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On 3 September, 2024, the Commodity Futures Trading Commission (CFTC)  announced the penalty imposed by Judge Mary Rowland of the United States District Court for the Northern District of Illinois in the case of Commodity Futures Trading Commission v. Jafia LLC, Sam Ikkurty (a/k/a Sreenivas I. Rao), and Ravishankar Avadhanam. The final judgment was delivered on 22 July 2024 in the above mentioned matter related to a Ponzi scheme disguised as crypto and carbon investment funds. The court imposed permanent injunction on the defendants from engaging in any commodity interests or digital asset transactions, and imposed financial penalties, including a restitution obligation of $83,757,249, disgorgement of $36,967,285, and a civil monetary penalty of $110,901,855, for violations of the Commodity Exchange Act (CEA). The case was lodged by CFTC against the defendants for operating fraudulent investment schemes involving commodities and digital assets. The defendants, Sam Ikkurty, Jafia LLC,...

On 27 August 2024, Zettai Pte. Ltd., the parent company of the cryptocurrency exchange WazirX, filed an application with the Singapore High Court seeking a moratorium under Section 64 of the Insolvency, Restructuring, and Dissolution Act 2018. The application, registered as Case No. HC/OA 861/2024, aims to secure a six-month halt on any winding-up resolutions and legal proceedings against the company as it undergoes a restructuring process. The moratorium application, submitted without notice, requests the Court to prevent any ongoing or new legal actions, including those before courts, arbitral tribunals, or administrative agencies, from proceeding against Zettai during this period. Additionally, the application seeks to restrict any execution, distress, or other legal processes against Zettai’s property unless expressly permitted by the Court. The moratorium, if granted, would provide Zettai with temporary relief from legal actions and financial obligations, giving the company a...

On 20 August, 2024, the Financial Services Regulatory Authority (FSRA) of the Abu Dhabi Global Market (ADGM) issued Consultation Paper No. 7, proposing a regulatory framework for the issuance of Fiat-Referenced Tokens (FRTs). This paper outlines regulations for these tokens. FRTs are stablecoins backed by high-quality, liquid assets denominated in a single fiat currency. The proposed paper addresses key areas such as reserve asset requirements, redemption rights, capital adequacy, and governance to ensure that FRTs are issued and managed in a manner that promotes financial stability, transparency, and consumer protection within the ADGM. While the FSRA had previously established guidelines for virtual assets, the FRTs necessitate a tailored regulatory approach. Unlike other stablecoins that may be backed by volatile assets, FRTs are intended to maintain a stable value by being backed by high-quality, liquid assets denominated in the same currency as the token to ensure their use as a...

The Hong Kong Monetary Authority (HKMA) has concluded its investigation into WeChat Pay Hong Kong Limited (WPHK), resulting in a HK$875,000 penalty for violations under the Payment Systems and Stored Value Facilities Ordinance (PSSVFO). The penalty was imposed for WPHK's failure to meet the required standards under section 6(2)(b) of Part 2 of Schedule 3 of the Ordinance, concerning anti-money laundering (AML) and counter-financing of terrorism (CFT) controls. The disciplinary action follows a self-report from WPHK and an ensuing investigation by the HKMA, which uncovered lapses in WPHK's compliance practices between August 25, 2016, and October 24, 2021. During this period, WPHK failed to conduct customer due diligence (CDD) and apply enhanced due diligence (EDD) measures, particularly in high-risk scenarios involving potential money laundering and terrorist financing risks. The HKMA's investigation revealed that WPHK did not properly categorise certain law enforcement agency...

On 29 August 2024, the Commodity Futures Trading Commission (CFTC) granted Kalshi Klear LLC an Order of Registration as a derivatives clearing organisation (DCO) under the Commodity Exchange Act (CEA). Kalshi's affiliate, KalshiEx LLC, was already registered as a designated contract market, and now it’s another subsidiary is designated as a DCO which expands its operational capabilities. Kalshi Klear is the first exchange regulated by the CFTC to focus on trading the outcomes of future events. They have developed a new asset class known as event contracts which allows participants to trade on a wide range of topics, from inflation and federal rates to government shutdowns and Supreme Court decisions. This platform enables individuals and institutions to hedge against risks directly related to their concerns and capitalise on their opinions about future events. Kalshi's platform introduces trading by allowing market participants to take Yes or No positions on whether specific events...

On 29 August 2024, the Bank of Latvia extended an invitation to crypto-asset service providers (CASPs) and consulting service providers to engage in pre-licensing consultations as they prepare to comply with the forthcoming European Union (EU) Markets in Crypto-Assets Regulation (MiCA). This new regulation, set to take effect on December 30, 2024, will introduce a unified regulatory framework across the EU for the crypto-asset industry. One of the key requirements under MiCA is that all crypto-asset service providers must obtain an operating permit to conduct their business within the EU. Latvijas Banka, in preparation of the formal application process that begins in January 2025, is offering these pre-licensing consultations to help companies understand the regulatory requirements and prepare their applications. The aim of this initiative is to allow companies to gain a clear understanding of the regulatory requirements, the necessary documentation, and the compliance standards they...

On 28 August, 2024, the Hong Kong Monetary Authority (HKMA) officially launched the Project Ensemble Sandbox today, for the practical adoption of tokenisation within the financial industry. The launch ceremony introduced four key themes for the initial round of experimentation, focusing on the tokenisation of both traditional financial assets and real-world assets. The Sandbox has been specifically designed to facilitate interbank settlement using experimental tokenised money, with a focus on transactions involving tokenised assets. Participating banks from the Project Ensemble Architecture Community have connected their tokenised deposit platforms to the Sandbox, enabling them to conduct experiments in payment-versus-payment and delivery-versus-payment settlement processes. The first round of experimentation within the Sandbox will cover four main theme areas: fixed income and investment funds, liquidity management, green and sustainable finance, and trade and supply chain finance....

On 28 August, 2024, the U.S. Securities and Exchange Commission (US SEC) announced new amendments to reporting requirements for certain registered investment companies, aimed at improving transparency and regulatory oversight. These changes, which affect Form N-PORT filings, are designed to provide both the SEC and investors with more timely and detailed information about the portfolio holdings of these funds. The US SEC's amendments to Form N-PORT will require registered open-end funds, registered closed-end funds, and exchange-traded funds organised as unit investment trusts to file monthly reports instead of the current quarterly filings. These reports will need to be submitted within 30 days after the end of each month. Previously, funds had a 60-day window after the end of each quarter to submit these reports. These monthly reports will be made publicly available 60 days after the end of each month, rather than only at the end of each quarter. This change is expected to...

On 23 August 2024, the Australian Securities and Investments Commission (ASIC) announced a series of regulatory interventions aimed at curbing greenwashing misconduct in the sustainable finance sector. Over a 15-month period leading up to 30 June 2024, ASIC undertook 47 actions, including the initiation of two Federal Court proceedings and the issuance of over $123,000 in infringement notice payments. These efforts are detailed in Report 791: ASIC’s Interventions on Greenwashing Misconduct: 2023–2024 (REP 791), which outlines the regulator’s ongoing commitment to addressing misleading and deceptive conduct related to sustainability claims. Over this period, ASIC made significant interventions in its fight against greenwashing. These actions includes the commencement of two civil penalty proceedings, the finalization of one civil penalty case resulting in $11.3 million in penalties, the issuance of eight infringement notices, and the achievement of 37 corrective disclosure outcomes,...

On 27 August 2024, the Swiss Financial Market Supervisory Authority (FINMA) published two new set of audit forms i.e. GB-A Regulatory audit report investment companies with variable capital (SICAV) 2024 & GB-A Regulatory audit report fund management companies 2024 to enhance oversight of Virtual Asset Service Providers (VASPs). Applicable to financial years beginning on or after 1 January 2024, these forms introduce rigorous reporting and compliance requirements for financial institutions engaged in virtual asset activities. This move is seen as a critical step in ensuring the security and transparency of Switzerland’s financial sector in the rapidly evolving digital asset landscape. The newly issued audit forms for fund management companies and investment companies with variable capital (SICAV) are designed to include comprehensive evaluations of the involvement of VASPs. These forms mandate detailed disclosures and assessments related to anti-money laundering (AML) measures,...