Day: April 1, 2023

NFA issues new rule for digital asset commodities

by Blockchain News

The National Futures Association (NFA), the self-regulatory organization for derivatives markets in the United States, has issued a new compliance rule for its members engaged in digital asset commodities. The rule, which takes effect on May 31, is aimed at addressing fraud and misconduct committed by the over 100 NFA members involved in activities related to Bitcoin and Ether.

The NFA submitted the proposed new rule to the secretary of the Commodity Futures Trading Commission (CFTC) in a letter dated Feb. 28, 2023. The organization explained that while it has over 100 members engaged in activities with digital asset commodities, it had no way to address fraud or misconduct committed by those members. The new rule is designed to complement the requirements issued in 2018 and is modeled on the NFA’s antifraud rules for exchange-traded futures, swaps transactions, and retail foreign exchange.

As the only registered self-regulatory organization with delegated authority from the CFTC, the NFA has an analogous status to the Financial Industry Regulatory Authority with the Securities and Exchange Commission. Under the new rule, NFA members engaged in digital asset commodities will be subject to guidance on fraud, trade principles, and employee supervision.

Currently, the NFA only imposes disclosure requirements on its members engaged in spot commodity activities with digital assets. These requirements are detailed in a single document. However, with the new rule, members will be subject to more comprehensive guidelines that aim to promote fair and ethical conduct in the digital asset commodities market.

It’s important to note that the new rule applies only to Bitcoin (BTC) and Ether (ETH), as they are the only digital assets with related commodity interests certified by a registered entity for listing under Part 40 of CFTC Regulations. The NFA hopes that the new rule will help protect investors in the rapidly growing digital asset commodities market.

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Sango Coin Listing Delayed in Central African Republic

by Blockchain News

The Sango Project, the organization behind the launch of the Central African Republic’s Sango Coin, has announced a delay in its listing due to legal and regulatory obstacles. The project stated in a message on its Telegram channel on March 31 that the delay will only be for a few weeks before the legal frameworks are finalized.

The government of the Central African Republic has made significant progress in establishing laws and regulations that will allow Sango Coin to be listed on crypto exchanges. However, the Sango Project has decided to postpone the listing to ensure full compliance with all relevant regulations and to launch the product in the most secure and responsible manner possible.

The Sango Coin listing was one of the objectives of Project Sango, a crypto hub proposed in the Central African Republic in May 2022. The government of the Central African Republic had passed legislation allowing citizens to use Bitcoin (BTC) as legal tender alongside the CFA franc, leading to the proposal of the crypto hub.

Since its launch in July 2022, the Sango Project has marketed Sango Coin to interested parties by offering pathways to Central African Republic citizenship through investments. However, this strategy was reportedly declared unconstitutional by the country’s court system in August 2022. Despite this setback, the Sango Project announced in December that it plans to list the tokens at a price of $0.45.

The delay in listing Sango Coin is a setback for the Sango Project, but the organization remains optimistic about the future. The project stated that the delay is necessary to ensure compliance with all relevant regulations, and it hinted that there are new surprises to come along with these laws.

The Central African Republic’s move to embrace cryptocurrencies is an interesting development in the global financial landscape. While some countries have been cautious about embracing cryptocurrencies, others have seen them as an opportunity to modernize their financial systems and attract investment. It remains to be seen whether the Central African Republic will be successful in its efforts to establish itself as a hub for cryptocurrency in Africa, but the launch of Sango Coin is a step in the right direction.

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Bittrex to Wind Down US Operations

by Blockchain News

Cryptocurrency exchange Bittrex has announced that it will be winding down its operations in the United States due to a challenging regulatory and economic environment. The company’s co-founder and CEO, Richie Lai, stated that as the cryptocurrency ecosystem evolved, regulatory requirements have become increasingly “unclear” and “enforced, without appropriate discussion or input,” leading to an uneven competitive landscape. This environment has made it economically unviable for Bittrex to continue its operations in the United States.

Founded in 2014 by three cybersecurity engineers, Bittrex offered features such as a full-service API, near-instant atomic transactions, wallet infrastructure, and offline cold wallet solutions. However, the winding down of Bittrex’s US operations is a reminder of the challenges faced by cryptocurrency businesses navigating an uncertain regulatory environment.

The company’s founders have decided to focus on helping Bittrex Global succeed outside the United States. Bittrex clarified that US customers do not have to worry about the safety of their funds, as all of their capital is safe and available for withdrawal. The platform shared that it will permit trading until April 14, 2023, but advised customers to withdraw all funds by April 30, 2023.

Bittrex’s decision to wind down its US operations is not an isolated incident. On March 3, Ripple CEO Brad Garlinghouse warned that the Securities and Exchange Commission’s regulatory approach puts the US at “severe risk” of missing out on being an attractive hub for the next evolution of blockchain and crypto innovation. In a Bloomberg interview, Garlinghouse suggested that the crypto industry has “already started moving outside” of the US because the country’s crypto regulation is “behind” other nations like Australia, Japan, the United Kingdom, Singapore, and Switzerland.

The regulatory environment for cryptocurrencies in the US has been a subject of debate and discussion for some time. While some states, such as Wyoming, have taken a more lenient approach to cryptocurrency regulation, others have been more restrictive. In addition, the Securities and Exchange Commission (SEC) has been criticized for its lack of clarity regarding which cryptocurrencies qualify as securities and which do not. This lack of clarity has resulted in several high-profile legal battles between the SEC and cryptocurrency companies.

Despite these challenges, the cryptocurrency industry continues to grow and evolve. While Bittrex may be winding down its US operations, other exchanges and companies are likely to step in to fill the void. It remains to be seen how the regulatory environment for cryptocurrencies will evolve in the coming years, but one thing is clear: the demand for cryptocurrencies and blockchain technology shows no signs of slowing down.

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Bermuda Remains Committed to Crypto Despite FTX Collapse

by Blockchain News

Bermuda’s Premier and Finance Minister, Edward Burt, has affirmed the territory’s commitment to digital assets and blockchain technology, despite the collapse of crypto exchange FTX in nearby Bahamas in November 2022. Burt believes that the future of finance is digital, and there are still considerable benefits to be gained from these technologies. He noted that regulations in Bermuda have a minimal impact on the territory, and the regulations are clear and won’t change for any company.

Bermuda, a self-governing territory with a parliamentary government, was one of the first places to implement a regulatory framework for digital assets. It is just 915 miles away from the Bahamas, where FTX once operated, and Burt reportedly faced intense political pressure before the exchange’s failure as it chose the Bahamas instead of Bermuda for its headquarters. However, according to Burt, the latest events in the crypto industry had a minimal impact on the territory thanks to its regulations.

Burt recently met with United States lawmakers and government officials in Washington to discuss common standards for digital assets, as well as topics related to Bermuda’s finance and insurance sectors. He believes that regulators worldwide must work together to provide clarity for emergent technologies.

Despite the challenges, Bermuda continues to show a strong interest in digital assets. The territory recently released its first stablecoin, powered by the Polygon blockchain, in December 2022. The stablecoin focuses on enabling real-time settlements using a stablecoin with a 1:1 peg to the U.S. dollar.

Bermuda’s regulatory framework for digital assets has made it an attractive destination for crypto and blockchain companies. The territory’s government is actively encouraging companies to set up shop there and has implemented measures to streamline the registration process. In addition to the regulatory framework, Bermuda has a strong infrastructure, including high-speed internet, and skilled professionals in finance and technology.

Burt’s affirmation of Bermuda’s commitment to digital assets and blockchain technology is a positive sign for the crypto industry, which has faced significant regulatory challenges in recent years. The territory’s stable regulatory framework and commitment to innovation demonstrate that there are places where crypto and blockchain companies can thrive while adhering to regulations.

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Terra’s Partnership with Washington Nationals Raises Eyebrows

by Blockchain News

Baseball fans attending the opening day of the Major League Baseball (MLB) season at Nationals Park in Washington D.C. were greeted with an unexpected sight – the prominent display of Terra, the cryptocurrency ecosystem that collapsed in May 2022. A Twitter user who attended The Washington Nationals’ home opener against the Atlanta Braves on March 30 shared an image of Terra prominently displayed on a banner with the slogan, “a decentralized economy needs decentralized money.”

While some attendees were intrigued by the appearance of Terra, others were left questioning the wisdom of the partnership between Terra and the Washington Nationals. One Twitter user noted that the Terra Club, a VIP pre-game venue experience, was located behind home plate at Nationals Park, with “a big sign in left center” promoting Terra.

The partnership between Terra and the Washington Nationals had been in effect since February 2022, just months before Terra’s collapse. The Terra community had committed $38.2 million in TerraUSD (UST) over five years to secure the deal. Terra’s founder, Do Kwon, proposed the partnership through the community’s governance platform.

However, the timing of the collapse of Terra has left some investors in the cryptocurrency wondering if they will ever see a return on their investment. In May 2022, Terra’s price plummeted, wiping out billions of dollars in market value. The collapse was attributed to a combination of factors, including a lack of transparency, poor risk management, and overreliance on leverage.

Adding to the uncertainty surrounding Terra is the arrest of its founder, Do Kwon. Kwon is currently in police custody in Montenegro and is reportedly facing harsh conditions in the penal system. According to an unnamed criminal defense lawyer cited in a March 29 Protos report, the conditions at Montenegro’s jails and prisons “haven’t changed” from those described in a 2020 human rights report by the United States State Department. The report cited a 2015 case in which prison officers were convicted of torturing and “inflicting grievous bodily harm” on 11 inmates.

Despite the collapse of Terra and the arrest of its founder, the partnership with the Washington Nationals remains in effect. The prominent display of Terra at Nationals Park raises questions about the wisdom of partnering with a cryptocurrency ecosystem that has experienced such a dramatic collapse. It also highlights the potential risks associated with investing in cryptocurrencies, which remain largely unregulated and subject to extreme volatility.

In conclusion, the appearance of Terra at Nationals Park during the Washington Nationals’ home opener on March 30 has drawn attention to the cryptocurrency ecosystem’s collapse and its partnership with the baseball team. While some attendees were intrigued by Terra’s message of “decentralized money,” others were left questioning the wisdom of partnering with a company that has experienced such a dramatic collapse. The arrest of Terra’s founder, Do Kwon, and the potential risks associated with investing in cryptocurrencies underscore the need for caution when investing in these emerging technologies.

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Musk Requests Dismissal of $258 Billion Dogecoin Pyramid Scheme Lawsuit

by Blockchain News

Elon Musk, the billionaire entrepreneur and CEO of SpaceX and Tesla, is facing a $258 billion lawsuit accusing him of operating a pyramid scheme to promote the popular cryptocurrency Dogecoin (DOGE). However, Musk and his legal team are now pushing to have the lawsuit dismissed, stating that the allegations are baseless and lacking in evidence.

The lawsuit was filed by a group of Dogecoin investors in June 2022, who claimed that Musk had used his enormous social media influence to artificially inflate the price of DOGE, causing them to suffer significant financial losses when the cryptocurrency’s value subsequently plummeted. The investors also accused Musk of manipulating the cryptocurrency market to his own advantage, calling his actions a “dogecoin hustle.”

However, according to a Reuters report from April 1, Musk’s lawyers have now requested that the lawsuit be dismissed on the grounds that it is a “fanciful work of fiction” with no factual basis. The hearing took place on March 31 in Manhattan’s federal court, where Musk’s legal team argued that the investors’ claims were entirely without merit and should be thrown out.

This is not the first time that Musk has faced legal action related to his involvement with cryptocurrencies. In 2018, the US Securities and Exchange Commission (SEC) fined him $20 million for allegedly misleading investors with tweets about taking Tesla private. The SEC also required Musk to step down as the chairman of Tesla’s board of directors.

Despite the legal challenges, Musk remains a high-profile figure in the world of cryptocurrencies, and his social media posts about DOGE and other digital assets continue to garner significant attention from both fans and detractors alike.

In recent years, Musk has publicly expressed his support for cryptocurrencies, particularly DOGE, which he has referred to as “the people’s crypto.” However, his statements have also been criticized for their potential to influence the market and create volatility.

Despite the controversy surrounding Musk’s involvement with cryptocurrencies, many investors and traders remain bullish on DOGE and other digital assets, viewing them as a potentially lucrative investment opportunity. Whether the lawsuit against Musk will ultimately be successful remains to be seen, but it is clear that the world of cryptocurrencies continues to be a hotbed of legal and regulatory challenges.

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El Salvador Eliminates Taxes on Technology Innovations

by Blockchain News

El Salvador made history in September 2021 by becoming the first country to establish Bitcoin as a legal tender. The move was aimed at countering hyperinflation and dependence on the US dollar, which has long been a significant concern for the country. Since then, El Salvador has been restrategizing its Bitcoin investments and utilizing capital gains to rebuild the nation.

As part of its ongoing efforts to expedite technological development and attract international investment, President Nayib Bukele recently eliminated all income, property, and capital gains taxes on technology innovations. The move was intended to encourage local entrepreneurs and foreign investors to set up shop in El Salvador, positioning the country as a technological and economic power. The bill was officially sent to Congress on April 1, as promised.

To support this initiative, Bukele also established the National Bitcoin Office (ONBTC), which will work with Bitcoin entrepreneurs and companies to conduct joint initiatives. The Bitcoin Association of El Salvador has welcomed the move, stating that it aligns with its vision to make the country a hub for technological innovation and entrepreneurship.

In addition to promoting technological development, Bukele is also taking measures to reinvent El Salvador in other ways. One such measure is promoting tourism to boost the country’s economy. Bukele has been working with private companies to build beach resorts and theme parks to attract international visitors.

Another measure is countering terrorism. El Salvador has a long history of gang violence and crime, which has impacted the country’s economy and security. Bukele has been working to tackle this issue, and his administration has implemented several measures to address it, including deploying the military to high-crime areas.

Finally, Bukele is also focused on building regional business hubs to attract foreign investment. As part of this effort, El Salvador recently passed legislation to provide the legal framework for Bitcoin-backed bonds called Volcano Bonds. These bonds are named after the location of Bitcoin City, which is set to become a renewable crypto-mining hub powered by hydrothermal energy from the nearby Conchagua volcano.

In conclusion, El Salvador’s decision to eliminate taxes on technology innovations is a significant step towards its goal of becoming a technological and economic power. Along with the establishment of the National Bitcoin Office and the promotion of tourism and regional business hubs, El Salvador is positioning itself as an attractive destination for entrepreneurs and investors. These efforts are expected to have a positive impact on the country’s economy and overall development.

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Declining trend in physical crypto ATMs

by Blockchain News

Despite the growing global adoption rate of Bitcoin and other cryptocurrencies, the number of physical ATMs dedicated to fiat-crypto conversions is on the decline. Coin ATM Radar data reveals that 3,627 crypto ATMs were removed from the network in March 2023, bringing the total number of ATMs to 33,727. This represents a significant reduction in the number of crypto ATMs available for public use, and it marks a reversal of the trend that had been ongoing for most of the decade since the first Bitcoin ATM was launched on Oct. 29, 2013.

Net crypto ATM installations have generally remained positive over the years, indicating a steady increase in total crypto ATMs worldwide. However, the trend is now reversing, as shown by data from Coin ATM Radar. Between September 2022 and March 2023, net crypto ATM installations declined for four months. March 2023 stands out as the month with the largest monthly decline, with 3,627 crypto ATMs being removed from the network.

The chart above shows the number of Bitcoin machines installed over time, revealing the sudden drop in the total number of crypto ATMs. This reduction is significant, considering that the highest number of ATMs installed in a single month was 2,048, recorded back in January 2021.

Despite the decline, there is a bright side as April broke the three-month-long downtrend by recording 37 crypto ATM installations on April 1. General Bytes, BitAccess, and Genesis Coin are the current market leaders in manufacturing crypto ATMs. General Bytes, however, faced a security incident in March that saw its customers’ hot wallets accessed and lost some customer funds. The company promised to reimburse the losses and issued a statement saying, “We have taken immediate steps to prevent further unauthorized access to our systems and are working tirelessly to protect our customers.”

The decline in physical crypto ATMs could be due to several factors. One possible explanation is the growing use of digital wallets and online platforms that allow for easy cryptocurrency trading without the need for physical ATMs. Another possible factor is the lack of regulatory clarity in some countries, making it difficult for operators to comply with local laws and regulations. Additionally, the COVID-19 pandemic and associated lockdowns could have led to reduced demand for physical ATMs.

In conclusion, the declining trend in physical crypto ATMs is a cause for concern for those who prefer to use physical ATMs to convert fiat to cryptocurrencies. However, the emergence of digital wallets and online platforms provides an alternative means of accessing and trading cryptocurrencies. As the cryptocurrency market continues to evolve, it remains to be seen how physical crypto ATMs will adapt to changing market conditions and regulatory environments.

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South Korean Court Denies Arrest Warrant for Terraform Labs Co-Founder

by Blockchain News

A South Korean court has denied a request for an arrest warrant for Terraform Labs co-founder, Shin Hyun-Seong, also known as Daniel Shin. This marks the second attempt by South Korean authorities to bring Shin in for questioning, following the recent arrest of Terraform Labs’ other co-founder, Do Kwon.

Kwon was arrested at Podgorica airport in Montenegro on March 23 while attempting to use fake documents to travel abroad. The Seoul Southern District Prosecutors Office took advantage of this situation and requested an arrest warrant for Shin on March 27, citing his involvement in cashing in illicit profits from Terra (LUNA) and TerraUSD (UST) sales.

However, the Seoul Southern District Court denied the request, citing unconfirmed allegations and the unlikelihood of Shin being a flight risk or destroying evidence, according to local media Yonhap.

Shin currently faces multiple fraud charges, specifically in relation to allegedly hiding risks associated with investing in Terraform Labs’ in-house tokens. The denial of the arrest warrant is a setback for South Korean authorities attempting to bring Shin to justice.

Following Kwon’s arrest in Montenegro, authorities from both the United States and South Korea have attempted to extradite the entrepreneur. However, determining to which state he will be extradited is based on several factors, according to Montenegro’s Minister of Justice, Zoran Kovač.

“In the case when we receive several extradition requests, I would like to say that determining to which state they will be extradited is based on several factors like the severity of the committed criminal offense, the location and time when the criminal offense has been committed, the order in which we have received the request for extradition and several other factors,” said Kovač through an interpreter.

Terraform Labs is a blockchain company that has gained popularity for its decentralized stablecoin, UST, which is built on the Terra blockchain. The company has been involved in several high-profile partnerships, including with Binance, OKEx, and Huobi. However, the recent arrests of both of its co-founders have raised concerns about the company’s future and the integrity of its operations.

Terraform Labs has stated that it is cooperating with authorities and is committed to maintaining the highest standards of compliance and transparency. The company has also emphasized that its products and services remain unaffected by the ongoing legal proceedings.

The denial of the arrest warrant for Shin is likely to result in further scrutiny of Terraform Labs’ operations by regulatory authorities in South Korea and other countries. As the blockchain industry continues to grow and mature, incidents of fraud and non-compliance are likely to come under increasing scrutiny, and companies will need to be proactive in demonstrating their commitment to legal and ethical standards.

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Yuga Labs Appoints Former Activision Blizzard COO as CEO

by Blockchain News

Yuga Labs, the company behind popular NFT collections, Bored Ape Yacht Club and CryptoPunks, has announced the appointment of a new CEO, Daniel Alegre. Alegre joins the NFT startup following his resignation as the President and COO of Activision Blizzard, a gaming giant responsible for popular gaming franchises like Call of Duty, World of Warcraft, Diablo, and Candy Crush.

Alegre’s LinkedIn profile indicates that he has extensive experience in the gaming, entertainment, and technology industries. He previously worked for the German media conglomerate Bertelsmann for nearly six years before joining Google, where he served in various leadership positions overseeing operations in Asia Pacific and Latin America, as well as global shopping revenue and retail ecosystem engagement.

Alegre’s appointment was announced by Yuga Labs in December, and he officially joined the company on April 1. In a press release, Alegre expressed excitement about the company’s pipeline of products, partnerships, and intellectual property, stating that they represent a massive opportunity to define the metaverse.

However, Yuga Labs faces a class-action lawsuit filed in the United States in December, which accuses the creators of the Bored Ape Yacht Club of misleading investors about the financial benefits of Yuga securities. The lawsuit also claims that celebrity promoters were used to lure in more investors. Investors who bought Bored Ape Yacht Club and CryptoPunks between April 23, 2021, and December 8, 2022, may be entitled to compensation, according to Rosen Law Firm.

Apart from this, Yuga Labs co-founder, Wylie Aronow, took a leave of absence in January to prioritize his health following a congestive heart failure diagnosis. It is unclear when he will be able to resume his responsibilities.

Alegre’s appointment has been considered a bold move in the NFT industry. Kieran Warwick, co-founder of the blockchain role-playing game Illuvium, stated that Yuga Labs’ new hire is “big for all of GameFi,” suggesting that Web3 gaming will spark the next crypto bull run.

In conclusion, Yuga Labs has appointed a new CEO, Daniel Alegre, to lead its NFT startup that created the Bored Ape Yacht Club and CryptoPunks collections. Despite facing legal challenges and the absence of one of its co-founders due to health issues, Alegre’s appointment has been hailed as a significant move in the NFT industry.

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Bitcoin (BTC) $ 27,751.44 1.45%
Ethereum (ETH) $ 1,648.40 0.52%
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Bitcoin Cash (BCH) $ 232.45 2.23%