Tag: Crypto Assets

Even Mark Cuban Isn’t Immune: CZ’s Essential Guide to Fortifying Your Crypto Assets

by Blockchain News

In a recent tweet, Changpeng Zhao (CZ), the CEO of Binance, highlighted the vulnerability of even the most seasoned crypto users, referencing the recent incident where entrepreneur Mark Cuban confirmed he was hacked for $870,000 on MetaMask. CZ emphasized the importance of security awareness and practices in the crypto space, pointing to an article he penned three years ago on Binance’s official blog.

The tweet from CZ read: “Mark Cuban Confirms Getting Hacked for $870K on MetaMask. This happens to the most experienced of crypto users. Read this article I wrote 3 years ago. There is a section about downloading software, wait 72 hrs, etc. Stay #SAFU.”

In the linked article titled “Keep Your Crypto #SAFU (CZ’s Tips)” on Binance’s blog, CZ delves deep into the nuances of crypto security. He stresses that while security is paramount, there’s a noticeable gap in security awareness among everyday users. He also notes the challenges experts face in designing user-friendly security setups that don’t compromise on robustness.

A few key takeaways from the article include:

The acknowledgment that no system is 100% secure. The goal is to make it “safe enough” based on the value of assets being protected.

The importance of understanding basic security concepts, especially when deciding between storing coins personally or on a centralized exchange.

The three primary objectives for securing coins: preventing theft, avoiding personal loss, and ensuring a method to pass them on in unforeseen circumstances.

A detailed discussion on the pros and cons of different storage methods, including personal devices, hardware wallets, and centralized exchanges.

The significance of securing one’s email account, using strong and unique passwords, and the role of two-factor authentication (2FA).

CZ’s emphasis on security comes at a time when the crypto market is buzzing with activity and attracting a new wave of participants. His insights serve as a reminder that while the crypto landscape offers immense opportunities, it also comes with its set of challenges, especially in the realm of security.

In conclusion, as the crypto community continues to grow and evolve, the importance of security cannot be overstated. Whether you’re a seasoned expert or a newcomer, staying informed and vigilant is the key to safeguarding your assets in the digital realm.

Disclaimer & Copyright Notice: The content of this article is for informational purposes only and is not intended as financial advice. Always consult with a professional before making any financial decisions. This material is the exclusive property of Blockchain.News. Unauthorized use, duplication, or distribution without express permission is prohibited. Proper credit and direction to the original content are required for any permitted use.

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Bittrex Files Motion to Dismiss SEC Charges

by Blockchain News

A motion to dismiss the case has been filed on behalf of Bittrex and its co-founder, William Hiroaki Shihara. The motion, filed on July 2, 2023, argues that the SEC lacks the authority to regulate crypto assets as securities and that the Commission has failed to provide adequate notice of the alleged securities law violations.

The SEC had previously charged Bittrex, Shihara, and Bittrex’s foreign affiliate, Bittrex Global GmbH, with operating an unregistered national securities exchange, broker, and clearing agency. This followed a six-year investigation into the company’s operations. However, the defendants are now challenging the SEC’s authority to regulate crypto assets as securities, a major question that they argue Congress has not clearly authorized.

Furthermore, the motion to dismiss argues that the SEC has not provided sufficient evidence to support its claims that securities transactions occurred on the Bittrex platform. The defendants contend that the SEC’s allegations require proof of “Investment Contracts” being traded on the platform, a requirement they claim the SEC has failed to meet.

The motion also seeks to dismiss the control person liability claim against Shihara, arguing that the SEC has failed to provide fair notice of the alleged securities law violations. The case, filed in the United States District Court for the Western District of Washington at Seattle, is scheduled for oral argument on September 8, 2023.

This legal development comes after Bittrex filed for bankruptcy protection in May 2023, following the SEC’s charges. The Seattle-based company ceased operations in the United States on April 30, 2023, but assured that the bankruptcy filing would not impact Bittrex Global, which serves customers outside the United States.

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World Economic Forum Paves Way for Global Crypto-Asset Regulation

by Blockchain News

The World Economic Forum (WEF) recently published a white paper titled “Pathways to the Regulation of Crypto-Assets: A Global Approach,” advocating for a collaborative approach towards crypto regulation on a global scale.

The white paper highlights the unique challenges and necessary considerations regarding the regulation of crypto-assets. Considering the borderless, open-source, decentralized nature of these digital currencies, their regulation requires a delicate balance between preventing harm, protecting users, and promoting innovation.

The WEF acknowledges significant progress made so far, especially through the involvement of numerous international organizations like FSB, IMF, BIS, OECD, IOSCO, and national regulators such as the EU, Singapore, Japan, the UAE, India, South Africa, the US, among others. However, many pertinent questions remain under discussion, including how to define and classify crypto-assets, adapting to a rapidly evolving ecosystem, and maintaining effective regulatory oversight.

The white paper outlines several challenges in implementing a global regulatory approach, including lack of harmonized classifications, regulatory arbitrage, and fragmented monitoring. The WEF suggests these hurdles can be overcome through collaboration among policymakers, regulators, and industry.

The report analyses the wide spectrum of regulatory approaches adopted by different jurisdictions such as principle-based, risk-based, agile regulation, self and co-regulation, and regulation by enforcement. A broad and global view of the topic was ensured by consulting diverse stakeholders of the Digital Currency Governance Consortium (DCGC) while evolving recommendations.

The white paper concludes that a global approach to regulating crypto-assets is ideal, urging international organizations, national/regional authorities, and industry stakeholders to consider its findings in developing a coordinated approach to crypto-asset regulation. It also emphasizes the need for academia, civil society, and users’ involvement in evolving a responsible ecosystem.

In conclusion, the WEF white paper outlines an urgent need for stakeholders worldwide to collaborate in formulating comprehensive crypto-asset regulations. As the crypto-asset ecosystem continues to evolve, this paper will serve as an important guidepost for shaping the future of digital currency governance.

To delve deeper into blockchain and crypto, please read our exclusive interview with Nadia Hewett, the blockchain project lead of the World Economic Forum, whose insights on these matters offer invaluable context and clarity on the path forward in this complex, rapidly-evolving sector.

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FTX Group and Alameda Research Recover Crypto Assets

by Blockchain News

After filing for bankruptcy and coming under new management, FTX Group and its affiliated companies, including Alameda Research, have been actively trying to recover funds from firms they previously sent crypto to.

FTX reached a settlement with hedge fund Modulo Capital on March 23, allowing it to recover $460 million previously invested in the fund. On May 4, FTX filed a motion to claw back $4 billion it allegedly lent to bankrupt crypto lending firm Genesis Global.

Meanwhile, Alameda Research recently received approximately $60 million worth of digital assets from OKX as part of a recovery effort to pay back customers of FTX. According to data from crypto analytics platform Arkham Intelligence, the funds included Mask Network (MASK) tokens and the Tether (USDT) stablecoin, and were spread out among 16 separate transactions.

Alameda Research currently holds over $284 million worth of assets in its crypto wallets, with its largest holdings being USDT, BitDAO (BIT), Ether (ETH), and Stargate Finance (STG).

FTX and Alameda Research’s recovery efforts come after a tumultuous period that saw the companies file for bankruptcy in November following a liquidity crisis. Alameda Research’s former CEO, Caroline Ellison, has been charged with fraud for allegedly colluding with former FTX CEO Sam Bankman-Fried to misappropriate FTX customer funds.

In summary, FTX Group and Alameda Research are making progress in recovering lost crypto assets, with FTX reaching a settlement with Modulo Capital and seeking to claw back funds from Genesis Global, while Alameda Research received $60M from OKX in a recovery effort. The recovery efforts come after FTX Group and its affiliated companies filed for bankruptcy in November following a liquidity crisis.

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OKX Sends $60M to Alameda Research

by Blockchain News

On May 9, crypto exchange OKX transferred approximately $60 million worth of digital assets to wallets associated with failed hedge fund Alameda Research. According to data from crypto analytics platform Arkham Intelligence, the funds were spread out among 16 separate transactions and included approximately 337.9 million Mask Network (MASK) tokens worth $1.3 million, as well as $57.77 million worth of the Tether (USDT) stablecoin.

Alameda Research currently holds over $284 million worth of assets in its crypto wallets, with its largest holdings being USDT, BitDAO (BIT), Ether (ETH), and Stargate Finance (STG).

It is believed that the funds sent by OKX may have been part of a recovery effort to pay back customers of its sister company FTX. On March 30, OKX announced that it planned to return approximately $157 million it held on behalf of FTX and Alameda, which it had frozen in November to safeguard them. FTX had filed a motion on March 30 to force OKX to release the funds to pay back creditors, which OKX said it “welcomed.”

After filing for bankruptcy and coming under new management, FTX and Alameda Research have been aggressively trying to recover funds from firms they previously sent crypto to. On March 23, FTX reached a settlement with hedge fund Modulo Capital, allowing it to recover $460 million previously invested in the fund. On May 4, FTX filed a motion to claw back $4 billion it allegedly lent to bankrupt crypto lending firm Genesis Global.

FTX Group and roughly 130 companies under its umbrella, including Alameda Research, filed for bankruptcy in November after the crypto exchange suffered a liquidity crisis. Alameda Research’s former CEO, Caroline Ellison, has been charged with fraud for allegedly colluding with former FTX CEO Sam Bankman-Fried to misappropriate FTX customer funds. She pleaded guilty to the charges on Dec. 22. However, Bankman-Fried has pleaded not guilty and has sought to dismiss some of the charges against him.

In summary, OKX sent $60 million worth of digital assets to Alameda Research as part of a recovery effort to pay back customers of FTX. Alameda Research currently holds over $284 million worth of assets, including USDT and ETH. FTX and Alameda Research have been actively recovering funds from firms they previously sent crypto to after filing for bankruptcy in November.

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Spanish Tax Agency Cracks Down on Crypto Holders

by Blockchain News

The Spanish Tax Administration Agency (AEAT) wants to send out 328,000 warning notifications to individuals who are responsible for paying their taxes for the 2022 fiscal year. This move is being made in an attempt to collect taxes on crypto assets. The number of notices has climbed by forty percent in comparison to the previous year, reaching a total of fifteen thousand in 2021. This rise is a clear indication that the monetary authorities are beginning to take the matter more seriously.

The efforts of the AEAT to collect taxes are not primarily concentrated on cryptocurrencies and related assets. This year, more than 660,000 people who underreported their rental income will get a notice, and 807,000 people who did not record their income earned outside the country will receive a notice. Both groups will receive letters. The notifications function as an offer to voluntarily pay the tax, the rate of which ranges between 19% and 23% and applies to profits realized from the sale of digital assets. Those who are late in making their tax payments will be liable to a fine of an extra 26%, which will be determined based on the total amount of money that remains due.

According to the research published by the National Securities Market Commission in August 2022, there is a rising population of crypto asset holders in Spain. According to the report, 6.8% of the country’s population now own crypto assets. The majority of these holders have at least some level of higher education, are between the ages of 35 and 44, and make more than 3,000 euros per month. The nation also has the most cryptocurrency ATMs in all of Europe, with 231 machines, which accounts for around 15% of the entire number. This places it in first place in Europe. Spain comes in at number four on the global scale, after the United States, Canada, and Australia.

The expanded efforts of the Spanish Tax Administration Agency reflect a rising pattern of governments throughout the globe striving to regulate and collect taxes on crypto assets. This trend was highlighted by the enhanced efforts of the Spanish Tax Administration Agency. This should not come as a surprise considering the expanding usage of cryptocurrencies across a wide variety of sectors, as their popularity continues to rise. Individuals and enterprises need to ensure that they are up to date on their tax duties in order to prevent the possibility of facing legal repercussions as a result of the proliferation of crypto assets.

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US SEC Hiring Attorneys for Crypto Assets and Cyber Unit

by Blockchain News

Regulators in the United States have been ramping up their efforts to regulate the crypto space, and the latest move from the U.S Securities and Exchange Commission (SEC) is no exception. The SEC has announced that it is seeking to hire general attorneys for its Crypto Assets and Cyber Unit in the Division of Enforcement. This unit is responsible for enforcing laws and regulations governing the use of crypto assets and cyber issues.

The job posting, which is available on the official government website, states that the successful candidates will be responsible for conducting “complex, fast-moving investigations” involving crypto asset securities and cyber issues. They will also be required to draft subpoenas or document requests, question witnesses through interviews, evaluate evidence and more.

This announcement comes shortly after the SEC’s chairman, Gary Gensler, asked for nearly $2.4 billion in funding to help the agency chase down crypto “misconduct” on March 29. This move highlights the regulatory pressure that the crypto community has been facing in the United States over the last year.

The crackdown on the crypto industry by US regulators has been ongoing, with local regulators planning to introduce new taxes directed towards the industry. Some industry insiders are concerned that these and other regulations could “choke” the industry and prevent much-needed innovation.

The Beaxy cryptocurrency exchange recently shut down after the SEC filed multiple charges against the company’s founder. Japan-based decentralized autonomous organization (DAO) Sushi is also facing a subpoena from the SEC. These actions demonstrate the SEC’s commitment to enforcing regulations governing the use of crypto assets.

However, not everyone in positions of regulatory authority is on board with the SEC’s approach. Congressman Tom Emmer has called Gensler a “bad faith regulator” and questioned his methods of industry oversight. Emmer’s comments highlight the ongoing debate about the appropriate level of regulation for the crypto industry.

In conclusion, the SEC’s move to hire general attorneys for its Crypto Assets and Cyber Unit in the Division of Enforcement is a clear sign that the agency is taking the regulation of the crypto industry seriously. This move follows a string of regulatory actions against crypto companies, and the ongoing debate about the appropriate level of regulation is likely to continue. The future of the crypto industry in the United States remains uncertain, but it is clear that regulators are not backing down from their efforts to enforce the law.

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IOSCO to Consult on Crypto Regulation

by Blockchain News

The International Organization of Securities Commissions (IOSCO) has announced that it will launch a consultation on its regulation report for crypto assets in the second quarter of 2023. This consultation will be followed by the publication of the final recommendations by the end of the year.

The dates for the consultation and final report are included in IOSCO’s work program for 2023-24. The Fintech Task Force plan of IOSCO includes two major workflows dedicated to decentralized assets. The first workflow focuses on crypto and digital assets, and the second workflow focuses on decentralized finance (DeFi).

The IOSCO’s report will provide recommendations on how to regulate crypto assets, including digital currencies and tokens. These recommendations will be based on consultations with relevant stakeholders, including regulators, industry players, and investors. The report will also analyze the risks and opportunities of crypto assets and how they fit within the existing regulatory framework.

The consultation on decentralized finance (DeFi) will begin in the third quarter of 2023. The DeFi market has grown significantly in recent years, and regulators are increasingly focusing on its potential risks and challenges. IOSCO’s consultation will seek input on how to regulate DeFi platforms, decentralized exchanges, and other DeFi applications.

The Fintech Task Force plan of IOSCO reflects the increasing importance of digital assets and decentralized finance in the global financial system. IOSCO recognizes the need for regulatory clarity and consistency to ensure investor protection and market integrity. The organization aims to provide a framework that balances innovation and risk management in the fast-evolving digital asset landscape.

The IOSCO’s consultation on crypto regulation and DeFi will be closely watched by the industry and the regulatory community. It will be interesting to see how IOSCO addresses the complex and evolving issues related to digital assets, such as custody, trading, and market manipulation. The consultations will provide an opportunity for stakeholders to share their views and concerns on the regulatory approach to crypto assets and DeFi.

In conclusion, IOSCO’s consultation on crypto assets and DeFi is a significant step towards establishing a coherent and effective regulatory framework for digital assets. The recommendations and guidelines from the organization will help to promote investor confidence and foster innovation in the rapidly evolving digital asset market.

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White House Report Casts Doubt on Cryptocurrencies

by Blockchain News

The White House’s recently released Economic Report of the President includes a chapter questioning the benefits of cryptocurrencies. This is the first time the White House has included a section on digital assets since it began issuing the annual economic policy report in 1950. The report includes 35 pages dedicated to debunking the “Perceived Appeal of Crypto Assets,” along with a short section on the FedNow payment system and central bank digital currencies.

The report argues that crypto assets fail to deliver on their touted benefits, such as improving payment systems, financial inclusion, and creating mechanisms to transfer value and intellectual property. It also argues that cryptocurrencies fail to perform the functions of sovereign money, as their prices fluctuate too wildly to be a stable store of value, nor can they function as a unit of account or medium of exchange. Stablecoins are also criticized, as they are subject to run risks and are therefore too risky to satisfy their role as a “fast payment” instrument.

Crypto executives have expressed frustration over the report, with the co-founder of digital asset investment firm Paradigm, Fred Ehrsam, remarking that 15% of the Economic Report was dedicated to “crypto FUD.” Kristin Smith, CEO of the Blockchain Association, called the report “disappointing,” stating that it shows some in the government appear “increasingly allergic” to the burgeoning crypto industry.

The report also takes aim at decentralization, arguing that blockchain-based applications are in practice neither decentralized nor trustless. Users access crypto assets by going to a limited set of crypto asset platforms, while a small group of miners performs the majority of mining in most crypto assets, it argues.

The latest annual economic policy report was published shortly after the collapses of Silvergate, Silicon Valley, and Signature banks, all of which had served aspects of the crypto industry. Dan Reecer, chief growth officer at decentralized finance platform Acala Network, claims that the report comes “just days” after Operation Chokepoint 2.0 was executed on crypto-friendly banks. He also noted an “obvious early warning” of an upcoming United States central bank digital currency, referencing a section of the report that seemingly touts the benefits of a U.S. central bank-controlled currency.

Despite the criticism, it is worth noting that the report is not a policy statement, and it remains to be seen how the Biden administration will approach the regulation of cryptocurrencies and digital assets in the coming months.

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WisdomTree Third-Quarter Crypto Assets’ AUM Drop 36% As Market Losses Continue

by Blockchain News

WisdomTree, a financial investment company based in New York, on Friday released its latest earning report showing the asset manager’s cryptocurrency holdings have declined by 36% and now stands at $178 million in the third quarter as of September 30.

WisdomTree said its holdings saw a decline of $87 million (36%) in the third quarter owing to the market downturn. According to the report, the company held $265 million in crypto assets at the end of the second quarter while its holding stood at $178 million at the end of the third quarter (July, August, and September).

The report indicated that the company’s crypto holdings have now reduced 56% since January, from $406 million. Overall, WisdomTree said it had $70.9 billion in assets under management at the end of this year’s third quarter.

The decline in holdings reflects the fall in crypto prices and the global crypto market cap, which has declined from $2.3 trillion in January to $1.02 trillion today.

Jarrett Lilien, WisdomTree’s President, and Chief Operating Officer said that the firm has not been deterred by the market crisis, saying that the company’s approach is to bring crypto mainstream.

WisdomTree is one of the several crypto asset managers impacted by the dull and long crypto winter. Several listed crypto business firms have lost interest from investors and faced severe downgrades from the brokerages at large.

The performance of these firms (such as PayPal, and Coinbase, among others) has been highly disappointing, with some (like BlockFi and others) recently announcing reductions of their headcounts while others (like Voyager Digital, Celsius Network, Arrow Three Capital, and others) announced bankruptcy protections.

A consistent increase in outflows from crypto investment products since the TerraUSD collapse has raised concerns over the survival and sustainability of many crypto asset management firms.

While the market downturn has made it difficult for small crypto funds to survive, it has created an opportunity for leading players in the asset management sector to rethink their risk management strategies.

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