A Tokenized Future: Regulatory Lessons from Crowdfunding and Standard Form Contracts

This Article examines the world of risk investing in the cryptoeconomy. The broader crypto market is booming despite the latest downturn. People and institutions are buying in. The question is now how to regulate it. This Article first tackles the question of whether coins, tokens, and other investable cryptoassets are securities. Second, for those cryptoassets that are not securities, this Article seeks to find a regulatory solution that balances promoting innovation with investor protection, just as the Securities and Exchange Commission (SEC) would do. To strike the right balance, this Article adopts a proposal by Ian Ayres and Alan Schwartz for policing standard form contracts that accompany consumer product purchases. That is, crypto issuers would be required to include a short, prominent “warning box” on their websites that includes only unexpected and harmful features of the crypto. Coupled with the whitepapers already provided by crypto developers—a shining example of voluntary disclosure working—the warning-box add-on completes the crypto regulation picture and properly balances innovation and investor protection. For well-known cryptos like bitcoin, nothing would be required in the warning box. Risks from investing in bitcoin, from environmental impact to price volatility, are generally understood. Tether developers, however, should have disclosed that their stablecoins were not fully backed by fiat currency reserves by using a warning box, and Ethereum developers should be disclosing that gas fees can be much higher than normal transaction fees investors may be accustomed to. This Article’s approach to crypto regulation favors market mechanisms over regulatory overreach in this emerging area

A Tokenized Future: Regulatory Lessons from Crowdfunding and Standard Form Contracts

This Article examines the world of risk investing in the cryptoeconomy. The broader crypto market is booming despite the latest downturn. People and institutions are buying in. The question is now how to regulate it. This Article first tackles the question of whether coins, tokens, and other investable cryptoassets are securities. Second, for those cryptoassets that are not securities, this Article seeks to find a regulatory solution that balances promoting innovation with investor protection, just as the Securities and Exchange Commission (SEC) would do. To strike the right balance, this Article adopts a proposal by Ian Ayres and Alan Schwartz for policing standard form contracts that accompany consumer product purchases. That is, crypto issuers would be required to include a short, prominent “warning box” on their websites that includes only unexpected and harmful features of the crypto. Coupled with the whitepapers already provided by crypto developers—a shining example of voluntary disclosure working—the warning-box add-on completes the crypto regulation picture and properly balances innovation and investor protection. For well-known cryptos like bitcoin, nothing would be required in the warning box. Risks from investing in bitcoin, from environmental impact to price volatility, are generally understood. Tether developers, however, should have disclosed that their stablecoins were not fully backed by fiat currency reserves by using a warning box, and Ethereum developers should be disclosing that gas fees can be much higher than normal transaction fees investors may be accustomed to. This Article’s approach to crypto regulation favors market mechanisms over regulatory overreach in this emerging area

Bitcoin em Pagamentos Online: Expandindo a moeda digital em pagamentos digitais

Technology has evolved exponentially, which has boosted the digitalization of payment systems. Thus, cryptocurrency emerged as a form of digital money and payment, whose adoption has been rising in recent years. On the other hand, the internet and technology also impacted e-commerce, which has potential for growth and development, consequently influencing online payment methods. While cryptocurrencies can attract and retain customers by offering an innovative, low-cost, and efficient payment alternative, there is still some resistance to market entry due to a lack of knowledge and trust. Aiming toward expanding the knowledge of cryptocurrencies, and sharing how payments with them work, this project seeks to develop a prototype capable of processing online Bitcoin cryptocurrency transactions. This prototype performs the integration with cryptocurrency payment gateways, being easily adapted to be integrated with other applications and support more cryptocurrencies. The evaluation conducted in this project is based on the Goal/Question/Metric approach, structuring the analysis concerning the quality attributes of Maintainability, Security and Reliability. The results are positive as the solution met all the expected values.A tecnologia tem evoluído exponencialmente o que potenciou a digitalização os sistemas de pagamento. Assim surgiu a criptomoeda como uma forma de dinheiro digital e pagamento, cuja adoção tem crescido nos últimos anos. Por outro lado, a internet e a tecnologia, têm também um grande impacto no comércio eletrónico que apresenta potencial de crescimento e desenvolvimento tendo assim influenciado os meios de pagamento online. Apesar de as criptomoedas puderem atrair e reter clientes ao oferecer uma alternativa de pagamento inovadora, de baixo custo e eficiente, ainda existe alguma resistência na entrada no mercado devido à falta de conhecimento e confiança. Tendo como objetivo expandir o conhecimento das criptomoedas, e partilhar como funcionam os pagamentos com estas, este projeto pretende desenvolver um protótipo capaz de suportar a criptomoeda Bitcoin para processamento de transações online. Este protótipo realiza a integração com gateways de pagamento de criptomoedas, sendo facilmente adaptado para ser integrado com outras aplicações e suportar mais criptomoedas. A avaliação realizada neste projeto é baseada na abordagem Goal/Question/Metric, estruturando a análise em relação aos atributos de qualidade de Manutenibilidade, Segurança e Confiabilidade. Os resultados finais são positivos visto que a solução cumpriu todos os valores expectáveis

Cryptocommunity Currencies

What are cryptocurrencies: securities, commodities, or something else? Maybe they are a new form of established currency-a non-sovereign fiat currency. Like other self-governing bodies, the communities that issue cryptocurrencies should be judged on how well they support their currencies. This analysis is not meaningfully different from how we have evaluated traditional sovereign issuers of currency. Indeed, as traditional-sovereign-issued currency becomes entirely digital, functional distinctions between traditionally sovereign-backed flat currency and widely accepted non-sovereign fat currency start to disappear. The primary way then to distinguish the value of such currencies from each other becomes the quality of their institutional backing. Through that lens, some self-governing online communities are better-organized and more supportive of their currencies than traditional sovereigns. By shooting across the bow of the securities-versus-commodities debate, this Article calls on regulators and academics to rethink their assumptions about cryptocurrencies and the communities that develop them. We should recognize well-institutionalized cryptocommunity currencies as non-sovereign flat currencies and regulate them accordingly

Cryptocurrencies exchange rates reporting tool

Tato prace popisuje soucasny trh s kryptomenami. Nasledne definuje atributy kryptomenovych burz, ktere jsou relevantni pro provedeni trojuhelnikove arbitraze. Na zaklade techto atributu jsou analyzovany vybrane kryptomenove burzy. Prace zaroven vymezuje klicove pozadavky dulezite pro vytvoreni aplikace, ktera stahuje data, zpracovava je a zobrazuje potencialni prilezitosti vykonani trojuhelnikove arbitraze v realnem case.This work describes present cryptocurrency market. Then it defines attributes of cryptocurrency exchanges relevant to perform triangular arbitrage. On the basis of these attributes selected cryptocurrency exchanges are analysed. The work also specifies core requirements important to building an application downloading data, processing them and displaying potential triangular arbitrage execution opportunities in real-time

Crypto-Currencies: does sentiment play a role?

This Master Thesis addresses the relationship between Market/ Investor Sentiment and the Crypto-Currencies Market using a database with 28 variables, such as the Crypto-Currencies Prices (Crypto-Currencies that had more than one Billion USD in Market Cap were selected), the S&P500 Index stock prices, the GDP of the US or Europe, Internet World Statistical data, among others, but most importantly Investor/ Market Sentiment data, gathered from Duke’s University surveys. All this data was then entered into SPSS and analyzed as Panel Data. The time period for this research spans from 2013 to 2019, 2013 because it is the first year were the market prices of Crypto-Currencies are available. Even though Bitcoin was created in 2008 (Nakamoto, 2008), market data about Crypto-Currencies only appeared in 2013. We run OLS and 2SLS regressions to test the significance, causality and the relationship between Sentiment and Crypto-Currencies. For the 2SLS, two Lagged variables were added. Additional Robustness tests were done including regressions with only Bitcoin and Litecoin. With this we find that there is a strong correlation and significance between the level of optimism and/ or pessimism in the financial markets and in Crypto-Currencies and that the relationship between them is mostly non-linear according to our research and analysis. Our results suggest that the price of Crypto-Currencies is an increasing function of sentiment, which calls for considering Behavioral Economics tenets when analyzing Crypto-Currencies markets’. Our findings are confirmed by robustness tests deploying alternative measures of the variable of interest – Sentiment – as well as alternative controls. The findings suggest that more regulation in the market is needed to avoid extreme volatility for investors. Crypto-Currencies show bigger growth when the sentiment towards the market is pessimistic, such as when there is a crisis either a monetary or a political one, because Crypto-Currencies are still associated with somewhat non-deterministic movements. It is now our job to pursue regulation and to attract more corporate investors so that Crypto-Currencies could start to be more accepted as financial assets, and not to be seen as just “internet money”, as unfortunately they are still perceived by many nowadays

Financial Inclusion, Cryptocurrency, and Afrofuturism

As a community, Black people consistently face barriers to full participation in traditional financial markets. The decentralized nature of the cryptocurrency market is attractive to a community that has been historically and systematically excluded from the traditional financial markets by both private and public actors. As new entrants to any type of financial market, Black people have increasingly embraced blockchain technology and cryptocurrency as a path towards the wealth-building opportunities and financial freedom they have been denied in traditional markets. This Article analyzes whether the technology’s decentralized system will lead to financial inclusion or increased financial exclusion. Without reconciling the racially discriminatory history or effects of the current central financial system, the innovative decentralized appeal to Black people will do little to overcome economic inequity. It may be possible that some cryptocurrencies can be tools for financial inclusion by improving economic outcomes and building wealth outside of traditional financial institutions, but without an intervention, a decentralized system will not necessarily lead to decentralized wealth. The rise of cryptocurrency presents an opportunity to think about how to create a fairer, more inclusive financial system. Taken together with the financial exclusions of the past, cryptocurrency can be a vehicle through which we think about true financial inclusion. However, asking traditionally marginalized groups to participate in an extremely risky cryptocurrency market in pursuit of racial equity is an unrealistic solution given the legacy and reality of financial exclusion. A decentralized system cannot fix the systemic racial inequality that has been embedded in our financial systems. This Article proposes using an Afrofuturist framework in the shaping of policy toward cryptocurrency. An Afrofuturist paradigm pushes for systemic problems to be solved through wholesale systems change rather than tinkering at the margins. Moving forward using an Afrofuturist lens would facilitate a rethinking of our financial systems and the role of cryptocurrency as a portal for racial equity