U.S. Federal Reserve Bans Employees From Trading Crypto, Bonds And Stocks

The Federal Reserve banned senior officials from engaging in several forms of active trading, finalizing a sweeping series of changes to its ethics rules after several Fed officials it became engulfed in controversy over their trading actions. 

Since September, three top Fed officials, including former Vice Chairman Richard Clarida, have resigned since disclosing trading activity at the start of the pandemic. The disclosures led to a widespread backlash, and prompted Fed Chair Jerome Powell to order a review of the ethics rules for top officials.

The new rules were previewed in October, and “aim to support public confidence in the impartiality and integrity of the Committee’s work by guarding against even the appearance of any conflict of interest,” the central bank said in a statement

The Federal Open Market Committee announced on Friday that it had unanimously adopted the guidelines, which go into effect on May 1. These prohibit senior officials from purchasing individual stocks or sector funds, shorting a stock, entering into derivatives contracts, or purchasing securities on margins. They also prevent them from holding individual bonds, agency securities, cryptocurrencies, commodities or foreign currencies.

In addition, senior officials will be required to provide 45 days’ notice before selling or buying securities and obtain approval for the transactions. They will need to hold investments for at least one year. The requirements for advance notice and pre-clearance take effect on July 1. 

The committee will also extend a blackout trading period running up to regularly scheduled FOMC meetings by a day after each meeting.

People covered by the rules range from Fed Board members and Reserve Bank presidents to Reserve Bank first vice presidents, research directors, staff officers, and any other person designated by the Chair—and their spouses and minor children. 

When the changes take effect, Reserve Bank presidents will be required to publicly disclose any transactions within 30 days, as Board members currently do. Officials have 12 months from when the rules take effect to dispose of any impermissible holdings.

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NFTs Causing U.S. Treasury To Raise Alarm Over Money Laundering In Art Industry

The U.S. Treasury Department on Friday issued a set of recommendations to combat illicit finance in the high-value art market and warned that the emerging digital art market, such as non-fungible tokens (NFTs), may present new risks.

In a study published on Friday, the Treasury found that there is some evidence of money laundering risk in the high-value art market, but limited evidence of terrorist financing risk, the Treasury said in a statement.

It said that those most vulnerable in the market are businesses offering financial services that are not subject to anti-money laundering or countering terrorism financing obligations, warning that asset-based lending “can be used to disguise the original source of funds and provide liquidity to criminals.”

A senior Treasury official told reporters next steps include engaging stakeholders such as those in Congress or in the industry to get their feedback, adding that the Treasury hopes the study will encourage industries to take additional steps to make it harder to launder illicit proceeds through the art market. The Treasury will give further thought as to whether additional regulatory steps are needed in this market, the official said.

The study also said that depending on the structure and market incentives, the digital art market, such as NFTs, may present new risks, as the characteristics of digital art make it vulnerable to money laundering.

NFTs are a form of crypto asset which exploded in popularity last year. All kinds of digital objects – from art to videos and even tweets – can be bought and sold as NFTs, which use unique digital signatures to ensure they are one-of-a-kind.

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Who Will Become The World’s Crypto Capital? Miami Vs New York

When Blockchain.com was looking for a new home for its U.S. headquarters, it decided to leave New York and move to downtown Miami.

“New York is a great city,” says Peter Smith, the cryptocurrency company’s co-founder and CEO. “But Miami was an easy choice for us.”

Miami’s vibrant nightlife and warmer weather were certainly a draw, but according to Smith, the decision ultimately came down to the city being better aligned with his company’s goals.

“It’s the gateway to Latin America,” he says. “It’s on the East Coast time zone. And more importantly, it’s probably the most excited city in the world about crypto right now.”

Cryptocurrencies are seen by many as the future of finance, and Miami is aggressively angling to become the world’s crypto capital – in a direct threat to New York’s status as the country’s financial hub, threatening New York’s dominance in finance.

Smith credits Mayor Francis Suarez with raising the city’s profile. During his first term, Suarez has gone all in on Bitcoin and blockchain, the technology that underpins it.

Today, Miami has its own cryptocurrency, called MiamiCoin, and last year, it hosted one of the world’s largest digital currency conferences.

“Crypto is incredibly important to the future of the city, and to how we are positioning ourselves right now,” Suarez told NPR in a recent interview. “We really have created the epicenter for crypto.”

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Cryptocurrencies & Cannabis Are A Match Made In Heaven

Cryptocurrency is the solution to the cannabis industry’s banking problem that stems from the DEA’s outdated Schedule I status of cannabis as a controlled substance instead of the natural healing plant that it is. In comparison, investors of cryptocurrency and consumers of cannabis products are individuals of society who understand the power of innovation and elevation.

Article By K. Crystal Carter

K. Crystal Carter is originally from Oakland, California, where she was employed in banking for 7.5 years and a cannabis grow director and cannabis advocate at local City Hall meetings for 6 years. She currently resides in Las Vegas as one of the lead Earthy Realist team members.

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