Laws move slower than markets. But they hit harder. This is issue #85 of The Bitcoin Act: your Tuesday and Sunday briefing on the legal and regulatory moves that actually shape Bitcoin.

Now for today’s top stories:

🎙️ Peirce's Parting Words
Departing SEC Commissioner Hester Peirce backed self-custody, developer protection and financial privacy. 

🏛️ California Bans Official Meme Coins
Newsom signed AB 2409, barring California officials from issuing meme coins. Bitcoin is untouched: no issuer, no official.

🧾 SEC Defines a True Receipt
SEC staff FAQs (no legal force) say a token is a receipt only if its issuer can't lend your deposit.

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In an exit interview with The Block, SEC Commissioner Hester Peirce backed self-custody, said developers shouldn't be liable when others misuse their tools, and criticized a financial surveillance regime that assumes nobody deserves privacy. Her last day: October 2.

Her words aren't law, and by her own account neither reform is done. She also said self-custody means no government safety net. Her priorities now rest with an SEC down to two commissioners.

The Block

On September 27, Governor Newsom signed AB 2409, barring California public officials from issuing meme coins and companies from listing coins bearing an official's likeness. The package also sets rules for seizing digital assets from criminal networks.

The meme coin ban can't touch Bitcoin: no issuer, no official, no face on the coin. New restitution rules cover scam victims. California stackers: if you're ever scammed, file a police report immediately and save every transaction ID.

Office of the Governor of California

On September 25, SEC staff issued non-binding FAQs (answers with no legal force), updated September 28. A token backed by deposited coins is a mere "receipt" only if the issuer can never lend, pledge, or rehypothecate (re-lend) those coins.

The FAQs don't protect anyone, but they point to the red flag. If a custodian or wrapped Bitcoin issuer can lend your deposit, you hold a claim, not sats. Search your custodian's terms for "rehypothecate" or "lend."

SEC Division of Corporation Finance FAQs

🔎 Iran's USDT Trail
A Senate report led by Sen. Richard Blumenthal found that 87% of 757 wallets tied to Iranian terror financing mainly used Tether's USDT stablecoin. Tether says it helped freeze $550 million in Iran-linked USDT.

🔓 Bitget's $388M Exploit
Bitget lost $388 million after an attacker used a zero-day (an unknown flaw) in a third-party security tool to fake withdrawal orders, its CEO says. Cold wallets were untouched, a protection fund covers the loss.

🇫🇷 France Flags Phishing
France's first crypto security forum named phishing, fueled by data leaks, the top threat, with physical attacks on holders rising. Panelists noted under 10% of criminal complaints in France lead to a judge-led investigation.

🇷🇺 Russia's Licensing Queue
From October 5, exchanges can apply to join the Bank of Russia's registry, but each needs approval. Bitcoin sits on a draft, not final, list for retail trading, with a 300,000-ruble yearly cap per platform.

🇪🇸 Spain Spares Self-Custody
Spain's tax authority confirmed coins in self-custody, where you control the keys, don't count toward Form 721, its report on crypto held with foreign custodians. EU DAC8 rules still require exchanges to log wallet withdrawals.

🇪🇺 ESMA's 2027 Agenda
ESMA, the EU's markets regulator, published its 2027 work plan: more uniform supervision of licensed crypto platforms across EU countries under MiCA, AI-based supervision tools, and continued work on tokenization.

🇭🇰 Hong Kong Audits Platforms
Hong Kong's securities regulator (SFC) and audit watchdog (AFRC) signed a deal on September 28 extending joint oversight to the financial reporting and audits of licensed brokers, crypto platforms and funds, including joint investigations.

🇰🇿 Flare Gas Mining
Kazakhstan is letting miners buy oil-field gas that would otherwise be burned off and use it to run their own power plants, keeping them off the strained grid. The legal framework is being drafted.

🇧🇷 Brazil Watches Withdrawals
From October 1, Brazilian institutions authorized by the central bank must report transfers of virtual assets worth $10,000 or more to or from self-custody wallets to Coaf, the country's financial intelligence unit.

🇪🇺 EBA's MiCA Wishlist
The EU's banking regulator (EBA) urged the European Commission to tighten stablecoin rules and regulate crypto lending, including decentralized lending apps, as it reviews MiCA, the EU's crypto law. Recommendations only, not rules.

Every week I answer one real question about Bitcoin law, regulation, or policy that affects your life as a stacker. No fluff. Just signal.

This week: How Does the IRS Track Your Bitcoin?

Much of what the IRS learns about your Bitcoin comes from paper trails: forms filed by exchanges, records demanded from companies, and your own tax return. Here's how each one works.

Got a legal or regulatory question you want answered next Tuesday? Hit reply and send it.

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