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first_img Canada has launched a consultation on the stablecoin draft, maintaining the prohibition on yields

The Canadian Ministry of Finance has launched a 60-day public consultation on the stablecoin regulatory draft, which will end on December 23. The draft maintains the prohibition on stablecoin issuers paying interest or returns to holders, including arrangements that encourage customers to hold tokens through third parties, although rewards related to transactions may still be allowed.The draft requires non-bank issuers to back circulating fiat-pegged tokens with reserves held by qualified Canadian financial institutions at a 1:1 ratio. Qualified institutions include banks, credit unions, and trust companies. Holders must be able to redeem stablecoins for conventional currency within three business days, with a redemption fee cap of 1%. Earlier this year, the government passed the Stablecoin Act, stating that the draft is necessary for the law to take effect and will specify the requirements for issuers to register with the Bank of Canada. The stablecoin framework is expected to take effect by the end of 2027.A spokesperson for the Canadian Bankers Association stated to The Logic in June that the association firmly supports the explicit prohibition of direct and indirect returns in the Stablecoin Act, as the banking industry is concerned that stablecoin returns may lead to deposit outflows and reduce available lending funds. Coinbase Canada has received permission from the Ontario Securities Commission this year to offer returns on eligible tokens, but must warn of risks and clarify that funds are not covered by deposit insurance. At the end of last month, Canada's six largest banks announced they are exploring a Canadian dollar tokenization system to expedite fund transfers between traditional financial institutions.

first_img The Pentagon prohibits the U.S. military from betting on prediction markets using military information

U.S. Secretary of Defense Lloyd Austin has prohibited all Pentagon personnel from using non-public information to place bets on upcoming military operations, involving prediction market platforms such as Kalshi and Polymarket. In a memo sent to senior Pentagon officials and defense agencies on Tuesday, he stated that all Department of Defense personnel are prohibited from using non-public information for financial transactions, with the relevant restrictions covering both classified and unclassified information.Austin wrote in the memo that adversaries will observe movements in these markets, and the safety of U.S. military personnel often depends on the enemy not knowing what is about to happen. He also pointed out that, aside from operational security, financial betting can distort judgment: a logistics personnel betting on the date of an operation will be concerned about that date, and an analyst holding a position on the outcome will also be concerned about that outcome.Before this directive was issued, U.S. Army soldier Gannon Ken Van Dyke was charged in April for allegedly profiting over $400,000 on Polymarket by using classified information regarding the operation to capture Venezuelan leader Nicolás Maduro. Prosecutors claimed he participated in the planning and execution of the operation and used advance knowledge to bet on the outcome of Maduro's ousting; he pleaded not guilty to all charges. In February, Israeli authorities also arrested and charged a military reservist and a civilian for allegedly using classified information to bet on events related to Israeli strikes against Iran on Polymarket.

first_img The U.S. Department of Homeland Security requires civil agencies to remove DeepSeek and prohibits new purchases

The U.S. Department of Homeland Security (DHS) instructed U.S. civil agencies on Monday to remove products from the Chinese AI company DeepSeek from government IT systems, as well as any third-party services built on that model, and to prohibit new procurements. The notice stated that using DeepSeek could lead to the transfer of sensitive data to China and could generate intelligence targeting U.S. individuals and institutions. DHS indicated that these models constitute "multiple threat vectors."The ban targets not only DeepSeek's own applications but also covers third-party services based on its development. A DHS memorandum from July was made public on Monday, which had previously requested agencies to monitor the risks related to DeepSeek in the traffic in and out of government websites. The U.S. Department of Commerce, the Navy, and the states of New York, Tennessee, and Virginia had previously restricted DeepSeek. The Federal Communications Commission (FCC) will vote on October 29 to decide whether to ban all Chinese laboratories from testing electronic products used in the U.S.DeepSeek is a startup based in Hangzhou, and its open-source model attracted widespread attention on January 27, 2025, with development costs of less than $5 million, leading to a 16% drop in Nvidia's stock price that day, evaporating about $600 billion in market value. In April 2025, the U.S. House of Representatives' Special Committee on China Issues stated that DeepSeek might secretly send U.S. user data to the Chinese government and may have used about 60,000 Nvidia chips, of which 20,000 were subject to U.S. export controls. The V4-Pro model preview released by DeepSeek in April this year was priced about 98% lower than OpenAI's GPT-5.5 Pro and was made available for free download and modification under the MIT license; this week it also released an updated version of the V4.1-Flash model focused on efficiency optimization.

first_img The Central Bank of Russia prohibits withdrawing funds from regulated cryptocurrency accounts to self-custody wallets

On October 12, the Central Bank of Russia clarified in its updated guidelines that individuals are not allowed to withdraw cryptocurrency from regulated digital accounts to self-custodied wallets. The Central Bank stated that this restriction is based on Article 31(9) of the new Russian cryptocurrency market law (Federal Law No. 282-FZ), which will take effect on September 1, 2026. Digital accounts are statutory accounts used to record crypto assets, and digital custodians are registered institutions that register and transfer these assets and provide access to wallet addresses.This restriction applies to the withdrawal of funds under the regulated custodial system in Russia. For withdrawals from ordinary investment accounts, the rules cover resident individuals and do not provide exemptions for qualified investors. According to Article 31, individuals who pass the required tests and receive risk disclosures can transfer cryptocurrency to wallets managed by legally authorized foreign custodians, which is different from withdrawing to personal wallets outside of institutional custody. The law also sets exceptions for foreign trade settlements and mining.The Central Bank also stated that transfers between individuals using addresses managed by digital custodians are not allowed, including transfers generated from transactions between individuals. The aforementioned provisions belong to the general cryptocurrency market law and are not rules applicable only to participants in experimental projects. The Central Bank indicated that direct peer-to-peer transactions between individuals are only permitted until July 1, 2027, when Article 30(1) will take effect; thereafter, residents who are not authorized as intermediaries in the cryptocurrency market must complete transactions through or with the participation of authorized intermediaries, with optional channels including licensed brokers and operators of cryptocurrency exchanges listed in the Central Bank of Russia's registry.
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