Fintech Market Overview

This article does not constitute legal advice.

Virtual currencies in the USA

Fintech Software

In 2013, FinCEN provided instructions on its role that proved the BSA is applicable to individuals who create, obtain, distribute, exchange, accept, or transmit convertible virtual currencies.1

FinCEN defines these individuals as important actors in the market known as exchangers or administrators of e-currencies. They serve as transmitters of funds; therefore, they need to pass registration as MSBs.1

Any money transmitter should accept and follow the BSA rules applicable to MSBs, such as registration with FinCEN; development, implementation, and maintenance of legal AML and KYC programs; submission of suspicious behavior reports and monetary transaction reports; and provision of other financial and statistical data.1

The IRS provided the company's initial crypto instructions in 2014, creating an official definition of a virtual currency as “a digital representation of value that functions as a medium of exchange, a unit of account, and/or a store of value”.1

Bitcoin represents a type of convertible e-currency as it can be used in digital transactions such as selling and purchasing, as well as exchanging for real money or other available digital currencies.1

The IRS classifies digital currencies as proprietary assets, employing the key taxation rules connected with property operations by means of e-currency.1

Hence, every operation with digital currency should realize possible financial gains or losses on the deal.1

Since around 2015, the CFTC has monitored all operations with existing digital currencies as commodities in accordance with the Commodity Exchange Act. You can now buy virtual currency for real money or through initial coin offerings (ICOs).1

The CFTC establishes its rules to prevent fraudulent schemes with e-currencies according to the Commodity Exchange Act.1

The CFTC's explanation of the position of digital currencies as commodities that fall within relevant regulatory jurisdiction has been supported by national judiciary.1

Wyoming and New York are coming up with a way to generate a comprehensive virtual asset-related body of law.1

The state of New York has developed its legal structure for digital currencies and demands that everyone involved in any of the below-mentioned activities be licensed with a BitLicense:

  • Conducting operations aimed at transmitting digital currency
  • Possession of e-currency on behalf of another person
  • Purchasing and selling digital currency with certain business goals
  • Ensuring control, management, or launching a digital currency 1

Digital assets in the USA

Fintech in the USA

Fintech in other countries

Let's introduce you

US Fintech Lawyers

Roman Buzko

Roman Buzko

Registration, regulatory advice, investment transactions and dispute resolution.

Languages: EN RU

Viacheslav Losev

Viacheslav Losev

Legal support for FinTech and Blockchain projects

Languages: RU EN

Silvia Calls

Silvia Calls

We work for international SMEs, startups and Telco's

Languages: EN ES

Fintech investors from the USA

2048 Ventures

2048 Ventures

We are a team of experienced operators and dreamers who are passionate about working with founders at the earliest stage

Languages: EN

First Check Ventures

First Check Ventures

Our syndicate is focused on investing in early stage startups across the globe

Languages: EN

  1. https://thelawreviews.co.uk/title/the-financial-technology-law-review/usa
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