in a way that builds credibility among investors and creates familiarity with securities trading as it relates to cryptocurrency. According to Midori Kanemitsu, the CFO of bitFlyer Inc., one of Japan’s largest cryptocurrency exchanges, “Japan is the first and only country that has a proper legal system regulating cryptocurrency trading.” Kanemitsu criticizes New York State’s “BitLicense” that regulates cryptocurrency exchanges too strictly. Japan’s Payment Services Act was the first national registration system for cryptocurrency exchanges.

In January 2018, hackers stole $534 million worth of NEM from Coincheck, one of Japan’s 36 cryptocurrency exchanges. Coincheck was in the process of obtaining official recognition from Japan’s Financial Services Agency (FSA). The FSA warned Coincheck that it had poor cybersecurity that required dramatic improvements. Coincheck announced it would refund $430 million of lost funds to the 260,000 affected users.

In response to security issues, Japan’s cryptocurrency exchanges will establish a single self-regulatory body of only FSA-approved exchanges in an attempt to regain public trust. The regulatory body will work to create fair trade rules and self-regulations to plug legal loopholes. The body will also discuss cryptocurrency policy and legislation with the government, and create policies on insider trading, advertising and security. Members of the regulatory body that fail to follow the policies will be subject to penalties.

Singapore – Friendly

Singapore is often considered one of the more hospitable governments toward cryptocurrencies. In October 2017, the Monetary Authority of Singapore (MAS) published a clarifying document on cryptocurrency regulation. The document states that MAS does not directly regulate cryptocurrency, but regulates fraudulent and dangerous financial activities such as money laundering and terrorism. The MAS also requires that ICOs structured as securities comply with securities laws to protect investors, however, ICOs that are not structured as securities will only be subject to anti-fraud and anti-terrorism legislation. Singapore’s relaxed regulations and tax laws have sparked numerous ICOs in their territory.

In November 2017, the MAS also announced that it would partner with R3, a blockchain technology company and group of financial institutions to create Project Ubin; a project to conduct inter-bank payments with blockchain technology. Project Ubin’s advisors and partners include Bank of America, Merrill Lynch, Citi, Credit Suisse, DBS Bank Ltd., HSBC Limited, J.P. Morgan, Mitsubishi UFJ Financial Group, OCBC Bank, Singapore Exchange (SGX), Standard Chartered Bank, and Unite Overseas Bank. Collaborators on the technological aspects of the project include: Accenture, R3, IBM, ConsenSys, Microsoft, and Azure Blockchain. Project Ubin developed three software prototypes for decentralized inter-bank payments and settlements with liquidity savings mechanisms. The prototypes inspired two spin-off projects. The first is an SGX driven project focused on increasing fixed income securities trading and settlement cycles through distributed ledger technology (DLT). The second focuses on methods of conducting cross-border payments with central bank currency.

Thailand – Neutral

Thailand expects to clarify its stance on how to regulate digital currencies within the coming months. The government aims to protect against fraudulent activities and deceitful investments, while maintaining the benefits of using blockchain technology.

The Central Bank of Thailand (BOT) banned Thailand banks from five cryptocurrency related activities: investing or trading in cryptocurrency, exchanging cryptocurrencies, creating platforms for cryptocurrency trading, allowing clients to use credit cards to buy cryptocurrencies, and advising customers on cryptocurrency investing and trading.

The Thai government is also in talks with Cryptocurrency project OmiseGo (OMG) to create a national digital identification platform that provides consumer protection and security against fraud. OMG would also help provide online privacy, and provide a convenient, transparent, and fast way to make payments.

Vietnam – Neutral/Hostile

Vietnam’s Ministry of Justice and State Bank of Vietnam (SBV) are quickly preparing a report to present to the Council of Ministers. Currently, the scope of regulations are still unknown. In 2017, Vietnamese tax authorities lost a lawsuit against a local citizen who made a fortune trading Bitcoin. Under Vietnamese law, Bitcoin is not considered an asset, so the court ruled that authorities could not tax him for his gains. In late 2017, the SBV ruled that Cryptocurrency is not a legal means of payment, and effectively outlawed the supply and use in the marketplace. Violators could face fines up to 200 million Dong ($9,000). In January 2018, the Vietnamese State Securities Commission (SSC) requested that Vietnamese security trading firms refrain from providing cryptocurrency related services.

India – Neutral/Friendly

On February 1, 2018, Arun Jaitley, India’s finance minister noted that cryptocurrency is not legal tender and promised to crackdown on illegitimate activities relating to cryptocurrency. Many media sources interpreted his statements as a cryptocurrency ban, however, those media interpretations were incorrect. Although India’s Central Bank, the Reserve Bank of India (RBI) does not allow the use of cryptocurrency as forms of payments, the RBI supports the growth of Blockchain technology behind cryptocurrency. Jaitley took the stance that “the government will explore use of blockchain technology proactively for ushering in the digital economy.”

Iran – Friendly

Recent statements from Iran’s central bank suggest that Iran is developing a state-run cryptocurrency. On February 21, 2018, MJ Azari Jahromi, the Iranian Minister of Information and Communications Technology announced discussing cryptocurrency and blockchain at a meeting with the Iranian central bank’s board of directors. He also announced that they decided to implement the country’s first cloud-based cryptocurrency using the capacity of Iran’s elite. In November 2017, Iran’s High Council of Cyberspace (HCC) said it would welcome bitcoin and cryptocurrency trading, subject to regulations.


Russia – Friendly

In January 2018, the Russian Finance Ministry drafted a bill that would legalize “digital financial assets” stored on blockchain networks as electronic securities. The bill would define the scope of regulations on cryptocurrency, and would not prohibit trading. The bill would further define bitcoin mining as an entrepreneurial activity, which could require Russian bitcoin miners to register with the government. It may also create a 50,000 ruble ($900) ICO investment limit for residents who are not registered as qualified investors. There are plans to pass the bill to Russian Parliament for amendments and voting later this year.

At the end of January 2018, Sberbank, Russia’s largest state bank, announced its plans to launch a cryptocurrency exchange in Europe through its Swiss branch. The bank is planned for Switzerland, because cryptocurrency operations are not currently permitted to be run out of Russia, while cryptocurrency exchanges are legal in Switzerland. Sberbank is currently developing its trading infrastructure, and plans to offer services only to legalized institutional investors.

In February 2018, Russia held meetings with Venezuela to discuss potential collaboration between governments on Venezuela’s new state-run cryptocurrency, Petro.

Switzerland – Friendly

During 2017, Swiss ICOs raised about $550 million in funding, totaling about 14% of the global $4 billion ICO market. As a response, the Swiss Financial Market Supervisory Authority (FINMA) published ICO guidelines on February 16, 2018, under the Swiss anti-money laundering and securities laws. Switzerland considers many ICOs as securities, with some exceptions. The guidelines create three categories of tokens: payment tokens, utility tokens, and asset tokens. Payment tokens and tokens used to access an already running blockchain platform would not be regulated as securities.

FINMA’s CEO, Mark Branson said the regulations are a “balanced approach to handling ICO projects and inquiries [to allow] legitimate innovators to navigate the regulatory landscape and so launch their projects in a way consistent with our laws protecting investors and the integrity of the financial system.” Many tokens are also subject to Switzerland’s favorable tax laws, which are partly responsible for the high demand for blockchain companies to base their ICOs there.

Britain – Neutral

On February 22, 2018, the U.K. Treasury announced that it will begin looking into issues surrounding cryptocurrency and blockchain technology. The investigation will look into the role of cryptocurrencies in Britain, including both opportunities and risks for consumers, businesses, and government. The Treasury Committee will look at the potential risks that cryptocurrency could pose, such as price volatility, money laundering, and cyber crimes. The Treasury Committee will also look at the potential technological and economic benefits, and how cryptocurrency can create innovative opportunities and disrupt traditional economies.

France – Neutral

In January 2018, Bruno Le Maire, the French Minister of the Economy, announced the creation of a group to develop cryptocurrency regulations. The group will be responsible for proposing guidelines and drafting regulations to prevent tax evasion, money laundering, financial crimes, and terrorist activities. Le Maire’s stated, “We want a stable economy. We reject the risks of speculation and the possible financial diversions linked to Bitcoin.”

Germany – Friendly/Neutral

Joachim Wuermeling, the Director of German’s Central Bank (Bundesbank), is pushing for bitcoin and cryptocurrency to be regulated through an international set of rules, rather than solely national rules. He believes cryptocurrencies are difficult to regulate within a specific region or country. At the G20 summit this March, Germany and France are planning to release a joint statement proposing regulations, and analyzing the risks linked to bitcoin and cryptocurrency.

In Germany, cryptocurrency is not considered a commodity, stock, or currency. It is classified as private money, similar to foreign currency. Thus, trading cryptocurrency in Germany is tax free for short-term gains under 600 EUR, and tax free for long-term capital gains of over one year.

Italy – Friendly

The Ministry of Economy and Finance of Italy (MEF) recently finished public consultations regarding new regulations for cryptocurrency in Italy. The MEF will aim to improve anti-money laundering laws by holding exchanges responsible to prevent illegal cryptocurrency transactions and money laundering. The MEF will also recognize cryptocurrency as a means of exchange, separate from legal tender, for purchases of goods and services, that is not issued by a public authority or central bank.  Aside from the MEF’s newly proposed regulations, Italy does not regulate cryptocurrency heavily. Most cryptocurrency gains and holdings are exempt from taxation. However, the Italian parliament introduced a new law that would require identities of parties in cryptocurrency transaction.

Poland – Friendly/Neutral

Poland has often promoted cryptocurrency and blockchain technology. Poland is working with The Polish Blockchain Technology Accelerator, which is subsidized by the Ministry of Digitalization, to create a national cryptocurrency called Digital PLN (dPLN). However, in an odd twist, Poland’s Central Bank, the National Polish Bank (NPB) recently admitted to paying YouTubers thousands of dollars to dissuade Polish Citizens from trading cryptocurrency. The NPB called it an “educational campaign.”

Central and South America

Venezuela – Friendly

In December 2017, the Venezuelan government announced Petro, its state-run, oil-backed token as a form of legal tender to pay for taxes, fees, and public necessities. The cryptocurrency entered the pre-sale phase on February 20, 2018. Initially, 100 million Petros will be issued at an initial value of $6 billion. The Venezuelan government will allow exchanges of Petros for hard currencies (less vulnerable to inflation) and cryptocurrencies, but not for the Venezuelan Bolivar.

The Petro has quickly become controversial. The Venezuelan opposition-run congress denounced the Petro as illegal and unconstitutional, because it would be effectively borrowing against the country’s oil reserves. U.S. Senators Marco Rubio (R – FL) and Robert Menendez (D – NJ) also denounced the Petro in an open letter the the U.S. Treasury Secretary. The Senators believe it may be possible for Venezuela to use the Petro to bypass American sanctions. Harry Colvin, director and senior economist at Longview Economics expressed his doubts about the Petro’s success, saying “Venezuela has been known for misappropriation of assets in the past and the central bank has just created hyperinflation so I imagine there’ll be trust and transparency issues.”

Brazil – Hostile

In May 2017, Brazil set up a commission to discuss regulation of cryptocurrency. It has since held seven public hearings. In December, Brazil announced it would take the stance to prohibit the issuance of cryptocurrency in national territory, prevent its commercialization, intermediation, and acceptance as a means of payments and settlement of debts. The CVM and Central Bank of Brazil also announced that “The Bitcoin is a financial asset with no ballast that people buy because they believe it will appreciate. That is a typical bubble or pyramid… The Central Bank is not interested in bubbles or illicit payments.” In January 2018, the Securities and Exchange Commission of Brazil (CVM) announced that cryptocurrency is not considered a financial asset, further hindering direct investments.

The Brazilian state of São Paulo is rumored to be looking into using cryptocurrency to help solve its infrastructure problems. Hélcio Tokeshi, the Secretary of Treasury for São Paulo, said, “We like innovation in São Paulo, and blockchain and cryptocurrencies are being followed as extremely interesting innovations that we had to start experimenting with.”

Mexico – Friendly

Mexico is one of the leaders in cryptocurrency exchange trading in Latin America, and has one of the largest financial technology (fintech) markets in the region. Mexico is planning to pass a bill to regulate fintech and cryptocurrency markets within the next few weeks. The bill establishes regulations that classify cryptocurrency as non-legal tender, but still gives permission to use it to pay for goods and services. Under the bill, financial institutions will be permitted to operate with virtual assets and invest in fintech institutions encompassing ITFs (both collective financing institutions and electronic payment fund institutions). The bill may create massive change to the Mexican financial ecosystem. ITFs could be considered just as important as banks, and all trade finance companies may soon be operating with ITFs.

Mexico’s Central Bank, The Bank of Mexico (BOM) plans to take a stance to support new technologies and strengthen the economy while maintaining control. The BOM will likely require licenses for cryptocurrency exchanges and enforce penalties for non-compliance.

Africa and Australia

South Africa – Friendly

In July 2017, the South African Reserve Bank (SARB) selected blockchain company Bankymoon to test digital currency regulations. The project has served as an experiment to help SARB decide on how best to regulate cryptocurrency. In February 2018, SARB announced it would begin testing Ethereum’s blockchain for smart contracts.

UBU, the first South African cryptocurrency project launched recently. UBU is a Universal Basic Income project that aims to significantly reduce poverty in Africa through decentralized distribution of digital currency to the poor. Projects such as UBU would provide digital currency to help people invest and earn money in nations that often suffer from poverty and hyper-inflated national currencies.

Australia – Friendly

The Australian Taxation Office (ATO) treats financial gains from trading cryptocurrency as property subject to capital gains taxes. An ATO spokesperson said, “Any financial gains made from the selling of bitcoin will generally be subject to capital gains tax and must be reported to the ATO.” However, reports say this policy has yet to be tested in court.

The Australian government does not stringently regulate cryptocurrencies. The relaxed regulations have caused Australian banks to opt out of cryptocurrency trading. CoinSpot, one of Australia’s most popular cryptocurrency exchanges has said that Australian banks were not cooperating with exchanges, placing strict limits on accounts, and frequently closing them. Analysts are predicting the high demand for cryptocurrencies will force Australian authorities to begin regulating the industry soon.

Updated February 25, 2018 to reflect more accurate information about India.