Department of Justice (DOJ) federal prosecutors from the Southern District of New York are investigating fintech company Block, formerly known as Square, for significant compliance failures in its transaction monitoring systems after a former employee revealed lapses that included processing transactions with sanctioned nations and groups linked to terrorism. Allegations against Block include handling transactions […]
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Salvadoran Official Crypto Wallet Chivo Dismisses Alleged Hacking Event
Chivo wallet, the official cryptocurrency wallet of El Salvador, has dismissed an alleged hack of the source code of its software and the data of over 5 million users linked to the wallet’s KYC procedures. According to Chivo, the data of Salvadorans is protected, and the security of its data has never been breached. Chivo […]
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New Research Paper Sheds Light on Alleged Conflicts of Interest in FTX’s Chapter 11 Filing
A recent research paper on SSRN by legal scholars scrutinizes the ethical quandaries and potential conflicts of interest surrounding Sullivan & Cromwell LLP’s involvement in FTX’s Chapter 11 bankruptcy filing. Study Highlights Legal Ethics From FTX Bankruptcy Proceedings The SSRN research paper entitled “Conflicting Public and Private Interests in Chapter 11” meticulously explores the controversial […]
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New York Judge Determines SEC’s Case Against Gemini and Genesis Is Plausible for Alleged Securities Law Violations
A New York federal judge has ruled that the Securities and Exchange Commission (SEC) has “plausibly alleged” that Gemini and Genesis violated securities laws through the Gemini Earn program. Judge Edgardo Ramos Highlights Hurdles in Dismissing Injunction Claims Early; Cites Howey and Reves A federal court in New York has affirmed the plausibility of the […]
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UN Sanctions Inspectors Probe Alleged North Korean Cyberattacks Targeting Crypto Firms
United Nations (UN) sanctions monitors are reportedly investigating specific cases of hacking attacks allegedly carried out by North Korea-affiliated hackers between 2017 and 2023. Besides attacking decentralized finance platforms, the UN monitors alleged that North Korea-affiliated hackers are targeting defense companies and supply chains. Hackers Rake in Billion in Six Years The United Nations […]
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EIA Launches ‘Emergency Survey’ on Crypto Mining’s Power Use Amid Concerns of Alleged ‘Public Harm’
The U.S. Energy Information Administration (EIA) has gained clearance from the Office of Management and Budget (OMB) to conduct an urgent survey regarding electricity usage by cryptocurrency mining firms across the U.S. The EIA submitted this request on the grounds that “public harm is reasonably likely” should standard operations persist.
Biden’s OMB Approves EIA’s Emergency Survey on Crypto Mining Energy Impact
The Biden administration’s Office of Management and Budget (OMB) has greenlit the Energy Information Administration (EIA) of the U.S. government to initiate a survey among mining enterprises. Starting next week, the EIA aims to gather information from specified commercial crypto mining companies, mandating their cooperation in disclosing energy consumption details. The authorization for this emergency data collection request was granted by the OMB on Jan. 26, 2024. Additionally, the EIA plans to invite public feedback regarding the data gathering on the energy usage of cryptocurrency miners.
“We intend to continue to analyze and write about the energy implications of cryptocurrency mining activities in the United States,” Joe DeCarolis, the EIA administrator said. “We will specifically focus on how the energy demand for cryptocurrency mining is evolving, identify geographic areas of high growth, and quantify the sources of electricity used to meet cryptocurrency mining demand.”
Biden has declared a Federal “emergency” because #bitcoin is winning pic.twitter.com/NwxLxHynQ9
— Pierre Rochard (@BitcoinPierre) January 31, 2024
The justification for the approval presents a compelling case, with the EIA highlighting that “public harm is reasonably likely” should the current course remain unaltered.
Currently diving into this edict from the EIA against bitcoin mining operations in the US. It is extremely Orwellian.
It seems like they are trying to create a hyper-detailed registry of miners in the US down to particular ASICs. pic.twitter.com/tfZRhjugHe
— Marty Bent (@MartyBent) February 1, 2024
“As evidence, the price of bitcoin has increased roughly 50% in the last three months, and higher prices incentivize more crypto mining activity, which in turn increases electricity consumption,” the reasoning behind the emergency request notes. “At the time of this writing, much of the central United States is in the grip of a major cold snap that has resulted in high electricity demand.”
Furthermore, the request elaborates:
The combined effects of increased crypto mining and stressed electricity systems create heightened uncertainty in electric power markets, which could result in demand peaks that affect system operations and consumer prices, as happened in Plattsburgh, New York in 2018.
Glenn McGrath, an EIA spokesperson conveyed to Reuters that the request is warranted. “We do think it is a significant source of demand which is worthy of our efforts to quantify it,” McGrath said. “However, until we are able to substantiate the activity with better data, we, too, have more questions than answers.”
What do you think about the EIA’s emergency mandate? Share your thoughts and opinions about this subject in the comments section below.
Ukrainian Police Collaborate With Europol to Apprehend Alleged Cryptojacking Mastermind
The Ukrainian police, in collaboration with Europol, recently apprehended the alleged mastermind behind a cryptojacking scheme. According to a statement released by Europol, the arrest underscores why the private sector should collaborate with law enforcement.
Law Enforcement and Private Sector Collaboration
The Ukrainian police recently arrested a 29-year-old man accused of masterminding a complex cryptojacking scheme. The unnamed man, who was apprehended in Mykolaiv, is believed to have mined cryptocurrencies worth over million using illegally accessed cloud resources.
According to a statement released via European Police (Europol), the alleged cryptojacker’s arrest followed months of collaboration between Ukrainian law enforcement, Europol and an unidentified cloud services provider. The statement said the arrest underscores why the private sector should collaborate with law enforcement.
Explaining how the probe, which saw law enforcement agents comb three properties associated with the cryptojacker, unfolded, Europol said:
“A cloud provider approached Europol back in January 2023 with information regarding compromised cloud user accounts of theirs. Europol shared this information with the Ukrainian authorities, who subsequently opened an investigation.”
On the day of the arrest, the European Cybercrime Centre (EC3) of the law enforcement agency set up a command post to support the National Police of Ukraine.
Meanwhile, in the statement, Europol shared some anti-cryptojacking tips that cloud service providers can use to stop criminals from illegally accessing cloud computing infrastructure. One way cloud providers can do this is by having strong access controls in place.
Cloud service providers can also block cryptojackers by regularly monitoring cloud environments for suspicious activities and keeping cloud resources updated, the statement added.
What are your thoughts on this story? Let us know what you think in the comments section below.
Crypto Mixer Sinbad Sanctioned by OFAC Over Alleged Ties to North Korean Hackers
The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) has imposed sanctions on yet another cryptocurrency mixing platform, labeling Sinbad.io as a “key money-laundering tool” used by the North Korean Lazarus Group crime syndicate. Sinbad.io, in addition to handling transactions originating from the Democratic People’s Republic of Korea (DPRK), has also been linked to processing transactions associated with drug trafficking and sales on darknet marketplaces.
OFAC Sanctions Sinbad.io; Agency Claims Mixer Helped Obscure Funds Stolen From Harmony Bridge, Axie, and Atomic Wallet
The U.S. Treasury’s Financial Crimes Enforcement Network (FinCEN) and OFAC have turned their attention towards digital currency mixing protocols. While Tornado Cash and Blender.io were previously targeted by both agencies, the latest subject of scrutiny is the mixer known as Sinbad.io. This service operates as a bitcoin (BTC) mixing platform, and according to OFAC, its primary function is to obscure transaction details, effectively concealing the flow of funds on the blockchain.
OFAC’s investigation has revealed that this mixer has been utilized by the infamous North Korean hacking group, Lazarus Group. Furthermore, it has been implicated in laundering funds obtained from the Harmony Horizon Bridge and Axie Infinity hacks. OFAC has now identified it as the “preferred mixing service” for the Lazarus Group, following the takedown of Blender.io. “Sinbad was used to launder a significant portion of the 0 million worth of virtual currency stolen on June 3, 2023, from customers of Atomic Wallet,” OFAC detailed.
“Mixing services that enable criminal actors, such as the Lazarus Group, to launder stolen assets will face serious consequences,” said Wally Adeyemo, the deputy secretary of the Treasury. “The Treasury Department and its U.S. government partners stand ready to deploy all tools at their disposal to prevent virtual currency mixers, like Sinbad, from facilitating illicit activities.”
This development comes in the wake of FinCEN’s recent update in late October, where it introduced new regulations requiring financial institutions to report transactions involving international cryptocurrency mixing services. At the time, Andrea Gacki, the director of FinCEN, and Adeyemo expressed their determination to combat illicit activities linked to digital currency mixing services.
Even before the proposed rules, the Treasury’s OFAC had been actively taking enforcement actions against mixers such as Blender and Tornado Cash. Simultaneously, OFAC had identified and flagged numerous sanctioned cryptocurrency addresses across various networks. The Treasury also warns that U.S. persons who “engage in certain transactions with the entity designated today may themselves be exposed to sanctions.”
What are your thoughts on this story? Let us know what you think in the comments section below.
Report: Taiwan Law Enforcement Seize Over 320 Million USDT From Alleged Money Launderer
Taiwanese law enforcement recently revealed the seizure of more than 320 million USDT stablecoins from an alleged money launderer. The seizure has been described as Taiwan’s largest bust ever from a single individual.
Lamborghini and a Lexus Seized
Taiwan’s law enforcement recently said it nabbed the four individuals behind what is being described as the region’s “largest virtual currency money laundering syndicate.” In a statement, the region’s law enforcement bodies said one of those arrested who is only identified as Qiu is said to have laundered more than 320 million USDT stablecoins. Three more individuals were also arrested alongside Qiu, the statement added.
According to a local language report, the now-seized funds relate to an investment fraud case operated by Qiu which was uncovered back in October 2022. However, despite the unmasking fraud scheme, law enforcement agents did not immediately arrest Qiu who is said to have frequently travelled to Malaysia and other South East Asian countries.
However, it was upon his return to Taiwan in June 2023 that agents finally detained Qiu and his accomplices and seized their mobile phones. As stated in the report, officials only discovered the extent of Qiu’s money laundering activities after they examined the accused’s mobile phones. As per the report, the value of the virtual currency during the raid on Qiu is believed to be the highest amount ever seized from one individual.
Besides the virtual currency, Taiwanese law enforcement is reported to have recovered two vehicles, a Lamborghini URUS and a Lexus LM luxury from Qiu’s residence. Laptops, credit cards, drugs, and three expensive watches were also seized.
Meanwhile, prosecutors from the Taichung District Prosecutor’s Office are said to have set Qiu’s bail at just over ,000 and 0 for one of his accomplices.
What are your thoughts on this story? Let us know what you think in the comments section below.
Ethereum Co-Founder, Consensys Sued By Early Employees Over Alleged Equity Promises
More than two dozen early employees of the blockchain software company Consensys have filed a lawsuit against Ethereum co-founder Joseph Lubin, Consensys, and other parties. The plaintiffs allege Lubin broke contractual promises related to equity compensation made when the employees joined the company in its formative years starting in 2014.
Ethereum Co-Founder Joseph Lubin Faces U.S. Lawsuit
The lawsuit filed in New York comes as Consensys, now valued at over billion, has evolved from its early experimental structure to a more traditional centralized company. The lawsuit was filed on October 19, 2023, in New York state court by 27 former Consensys employees.
The court filing names Joseph Lubin, Consensys, and JPMorgan Chase as defendants. The plaintiffs claim Lubin induced them to join Consensys in its early days with offers of equity in the parent “hub” company Consensys AG.
The former staff members allege Lubin promised this equity would not be diluted. However, in 2020 Consensys restructured, reportedly moving key assets to a new Delaware entity Consensys Software Inc. (CSI). The plaintiffs claim they were largely excluded from the restructuring, leaving their shares in the original Consensys AG far less valuable.
“Lubin made a similar offer to each plaintiff in connection with his or her joining Consensys; plaintiffs accepted the deal, and an agreement was formed,” the lawsuit details.
Lubin allegedly broke a deal that early employees would “win or lose – together – alongside Lubin and Consensys.” The suit claims “Finance took precedence over founding employees.” It seeks damages for breach of contract and fiduciary duties.
It’s not the first instance where Consensys and Lubin have faced such allegations. On March 1, 2022, a collective of thirty-five ex-staffers, accounting for over half of all recognized Consensys AG (CAG) stakeholders, lodged a petition for a distinctive review in line with article 697a and following sections of the Swiss Code of Obligations. The intent? To delve deep into significant discrepancies within CAG.
A spokesperson for Lubin and Consensys fervently refuted the allegations, describing them as “frivolous” in an email sent to Bloomberg. “After two years of getting nowhere with their frivolous claims against Consensys Mesh in a Swiss court, plaintiffs now believe their merit-less claims stand a better chance of yielding a pay day if they game U.S. courts and entangle Consensys Software and other unrelated parties in litigation,” the spokesperson stressed.
What do you think about the lawsuit against Lubin and Consensys? Share your thoughts and opinions about this subject in the comments section below.