{"id":131420,"date":"2020-12-12T01:43:29","date_gmt":"2020-12-11T22:43:29","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/law-decoded-the-war-of-the-wallets-12-4-12-11\/"},"modified":"2020-12-12T01:43:29","modified_gmt":"2020-12-11T22:43:29","slug":"law-decoded-the-war-of-the-wallets-12-4-12-11","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/law-decoded-the-war-of-the-wallets-12-4-12-11\/","title":{"rendered":"# Law Decoded: The war of the wallets, 12\/4\u201312\/11"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a3dd29e3bff8\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a3dd29e3bff8\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/law-decoded-the-war-of-the-wallets-12-4-12-11\/#Editors_note\" >Editor\u2019s note<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/law-decoded-the-war-of-the-wallets-12-4-12-11\/#Liberte_egalite_mais_pas_anonymite\" >Libert\u00e9, \u00e9galit\u00e9, mais pas anonymit\u00e9<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/buradabiliyorum.com\/en\/law-decoded-the-war-of-the-wallets-12-4-12-11\/#Congressional_Blockchain_Caucus_beefs_with_regulators_over_crypto\" >Congressional Blockchain Caucus beefs with regulators over crypto<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/buradabiliyorum.com\/en\/law-decoded-the-war-of-the-wallets-12-4-12-11\/#Privacy_wallets_have_skyrocketed_in_popularity_this_year\" >Privacy wallets have skyrocketed in popularity this year<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/buradabiliyorum.com\/en\/law-decoded-the-war-of-the-wallets-12-4-12-11\/#Further_reads\" >Further reads<\/a><\/li><\/ul><\/nav><\/div>\n<p>&#8220;<strong># Law Decoded: The war of the wallets, 12\/4\u201312\/11<br \/>\n<\/strong>&#8221;<br \/>\n<img decoding=\"async\" src=\"https:\/\/images.cointelegraph.com\/images\/840_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjAtMTIvNmExOTMyMzctOWI4ZS00YTZiLTg2OGUtMjNmNGFhZDExNzNjLmpwZw==.jpg\" \/><\/p>\n<div class=\"post-content\" data-v-5a136f3a>\n<em>Every Friday, Law Decoded delivers analysis on the week\u2019s critical stories in the realms of policy, regulation and law.<\/em><\/p>\n<h3><span class=\"ez-toc-section\" id=\"Editors_note\"><\/span>Editor\u2019s note<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Last week\u2019s Law Decoded sounded the alarm on threats to self-custodial wallets in the U.S. in particular. While such concerns have continued to take shape, nothing concrete has emerged from the U.S. Treasury, which was at the heart of last week\u2019s conversation.<\/p>\n<p>Though I don\u2019t like to recycle <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">theme<\/a>s, it seems a reasonable time to ask the question: What is a crypto wallet as far as a regulator is concerned? <\/p>\n<p>While many people access their crypto through custodial solutions in which your \u201ccrypto\u201d is yours on someone else\u2019s ledger rather than on the underlying blockchain, real wallets are just means of managing private and public keys. They are analogous to bank accounts in that they let you transfer value in the form of Bitcoin or whatever else, which is where many regulators see their right to step in. <\/p>\n<p>Bank accounts in most major economies require a fair amount of personal information as a means of preventing money laundering, but they are still involved in facilitating plenty of illicit activity. Exemptions for corporate entities, for example, have created notoriously difficult webs to untangle in investigations. And while regulators may be willing to look at crypto wallets as bank accounts to get more authority to reign them in, it\u2019s disingenuous to say that bank accounts are the only analogy available. You can buy a real wallet and fill it with cash without ever having to pass a KYC check. <\/p>\n<p>The regulatory counterargument is, of course, that it takes much more time to bring a real wallet full of cash to, say, a sanctioned person in Iran than to send the equivalent value to that person\u2019s Bitcoin wallet. But, nobody at this point is really finding that Bitcoin, in its current state, is more likely to be caught up in illegal activity than cash or even bank accounts. So from a regulatory perspective, it seems odd to prioritize a hypothetical problem over existing problems of equal or greater scale.<br \/>\n<template data-name=\"subscription_form\" data-type=\"law_decoded\"><\/template><\/p>\n<h3><span class=\"ez-toc-section\" id=\"Liberte_egalite_mais_pas_anonymite\"><\/span>Libert\u00e9, \u00e9galit\u00e9, mais pas anonymit\u00e9<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>France is looking askance at anonymous crypto accounts, per a recent order from several French ministries. <\/p>\n<p>The order primarily reinforces that existing financial controls \u2014 especially those requiring accounts and assets to be traceable to beneficial owners \u2014 also apply to crypto. Effectively, this would mean that crypto addresses need to be traceable to specific customers. The order refers to this as a way of integrating crypto further into the regular financial system.<\/p>\n<p>The most notable signatory to the order was Minister of Finance Bruno Le Maire. At the heart of the order are the usual suspects: Fear of money laundering and terrorism financing. Le Maire in particular has been critical of crypto as a means to unseat national monetary sovereignty. <\/p>\n<p>However, the extent of this order\u2019s application seems limited. It refers extensively to the Financial Action Task Force\u2019s guidance, which concentrates on exchanges rather than independent wallets. Though the order specifies that crypto-to-crypto exchanges are within its purview, it\u2019s also notoriously difficult for governments to be sure that such transactions are happening within their jurisdictions, which is a big part of why authorities tend to focus on crypto-to-fiat gateways. Nonetheless, such an order adds legal force to enforcers in one of the biggest economies in Europe and their ability to attack anonymous exchanges of crypto.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Congressional_Blockchain_Caucus_beefs_with_regulators_over_crypto\"><\/span>Congressional Blockchain Caucus beefs with regulators over crypto<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>This week saw two letters going from members of Congress, one to the Securities and Exchange Commission and one to the Treasury.<\/p>\n<p>The two letters included overlapping members as signatories, especially those from the Blockchain Caucus. They also shared concerns with anticipated rulemaking, though the legislators were asking the Treasury to pump the brakes and the SEC to hit the gas.<\/p>\n<p>The letter to the Treasury focused on a rumored ban on self-custody i.e. wallets that are not in the hands of exchanges or other financial institutions that can report on the details of the wallet owners. In other words, an attack on peer-to-peer, which seems impractical but also would undermine one of the foundational pillars of crypto.<\/p>\n<p>The letter to the SEC was a request for clarity on who can custody security tokens \u2014 a major hold-up for potential broker-dealers trying to register with self-regulatory group, FINRA. Currently, there is a backlog of applications in limbo, seeing neither acceptance or rejection. Without clear guidance, nobody knows how to proceed.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Privacy_wallets_have_skyrocketed_in_popularity_this_year\"><\/span>Privacy wallets have skyrocketed in popularity this year<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>As self-custodial wallets fall under threat, wallets that specifically enhance privacy are gaining popularity among allegedly illicit actors. <\/p>\n<p>Per analytics firm Elliptic, the overall proportion of Bitcoin transactions that involve illicit usage has dropped significantly over the past several years as mainstream investment has picked up. <\/p>\n<p>While mixers seem to have gained some traction with criminal activity this year, privacy wallets \u2014 especially Wasabi \u2014 seem to have come out on top. The firm noted that illicit crypto made its first stop in such wallets in 13% of cases, compared to just 3% the year before. The firm further confirmed that they still <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/general\/\" data-internallinksmanager029f6b8e52c=\"3\" title=\"General\" target=\"_blank\" rel=\"noopener\">general<\/a>ly can\u2019t trace Bitcoin upon its departure from such wallets, which would seem to mean that the <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/technology\/\" data-internallinksmanager029f6b8e52c=\"4\" title=\"Technology\" target=\"_blank\" rel=\"noopener\">technology<\/a> is working. <\/p>\n<h3><span class=\"ez-toc-section\" id=\"Further_reads\"><\/span>Further reads<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>AEI\u2019s Jim Harper interrogates the <a rel=\"nofollow noopener noreferrer\" target=\"_blank\" href=\"https:\/\/www.aei.org\/technology-and-innovation\/are-bitcoins-programmers-fiduciaries\/\">logic of holding crypto programmers responsible<\/a> in the same way as fiduciaries.<\/p>\n<p>Despite delays in releases due to COVID-19, attorney Keith Letourneau <a rel=\"nofollow noopener noreferrer\" target=\"_blank\" href=\"https:\/\/www.jdsupra.com\/legalnews\/the-impact-of-covid-19-on-blockchain-15757\/\">argues that the pandemic has revealed<\/a> more need for blockchain than ever.<\/p>\n<p>Jason Razovsky of R3\u2019s legal team advises other counsel on <a rel=\"nofollow noopener noreferrer\" target=\"_blank\" href=\"https:\/\/news.bloomberglaw.com\/securities-law\/what-general-counsels-need-to-know-about-procuring-blockchain-software?utm_source=rss&amp;utm_medium=SLNW&amp;utm_campaign=00000176-0b07-d6bb-a777-dbc72caa0001\">legal concerns of proprietary blockchain software<\/a>.\n<\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/general\/\" target=\"_blank\" rel=\"noopener noreferrer\">General category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/cointelegraph.com\/news\/law-decoded-the-war-of-the-wallets-12-4-12-11\" target=\"_blank\" rel=\"noopener noreferrer\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;# Law Decoded: The war of the wallets, 12\/4\u201312\/11 &#8221; Every Friday, Law Decoded delivers analysis on the week\u2019s critical stories in the realms of policy, regulation and law. Editor\u2019s note Last week\u2019s Law Decoded sounded the alarm on threats to self-custodial wallets in the U.S. in particular. While such concerns have continued to take&#8230;<\/p>\n","protected":false},"author":1,"featured_media":131421,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/s3.cointelegraph.com\/uploads\/2020-12\/6a193237-9b8e-4a6b-868e-23f4aad1173c.jpg","fifu_image_alt":"","footnotes":""},"categories":[1],"tags":[15047,74859,76943,75141,80098,74879,32232,70934],"class_list":["post-131420","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-privacy","tag-aml","tag-anonymity","tag-kyc","tag-private-keys","tag-wallet","tag-france","tag-regulation"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/131420","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=131420"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/131420\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/131421"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=131420"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=131420"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=131420"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}