Blog

  • Credit Cards and Crypto Business – Crypto Companies as High-Risk Merchants
    The vast majority of goods and services that are purchased online is still paid for via credit card. This also applies companies from the blockchain industry since cryptocurrencies as a means of payment, even in this field of business, have not yet reached mass adoption. It is therefore crucial for e.g. crypto exchanges, token emitters […]
  • Introducing Digital Securities – What are the Implications for Security Token Offerings?
    The German Federal Government resolved its blockchain-strategy on 18th September 2019. The resolved version includes 44 specific measures not only concerning initiatives that are related to capital and financial markets but also the promotion of blockchain projects that have an impact on the real economy, as well as research, cooperation initiatives and the implementation of the technology […]
  • Spot on Crypto Payment Providers – How is that Regulated?
    Next to crypto exchanges and Bitcoin ATMs, crypto payment service providers were one of the business models of the Blockchain community from the very get-go. The user of these services can transfer Bitcoin to the service provider which will in return transfer the equivalent in e.g. Dollar or Euro to a bank account of the […]
  • European Market Abuse Regulation – What do STO Issuers Have to Consider?
    With the introduction of the European Market Abuse Regulation (MAR), which is directly applicable in the member states without transposition, in July of 2016 the regulations for securities trading with regards to insider trading, market manipulation and the publication of insider information are harmonized within the EU. The national capital markets regulations of the member […]
  • Let´s Build an Equity Token – Why don´t We Bring Stocks to the Blockchain?
    Tokenizing is one of the hottest topics at the capital markets right now and with the authorization of the first security token offerings by the national supervising authorities the subject is picking up speed. BaFin, the competent authority in Germany, already approved two security prospectuses for security token offerings and it is just a matter […]
  • Crypto Custody vs Securities Deposit Business – Who Will be Allowed to Store Security Tokens?
    Security Tokens of German issuers so far have been issued solely as securities according to the German Securities Prospectus Act respectively the EU Prospectus Regulation. They are designed as identical and freely tradable blockchain tokens that grant its owners certain investor rights such as a return on investment and a repayment claim. Security tokens can […]
  • Security Token as Asset Investment – Is that Possible?
    This year, BaFin already approved two securities prospectuses for security token offerings. In July of 2019 it approved a prospectus concerning the offering of token based subordinated bonds in the form of profit participation certificates and in January of 2019 a prospectus concerning a security token in the form of a registered bond. The approval […]
  • Would a BaFin issued Crypto Custody License be EU-Passpotable?
    In less than six month the new financial service of crypto custodian services will be introduced to the German banking regulatory law unless the German legislator does not change his mind. The decision to subject crypto custodians to BaFin authorization is currently being criticized and discussed massively. Especially the proposed introduction of section 32 subsection 1g into […]
  • Crypto Custody Service – New Financial Service Providers as the Future Centers of Power of the Crypto Market?
    On 29th of July the German federal government resolved its draft proposal for the transposition of the provisions of the 5. European AML Directive into national law. It can be expected that this draft in its current form will be passed into law by the end of 2019. As of 1st of January 2020, crypto assets will be included […]
  • Crypto Assets vs. Units of Account – What would be the Impacts of the Introduction of Crypto Assets as Financial Instruments?
    The German Ministry of Finance caused a stir to the German cypto community in May 2019 with its first draft for the transposition of the provisions of the 5. European AML Directive into national law. The ministries draft would not only implement the mandatory regulations from the directive to the German Anti Money Laundering Act […]
  • Seminar on Anti-Money-Laundering Regulation and Virtual Currencies
    On 30th September 2019 Lutz Auffenberg, LL.M. will inform about the regulatory obligations of BaFin-regulated institutions and possible pitfalls regarding virtual currecnies and crypto assets in a daytime seminar of Forum Institut für Management GmbH in Jumeirah Hotel in Frankfurt on Main. Next to the current state of regulation on basis of the EU’s fourth […]
  • Decentralized Exchanges – Crypto Exchanges Without a BaFin License?
    Decentralization was one of the main motivations of the authors of the Bitcoin whitepaper in 2008. The Bitcoin ecosystem was supposed to enable payments between the users without the necessity of intermediaries such as payment processors or banks. While the possibility of peer-to-peer payments is an inherent use case with all cryptocurrencies the trading of […]
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