Merchants are able to accept cash for their products, and also use payment processors to access other networks.
The government has been content with leveraging payment processors and banks to understand the location of the money supply. The merchant's cash would be logged when deposited at a bank. Some governance of this is related to combatting rackets and terrorism. The state's interest in understanding the location of its money supply has had great efficacy, and transparent blockchains can assist with this on their own, removing a burden from issuers and service providers.
Therefore, people selling digital units as products should be treated like merchants. Basically the issuer shouldn't have the liability of AML/KYC and should be also be able to use payment processors who already have implemented AML/KYC. Wyoming democratically exempted issuers from Money Services Business requirements in their Utility Token law, the Federal law can mimic this.
Currently, there is conflicting guidance on what to expect when using a distributed ledger network (blockchain) to accept payments for a crowdsale.
This act should clarify this. The lowest friction would be like the Wyoming Utility Token law, putting token issuers on the same level as merchants accepting cash.
Exempting such transactions from Securities laws implies this outcome already, but licensed financial professionals and Self Regulatory Organizations need the clarity to avoid company-specific interpretations of compliance.
Merchants are able to accept cash for their products, and also use payment processors to access other networks.
The government has been content with leveraging payment processors and banks to understand the location of the money supply. The merchant's cash would be logged when deposited at a bank. Some governance of this is related to combatting rackets and terrorism. The state's interest in understanding the location of its money supply has had great efficacy, and transparent blockchains can assist with this on their own, removing a burden from issuers and service providers.
Therefore, people selling digital units as products should be treated like merchants. Basically the issuer shouldn't have the liability of AML/KYC and should be also be able to use payment processors who already have implemented AML/KYC. Wyoming democratically exempted issuers from Money Services Business requirements in their Utility Token law, the Federal law can mimic this.
Currently, there is conflicting guidance on what to expect when using a distributed ledger network (blockchain) to accept payments for a crowdsale.
This act should clarify this. The lowest friction would be like the Wyoming Utility Token law, putting token issuers on the same level as merchants accepting cash.
Exempting such transactions from Securities laws implies this outcome already, but licensed financial professionals and Self Regulatory Organizations need the clarity to avoid company-specific interpretations of compliance.