digital assets – Fintechnically Speaking

A new California law, AB 2426, signed by Governor Gavin Newsome on September 24, 2024, requires any company offering online-only digital goods to California consumers using “buy,” “purchase” or similar terms to clarify whether or not the goods are a transfer of ownership or are instead a license to the purchaser.

In essence, the law bans digital storefronts from using terms like “buy” or “purchase” if there is no transfer of ownership unless they also inform customers that they are not getting unrestricted access to the digital items they are paying for. Online sites using “buy,” purchase” or similar terms when offering digital goods will have to prominently state that customers are getting a license that can be revoked and provide the terms of the license. Companies that do not could be fined for false advertising or potentially sued by consumers.

Read the full story on the Duane Morris LLP website.

By Joe Silvia

On October 3, 2024, the Society for Worldwide Interbank Financial Telecommunication (“SWIFT”), the global bank messaging network, announced plans to allow global financial institutions the ability to use its platform to conduct pilot transactions for the settlement of digital assets and currencies starting in 2025. This announcement is just the latest advancement for the digital assets ecosystem as it moves the settlement of digital assets and currencies from Swift experimentation to live transactions.

Swift indicated that “these trials will demonstrate how financial institutions can transact interchangeably across both existing and emerging asset and currency types using their current Swift connection” and the “trials aim to address a key challenge in the continuously evolving digital asset market: the rise of disconnected digital platforms, or ‘digital islands’, that could hinder more widespread adoption and ease of use for new forms of value.” Swift notes that its ultimate vision in this space is to give financial institutions a single point of access to multiple digital asset classes and currencies, and this move to pilot transactions “marks an important milestone” toward that ultimate vision.

While the announcement reflects the continued interest and demand for further integration of digital assets in the global financial system, we anticipate continued sluggish progress to that end given the broad range of stakeholder perspectives.

Tag: digital assets

California Requires Digital Storefronts to Avoid “Sales” Terms and Provide License Terms

Swift Pilots Live Digital Asset Transactions Beginning in 2025