cbdc:public:cbdc_omg:04_doc:15_common:48_natsec:start
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| | [[cbdc:public:cbdc_omg:04_doc:15_common:start| Return to Common Elements]] | <WRAP> | | [[cbdc:public:cbdc_omg:04_doc:15_common:start| Return to Common Elements]] | <WRAP> | ||
| <html><b> | <html><b> | ||
| - | <a href="mailto:[email protected]?Subject=OMG CBDC Response: | + | <a href="mailto:[email protected]?Subject=OMG's CBDC WG Response: |
| 4.5 National Security Considerations | 4.5 National Security Considerations | ||
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| The following Laws and Regulations governing Privacy, Money Laundering, Terrorism, and Financials apply in the U.S. and need to be part of any DIDO solution concerned with currency, money, financials, or cryptocurrencies. Often these Laws and Regulations are considered obstacles or barriers to innovation, but each law or regulation is developed in response to some situation that occurred in the past. To prevent a "modern" repeat of these situations, the laws and regulations should be upgraded, not ignored or overturned. | The following Laws and Regulations governing Privacy, Money Laundering, Terrorism, and Financials apply in the U.S. and need to be part of any DIDO solution concerned with currency, money, financials, or cryptocurrencies. Often these Laws and Regulations are considered obstacles or barriers to innovation, but each law or regulation is developed in response to some situation that occurred in the past. To prevent a "modern" repeat of these situations, the laws and regulations should be upgraded, not ignored or overturned. | ||
| - | Some of these Laws, Regulations, and Authorities have general applicability to DIDOs when the data stored within the DIDO refers to [[https://www.omgwiki.org/dido/doku.php?id=didopublic:ra:xapend:xapend.a_glossary:p:pii | Personal Identifiable Information (PII) ]] and therefore subject to the tenets of privacy. See [[https://www.omgwiki.org/dido/doku.php?id=didopublic:ra:xapend:xapend.a_glossary:r:right_to_privacy | Right to Privacy.]]. | + | Some of these Laws, Regulations and Authorities have general applicability to DIDOs when the data stored within the DIDO refers to [[https://www.omgwiki.org/dido/doku.php?id=didopublic:ra:xapend:xapend.a_glossary:p:pii | Personal Identifiable Information (PII) ]] and therefore subject to the tenets of privacy. See [[https://www.omgwiki.org/dido/doku.php?id=didopublic:ra:xapend:xapend.a_glossary:r:right_to_privacy | Right to Privacy.]]. |
| Some Laws, Regulations, and Authorities are relevant to DIDO when the DIDO is considered a [[https://www.omgwiki.org/dido/doku.php?id=dido:public:ra:xapend:xapend.a_glossary:f:financial_instrument | Financial Instrument]] or a [[https://www.omgwiki.org/dido/doku.php?id=didopublic:ra:xapend:xapend.a_glossary:s:security_finance | Security]]. Certain [[https://www.omgwiki.org/dido/doku.php?id=didopublic:ra:xapend:xapend.a_glossary:c:cryptocurrency | Cryptocurrencies]] and [[https://www.omgwiki.org/dido/doku.php?id=dido:public:ra:xapend:xapend.a_glossary:i:ico | Initial Coin Offerings (ICOs)]] may be found to meet the definition of an "investment contract" under the [[https://www.omgwiki.org/dido/doku.php?id=dido:public:ra:xapend:xapend.a_glossary:h:howey_test | Howey Test ]] from which the U.S. Supreme Court ruling determined that an Investment Contract must: | Some Laws, Regulations, and Authorities are relevant to DIDO when the DIDO is considered a [[https://www.omgwiki.org/dido/doku.php?id=dido:public:ra:xapend:xapend.a_glossary:f:financial_instrument | Financial Instrument]] or a [[https://www.omgwiki.org/dido/doku.php?id=didopublic:ra:xapend:xapend.a_glossary:s:security_finance | Security]]. Certain [[https://www.omgwiki.org/dido/doku.php?id=didopublic:ra:xapend:xapend.a_glossary:c:cryptocurrency | Cryptocurrencies]] and [[https://www.omgwiki.org/dido/doku.php?id=dido:public:ra:xapend:xapend.a_glossary:i:ico | Initial Coin Offerings (ICOs)]] may be found to meet the definition of an "investment contract" under the [[https://www.omgwiki.org/dido/doku.php?id=dido:public:ra:xapend:xapend.a_glossary:h:howey_test | Howey Test ]] from which the U.S. Supreme Court ruling determined that an Investment Contract must: | ||
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| - | <nspages :cbdc:private:cbdc_omg:04_doc:15_common:48_natsec -tree -r -exclude -subns -pagesInNs -h1 -textNs=""> | + | <nspages :cbdc:public:cbdc_omg:04_doc:15_common:48_natsec -tree -r -exclude -subns -pagesInNs -h1 -textNs=""> |
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| <table securityReq> | <table securityReq> | ||
| - | <caption>Examples of **security** Desirements identified during the White Paper Analysis conducted by the OMG</caption> | + | <caption>Examples of **security** Desirements identified during the White Paper Analysis conducted by the OMG's CBDC WG</caption> |
| |< 100% 20% ->| | |< 100% 20% ->| | ||
| ^ Category ^ Desirements ^ | ^ Category ^ Desirements ^ | ||
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| [[cbdc:public:cbdc_omg:04_doc:15_common:48_natsec:start| Return to Top]] | [[cbdc:public:cbdc_omg:04_doc:15_common:48_natsec:start| Return to Top]] | ||
| - | The "desirements" specified in [[https://www.omgwiki.org/CBDC/doku.php?id=cbdc:private:cbdc_omg:15_summary:start&do=edit | White Paper]] and identified by the [[https://www.omgwiki.org/CBDC/doku.php?id=cbdc:private:cbdc_omg:15_summary:start | OMG's White Paper Analysis]] as **Security Issues** are listed in Table {{ref>securityReqDiscussion}}. | + | The "desirements" specified in [[https://www.omgwiki.org/CBDC/doku.php?id=cbdc:public:cbdc_omg:15_summary:start&do=edit | White Paper]] and identified by the [[https://www.omgwiki.org/CBDC/doku.php?id=cbdc:public:cbdc_omg:15_summary:start | OMG's CBDC WG White Paper Analysis]] as **Security Issues** are listed in Table {{ref>securityReqDiscussion}}. |
| <table securityReqDiscussion> | <table securityReqDiscussion> | ||
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| </WRAP>| | </WRAP>| | ||
| ^ B0052 ^ Prevent Financial money laundering crimes |<WRAP> | ^ B0052 ^ Prevent Financial money laundering crimes |<WRAP> | ||
| - | There are already quite a few Laws and Regulations within the U.S. to cover [[cbdc:public:cbdc_omg:04_doc:15_common:48_natsec:40_launder| Money Laundering]]. However, within the context of CBDC, these laws need to be reviewed, updated or amended to reflect Digital Currency and how it might be used in Criminal Activities. | + | There are already quite a few Laws and Regulations within the U.S. to cover [[cbdc:public:cbdc_omg:04_doc:15_common:48_natsec:40_launder| Money Laundering]]. However, within the context of CBDC, these laws need to be reviewed, updated, or amended to reflect Digital Currency and how it might be used in Criminal Activities. |
| </WRAP>| | </WRAP>| | ||
| ^ B0053 ^ <WRAP> Provide resiliency to threats to existing payment services—including: | ^ B0053 ^ <WRAP> Provide resiliency to threats to existing payment services—including: | ||
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| <figure> | <figure> | ||
| - | {{ :cbdc:private:cbdc_omg:04_doc:15_common:48_natsec:layers_of_security.png?400 |}} | + | {{ :cbdc:public:cbdc_omg:04_doc:15_common:48_natsec:layers_of_security.png?400 |}} |
| <caption>The layers of Security.</caption> | <caption>The layers of Security.</caption> | ||
| </figure> | </figure> | ||
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| ** 4. Legal Frameworks: ** | ** 4. Legal Frameworks: ** | ||
| There are already legal frameworks in place to handle: | There are already legal frameworks in place to handle: | ||
| - | : a. [[https://www.omgwiki.org/CBDC/doku.php?id=cbdc:private:cbdc_omg:04_doc:15_common:45_privacy:start | National Privacy Considerations]] | + | : a. [[https://www.omgwiki.org/CBDC/doku.php?id=cbdc:public:cbdc_omg:04_doc:15_common:45_privacy:start | National Privacy Considerations]] |
| - | : b. [[https://www.omgwiki.org/CBDC/doku.php?id=cbdc:private:cbdc_omg:04_doc:15_common:48_natsec:start | National Security Considerations]] | + | : b. [[https://www.omgwiki.org/CBDC/doku.php?id=cbdc:public:cbdc_omg:04_doc:15_common:48_natsec:start | National Security Considerations]] |
| Although these frameworks were developed without a CBDC, they already //"comply with the United States are subject to robust rules"// and are continuously being reviewed, updated, and amended based on new information obtained from the field. As part of this process, these frameworks need to add to the existing frameworks rather than created new frameworks. | Although these frameworks were developed without a CBDC, they already //"comply with the United States are subject to robust rules"// and are continuously being reviewed, updated, and amended based on new information obtained from the field. As part of this process, these frameworks need to add to the existing frameworks rather than created new frameworks. | ||
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| There are two areas within the existing legal frameworks covering Illicit transactions: | There are two areas within the existing legal frameworks covering Illicit transactions: | ||
| - | : a. [[https://www.omgwiki.org/CBDC/doku.php?id=cbdc:private:cbdc_omg:04_doc:15_common:48_natsec:40_launder | Money Laundering]] | + | : a. [[https://www.omgwiki.org/CBDC/doku.php?id=cbdc:public:cbdc_omg:04_doc:15_common:48_natsec:40_launder | Money Laundering]] |
| - | : b. [[https://www.omgwiki.org/CBDC/doku.php?id=cbdc:private:cbdc_omg:04_doc:15_common:48_natsec:30_corrupt | Corruption ]] | + | : b. [[https://www.omgwiki.org/CBDC/doku.php?id=cbdc:public:cbdc_omg:04_doc:15_common:48_natsec:30_corrupt | Corruption ]] |
| Although these frameworks were developed without a CBDC, they already //"comply with the United States are subject to robust rules"// and are continuously being reviewed, updated, and amended based on new information obtained from the field. As part of this process, these frameworks need to add to the existing frameworks rather than created new frameworks. | Although these frameworks were developed without a CBDC, they already //"comply with the United States are subject to robust rules"// and are continuously being reviewed, updated, and amended based on new information obtained from the field. As part of this process, these frameworks need to add to the existing frameworks rather than created new frameworks. | ||
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| </WRAP>|<WRAP> | </WRAP>|<WRAP> | ||
| ** 1. Money Laundering: ** | ** 1. Money Laundering: ** | ||
| - | There are roughly **''11''** Laws and Regulations in the U.S. covering [[cbdc:public:cbdc_omg:04_doc:15_common:48_natsec:40_launder]] that have taken years to create, usually in response to known or discovered Money Laundering schemes that are continuing to evolve. In many ways, it is an //"Arms Race"//. The people with a need to launder money keep developing new ways around existing rules, requiring the government to create new rules. | + | There are roughly **''11''** Laws and Regulations in the U.S. covering [[cbdc:public:cbdc_omg:04_doc:15_common:48_natsec:40_launder]] that took years to create, usually in response to known or discovered Money Laundering schemes that are continuing to evolve. In many ways, it is an //"Arms Race"//. The people with a need to launder money keep developing new ways around existing rules, requiring the government to create new rules. |
| The CBDC must at least start from the same place as the existing systems with as many of the rules in place as possible in order to prevent the entire system from imploding. It also needs to assess the current sets of Laws and Regulations to determine if there are required updates or amendments that need to be made before the CBDC can "go live". | The CBDC must at least start from the same place as the existing systems with as many of the rules in place as possible in order to prevent the entire system from imploding. It also needs to assess the current sets of Laws and Regulations to determine if there are required updates or amendments that need to be made before the CBDC can "go live". | ||
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| Also, under the definition of [[cbdc:public:cbdc_omg:8_append:20_glossary:financial_crimes]] provided by the Federal Reserve, financial institutions must comply with a robust set of rules that are designed to combat Financial Crimes. These rules include [[https://www.omgwiki.org/dido/doku.php?id=dido:public:ra:xapend:xapend.a_glossary:c:cdd | Customer Due Diligence]], record keeping, and reporting requirements. | Also, under the definition of [[cbdc:public:cbdc_omg:8_append:20_glossary:financial_crimes]] provided by the Federal Reserve, financial institutions must comply with a robust set of rules that are designed to combat Financial Crimes. These rules include [[https://www.omgwiki.org/dido/doku.php?id=dido:public:ra:xapend:xapend.a_glossary:c:cdd | Customer Due Diligence]], record keeping, and reporting requirements. | ||
| - | Therefore, the CBDC should rely on the existing Intermediaries to help provide well documented, tried and true Record Keeping. Blockchain Technology may help alleviate some of the record-keeping responsibilities, but the blocks must include enough information to support **record-keeping** and **reporting requirements**. | + | Therefore, the CBDC should rely on the existing Intermediaries to help provide well-documented, tried, and true Record Keeping. Blockchain Technology may help alleviate some of the record-keeping responsibilities, but the blocks must include enough information to support **record-keeping** and **reporting requirements**. |
| ** 5. reporting requirements: ** | ** 5. reporting requirements: ** | ||
cbdc/public/cbdc_omg/04_doc/15_common/48_natsec/start.1652743813.txt.gz · Last modified: 2022/05/16 19:30 by terrance
