In January, billionaire investor George Soros ripped cryptocurrencies, saying the asset class is too volatile to replace traditional currencies. Now, Soros is eyeing trading cryptos, according to various media reports.
Soros Fund Management, the billionaire’s family office operation, which has $26 billion in assets, is looking to trade digital currencies.
“Adam Fisher, who oversees macro investing at New York-based Soros Fund Management, got internal approval to trade virtual coins in the last few months, though he has yet to make a wager, according to people familiar with the matter,” reports Bloomberg.
At the World Economic Forum in Switzerland earlier this year, Soros bashed bitcoin and other digital currencies. The price of bitcoin, the largest digital currency, is off more than 40% since Soros made those remarks and has lost about half its value just this year. Bitcoin traded just under $7,000 at this writing Sunday, meaning it has lost nearly two-thirds of its value since its December peak.
Others Following Suit
Soros is not the only famed financial name to recently get involved in cyrpotcurrencies. Last week, it was reported that Venrock, the venture capital arm of the famous Rockefeller family, said it is partnering with New York-based CoinFund “to help entrepreneurs build businesses based on blockchains, the hot distributed ledger technology that first came to prominence with the development of Bitcoin a decade ago,” according to Fortune.
Some industry observers believe the addition of more big-name institutional investors to the crypto market will help the market mature, potentially enhancing liquidity in the process. Recent data suggest many professional investors remain leery of digital currencies with the bulk of that group not planning to make crypto investments this year.
While not necessarily a famed investor on par with the Rockefellers or Soros, the Crown Prince of Liechtenstein recently said his family could look to diversify its investment portfolio to include cryptocurrencies.
In a recent interview with CNBC, Crown Prince Alois acknowledged that digital currencies are “risky” while highlighting the potential of blockchain, saying “Blockchain will change a lot of things, it could even help make our state more efficient the way it is administered.”
U.S. Takes Crypto Crime Seriously with Anti-Money Laundering Reforms
The United States passed into law its Anti-Money Laundering Act of 2020, which takes effect on January 1, 2021. This brings digital currency exchange companies and other digital-asset-related businesses under the scope of regulations of the Bank Secrecy Act (BSA), which requires financial institutions “to actively detect, monitor and report potential money laundering activity.”
“I’m pleased that our anti-money laundering legislation was included as a part of this year’s [National Defense Authorization Act]. This bipartisan legislation protects Americans by depriving criminals and terrorists of the tools they use to finance illicit activity. It is the first serious overhaul of our anti-money laundering system in decades, and it makes sense to include it in the biggest, most important national defense legislation Congress passes each year,” South Dakota Sen. Mike Rounds said in a press release.
The massive anti-money laundering reforms are targeting businesses dealing with digital currencies and assets by clearly specifying the definition of a “financial institution” to “‘a business engaged in the exchange of currency, funds, or value that substitutes for currency or funds” and “a licensed sender of money or any other person who engages as a business in the transmission of funds or value that substitutes for currency.”
The reforms further define a “money transmitting business” to include those who deal with “currency, funds, or value that substitutes for currency.” Now, there are no longer loopholes that digital asset companies can use when dealing with the Financial Crimes Enforcement Network (FinCEN), the agency that enforces the BSA.
Stricter Penalties Enforced
Aside from updating definitions to ensure that digital currency exchange firms and others dealing in digital assets are clearly within the scope of the AML Act of 2020 and the BSA, stricter penalties are now being enforced for crypto criminals.
Now, those who have been found guilty of violating the AML Act of 2020 and/or BSA are faced with fines amounting to profits earned while committing the violation and possible jail time. Those guilty of an “egregious” breach are also going to be banned from taking a board member position of any financial institution in the country for 10 years. Furthermore, employees of financial institutions who commit these crimes will be obligated to return to their employer all bonuses received during the time the act was committed.
FinCEN is being given additional resources, like increasing its manpower, to ensure the enforcement of these reforms. This will further safeguard investors against crypto crimes and nail down digital currency exchange firms and other digital-asset-related businesses that do not comply with BSA regulations.
Bitcoin (BTC) Crosses 55k And Is Heading Towards 60k Fast!
Less than two months into 2021, the price of bitcoin has risen 95.4%.
Based in the United States and want to trade via Binance.US? Click here to sign up now!
Cardano founder, Charles Hoskinson speaks on the future of Bitcoin and taking profits
Charles Hoskinson has always been a huge advocate for decentralized finance and building a network that could provide solutions to the problems with our current financial and banking systems. In this recent AMA Charles speaks out on his view about the issues that Bitcoin faces as well as reminding everyone that cryptocurrency isn’t all about taking profits.