Practice Test Geeks(CCA) Certified Cryptocurrency Auditor Practice Test
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Regulatory and Legal Frameworks Flashcards

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  1. Under the FATF Travel Rule, what threshold triggers the requirement to transmit originator and beneficiary information for virtual asset transfers?

    Answer: $1,000 USD or equivalent

    FATF Recommendation 16 requires VASPs to transmit originator and beneficiary information for virtual asset transfers at or above $1,000 USD (or equivalent in local currency).

  2. Which U.S. regulatory body has primary authority over cryptocurrency exchanges that list tokens deemed to be securities?

    Answer: SEC

    The SEC has primary authority over exchanges listing crypto tokens classified as securities under federal securities laws, including the Securities Exchange Act of 1934.

  3. New York's BitLicense, introduced in 2015, requires virtual currency businesses to do which of the following?

    Answer: Obtain a license from the NYDFS before conducting virtual currency business activity in New York

    The BitLicense regulation (23 NYCRR Part 200) requires any entity engaging in virtual currency business activity involving New York residents to obtain a license from the New York Department of Financial Services (NYDFS).

  4. Under U.S. law, which of the following best describes how the IRS treats cryptocurrency received as payment for services?

    Answer: It is treated as ordinary income at fair market value on the date received

    Per IRS Notice 2014-21 and subsequent guidance, cryptocurrency received for services is treated as ordinary income equal to the fair market value of the crypto on the date of receipt.

  5. Which international body sets the global Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) standards that most countries adopt for virtual assets?

    Answer: The Financial Action Task Force (FATF)

    FATF is the intergovernmental body that sets international AML/CTF standards; its 2019 amendment to Recommendation 15 specifically extended these standards to virtual assets and VASPs.

  6. A cryptocurrency exchange that operates as a Money Services Business (MSB) must file a Suspicious Activity Report (SAR) with FinCEN when a suspicious transaction involves at least:

    Answer: $5,000

    Under the Bank Secrecy Act, MSBs (including crypto exchanges) must file a SAR for suspicious transactions involving $5,000 or more.

  7. The EU's Markets in Crypto-Assets (MiCA) regulation primarily aims to:

    Answer: Create a harmonized regulatory framework for crypto-assets not covered by existing EU financial services law

    MiCA establishes a comprehensive, harmonized EU-wide regulatory framework for crypto-assets (including utility tokens, asset-referenced tokens, and e-money tokens) not already covered by existing financial services legislation.