Hong Kong, Australia, and Venezuela took middle stage as regulatory actions rocked the scene. In the meantime, Sam Bankman-Fried’s mother and father face lawsuits whereas Binance and Coinbase navigate challenges.
Hong Kong ramps up efforts
Throughout the Shanghai Blockchain Worldwide Week, Duncan Chiu, a member of Hong Kong’s Legislative Council, introduced the forthcoming implementation of stablecoin laws in Hong Kong by mid-2024. This endeavor stands in stark distinction to China’s rigorous cryptocurrency insurance policies.
Authorities in Hong Kong beforehand apprehended 11 people linked to a cryptocurrency fraud case related to the JPEX platform.
This decisive response was prompted by complaints of illicit actions amounting to 1 billion Hong Kong {dollars} ($127.8 million).
The Securities and Futures Fee (SFC) underscored its vigilant oversight of the unfolding occasions. A number of days later, subsequent experiences instructed that the variety of arrested people had elevated to 11.
Australian company sues Kraken, ByBit hits roadblock within the UK
Shifting our focus past Asia, information rising from Australia revealed that The Australian Securities and Investments Fee (ASIC) filed a lawsuit towards Bit Commerce Pty Ltd, the operator of the Kraken change in Australia.
The allegations pertain to Bit Commerce’s alleged non-adherence to Australian monetary laws. ASIC contended that Bit Commerce’s margin buying and selling, which lacked correct goal market identification, contributed to losses estimated at $12.95 million for its Australian clientele.
Bybit, a Dubai-based change, just lately determined to droop its providers for patrons within the U.Okay. because of the nation’s new laws relating to crypto promoting and promotions.
Bybit introduced that U.Okay. customers have till Jan. 8, 2024, to shut their positions or danger liquidation. New U.Okay. registrations will stop on Oct. 1, and deposit capabilities shall be disabled for present prospects from Oct. 8.
ByBit’s announcement got here up a day after the U.Okay.’s Monetary Conduct Authority (FCA) delivered a stern remaining warning to corporations selling crypto belongings to prospects within the nation.
Regardless of prior outreach efforts, the FCA seems annoyed by the lackluster response from unlicensed crypto corporations abdoad, with a meager 24 out of 150 even bothering to answer to their inquiries. The company warned that each one corporations take heed or put together for some regulatory turbulence from Oct. 8.
Venezuela confiscates illicit Bitcoin mining machines
This week, Venezuelan safety forces carried out a raid on the Tocorón jail, managed by a infamous prison gang, seizing Bitcoin (BTC) mining machines alongside weapons comparable to grenades and rocket launchers.
The federal government deployed over 11,000 personnel to retake the jail, which had grow to be the working headquarters of the dreaded Tren de Aragua gang, infamous for a variety of unlawful actions.
Among the many jail’s extravagant services, together with a zoo and on line casino for inmates, have been Bitcoin mining machines used for illicit mining.
Journey to Bankman-Fried’s FTX trial
The crypto scene additionally witnessed a number of developments on the journey to FTX founder Sam Bankman-Fried’s fraud trial within the U.S. This week, prosecutors raised objections to Bankman-Fried’s intensive jury choice queries for the upcoming trial.
They argued that these questions might lengthen the choice course of and probably bias jurors in favor of the protection. They described the proposed questions as pointless, time-consuming, repetitive, and argumentative.
In the meantime, Bankman-Fried is seeking to make a second try and safe his launch from the Brooklyn Metropolitan Detention Middle forward of the trial.
His protection staff will seem earlier than one other U.S. Appeals Courtroom, aiming to persuade judges that staying in detention hampers his protection preparation. This comes after a Southern District of New York courtroom denied his pretrial launch.
Nevertheless, in a stunning flip of occasions, District Choose Lewis Kaplan blocked a number of key witnesses, together with British barrister Lawrence Akka and College of Michigan professor Andrew Di Wu, from testifying in Bankman-Fried’s upcoming trial.
The trial had relied on these witnesses to make clear FTX’s phrases of providers and obligations. Choose Kaplan’s determination got here in response to prosecutors’ issues raised in late August, who argued that these people didn’t meet the factors for skilled testimony.
Household feud
The present FTX administration took the surprising step of accusing Sam Bankman-Fried’s mother and father, Joseph Bankman and Barbara Fried, of improperly redirecting thousands and thousands of {dollars} and contributing considerably to FTX’s implosion.
Per courtroom paperwork, the Stanford Regulation College professors weren’t simply bystanders; Joseph Bankman held a key decision-making function, whereas Barbara Fried influenced the corporate’s political donations, they stated.
So as to add extra twist to the matter, courtroom filings from this week make clear how Joseph was initially supplied a $200,000 annual wage at FTX, and had grander ambitions, looking for $1 million a yr for his function within the firm. He even enlisted the assistance of SBF’s mom, Barbara Fried, in these negotiations.
Binance vs. SEC
Binance’s challenges spilled into this week. Stories on Sept. 19 indicated that Binance is going through elevated scrutiny from the SEC amid the departure of a number of executives, together with the CEO of its U.S. arm.
The SEC is pushing for a deeper investigation into Binance’s actions, particularly relating to asset custody on the change. The company described Binance’s opposition to its movement as “half-hearted.”
This authorized tug-of-war continues as Binance maintains that its counsel narratives and paperwork ought to suffice, dismissing remaining issues as baseless.
The SEC can also be involved about how Binance’s U.S. arm, BinanceUS, handles buyer belongings.
The core of this conflict facilities on an entity often known as Ceffu. The SEC asserted that Ceffu is one other Binance entity, rebranded and used for the custody of BinanceUS buyer belongings. Nevertheless, Binance CEO Changpeng Zhao refuted these claims, claiming that BinanceUS has by no means utilized Ceffu or Binance Custody.
Binance requests dismissal of prices
Binance and Zhao filed a movement on Sept. 21 requesting the dismissal of the SEC’s lawsuit. They argued that the company is overstepping its authority, additional citing lack of regulatory readability within the crypto trade.
They asserted that the SEC’s makes an attempt to use its authority retroactively to crypto asset gross sales courting again to July 2017, with out prior public cryptocurrency steering, are unjustified.
Binance’s authorized staff additional contended that the SEC is misinterpreting securities legal guidelines in an try to realize regulatory management over the crypto sphere. Including to this authorized saga, on the identical day, BinanceUS additionally filed a separate request for prices to be dismissed.
Coinbase explores abroad development
Whereas Binance grapples with regulatory challenges, Coinbase — one of many largest crypto exchanges within the U.S. — regarded to increase overseas.
Coinbase added one other feather to its European cap by snagging an operational license from the Financial institution of Spain. This transfer permits the change to be a registered change for Bitcoin and different crypto belongings. With this nod from the Financial institution of Spain, Coinbase is now a licensed custody pockets supplier and might serve each retail and cooperate shoppers in Spain.
Coinbase has been eyeing licenses in Europe for fairly a while, particularly within the derivatives market. Apparently, the change confirmed curiosity in buying FTX’s European arm shortly after the FTX empire went bankrupt.