[Newsflash n. 63]

Consob, following its previous resolutions (see our Newsflashes n. 54 and n. 58), continues its strict monitoring on activities concerning crypto-assets addressed to Italian investors.

During the first week of May, Consob published the following Resolutions, where it has reiterated its firm view regarding the dealing in cryptocurrencies, in particular through internet:

1) Resolution No. 20907 – concerning the website https://cryptokartal.com/ and the company “Elmond Enterprise LTD” and “Fukazawa Partneritship OÜ”

2) Resolution No. 20908 – concerning the website https://cryptokartal.com/ and the company “Bitcoin Revolution”

3) Resolution No. 20909 – concerning the website https://bitcoin-code.eu and the company “BitCoin Code”

4) Resolution No. 20910 – concerning the website http://it.thebitcoinscodes.com/?TrackingID=769&ClickID=1024e37479bbedf8bc7def95e88c2d&SubCampaignID=1160 and the company “The-Bitcoin Codes”

5) Resolution No. 20928 – concerning the website www.mycrypto-invest.com <http://www.mycrypto-invest.com>  and the company “MyCrypto-Invest” ascribable to “Fintech Horizons Limited”.

The key points of the Regulator’s reasoning can be summarized as follows:

  • the websites (and hence the offers) are addressed to Italian investors, based on the circumstance that the language used to present the information is Italian and in some cases an Italian version of the website is made available;

  • after registration on the website and payment of a minimum deposit in EUR or dollars, the user is given access to an account for online trading involving different kind of products, including cryptocurrencies (such as Bitcoin);

  • according to Consob, these activities shall be deemed as provision in Italy of investment services (Resolutions nn. 20907 and 20928) or distance promotion and placement of investment services and activities (Resolutions nn. 20908, 20909 and 20910);

  •  with particular reference to the financial promotion carried on by “Bitcoin Revolution” and “BitCoin Code”, the online registration gives access to an online trading account of the broker “Brokerz” that has been already sanctioned and banned by Consob with Resolution No. 20835 of 27 February 2019 for the violation of Article 18 of Italian Financial Act (“TUF”);

  • the entities operating the websites in question do not have the authorization to provide investment services and activities to the Italian investors.

In light of the above, Consob has resolved that such activities constitute infringements of the Italian provisions of law on reserved activities, which are subject to the authorization requirement set out by Article 18.1 and 32.2 of TUF and of Articles 125.1 of Consob Regulation on Intermediaries No. 20307/2018. As a result, the Regulator has ordered to cease the above infringements, pursuant to Article 7-octies (1)(b) of TUF.

The above intervention by Consob aimed at tackling cases of breach of law coupled with the call for evidence to assess the introduction of an ad hoc regulation recently launched by the Regulator (see our Newsletter n.16), shows Consob’s strong commitment to address the growing phenomenon of crypto-assets and related ICO in order to grant the protection of investors and the orderly functioning of the market.

Please do not hesitate to contact us should you need any further clarification on the above and any other FinTech related matters.

Contacts:

Vito Vittore
Partner

Elena Pagnoni
Partner

Roberta Talone
Associate