And we whipsaw back to crypto and into the legal weeds again. Everyone keeping up? No? me neither.
This week, I discuss:
- Crypto in the US: Another regulatory win
- BlueCrest v HMRC: Leave to appeal granted with AIMA help
Stay frosty!
Read more hedge fund letters here
Drew Nicol, Director, Research and Communications, AIMA
Disclaimer: All views expressed in this blog are my own, not AIMA's.
Another win for US crypto as SEC withdraws custody statement following AIMA letter
SEC has withdrawn the 2019 Joint Staff Statement on Broker-Dealer Custody of Digital Asset Securities, which is something we asked for this in our recent letter to the Crypto Task Force.
The staff statement from both the SEC and FINRA provided temporary guidance for broker-dealers on how they could custody digital asset securities under certain conditions. The agencies now accept this guidance is no longer needed.
Jack Inglis, AIMA CEO, said: "We welcome the SEC’s decision to withdraw its previous guidance on broker-dealers and the custody of digital assets. In our recent submission to the SEC’s Crypto Task Force, we urged the Commission to rescind the Special Purpose Broker-Dealer (SPBD) Statement.
"We believe broker-dealers should be able to custody digital asset securities – alongside other digital and traditional assets – without the imposition of unduly restrictive conditions."
We expect developments in this space to come at a fairly regular clip from here.
BlueCrest granted leave to appeal versus UK HMRC following AIMA intervention
Last week the Supreme Court granted permission to BlueCrest Capital Management LLP to appeal against the decision of the Court of Appeal in BlueCrest’s dispute with HMRC.
AIMA intervened in BlueCrest’s application for permission to appeal and has been granted permission to intervene also in the substantive hearing of BlueCrest’s appeal.
The case concerns the “salaried members rules” which can apply to treat as employees for tax purposes individual members of a LLP who would otherwise be regarded as self-employed.
AIMA regards the Court of Appeal’s decision as potentially detrimental not only to alternative investment asset management businesses constituted (as is common) as a LLP but also to a wide range of LLP businesses.
If left unchallenged, the Court of Appeal’s decision could create significant uncertainty around the tax status of LLP members and undermine the commercial rationale for operating as an LLP, a structure widely used across the asset management industry to attract and retain talent through entrepreneurial and partnership-based models.
About AIMA:
The Alternative Investment Management Association (AIMA) is the global representative of the alternative investment industry, with around 2,100 corporate members in over 60 countries. AIMA’s fund manager members collectively manage more than US$3 trillion in hedge fund and private credit assets.
