{"id":44822,"date":"2016-02-18T18:09:21","date_gmt":"2016-02-18T17:09:21","guid":{"rendered":"https:\/\/undsgn.com\/uncode_new\/?page_id=44822"},"modified":"2020-02-24T15:39:08","modified_gmt":"2020-02-24T15:39:08","slug":"classic-consultants","status":"publish","type":"page","link":"https:\/\/virtualcommodities.org\/","title":{"rendered":"VCA"},"content":{"rendered":"

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\n<\/a><\/p>\n

Our Mission<\/h5>\n

[\/vc_custom_heading][vc_column_text]Our mission as a non-profit organization of cryptocurrency exchanges and custodians is to establish an industry-sponsored, self-regulatory organization (SRO) designation for U.S. cryptocurrency marketplaces to oversee virtual commodity marketplaces.<\/span><\/em>[\/vc_column_text][\/vc_column][\/vc_row][vc_row][vc_column][vc_column_text]
\n[\/vc_column_text][\/vc_column][\/vc_row][vc_row row_height_percent=”0″ override_padding=”yes” h_padding=”2″ top_padding=”3″ bottom_padding=”1″ back_color=”color-lxmt” overlay_alpha=”0″ gutter_size=”100″ column_width_percent=”100″ shift_y=”0″ z_index=”0″ style=”inherited”][vc_column column_width_percent=”100″ overlay_alpha=”100″ gutter_size=”4″ medium_width=”0″ mobile_width=”0″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ zoom_width=”0″ zoom_height=”0″ width=”1\/1″][vc_custom_heading text_size=”fontsize-953248″ text_weight=”500″ text_transform=”uppercase” text_color=”color-prif” separator=”yes”]
\n<\/a><\/p>\n

Background<\/h5>\n

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The VCA began as a working group in 2018 working towards the goal of establishing an industry-sponsored, self-regulatory organization for the U.S. virtual currency industry, specifically<\/span> virtual commodity<\/i><\/b>\u00a0<\/i><\/span>marketplaces.<\/span><\/span><\/h3>\n

During 2019, the VCA launched six committees, appointed two special advisors, and board leadership appointments to help set standards, sound practices, and oversight to self-regulate cryptocurrency marketplaces.<\/span><\/p>\n

Several regulatory agencies have called upon the cryptocurrency industry to provide better oversight and surveillance of cryptocurrency markets. The VCA wants to address these concerns, while beginning to create a regulatory framework for virtual commodity marketplaces. These committees will adopt best practices and standards commonplace in traditional financial markets.<\/span>
\n[\/vc_column_text][vc_tabs vertical=”yes”][vc_tab title=”Virtual Commodity Designation” tab_id=”1534168859-1-41″][vc_column_text]When evaluating this need, it is important to first note that the term virtual currency (often used interchangeably with the terms \u201cdigital asset,\u201d \u201cdigital currency,\u201d or \u201ccryptocurrency\u201d) can refer to different asset types including virtual commodities (e.g., bitcoin, ether) or securities. The specific designation depends on the individual facts and circumstances of each digital asset\u2019s characteristics (e.g., speech<\/span><\/a> by William Hinman, Director of the Securities and Exchange Commission (SEC) Division of Corporation Finance Speech explaining his view of the ether token). The legal status of bitcoin as a commodity was articulated by the Commodity Futures Trading Commission (CFTC) in the 2015 order against Coinflip, Inc. This order stated that \u201cBitcoin and other virtual currencies\u201d fall under the definition of a \u201ccommodity\u201d as defined in Section 1a(9) of the Commodity Exchange Act of 1936 (CEA). The order was recently favorably cited by the U.S. District Court for the Eastern District of New York, in its opinion holding that bitcoin was a commodity.<\/span>
\n[\/vc_column_text][\/vc_tab][vc_tab title=”Virtual Commodity Jurisdiction” tab_id=”1534187751885-2-8″][vc_column_text]
\nVirtual commodities like bitcoin and ether are \u201cexempt commodities,\u201d which means the CFTC puts them in the same category as metals and energy commodities, including gold, silver, oil, and natural gas. The cash markets (or spot markets) for exempt commodities, including virtual commodities, do not fall under the jurisdiction of the CFTC; however, the CFTC does have fraud and manipulation enforcement jurisdiction over these markets and market participants under the Commodity Exchange Act (CEA). By contrast, security tokens and cash markets for security token transactions fall under the direct jurisdiction of the SEC and the federal securities laws, rules, and regulations.
\n<\/span><\/p>\n

The purchase and sale of commodities in the spot\/cash markets has been historically exempt from the CEA and CFTC jurisdiction. Nevertheless, cash markets for virtual commodities \u2013 as it is a less well known industry \u2013 can benefit from an additional layer of oversight. We believe that adding this layer can provide even more protection for consumers and ensure the integrity of these markets and growing industry.<\/span>[\/vc_column_text][\/vc_tab][\/vc_tabs][vc_empty_space empty_h=”3″][\/vc_column][\/vc_row][vc_row row_height_percent=”0″ override_padding=”yes” h_padding=”2″ top_padding=”1″ bottom_padding=”0″ overlay_alpha=”0″ gutter_size=”100″ column_width_percent=”100″ shift_y=”0″ z_index=”0″ style=”inherited”][vc_column column_width_percent=”100″ overlay_alpha=”100″ gutter_size=”4″ medium_width=”0″ mobile_width=”0″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ zoom_width=”0″ zoom_height=”0″ width=”1\/1″][vc_empty_space empty_h=”1″][vc_custom_heading text_size=”fontsize-953248″ text_weight=”500″ text_transform=”uppercase” text_color=”color-prif” separator=”yes”]<\/a>Governance
\n[\/vc_custom_heading][vc_column_text css=”.vc_custom_1534525104860{margin-top: 36px !important;}”]<\/p>\n

The VCA is governed by a Board of Directors\u200a and capitalized by members. The Board structure (including a required number of independent directors) has been established. The primary function of the Board will be to facilitate the goals and mission of the VCA, potentially including the issuance of reports regarding the standards set forth by the VCA.<\/h3>\n

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\n[\/vc_column_text][\/vc_column][\/vc_row][vc_row unlock_row=”” row_height_percent=”0″ override_padding=”yes” h_padding=”2″ top_padding=”2″ bottom_padding=”2″ back_color=”accent” overlay_alpha=”50″ gutter_size=”3″ column_width_percent=”100″ border_style=”solid” shift_y=”0″ z_index=”0″ css=”.vc_custom_1534193439116{margin-top: 34px !important;margin-bottom: 64px !important;}”][vc_column width=”1\/1″][vc_column_text]<\/p>\n

The VCA…<\/h3>\n

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\n1<\/span><\/p>\n


\n…is a non-profit, independent organization that does not operate any markets
\n<\/span><\/p>\n

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\n2<\/span><\/p>\n


\n…is not a trade association
\n<\/span><\/p>\n

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\n3<\/span><\/p>\n


\n…is working towards establishing itself as an SRO
\n<\/span><\/p>\n

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\n4<\/span><\/p>\n


\n…does not provide regulatory programs for security tokens or security token platforms
\n<\/span><\/p>\n

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\n5<\/span><\/p>\n


\n…will adopt, monitor, and enforce global standards and best practices for SROs
\n<\/span><\/p>\n

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\n[\/vc_column_text][\/vc_column][\/vc_row][vc_section][vc_row row_height_percent=”0″ override_padding=”yes” h_padding=”2″ top_padding=”3″ bottom_padding=”0″ back_color=”color-lxmt” overlay_alpha=”50″ equal_height=”yes” gutter_size=”4″ column_width_percent=”100″ border_color=”color-gyho” border_style=”solid” shift_y=”0″ z_index=”0″ css=”.vc_custom_1534183879796{border-top-width: 0px !important;}”][vc_column column_width_percent=”100″ position_horizontal=”right” position_vertical=”middle” overlay_alpha=”50″ gutter_size=”3″ medium_width=”7″ shift_x=”0″ shift_y=”0″ z_index=”0″ width=”1\/1″][vc_custom_heading text_size=”fontsize-953248″ text_weight=”500″ text_transform=”uppercase” text_color=”color-prif” separator=”yes” sub_lead=”yes”]
\n<\/a>Committees and Advisors
\n[\/vc_custom_heading][vc_column_text]<\/p>\n

Members shall work with the VCA and its six committees to adopt and follow sound practices<\/h3>\n

[\/vc_column_text][\/vc_column][\/vc_row][vc_row][vc_column][vc_column_text]<\/p>\n

[\/vc_column_text][\/vc_column][\/vc_row][vc_row row_height_percent=”0″ override_padding=”yes” h_padding=”2″ top_padding=”3″ bottom_padding=”0″ back_color=”color-lxmt” overlay_alpha=”50″ gutter_size=”4″ column_width_percent=”100″ border_color=”color-gyho” border_style=”solid” shift_y=”0″ z_index=”0″][vc_column column_width_percent=”100″ position_horizontal=”left” overlay_alpha=”50″ gutter_size=”3″ medium_width=”7″ mobile_width=”0″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ width=”1\/4″][vc_custom_heading heading_semantic=”h3″ text_size=”h4″ text_weight=”300″]
\nBoard of Directors<\/strong>
\n[\/vc_custom_heading][vc_column_text]President<\/b> \u2010 Yusuf Hussain (Head of Risk at Gemini Trust Company, LLC)
\nSecretary<\/b> \u2010 Zachary Figueroa (Head of Legal and Regulatory Affairs at bitFlyer USA, Inc)
\n<\/span>[\/vc_column_text][\/vc_column][vc_column width=”1\/4″][vc_custom_heading heading_semantic=”h3″ text_size=”h4″ text_weight=”300″]
\nSpecial Advisors<\/strong>
\n[\/vc_custom_heading][vc_column_text]
\nEllen Zimiles and Alma Angotti (Navigant Consulting, Inc.)
\nDana Syracuse (Perkins Coie, LLP)
\n<\/span>
\n[\/vc_column_text][\/vc_column][vc_column width=”1\/4″][vc_custom_heading heading_semantic=”h3″ text_size=”h4″ text_weight=”300″]
\nBSA\/AML<\/strong>
\n[\/vc_custom_heading][vc_column_text]
\nLed by: Michael Carter (Alvarez & Marsal)<\/span><\/p>\n

Apply Bank Secrecy Act BSA\/AML and Know Your Customer (KYC) controls, including blockchain analytics, transaction monitoring and investigations.<\/p>\n

[\/vc_column_text][\/vc_column][vc_column column_width_percent=”100″ overlay_alpha=”50″ gutter_size=”3″ medium_width=”0″ mobile_width=”0″ shift_x=”0″ shift_y=”0″ shift_y_down=”0″ z_index=”0″ width=”1\/4″][vc_custom_heading heading_semantic=”h3″ text_size=”h4″ text_weight=”300″ sub_lead=”yes”]
\nCustody and Security<\/strong>
\n[\/vc_custom_heading][vc_column_text]
\nLed by: Adam Cohen (Redgrave LLP) and Nicole Becher<\/span><\/p>\n

Focus on implementing custody protections and security measures and maintaining current best practices for cryptocurrency custody, which is based heavily on cryptographic principles.<\/p>\n

[\/vc_column_text][\/vc_column][\/vc_row][vc_row][vc_column][vc_column_text]<\/p>\n

[\/vc_column_text][\/vc_column][\/vc_row][vc_row row_height_percent=”0″ override_padding=”yes” h_padding=”2″ top_padding=”3″ bottom_padding=”4″ back_color=”color-lxmt” overlay_alpha=”50″ gutter_size=”4″ column_width_percent=”100″ border_color=”color-gyho” border_style=”solid” shift_y=”0″ z_index=”0″][vc_column width=”1\/4″][vc_custom_heading heading_semantic=”h3″ text_size=”h4″ text_weight=”300″]
\nEnforcement<\/b>
\n[\/vc_custom_heading][vc_column_text]
\nLed by: Philip Moustakis (Seward & Kissel, LLP)<\/span><\/p>\n

Enforce the regulatory framework established by the VCA, keeping the VCA members accountable. This includes maintaining a system of marketplace conduct rules, implementing policies and procedures, and responding to and addressing customer concerns and complaints.<\/p>\n

[\/vc_column_text][\/vc_column][vc_column width=”1\/4″][vc_custom_heading heading_semantic=”h3″ text_size=”h4″ text_weight=”300″ sub_lead=”yes”]
\nInsurance<\/b>
\n[\/vc_custom_heading][vc_column_text]
\nLed by: Matthew Gaul (Mayer Brown, LLP) and Alexander Sand (Eversheds Sutherland US, LLP)<\/span><\/p>\n

Establish minimum, appropriate insurances and coverages for cryptocurrency exchanges and custodians.<\/p>\n

[\/vc_column_text][\/vc_column][vc_column width=”1\/4″][vc_custom_heading heading_semantic=”h3″ text_size=”h4″ text_weight=”300″]
\nMarket Integrity<\/b>
\n[\/vc_custom_heading][vc_column_text]
\nLed by: Michael Roe (Exiger)<\/span><\/p>\n

Facilitate cross-market information sharing, consolidated audit trails and cross-market surveillance to detect and deter manipulative and fraudulent activity.<\/p>\n

[\/vc_column_text][\/vc_column][vc_column width=”1\/4″][vc_custom_heading heading_semantic=”h3″ text_size=”h4″ text_weight=”300″ sub_lead=”yes”]
\nTax<\/b>
\n[\/vc_custom_heading][vc_column_text]
\nFocus on establishing tax framework and interpreting and establishing tax code law as it relates to cryptocurrency trading.
\n<\/span>
\n[\/vc_column_text][\/vc_column][\/vc_row][\/vc_section][vc_row][vc_column][vc_column_text]<\/p>\n

[\/vc_column_text][\/vc_column][\/vc_row][vc_row row_height_percent=”0″ override_padding=”yes” h_padding=”2″ top_padding=”3″ bottom_padding=”4″ back_color=”color-prif” overlay_alpha=”50″ gutter_size=”3″ column_width_percent=”100″ shift_y=”0″ z_index=”0″][vc_column width=”1\/1″][vc_custom_heading text_size=”fontsize-953248″ text_weight=”500″ text_transform=”uppercase” text_color=”color-lxmt” separator=”yes”]
\n<\/a>Working Group Members
\n[\/vc_custom_heading][vc_row_inner row_inner_height_percent=”0″ overlay_alpha=”50″ equal_height=”yes” gutter_size=”4″ shift_y=”0″ z_index=”0″ css=”.vc_custom_1534186696316{padding-top: 34px !important;}”][vc_column_inner width=”1\/2″][vc_single_image media=”72872″ media_width_percent=”60″][\/vc_column_inner][vc_column_inner width=”1\/2″][vc_single_image media=”72909″ media_width_percent=”100″][\/vc_column_inner][\/vc_row_inner][\/vc_column][\/vc_row][vc_row][vc_column][vc_column_text]
\n[\/vc_column_text][\/vc_column][\/vc_row][vc_row row_height_percent=”0″ override_padding=”yes” h_padding=”2″ top_padding=”4″ bottom_padding=”0″ overlay_alpha=”50″ gutter_size=”3″ border_color=”color-gyho” border_style=”solid” shift_y=”0″ css=”.vc_custom_1459355823506{border-top-width: 1px !important;}”][vc_column column_width_percent=”100″ overlay_alpha=”50″ gutter_size=”3″ medium_width=”0″ shift_x=”0″ shift_y=”0″ z_index=”0″ width=”1\/1″][vc_custom_heading text_size=”fontsize-953248″ text_weight=”500″ text_transform=”uppercase” text_color=”color-prif” separator=”yes”]
\n<\/a>Contact
\n[\/vc_custom_heading][vc_column_text]<\/p>\n

We appreciate your interest and support.<\/span><\/h3>\n

For press\/media related inquiries, please email press@virtualcommodities.org<\/span><\/a>.<\/span><\/h3>\n

If you are interested in becoming a future member of, or looking for further information about the VCA, please email\u00a0<\/span>inquiries@virtualcommodities.org<\/span><\/a>.\u00a0<\/span><\/h3>\n

We look forward to engaging with industry leaders, participants, regulators, and legislators on this proposal.<\/span><\/h3>\n

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