Wormhole Nets $225M in a Funding Round Led by Brevan Howard

In advanced communication, the famous messaging protocol Wormhole raised approximately $225 million from a funding round led by the European investment company Brevan Howard. Other participants in the successful fundraising included Coinbase Ventures, ParaFi, Arrington Capital, Borderless Capital, and Jump Trading. The multimillion-dollar investment propelled Wormhole’s firm value to reach $2.5 billion.

Wormhole Raises $225 Million in a Funding Round

The investment came when Wormhole gained global recognition as the leading cross-chain messaging protocol that allows developers to create decentralized applications on the blockchain network. 

The exciting growth has inspired the Chicago-based crypto firm to launch an independent tech company, Wormhole Labs. The launching of the new entity aims to promote innovation and the development of cutting-edge products that foster the growth of cross-chain activities. 

With the latest development, the Wormhole blockchain-to-blockchain communications technology has gained popularity in powering Oracle data feeds and supporting the transfer of non-fungible tokens (NFTs). 

Despite the recent upgrades on the Wormhole platform, the company has supported over $35 billion in transactions since it was launched. The developments on the Wormhole platform play a pivotal role in processing over 2 million messages across 30 different chains daily.

Remarkably, from 2021, Wormhole has managed to establish a strong market presence in the digital sector. A few months ago, Wormhole separated from its parent company, Jump Trading Group, shortly after it doubled down its crypto operation.

Impact of FTX Impolsion on Entire Crypto Market

 The changes forced some of the top-level executives of Jump Trading to join Wormhole to support the firm in operating independently. At that time, the Jump claimed to have suffered significant losses from the collapse of the Bahamian crypto exchange FTX.

  The dramatic separation between Wormhole and Jump Trading came months before the messaging protocol was hit by a multimillion-dollar exploit. In February 2022, the attackers launched a malicious attack on Wormhole protocol, heisting assets worth $320 million. 

The Wormhole exploit was ranked among the largest hacking incidents to be witnessed in decentralized finance (DeFi). The attack interrupted Wormhole developments, delaying most of the core projects. Following the attack, Jump Crypto offered financial support to Wormhole to help the firm restore operations.

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U.S Treasury Seeks More Powers to go After Crypto Companies

The U.S Treasury has requested the U.S congress has requested more authority to crack down on the crypto industry.

The department sent recommendations to lawmakers, including the need for new sanction tools prepared remarks from Deputy Treasury Secretary Wally Adeyemo showed.

“We are calling on Congress to create a secondary sanction regime that will not only cut off a firm from the U.S. financial system, but will also expose any firm that continues to do business with the sanctioned entity to being cut off from the U.S. financial system,” Adeyemo said. 

“This is a significant tool we do not request lightly. But we need to do everything in our power to make sure that groups like Hamas are not able to find safe haven within the digital asset ecosystem,” he added.

There has been an increasing concern about the illicit use of cryptocurrencies since the Hamas incident. Hamas was found to be using cryptocurrencies to raise funds to sponsor its terrorist activities. 

Since then, lawmakers of both Democrat and Republican origin have shown concern on the use of crypto for illicit purposes. 

In a bid to contend the possibility of crypto being used for illicit purposes, the treasury is proposing a new crypto related category under the Bank Secrecy Act. According to the treasury statement, decentralized finance (DeFi) platforms claim to be exempted from the BSA, seeking legislation to make DeFi follow the act.

Oversight on Stablecoins

Another concern raised by Adeyemo is on stablecoins, which are cryptocurrencies pegged to fiat currencies such as the USD. He is advocating for legislation to compel dollar-backed stablecoin issuers outside the U.S to block terrorists from using the stablecoins.

“Legislation could explicitly authorize OFAC to exercise extraterritorial jurisdiction over transactions in stablecoins pegged to the USD (or other dollar-denominated transactions) as they generally would over USD transactions,” Treasury said. 

Also commenting on the Binance settlement proposed by the Department of Justice (DOJ) about a week ago, Adeyemo said the exchange allowed illicit use of its platform for several nefarious activities, hence the sanction.

“Over several years, Binance allowed itself to be used by the perpetrators of child sexual abuse, illegal narcotics trafficking, and terrorism, across more than 100,000 transactions,” Adeyemo said. “Groups like Hamas, Al Qaeda, and ISIS conducted these transactions.”

A Warning to the Industry

According to Adeyemo, the entire crypto industry needs to be aware that it is not above the law and that it must come under the purview of the law. He sent a warning to the industry, saying the treasury will go after violators

“I want to directly address those within the digital asset industry who believe they are above the law, those that willfully turn a blind eye to the law, and those that promote assets and services that aid criminals, terrorists, and rogue states,” Adeyemo said. “My message is simple: We will find you and hold you accountable.”

To many in the crypto industry, this message spells doom for the industry as it is still under intense crackdown from the securities and exchange commission. 

With such threats coming from the Treasury again, it looks like more dark times are coming to the crypto industry in the near future. At this rate, more crypto companies may be getting set to leave the U.S.

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Fireblocks Debuts New Trading Exchange for Institutional Clients

In a November 28 update, the renowned Multi-party computation (MPC) wallet provider Fireblocks was debuting a new trading system, Off Exchange, for institutional clients. The Fireblocks team confirmed that the new trading platform will leverage emerging technologies to allow institutional customers to swap tokens.

 This development has replaced the initial process requiring customers to deposit their tokens on the exchange before swapping. The report demonstrated that Fireblocks’ new trading platform aimed to reduce the inherent risks associated with third-party involvement in centralized exchanges. 

Fireblocks Seeks to Mitigate Centralized Exchange Risk

With the changes in the financial sector, the New York-based tech firm confirmed implementing diverse security measures to prevent the recurrence of an FTX saga. A statement from the chief executive of Fireblocks, Michael Shaulov, highlighted the features and benefits of the new Off Exchange.

 The CEO stated that the new trading platform has a shared MPC wallet that can only be accessed through a unique private key. The executive explained that the team behind the Off Exchange embedded three shards on the private key for security purposes.

 The first shard belongs to the trading firm, while the exchange will hold the second shard. The executive stated that the oracle would own the third shard. The exciting integration of the three shards aims to ensure that the assets on the MPC wallets are safe and secure. 

According to the CEO, the user must verify the transaction on the exchange and trading shards. The withdrawal procedure aims to prevent the trader and the exchange from unilaterally withdrawing funds. 

Features of Off-Exchange

The executive confirmed that to proceed with the withdrawal process, the exchange and the trader must initiate the transaction through signing. Mr Shaulov explained that the third shard will only be used under particular conditions.

 The CEO admitted that the trader or the exchange might not be available simultaneously. If this happens, the third-party oracle can provide the second signature. Shaulov underlined that the third-party oracle is only involved in a transaction when the trader or the exchange fails to cooperate.

 The CEO explained that in case of an unforeseen circumstance, such as a hacking incident that might undermine the operation of an exchange for a specified time, then the trader and the third-party oracle are allowed to proceed with the transaction. 

Interestingly the launching of the Off Exchange will enable the Fireblocks team to prevent financial fraud. The tech company regretted that the ordinary structure of the crypto trading platform had become a common ground for attackers since normally the exchange had complete control of the custodial and trading services.

As a safety measure, the Fireblocks will ensure that all assets are stored on the MPC shared wallets, and neither the exchange nor the trader can proceed with the withdrawal without informing the other.

Hackers Target Centralized Crypto Exchanges

The latest development of Fireblocks aims to shield centralized exchanges from counterparty risks affecting the best-performing crypto exchanges. 

For years, the attackers have been preying on the centralized platforms to heist measurable amounts of customers’ funds. In 2014, the Tokyo-based crypto exchange Mt.Gox was hit by a multimillion-dollar attack that lost assets worth $473 million. 

 After the Mt.Gox incident, the attacker launched malicious attacks on other centralized crypto exchanges. A similar incident occurred in 2018 after the attackers heisted a measurable amount of funds from Quadriga. 

The rise of crypto scams has forced crypto and fintech firms taking preventive measures to ensure the customers’ funds are secure. The Fireblock’s latest development mirrors the Off Exchange feature on QCP Capital, Zerocap, and BlockTech.

 The Off Exchange feature will soon be available on Gate. io,Bitget, Coinhako, OneTrading HTX, Bybit, and WhiteBIT. The remarkable development of Off Exchange aims to meet the ever-evolving needs of institutional clients.

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BitMEX Founder Describes US Treatment on Outgoing Binance CEO as ‘Absurd’

In the recent turn of events, the world’s largest crypto exchange by daily trading volume, Binance, has battled a series of legal charges due to non-compliance. The legal peril facing Binance and the recent multi-million settlement with the US regulatory agencies has attracted global attention.

A recent report from the founder of BitMEX, Arthur Hayes, described legal action against Binance and the chief executive, Changpeng Zhao, as absurd punishment. In a November 28 blog post, Hayes expressed regret that Binance and the CEO were treated absurdly.

Binance Battles Legal Charges Due to Non-Compliance

The executive stated that the legal action against the controversial crypto exchange demonstrated the arbitrariness of US legislation. Reflecting on the $4.3 billion penalty settled by Binance, Hayes lamented that the fines were “disproportionately harsh” compared to the hefty fines imposed on the top-level executives responsible for the 2007-2008 financial crisis. 

At that time, the corporate leaders of the US best-performing banks received fair treatment since convicting them posed a threat to the entire banking sector. After reviewing the Binance CEO career journey, Hayes noted that CZ rose from a nobody to become the richest crypto mogul. 

His career took a progressive trajectory that propelled CZ to head the world’s largest crypto exchange. This exciting career growth posed a threat to the financial and political establishment since it eliminated some of the institutions and undermined power sharing. 

Consequences of Violating US Crypto Regulation

Besides Binance, Hayes described the rise and fall of the Terra ecosystem as the nature of crypto. The executive admitted that after launching his crypto exchange in 2014, he was later profiled as a bad boy. Seven years later, the Department of Justice (DOJ) accused Hayes of breaching the Bank Secrecy Act for failing to uphold the anti-money laundering practices. 

Following a lengthy court process, Hayes pleaded guilty and received a two-year imprisonment and six months home arrest. After serving the punishment, Hayes moved to Singapore, where he became an active contributor to the crypto industry. 

Despite the dramatic changes in the financial sector, BitMEX officials remain optimistic that crypto will replace the “broken banking system.” The executive noted that the conventional financial industry has exposed many to debts. 

He regretted that the unsuitability of traditional finance has forced investors to invest in either gold or crypto assets. A few days ago, the CZ resigned from his CEO position after he pleaded guilty to supporting the violation of anti-money laundering (AML) regulations. 

Legal Peril Facing Binance Deepens

Guided by the existing rules, the outgoing CEO will face ten years imprisonment and will be required to settle a court fine amounting to $50 million. The court instructed that Zhao will remain in the US until February next year to proceed with his criminal trials.

The court reversed the previous ruling that allowed Zhao to return to his home country in the United Arab Emirates. A review of the court report revealed that allowing Zhao to return to UAE will undermine the ruling since the Arab country lacks a favorable extradition treaty.

According to the DOJ, the embattled CEO focused more on ways to expand revenue streams and failed to comply with the existing laws. The non-compliance of Binance enabled illicit groups to finance their illegal activities through the exchange. 

The report revealed that recently, the Iran illicit group transferred assets worth approximately $898 million on Binance without being noticed.

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Bitcoin Developer Blames VC-Funded Lightning Firms for Failing to Fix Security Bugs

In readiness for the fourth Bitcoin halving, crypto firms are exploring ways to maximize their profits before April 2024, when the reward for mining BTC will be reduced by half. The attempt to solve the complex puzzle revolving around the upcoming Bitcoin halving has posed a threat to the crypto industry’s growth. 

An official communication from the former researcher and developer at the Lightning network, Antoine Riard, reveals that developers neglect to uphold security standards when integrating Bitcoin Lightning Network. He blamed the Lightning developers for forgetting to adopt adequate security measures while developing the Lightning Network.

Attackers Targeting to Exploit Payment Network Through Replacement Cycle Attack

 He noted that most Lightning-oriented developments aim to maximize investors’ profit. Riard defined a Lightning Network as a Layer-2 solution built on the blockchain network of the Bitcoin ecosystems. The integration of the Lightning Network aims at improving the scalability and efficiency of Bitcoin (BTC).

Last month, before resigning from the Lightning Network, Riard regretted that the attackers had developed new strategies to steal from the customers.

 He observed that the lousy actor recently launched a replacement cycle to exploit vulnerable payment networks. With the emergence of new types of attacks, Riard regretted that this development posed a threat to the Lightning network. 

The executive explained that the replacement cycling attack is a trending exploit allowing attackers to heist funds from a network. This attack involves exploiting vulnerabilities between mempools on the blockchain network.

He stated that the new attacks threats Lightning Network and places it in a perilous position. In the meantime, Riard is improving the Bitcoin base layer to fix any vulnerabilities. The executive has urged other developers to invest in improving the safety of the Bitcoin Lightning.

Bitcoin Developer Urges Lightning Network Creators to Fix Existing Bugs

 He requested the developers to stop being lazy and start creating effective solutions that sustain the decentralized and open nature of Bitcoin Lightning. He encourages the developers to invest in improving the base layers. 

 After reviewing the latest development in the Lightning sector, Riard noted that most developers are failing to attain Lightning’s core objectives. The executive noted that most Lightning developers working for venture capital or business entities must deliver within the specified time. 

Riard noted that tight deadlines expose users to long-term risks. With the development of the Lightning Network, the official envisages that in the future, some companies might desire to gain a competitive advantage over others.

Riard revisited the ‘tragedy of the commons,’ a theory developed by William Forster Lloyd that stated that entities with access to public resources would act in manners that would only benefit them. 

Antoine Riard Predicts a Dull Future for Bitcoin Lightning Network

The developers noted that the VC Lightning companies sought to trade off decentralization. Riard pointed out that centralized systems are more efficient than decentralized platforms. 

The executive noted that centralized systems have lower user censorship costs, which threatens Bitcoiner.From his in depth analysis Riard predicts that the future of Lightning Network seems dull with ongoing developments. 

He confessed that he did not want to be associated with the development of the Lightning sector due to the inherent risks that will emerge in future. Riard stated that he felt discouraged to continue working in his previous role since he was unwilling to be charged or held accountable for Lightning Network security.

The executive noted that not much can be done to stop the breach of the censorship-resistance and permissionlessness of the Lightning Network core values. 

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Crypto Giant eToro Secures Operational License in UAE

Top crypto trading and investing company eToro has secured an operational license from the United Arab Emirates (UAE) to operate in Abu Dhabi. 

The Abu Dhabi Financial Markets Authority (ADGM), on behalf of the country awarded the a Financial Services Permission (FSP) license to eToro to operate as a broker for securities, derivatives, and crypto assets in the United Arab Emirates.

eToro with over 34 million registered users operates in over 100 countries and is localized in more than 20 languages. Speaking on the license, Founder and CEO of eToro, Yoni Assia said:

“The approval of our operating license by ADGM is a key milestone in our continued global expansion. Abu Dhabi is increasingly recognized as a growing fintech hub, and we are excited to become part of this flourishing ecosystem.”

“With our team in Abu Dhabi led by Jason Hughes, Senior Executive Officer for eToro Middle East and George Naddaf, GCC & MENA Regional Manager, we are looking forward to deepening our relationships in this dynamic market and to helping our UAE clients grow their financial knowledge and wealth as part of a global community of investors,” he added. 

The license permits eToro to be “an Authorized Person to conduct the Regulated Activities of (a) Dealing in Investments as Principal (Matched), (b) Arranging Deals in Investments, (c) Providing Custody, (d) Arranging Custody and (e) Managing Assets (under Financial Services Permission Number 220073) under the Financial Services and Market Regulations 2015 (“FSMR”).”

The UAE is the latest to grant eToro operational license. The company also has a license from the Cyprus Securities and Exchange Commission (CySEC) in Cyprus, the Financial Conduct Authority (FCA) in the UK, the Australian Securities and Investments Commission (ASIC) in Australia, and the Financial Services Authority (FSA) in the Seychelles.

Enhancing eToro’s Vision

Securing an operational license is one of the greatest things any crypto platform can achieve, regulators can make or mar the company’s business. According to Chief of Market Development at ADGM Arvind Ramamurthy, the license will help eToro achieve its vision of empowering the world educationally and financially.

“We are delighted to welcome eToro to ADGM. We are confident that ADGM’s dynamic ecosystem and progressive regulations will enable eToro’s vision, ADGM is the largest regulated jurisdiction of virtual assets in the MENA region and eToro’s participation will add to its vibrant and trusted ecosystem of virtual asset trading venues, global exchanges and service providers, and reinforce the UAE’s strategic value to global finance,” he said.

 eToro is just one of the many crypto companies that have secured regulatory permissions to operate in the UAE. Other top players like Binance and Coinbase secured various licenses earlier this year, giving them legal backing to operate in the region.

UAE’s Role in Global Crypto Growth

The UAE is a strategic player in the global adoption of cryptocurrencies. As stated by Ramamurthy, it is known for its progressive legislation as far as cryptocurrencies are concerned.

This explains why its major cities like Dubai and Abu Dhabi have become hotspots for crypto startups over the years. Every top crypto company either has an office in the region or is aspiring to create one.

With the new license, eToro is the latest big crypto exchange to operate there, but is certainly not the last, as many more companies will seek licenses in the UAE. 

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Zipmex Suspends Trading and Depository Services in Thailand

As global regulators seek to provide comprehensive regulations for digital assets, most crypto exchanges have prioritized improving their compliance level to operate as regulated entities. 

On Friday, November 25, the prominent crypto exchange in Singapore, Zipmex, took strategic action to meet the new regulatory requirements in Thailand. The crypto exchange announced the indefinite suspension of trading and depository services on the Zipmex platform in Thailand. 

Crypto Exchange Zipmex Suspend Operation in Thailand

The crypto exchange confirmed that the decision to suspend its operation emanated from the need to comply with the Securities and Exchange Commission (SEC) requirements. With the changes in Thai crypto regulation, the Zipmex team agreed to focus on fulfilling the SEC requirements.

Last year, the Thai SEC accused Zipmex and the co-founder Akalarp Yimwilai of breaching the securities law. The SEC reported the case to the Thai police, claiming that Zipmex violated Section 75 of the Digital Assets Act.

The market regulators stated that the SEC requested Zipmex to provide a detailed report concerning its business practices and operation. After reviewing the report submitted by Zipmex to the SEC, the regulators noted that some of the reports were incomplete and data was unreliable.

This compliance challenge forced Zipmex to suspend trading and depository services as of November 25. The unexpected suspension of Zipmex’s operation in Thailand has created mixed feelings among the customers. 

Responding to the multiple queries from the affected customers, the Zipmex team outlined the withdrawal procedure. The crypto exchange advised the customers to contact the support team if they encounter challenges withdrawing their assets. 

Thai SEC Accuses Zimpex for Violating Crypto Regulations

In the latter, the Zipmex team confirmed that the crypto exchange will suspend all withdrawals at the end of January next year. It implies that the Zipmex withdrawal feature on the website or the mobile application will be unavailable from next year. 

Therefore, Zipmex customers are advised to start the withdrawal process immediately. Since the collapse of the Bahamian crypto exchange FTX, Zipmex struggled to overcome the challenges in the crypto sector.

The Zipmex team reportedly lost approximately $5 million in the now-defunct crypto lender Celsius. The crypto exchange also lost measurable funds on Babel Finance and Genesis Global. Months after the FTX implosion, the Zipmex team made several attempts to repay the creditors.

Zipmex Request for Debt Repayment Extension

Earlier this year,the crypto exchange was in the process of being acquired by V Ventures at $100 million. This development failed to materialize after V Venture ditched the Zipmex acquisition plans.

After failing to restore a considerable financial position, the Zipmex team is at the edge of being insolvent. Due to the financial crises facing Zipmex a court in Singapore advised the firm to develop a restructuring plan by December last year. 

Guided by Section 64 of the Insolvency, Restructuring, and Dissolution Act 2018 Zipmex requested a court in Singapore to extend the deadline for its debt repayment plans. The court report revealed that Zipmex needed extra time to increase customers’ value.

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Wallet of Satoshi Exits US Market, Removes Application from IOS and Android App Stores

The prominent lightning wallet provider Wallet of Satoshi (WoS) has suspended its services in the US. In an advanced communication, the WoS claimed to have removed its application from Apple and Google app catalogs, marking a dramatic exit from the US market.

News concerning the suspension of WoS in the US clients created mixed reactions among retail and institutional clients.

WoS Exits US Market

On X (formerly Twitter), the affected US customers expressed disbelief that they would no longer access the WoS app on IOS or Android mobile phones.

Others shared their annoying experience when attempting to log into their WoS app. After multiple failed attempts to access the WoS, the US customers reported the matter to the company.

In response, the WoS team apologized for inconveniencing the US customers. The digital wallet provider described removing the WoS on Google and Apple app stores as the most challenging decision.

 Moving forward, the WoS team confirmed that its service would remain suspended in the US. However, the Bitcoin Lightning company anticipates that WoS will soon establish a significant comeback in the US in future. 

Crypto Firms Exiting US Cites Lack of Regulatory Clarity

For years, the WoS has played a pivotal role in improving the Bitcoin experience and pushing for mainstream adoption of crypto assets. According to the X post, the WoS demonstrated its unwavering commitment to increasing the usability of the Bitcoin Lightning Network. 

In light of WoS’past achievements, the company has provided a safe, secure, and compliant wallet. Additionally, the WoS has leveraged emerging technologies to ensure the wallet is user-friendly and cost-effective.

To sustain the desired success, WoS has invested heavily in improving the platform’s safety and customer experiences. In the meantime, the WoS team has advised the US customers to withdraw their assets or transfer funds to different wallets. 

The WoS assured the affected customer that their asset would remain safe during the downtime. In a subsequent post, the WoS confirmed that the changes had not affected their customers outside the US.

Upon reaching WoS users outside the US to assess whether the digital wallet was available on the IOS and Google, the Australian and Singapore users confirmed that the services were still available.

WoS Silences Tides of Criticism

News concerning the suspension of WoS in the US ignited heated debates on X. Some users argued that the US regulators had instructed WoS to exit the US market.

Citing the ongoing legal and regulatory action against the fast-paced crypto exchange Binance and the chief executive Changpeng Zhao, the customers suspected that WoS was restricted in the US due to non-compliance cases.

Elsewhere, the chief executive of Synonym, the prominent Bitcoin software developer John Carvalho, argued that the WoS was required to comply with US regulations to continue operating the region.

Reportedly, this was not the first incident when the WoS faced tides of criticism. Months ago, the crypto community questioned the custodial feature of the WoS. Compared to the non-custodial solutions, the market critics noted that the WoS custodial restricts user control over customers’ funds.

Despite the speculation the renown podcaster Kevin Rooke reviewed the market performance of WoS and was pleased to note a growing popularity of the platform for the past few months. Rooke envisages the WoS will support over 1.1 million payments this month. He anticipates that WoS will witness the largest Lightning Network-supported transaction in November.

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UK Regulators Urges Asset Managers to Invest in Tokenization of Funds

With the changes in the financial ecosystem, tokenization has emerged as a developing trend seeking to redefine most industries. The astounding growth of the tokenization of assets has challenged investment managers in the United Kingdom to engage regulatory agencies in supporting the expansion of the tokenization of real-world assets.

In response to the growing demand from crucial investment players, the regulators in the UK have supported the need to tokenize assets. In a recent publication by the Investment Association (IA) titled “UK Fund Tokenization: A Blueprint for Implementation,” the regulators believe that tokenization will create efficiency and transparency in the ever-evolving financial sector. 

Benefits of Tokenization of Assets

The 30-page report defined tokenization as leveraging blockchain technology to issue digital versions of an asset. After analyzing the benefit of tokenization of assets, the IA team noted that blockchain technology supports the usability of a real-time record-keeping system by ensuring the information can be accessed by multiple parties involved in serving the funds. 

The responsible use of blockchain aims to reduce transaction costs and streamline the reconciliation processes. Through the tokenization of funds, the financial institution has benefited from fast settlement processes and convenient service delivery.

A statement from Financial Conduct Authority (FCA) executive director of markets and international Sarah Pritchard applauded the exemplary work of the regulatory agencies in identifying the profitable venture for the asset managers. 

The executive noted that despite the endless benefits of tokenization of funds, there were potential risks associated with these investments. Pritchard affirmed that the FCA, in collaboration with other government agencies, would support investment companies in adopting innovative solutions that address risk and support the expansion of the vibrant UK asset management sector.  

UK Supports Asset Managers to Tokenize Funds

According to the IA publication, the regulators outlined the basic principles for the tokenization of funds. A review of the proposed principle for the tokenization of funds aims at ensuring local practices meet international standards. 

The suggested principles focus on other investment opportunities besides those in the asset management industry. Primarily, the IA report identifies the existing options in the entire financial sector.

 The report reviewed the opportunities in different firms, asset classes, product types, and customer groups. Besides the notable opportunities, the IA underscored the need to formulate a roadmap and strategies to seize the available market opportunities.

UK Seeks for Innovative Solutions to Strengthen its Economy

 The regulators urged the investors and business entities to focus on gaining a competitive edge in the market. This will be attained by collaborating with the relevant authority to meet the FCA requirements.

 The report stated that despite the changes in the financial sector, the legal and regulatory requirements will not change. The IA report mirrors an earlier UK government publication highlighting the need to develop innovative solutions that support business growth.

 In the meantime, the UK authority plans to engage in intense discussion to examine the role of technology in the asset management industry.

 The proposed talks will revolve around effective strategies to make the UK an innovation center. The government plans to team up with industrial players to create an attractive business environment.

Based on the UK crypto objectives, the government has joined other developed countries, such as the US and Europe, to create new opportunities for professions in the crypto and blockchain field.

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Crypto Exchange HTX and Heco Chain Blockchain Protocol Hacked for $100 Million

Another top crypto exchange, HTX has come under attack alongside the Heco Chain blockchain protocol. The attack resulted in the theft of $100 million in several different cryptocurrencies.

Former CEO of Tron and long-time cryptocurrency entrepreneur and an investor in HTX Justin Sun confirmed the incident. 

“HTX and Heco Cross-Chain Bridge Undergo Hacker Attack. HTX Will Fully Compensate for HTX’s hot wallet Losses. Deposits and Withdrawals Temporarily Suspended,” Sun said in a post on X.

Crypto exchanges are usually prone to attacks from hackers and other bad actors. Throughout the history of crypto, top exchanges have come under attack at various points, many of which have not yet recovered, such as Mt Gox.

For HTX, the hack was first spotted by blockchain cybersecurity firm Cyver. According to CoinDesk, the experts at the firm noticed a suspicious transfer of $85 million and decided to investigate. The team had reasons to believe that the theft resulted from leaked private keys. 

The attackers then used the keys to access the bridge between Ethereum and Heco Chain, leading to the theft. The firm said it could not ascertain the exact value of assets stolen because of the volatility of crypto assets, nor could it determine the precise tokens stolen.

The firm is still conducting investigations and is yet to come up with final conclusions on the extent of damage.

Sun Blamed for Incident

Justin Sun has had a number of experiences with hackers, and this isn’t the first time that HTX has come under attack. The exchange was attacked in October, leading to hackers stealing $8 million worth of Ether at the time.

Poloniex, another exchange in which Sun is a major shareholder also came under attack less than a month ago, resulting in the loss of $115 million in assets. With these recurring attacks on crypto exchanges Sun is affiliated with, members of the crypto community are starting to suspect him.

“Either you are the hacker or you have some seriously lacking security measures and controls in your businesses. Either way I wouldn’t feel confident in holding any crypto in anything you control for the time being,” one Twitter user said in response to Sun’s tweet.

Other users suspect that Lazarus, a notorious North Korean hacking collective, could be behind the recent string of attacks, and advised Sun to listen to the experts he has access to.

“Lazarus loves to rekt you multiple times. It’s kinda one of their hallmarks. You miss a single one of their tiny toeholds and they’ll regain entry. You’re already in rooms with some of the best investigators who have been tracking Lazarus since 2017. LISTEN. TO. THEM.” another person said.

Customers Will be Reimbursed

As this is the second time HTX has come under attack, it is natural for customers to panic concerning their funds. However, Sun in the tweet stated that there was no need for such panic because everyone who was a victim of the hack will be fully reimbursed.

“All Funds in HTX Are Secure, and the Community Can Rest Assured. We are investigating the specific reasons for the hacker attack. Once we complete the investigation and identify the cause, we will resume services,” Sun assured.

This will go a long way in retaining the confidence of users in the exchange despite previous bad experiences, as the security of customer funds is paramount.

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Adobe Acquires Rephrase.ai. to Expand its AI Capabilities

In an exciting turn of events, the team behind Photoshop Adobe System entered into a merger and acquisition deal with the Indian-based artificial intelligence company Rephrase.ai. The acquisition of Rephrase.ai aimed at enabling Adobe Systems to expand its AI capabilities. 

Adobe Acquires Indian AI Firm Rephrase.ai.

News concerning the impending acquisition of Rephrase.ai was shared by the company co-founder Shivam Mangla. In his statement, the executive confirmed the imminent M&A deal will support the Adobe team to expand its AI generative initiatives.

Recently, the Adobe team has embarked on an exciting journey to leverage the power of AI to upgrade some applications. This attractive development has proven fruitful after the digital media solution provider debuted an AI-powered design creator, Adobe Firefly, which is currently undergoing beta testing.

Besides Adobe Firefly, the media company integrated AI features into Photoshop to give designers and web creators a unique experience. An announcement conveyed by Mangla demonstrated, despite the highs and lows, the Rephrase. ai team has attained significant success.

The executive confessed that Rephrase.ai’s success was driven by the strategic partnership with industry-leading firms and support from public figures. He admitted that Rephrase.ai expansion to the US market steered the firm in a direction that attracted success.

The CEO remains optimistic that the acquisition by Adobe will propel Rephrase.ai to enter a new era of generative AI. In the latter, Mr.Mangla revisited Rephrase.ai’s past achievements and applauded the exemplary work done by his team. 

Adobe to Double Down its AI Operation

He was pleased to state that the AI firm has built a solid customer base with around 50,000 active users. For years, Rephrase.ai has retained existing customers by creating unique products that restore the user’s confidence. 

He recognized the pivotal role of the Rephrase.ai community in supporting the company in attaining its intended purpose. Mangla anticipates the acquaisation position Rephrase.ai, at a pinnacle position to tap endless opportunities in the ever-evolving tech industry.

The acquisition came a year after Rephrase.ai generated $13.9 million in a series A funding round led by Red Ventures. 

Adobe to Optimize its Operation in India

The funding round aimed to enable Rephrase.ai to support its core business in engineering, data science, and product development. The acquisition will potentially position Adobe at a considerable market position in the Indian market.

Even though the Adobe team has not confirmed the expected acquisition, it seems that the M&A will create a mutually beneficial relationship between the two companies. A few weeks ago, the Adobe team released an AI-oriented tool that allows the user to effortlessly inpaint videos and modify the appearance of images. 

Despite the complexities of creating video generation tools from scratch, the Adobe team is exploring ways to develop reference work for their AI models through the Rephrase.ai acquisation.

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UK Launches Support for Crypto Startups with “mini-budget” Announcement

The UK has announced new legislation that will provide support for the crypto sector in the country. UK Chancellor of the Exchequer Jeremy Hunt outlined 110 measures for growing the nation’s economy in a mini-budget announcement which includes plans to boost the digital assets sector.

Central to the plans is to pass legislation to implement the Digital Securities Sandbox (DSS), which aims to facilitate the adoption of digital assets across financial markets. 

“The government will lay a statutory instrument to implement the Digital Securities Sandbox, delivering on the Edinburgh Reform announcement to implement a Financial Market Infrastructure Sandbox in 2023,” the budget statement said

The initiative will begin in the first quarter of 2024, and the government plans to publish its response to a consultation on the DSS that was launched in July. 

Commenting on the initiative, Zodia Markets General Counsel Dina White.said that the DSS is an important development in the evolution of the securities industry.

“We are seeing a continual progression of digitalization across a range of financial instruments, and this represents a critical step in the adoption of new technologies as they are applied to traditional financial assets,” White told The Block.

Indeed, the UK has done much to foster the growth of the crypto industry. From formulating friendly regulation to outrightly creating legislation to boost the industry’s growth, the country is one of the most pro crypto countries in the world currently.

An Improvement

The UK government already has a Digital Sandbox launched by the Financial Conduct Authority (FCA) in August and is currently functioning. However, the upcoming Digital Securities Sandbox will be different.

While the SEC FCA’s Digital Sandbox aims to support firms in the early stages of digital product development,FCA Head of Capital Markets Helen Boyd in a speech at the CCData Digital Assets Summit in October said the DSS will have “a new rule set that would allow it to do new things with digital securities.”

Ensuring Wider Use of Crypto Technology

The crypto industry is facing resistance in many countries, particularly in America. As a result, it is difficult for mainstream organizations to  adopt crypto technology in every aspect of their businesses. This is about to change in the UK.

According to White, the sandbox will allow firms to use digital asset technology to establish and operate critical financial market infrastructure, such as central securities depositories or trading venues.

“It will also allow for a wide range of assets to interact with wider financial market activities, such as being used as collateral, or as part of repo transactions. Given that these will include both ‘digitally native’ securities and digital representations of traditional instruments, this represents an exciting time for experimentation in a well-established industry,” White added.

The UK’s DSS consultation paper confirms this, stating that companies have an opportunity “to set up financial market infrastructures that utilize digital asset technology, which can perform a number of activities in relation to digital securities under a temporarily modified legislative and regulatory framework.”

Ultimately, the UK government seeks to bring digital asset technology into mainstream adoption and use. Regulators recently proposed bringing stablecoins – a group of cryptocurrencies with less volatility – into the mainstream payment system in the country, making it a legal means of digital payment.

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Coinbase Accuses SEC of Deliberately Delaying Action on New Crypto Rules

Top crypto exchange Coinbase has accused the securities and exchange commission (SEC) of delaying action on the new crypto rules the exchange has proposed.

Coinbase in a letter to the Court of Appeals argued that the Securities and Exchange Commission (SEC) has been reluctant concerning the quest for new crypto rules. The exchange had in April sued the SEC demanding clear regulatory guidelines for the crypto industry.

Since then, the SEC hasn’t done anything about the suit, arguing that the crypto industry already has sufficient guidance and does not have any special guidance. The agency also argued that it would take too long to come up with a new regulatory framework for the industry.

In the letter, Coinbase lawyer Eugene Scalia said in the letter, “Only an order by this Court will make the Commission act,” adding that a recent update to the court from the SEC provided “no additional information about its progress” other than the promise of a further status report by Dec. 15.

“Although the agency’s fear of a court ruling spurred it to do something, its proffer of another ‘report’ — as it continues to hedge and delay — confirms that only mandamus will impel the Commission to fully, finally acknowledge that Coinbase’s petition for rulemaking was pocket-vetoed long ago,” Scalia continued.

Kraken Lawsuit Shows SEC’s Indifference

While Coinbase’ case subsists in the court, the SEC has moved on to sue another top exchange, Kraken, with similar charges to those of Coinbase and Binance which the agency sued in June.

Coinbase in its Wednesday letter told the court that the suit against Kraken was evidence that the SEC was not ready to bring any new rules to the crypto industry.

“The Commission’s submission comes just a day after filing another lawsuit against a crypto exchange,” Scalia wrote, saying the suit illustrated that “the SEC’s asserted need for more time to make up its mind is a mirage.”

“The Kraken action was necessarily approved by the Commission and (like previously commenced suits against Coinbase and others) is further evidence that the Commission sees no need for regulatory clarity,” he continued. “Its course is determined, and the Court should reject this latest empty gesture.”

The SEC has insisted that most cryptocurrencies are securities and that crypto exchanges are also security exchanges, which must be registered with the agency to operate legally. This is why is it charging Kraken with failing to register as a security exchange as well as engaging in practices that are unbecoming of a security exchange.

The Need for New Rules

There is a subsisting confusion concerning crypto regulation in the U.S, as top regulatory bodies the SEC and the commodities futures trading commission (CFTC) sustain different views on the matter.

While the SEC says crypto has sufficient guidance, CFTC chairman Rostin Behnam says that the industry needs a separate set of rules to guide it because cryptocurrencies are unique assets and cannot be brought under the same rules as traditional assets like bonds and stocks.

Based on this, lawmakers are already working on drafting a legal framework for the regulation of the industry that will create unique rules that fit the industry specifically. Such rules will enable the industry to have clear guidance and allow it to thrive, which is what Coinbase hopes for.

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KPMG Partners Chainalysis to Fight Crypto-Related Crimes in Canada

Top accounting firm KPMG through its Canadian arm has partnered with on-chain analysis firm Chainalysis to help organizations combat crypto-related fraud in the country.

According to a statement, KPMG will be working with Chainalysis’ “Solution Provider” program, offering “rigorous monitoring, support, governance and risk management to crypto exchanges, financial institutions, law enforcement and government agencies.”

As part of the collaboration, KPMG professionals will become “Chainalysis Certified Investigators” to help them assist clients in detecting and preventing illicit crypto-based activity, adhere to evolving crypto regulations and enhance existing anti-money laundering compliance.

Commenting on the partnership, forensic leader at KPMG in Canada, Enzo Carlucci, said “Crypto asset exchanges, crypto-native companies, financial institutions, government and law enforcement agencies are increasingly looking for innovative ways to help them ‘follow the crypto’ to investigate criminal activity,” 

“By teaming up with Chainalysis, KPMG clients can benefit from Chainalysis’ proprietary blockchain data monitoring technology, resulting in improved identification of potentially criminal activities and faster response times,” he added. 

Crypto frauds have seen a sudden surge in Canada this year, even though the country isn’t the most friendly towards crypto. Canadians were reportedly scammed of over $160 million in the first quarter of 2023 alone. 

The Ontario Securities Commission Contact Centre also reported a 200% increase in crypto-related complaints since 2020. The police have also received 340 reports of cryptocurrency-related scams so far this year in Calgary alone, with losses topping $22 million. 

Most of the crypto frauds came as big investment opportunities that victims rushed into and lost their funds. This calls for urgent actions, hence the partnership with KPMG.

Leveraging KPMG’s Professionalism

KPMG is a business forensic company whose goal is to help clients achieve the highest level of business integrity through the prevention, detection, and investigation of fraud and misconduct. 

Its skilled forensic experts are versed in cross-border and sector-specific knowledge, conduct precise investigations, analyzing intricate financial data to detect crimes and prevent them. Chainalysis says its clients will be leveraging the company’s professional forensics to help them prevent future frauds.

“By teaming up with one of Canada’s largest professional services firms, our clients can leverage the expertise of KPMG’s trusted forensics and crypto asset advisory professionals to establish effective know your transaction (KYT) rules, stronger anti-money laundering protocols and robust investigation strategies,” Chainalysis co-founder and Chief Strategy Officer Jonathan Levin added.

Global Rise in Crypto Crypto Crimes

Canada isn’t the only country facing the menace of the rising number of crypto crimes. All over the world as crypto adoption continues to grow, crypto fraudsters have also increased in number and effectiveness of their operations to better steal from unsuspecting victims.

According to a crypto crime report by Chainalysis, global illicit crypto transaction volume reached record levels last year, hitting $20.6 billion. This number is likely to increase in the coming months as the crypto industry goes into a bull market between 2024 and 2025 based on expert predictions.

The crime rate has also increased during bull markets historically. This coincides with the time when new investors enter the crypto industry with little or no experience, most of which are usually taken advantage of by fraudsters.

This calls for caution on the part of crypto investors who should be more mindful of the kind of investments they get into.

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Binance Sees $1 Billion Net Outflows in 24 Hours Following DOJ Settlement

World’s largest crypto exchange, Binance has seen a massive outflow of assets following news that its CEO Changpeng “CZ” Zhao Was resigning after pleading guilty to criminal charges in the U.S.

Data from DeFiLlama revealed that the exchange recorded a net outflow of over $1 billion within 24 hours following CZ’s resignation. Of the $1 billion, $605.9 million came across the Ethereum, BNB chain, Avalanche, Fantom and Polygon networks, data from on-chain analytics platform Nansen also revealed.

CZ also agreed to pay a $50 million fine, in addition to Binance’s $4.3 billion fine after it pled guilty to several counts including money laundering, conspiracy to conduct an unlicensed money transmitting business, and sanctions violations. 

Commenting on the incident, chief commercial officer of crypto market maker Auros, Jason Atkins told The Block that there is a second-order effect around market sentiment as “developments, such as the fines levied on Binance by the DOJ, are indicative of the positions of various regulatory bodies when it comes to historical infractions.” 

“We anticipate that this will accelerate the outflow of projects, exchanges, founders and firms from direct U.S. regulatory purview,” Atkins said. “Compliance will now be non-negotiable so as to minimize lapses in the AML and KYC requirements in the U.S., irrespective of the country of incorporation.”

BNB Down 9% Following News

Following the news of CZ’s resignation and the $4 billion settlement, Binance’s cryptocurrencies Binance Coin (BNB) dropped over 9%. Though it had been down for some time, the token was already recovering, reaching over $466.

However following the news, BNB has dropped to new lows, currently trading at $231.17 at the time of writing this report. As the general crypto market is also bleeding, it is not likely that BNB will see a bounce anytime soon.

This may be as a result of investors losing interest in the token as CZ pleaded guilty to criminal charges leveled against him.

Looking to the Future

Although the settlement and resignation of its CEO was a major blow to Binance, the exchange has since moved on and is already planning for the days ahead. The exchange in a blog post yesterday admitted that it lacked adequate compliance controls in its early days, but tried to frame a positive vision for the future.

Binance emphasized that it has “worked hard to restructure our organization and personnel and upgrade our systems.” 

“With the compliance and governance enhancements enshrined in our commitments, we can begin to share our vision for Binance’s exciting future and the future of the crypto industry. We are confident that Binance will emerge as a stronger company as we lay the foundation for the next 50 years,” it wrote.

The company maintained that it has at all times maintained 1:1 backing for user assets, highlighting that, in the settlement, U.S. regulators did not allege misappropriation of user funds or market manipulation. 

Key players in the crypto industry have expressed optimism that Binance’s settlement is positive for the industry, and that it will allow the industry to move on and make progress. Meanwhile, regulators are going after more exchanges with Kraken being the latest.

Coinbase which is already in court could be next in line for a settlement as this is fast becoming the norm with regulators in the U.S.

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OpenAI Engages in ‘Intense Discussions’ to Halt Exodus of Key Employees

The departure of Sam Altman from OpenAI has exposed the tech company to potential career gaps as more employees threaten to step down. In a recent update, the OpenAI core team demanded the board to reconsider its decision and return Altman. 

In response to the employee’s demand, Anna Makanju, the vice president of global affairs at the startup, issued an internal memo confirming that OpenAI was engaging in “intense discussion” to back its leadership transition plan. 

OpenAI Hit by Employees Exodus

The executive stated that the OpenAI seeks to unify the board, management, and outgoing CEO. Also, the OpenAI team plans to bring on board the newly appointed chief executive Emmett Shear. After a lengthy discussion with the OpenAI management, Makanju admitted that the tech firm might not be in a position to share its final thoughts concerning the Altman case. 

The memo was released days after the OpenAI board of directors fired Mr. Altman. Surprisingly, the dismissal of Altman exposed OpenAI to a major exodus of its top executives. 

In a recent report, OpenAI key players in the research division, including Jakub Pachocki, Aleksander Madry, and Szymon Sidor, revealed plans to leave office. Also, the president of the OpenAI board of directors, Greg Brockman, announced plans to step down. 

The departure of OpenAI top executives widened the professional gaps at the startup, forcing other employees to seek other viable opportunities. According to Reuters, approximately 90% of OpenAI staff are at the edge of leaving the office.

OpenAI Investors Seeks for Reinstatement of Former CEO

 Shortly after leaving OpenAI, Altman announced plans to start a new venture. Based on his past achievements and extensive experience in tech and innovation, some of the OpenAI employees are willing to join Altman to support the establishment of the new entity. 

Elsewhere, other OpenAI supporters and business associates have started campaigns to bring back Altman. These campaigns are led by Thrive Capital, Tiger Global, and Khosla Ventures. Despite the efforts made to bring Altman back to OpenAI, it seems that the outgoing CEO has a better deal. 

A few days ago, the giant tech company Microsoft appointed Altman as a senior executive to support the company in expanding its artificial intelligence capabilities. The appointment of Altman aligns with Microsoft’s objective of leveraging the power of AI to support tech developments and improve the well-being of the community.

Following Altman’s appointment at Microsoft, the executive will only return to OpenAI under prescribed conditions. A source familiar with the information stated that Microsoft has published the condition that Altman can only return to OpenAI. 

OpenAI Struggles to Keep Employees from Leaving

With the sudden change in OpenAI management, the Microsoft team has suggested that Altman can only return to OpenAI if the current board of directors is dissolved. The giant tech firm also advised OpenAI to consider restructuring its governance to sustain the remaining employees and attract new talents. 

A review of the current OpenAI governance model demonstrated that the startup has adopted an “unusual non-profit governance system” that grants the board of directors overall control over the startup. 

The power conferred to the board aims at supporting the management to attain its core objective of humanity. Unlike other governance models, the OpenAI restricts the investors from interfering with the board’s interests.

In an exclusive interview with CNBC, the chief executive of Microsoft, Satya Nadella, revisited last week’s events and advised the OpenAI team to consider improving the existing governance structure. The CEO silenced the tide of criticism that Microsoft faced after it appointed Altman for a top-level executive role. 

In her address, Nadella admitted that the Microsoft team was willing to partner with OpenAI. The CEO confessed that Altman would continue working for Microsoft.

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SEC Sues Kraken for Running Unregistered Trading Platform

The Securities and Exchange Commission (SEC) has filed a lawsuit against another top crypto exchange, Kraken, for not registering as a securities trading platform.

In the suit filed on Monday, the SEC said it’s seeking a judgment to permanently forbid Kraken from violating securities laws and ordering the exchange to give up gains from running an unregistered trading platform.

The agency also wants to stop the exchange from acting as an unregistered exchange, broker, dealer or clearing agency.

“Without registering with the SEC in any capacity, Kraken has simultaneously acted as a broker, dealer, exchange and clearing agency with respect to these crypto asset securities,” the SEC wrote in a court filing in the U.S. District Court for the Northern District of California. 

“In doing so, Kraken has created risk for investors and taken in billions of dollars in fees and trading revenue from investors without adhering to or even recognizing the requirements of the U.S. securities laws that are designed to protect investors,” the filing further stated.

The SEC under current chair Gary Gensler has maintained that cryptocurrencies are securities, hence crypto exchanges must be registered with the agency as securities exchanges or face the law. Apparently, crypto exchanges haven’t accepted this and continue to operate, hence the legal actions against them.

Kraken’s “Prohibited” Practices

Among the reasons for suing Kraken are its operational practices, one of which is commingling of user assets. The SEC further alleged that  Kraken’s business practices, internal controls and record keeping presented investors additional risks “that would also be prohibited for any properly registered securities intermediary.”

“Kraken has at times held customer crypto assets valued at more than $33 billion, but it has commingled these crypto assets with its own, creating what its independent auditor had identified in its audit plan as “a significant risk of loss” to its customers,” the agency said

“Similarly, Kraken has held at times more than $5 billion worth of its customers’ cash, and it also commingles some of its customers’ cash with some of its own,” the SEC also said, alleging the exchange at times paid operational expenses directly from bank accounts that held customer cash.

“In failing to prevent known conflicts of interest and commingling its investors’ assets with its own, Kraken demonstrates why registration and the investor protections that come with regulatory oversight are critical to the soundness of the United States capital markets,” the SEC added.

Kraken Joins Line of Sued Exchanges

The SEC embarked on a crackdown on crypto earlier this year, leading to the lawsuit against crypto exchanges Coinbase, Bittrex, and Binance. Kraken is now the latest exchange to be charged to court by the SEC.

While Bittrex has settled the SEC by paying a fine, Coinbase and Binance are still in court. However, in a recent development, the U.S Department of Justice (DOJ) has asked Binance to settle the suit with a $4 billion fine.

Kraken’s suit isn’t much of a surprise, as the SEC said it was going after more crypto companies as soon as it had less to handle on its plate. With Binance almost out of the way, it is logical that the agency is coming after Kraken, and may do same for more crypto companies in the near future.

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Bittrex Global to Wind Down Operation in December

As the legal peril against non-compliant firms intensifies, crypto firms have taken strategic action to comply with the US Securities and Exchange Commission (SEC). Despite the efforts to meet the regulatory requirements, the ongoing SEC crackdown on crypto firms has forced vital market players to cease operations. 

On Monday, Bittrex Global joined the string of companies at the edge of closure of operation due to the long waging war with the SEC. The Bittrex team confirmed plans to wind down operations as of December 4. 

Bittrex Global to Sunset Trading Activities

The troubled crypto exchange stated that all trading activities would be unavailable two weeks from now. In an X post, Bittrex Global confirmed the crypto exchange has decided to wind down operations due to SEC legal action.

 The tweet demonstrated that the crypto exchange felt apologetic about the closure of Bittrex’s operation since the firm has been operational for almost two decades. In the X post, the Bittrex team advised the customers to withdraw their assets from December 4 to allow the firm to start the winding down process.

 The Bittrex team shared the procedure for withdrawing the funds and encouraged the customers to start the withdrawals immediately. In a subsequent post, the crypto exchange confessed that the decision to close Bittrex’s operation stemmed from the SEC regulatory action against the company.

Impact of SEC Crack Down on Crypto Firms

 At the beginning of this year, the Bittrex team closed its US operations, citing the unclear regulatory environment. The Bittrex team regretted that despite the efforts to comply with the law, most US regulatory requirements were vague. 

The crypto exchange blamed the lawmakers for enforcing rules without consulting the public. The exchange added that lack of regulatory clarity has created unhealthy competition in the crypto industry.

 An X post from the chief executive of Bittrex, Richie Lai, revealed that the US was not economically viable, hindering the crypto exchange from attaining its core objectives. The CEO lamented that the current regulation for digital assets and economic slowdown has made it difficult for the exchange to continue operating in the US. The closure of Bittrex US resulted in the dismissal of around 80 employees.

Bittrex Files for Chapter 11 of Bankruptcy Protection

After sunsetting the US operations, the SEC charged the crypto exchange for contravening the securities laws by offering customers unregistered securities. Responding to this allegation, the Bittrex team neither denied nor admitted that it provided unregistered financial products. 

The court ordered Bittrex to settle a court penalty amounting to around $24 million within 90 days after liquidation. In May, Bittrex filed for Chapter 11 of Bankruptcy Protection at a court in Delaware. The file of Chapter 11 aimed at allowing the crypto exchange to restructure. 

Editorial credit: Mehaniq / Shutterstock.com

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Tether Freezes USDT Worth $225M Linked to Human Trafficking Group

With the advancement in the digital sector crypto has become a tool for conducting unlawful activities forcing industrial players to take decisive action to protect the digital industry from collapsing. As part of the pivotal role to shield the crypto industry from involvement in criminal activities, Tether has freezed million dollars linked to human trafficking.

 In a recent report, the leading stablecoin issuer, Tether, froze $225 million tied to a human trafficking group. This preventive measure aim at assisting the Department of Justice (DOJ) to conduct a thorough investigation on the incident to prosecute the criminals. 

Tether Report Pig Butchering Case to DOJ

A statement from a Tether spokesperson revealed that several digital wallets holding measurable amounts of USDT belonged to a human trafficking group based in Southeastern Asia. After analyzing the transaction history involving the self-custodial digital wallet, Tether noted that the suspicious group orchestrated a “pig butchering scam.”

 The stablecoin issuer observed that the suspects created fake accounts on different social media platforms to deceive innocent investors to venture into a bogus investment. The suspect develops various tactics, such as establishing a relationship with investors to convince them on the benefits of investing in crypto investment. 

Last year, a pig butchering scam exposed US residents to losing assets worth $3.3 billion. A report from the Federal Bureau of Investigation (FBI) revealed that the pig butchering scam was conducted by Asian illicit groups targeting innocent crypto investors.

 From their findings, the Tether team noted that the suspects used 37 digital wallets to transfer funds to the Seychell-based crypto exchange OKX. Shortly after discovering the incident, Tether informed the OKX about the matter. 

The two contacted Chainalysis to assist in tracking the movement of the funds. After extensively investigating the movement of funds, Tether and OKX reported the matter to the relevant authorities.  

Rise of Crypto Scams

A statement from the chief executive officer of Tether Paolo Ardoino confirmed that after reporting the matter, the US Secret Service advised the exchange to suspend the account linked to the suspicious group immediately. 

The CEO admitted that Tether worked closely with the DOJ during the initial investigation phase. Ardoino was pleased to announce that the collaboration with the DOJ demonstrated Tether’s commitment to creating a secure environment to boost the development of the crypto industry. 

This impressive move portrayed Tether’s devotion to combat crime by implementing new safety standard that restricts unlawful activities.Lately, Tether has positioned itself among the crypto exchange, fighting for a secure crypto industry. 

Last month, Tether worked closely with Israeli law enforcement units to freeze 32 crypto addresses tied to the Hamas and Ukraine illicit groups. The collaboration with the Israeli law enforcers aimed at weakening the financial stronghold of Hamas by restricting the flow of funds.

Tether Vows to Collaborate With Law Enforcers to Address Crypto Crime

In an earlier report, Ardoino affirmed that Tether would remain at the forefront in promoting the use of responsible blockchain. The CEO vowed to work with global law enforcers to stand against cybercrime. 

The executive stated that Tether will remain committed to restoring financial integrity and promoting international security. In 2022, Tether assisted the US law enforcers in freezing USDT worth $46 million linked to the FTX.

 Despite Tether’s pivotal responsibility in safeguarding the crypto industry by bringing down criminals, the stablecoin issuer has faced multiple charges with US law enforcement units. 

A few years ago, Tether was described as a controversial stablecoin issuer after it failed to prove that the US dollar ultimately backed USDT. The market regulators noted that Tether provided fake documents concerning its dollar-backed stablecoin.

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Canada Requests Feedback on Crypto Reporting Rules From Banks

The banking regulator in Canada, the Office of the Superintendent of Financial Institutions (OSFI), has called on banks to  give feedback on guidelines on how banks should report crypto exposure.

Similarly, the Basel Committee on Banking Supervision (BCBS) is asking for feedback from internationally active banks through its own consultation. OSFI specifically asked for feedback in three areas, which it said it will combine with developments coming from the BCBS. 

“Digital innovation is transforming how we transact, manage money, and view value but poses risks to our financial system,” the OSFI said in a statement. “Recent crypto events underscore risks of unregulated financial innovation. Public disclosures enhance transparency, comparability of data, and market discipline for a safer financial system.”

The Canadian government is one of the most skeptical when it comes to crypto innovation. As a result, the country is also considering the launch of a central bank digital currency to bypass the use of cryptocurrencies. 

Seeking feedback on crypto disclosures from banks is also one of the strategies to ensure that crypto is regulated and not used without supervision from regulators.

The draft of guidelines for crypto reporting are expected to be published by the fall of 2024, with final rules to be communicated by 2025. 

The BCBS Asks Questions

As part of the feedback request, the BCBS has also released a statement requesting feedback from internationally active banks through its own consultation. According to a statement from the agency, this consultation allows the industry to provide feedback on BCBS proposals, ensuring that the guidelines align with the Canadian context.

“What, if any, technical aspects of the BCBS disclosure tables and templates should be amended for banks and insurers in the Canadian context?” it wrote in its own consultation. “What key considerations should we factor in to ensure proportionality of disclosures?”

“What other considerations raised by the BCBS consultation should we keep in mind in developing Canadian disclosure expectations?” the regulator continued. 

The provided answers will be a critical part of the final rules to be released by 2025, and participating institutions have until January 31 to send it their comments.

The Move for Crypto Regulation

Canada isn’t the only country that is working on crypto regulation and ensuring that the use of cryptocurrencies doesn’t amount to a risk to the financial system. In Europe, the European Union has come up with general rules for the region, known as MiCA. 

The rules which will be put into use by next year will ensure that crypto users in the region are protected and that legitimate crypto startups are also provided with the enabling environment to operate without affecting the financial system.

In the U.S, the regulators are taking a different approach by prioritizing enforcement. This led to a massive crackdown on crypto startups in the country, including Coinbase and Binance. 

So far, the securities and exchange commission (SEC) which is at the forefront of the crackdown remains resolute about its enforcement actions even though there’s almost non-existent crypto rules to guide the industry.

As a result, the industry led by Coinbase is seeking for the court to demand that proper regulations be put in place. In the same manner, the company is now lobbying lawmakers to draft legislation for a regulatory framework for crypto.

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Fidelity Investment Files for Ethereum Spot ETF Cites Growing Demand for Crypto

In a recent report, Fidelity Investment seeks to expand its product offering by introducing the Ethereum exchange-traded funds (ETF). On Thursday, November 16, the Fidelity team filed for the Ethereum ETF with the US Securities and Exchange Commission (SEC).

 This impressive move aims at positioning Fidelity among the best asset managers across the world. The proposal was submitted a day after its top rival, BlackRock, had filed for an Ethereum ETF with the SEC. Apart from BlackRock, other asset managers, including VanEck, HashDex, Grayscale, and 21 Shares, among others, have already submitted their Ethereum spot ETFs.

Fidelity Seeks to Offer Customer Ethereum Exposure

From the multiple applications Fidelity has developed a unique approach to gain a competitive advantage. The report revealed that the Fidelity Ethereum spot ETF will enable the user to track the price performance of Ether (ETH) through Fidelity Ethereum Index.

 Consequently, the asset manager plans to list the Fidelity Ethereum spot ETF on the Cboe BZX exchange under the ticker symbol ETHF. The Fidelity team confessed that the Ethereum spot ETF filing aims at enabling the US retail customer to gain exposure to digital assets. 

The assets manager regretted that the lack of comprehensive legislation for crypto assets in the US had forced the investors to turn to conventional exchange-listed and other traded products. In an email statement, Fidelity’s spokesperson confirmed that the growing interest among the customers for an Ethereum spot ETF challenged the firm to take strategic action and file its proposal to the relevant authority.

 The spokesperson noted that a significant number of Fidelity customers had demonstrated their willingness to invest in digital assets. He vowed that the Boston-based asset manager will remain committed to offering the esteemed customers a unique portfolio of solutions. 

Fidelity Investment to Offer Ethereum Spot ETF

This portfolio will provide customers with a platform to explore different investment options. The spokesperson added that Fidelity will equip their customers with relevant knowledge crucial to making informed financial decisions. 

Beyond this, the asset manager plans to extend their staunch support to enable the users to meet their financial obligations. Elsewhere, the chief executive of Fidelity, Abigail Johnson, confessed that for a long time, the asset manager has been aiming to integrate crypto assets in its product offering. 

Last year, the Fidelity team introduced a Digital Asset Account (DAA) to allow employees to buy crypto assets. The assets manager confirmed that the eligible 401K employees could access the DAA. 

The launching of the DAA raised concerns among US policymakers. In July, the US policymakers recognized the unique features of the Fidelity Investment retirement plan. However, the lawmakers were a bit skeptical that the Fidelity DAA might expose the employees to the inherent risk of Bitcoin.

With the changes in the financial landscape, the Fidelity team noted the potential gaps in the market that limit investors from venturing into low-risk investments such as the Ethereum ETF. The asset management pointed out challenges faced by investors seeking to tap the endless benefits of crypto assets. 

These challenges include legal uncertainty in the US, technical challenges, and counterparty risks.Citing the variety of spot crypto assets in the European market, the Fidelity team blamed the US government for restricting the public from gaining exposure to digital assets. 

Recently, the European regulators approved the Bitcoin ETF application submitted by the Jacobi group. The approval allowed the financial institution to list its Bitcoin spot ETF on the Euronext Amsterdam Stock Exchange on August 15.

SEC Delays to Approve ETFs

An announcement conveyed by James Seyffart, a renowned ETF research analyst, revealed that the Fidelity application was among the seven Ethereum ETF applications submitted to the SEC. The executive stated that BlackRock leads other asset managers in applying for the Bitcoin and Ethereum ETF. 

He confessed that BlackRock boasts of managing assets worth around $8.5 trillion, while Fidelity has $4.5 trillion in assets under management. The BlackRock team anticipated that by launching the Bitcoin ETF, the investors would gain exposure to digital assets. 

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OpenAI Faces Exodus of Senior Executive Cites Ongoing Leadership Shake Up

The departure of Sam Altman as the chief executive of the giant tech firm OpenAI has triggered a top-level exodus. A source privy to the information stated that the departure of Altman from OpenAI has deepened the leadership shakeup.

In a recent meeting, the OpenAI board of directors complained that they lacked confidence in Altman’s leadership. After careful consideration, the board agreed to remove Altman from office, citing that he “was not candid in his communications with the board.”

OpenAI Hit by Major Exodus of Key Executives

They regretted that lack of proper communication hindered the board from attaining its core objectives. The OpenAI team appointed Mira Maruti as the interim CEO. The tech company revealed plans to recruit a suitable candidate to succeed Altman.

Hours after the OpenAI team removed Altman from office, the chairman of the board of directors, Greg Brockman, announced plans to leave office. The departure of one of the biggest stars in the artificial intelligence industry has marked a shocking turn of events for OpenAI as three key executives in the research division have revealed plans to resign from their posts.

A November 17 announcement revealed that the OpenAI director of research, Jakub Pachocki, and an official in risk management, Aleksander Madry, had revealed plans to step down from office. Also, Szymon Sidor, a key player in the OpenAI research, will be resigning from his research duties.

According to the source familiar with the situation, the three executives expressed their disappointment with Altman’s removal from office. 

Sam Altman Leaves Office

In a separate report, another OpenAI employee Alex Cohen updated X that he was dismissed from work. In his previous role, Cohen worked closely with the OpenAI board of directors and assisted them in preparing presentations. The official regretted that the OpenAI team did not provide further details concerning his dismissal.

The departure of Cohen and the resignation of high-profile executives have raised concerns about whether the tech company was preparing for a massive layoff. Cohen predicted that approximately 40% of the OpenAI team were actively searching for new job openings.

The executive stated that Altman and Brockman played a critical role in onboarding more customers to OpenAI. He regretted that the departure of OpenAI core players could undermine the company’s efforts to sustain its customer base and attract new clients.

Worldcoin Market Outlook

Even though the OpenAI did not mention whether Altman maintained a healthy work relationship, the outgoing CEO had some misunderstandings with chief scientist Ilya Sutskever. According to the report, Altman and Sutskever had engaged in a heated argument concerning the impending fundraising to support OpenAI in optimizing its operations.

News concerning the OpenAI leadership transition has triggered Worldcoin (WLD) to showcase a remarkable recovery. According to CoinMarketCap, WLD increased by 23% to trade at $2.44 in the last 24 hours. The WLD established an upward trajectory, pushing the daily trading volume to reach $256 million, a 42% increase in a day.

Editorial credit: Ascannio / Shutterstock.com

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