blockbank Crypto News Desk — #12

Feb 20th

Yuga Labs Accused of IP Theft for Trademarking BAYC Wolf Skull Logo

Yuga Labs, the creator of the popular non-fungible token collection Bored Ape Yacht Club (BAYC), has been accused of intellectual property (IP) theft for allegedly illegally trademarking the iconic wolf skull logo without proper licenses. The image was originally released by Easy Drawing Guides, a company specializing in drawing tutorials for children and beginners.

NFTs were introduced to solve the illegal use of intellectual properties and protect artists, but Yuga Labs has been accused of doing the opposite. Yuga Labs trademarked the unlicensed logo as its own, which Easy Drawing Guides confirmed as their original drawing protected by their terms and conditions.

On one hand, BAYC supporters believe that no intellectual property was breached in using the logo; however, most agree that Easy Drawing Guides is entitled to compensation. This incident raises questions about the ethical implications of using someone else’s intellectual property without permission, especially in the rapidly expanding world of NFTs.

As the use of NFTs continues to grow, it is important for creators to be aware of the laws and regulations surrounding the use of intellectual property. While the rise of NFTs provides a new medium for creators to monetize their work, it is crucial to respect the original creators and their intellectual property.

NBA Hall of Famer Paul Pierce Charged by SEC for Promoting Ethereum Max Without Disclosure

On February 17, the Securities and Exchange Commission (SEC) charged NBA Hall of Famer Paul Pierce with illegally promoting the EMAX token on his social media accounts. The EMAX token was offered and sold by EthereumMax. This action highlights the SEC’s continued crackdown on celebrities and influencers who promote unregistered crypto-asset securities without disclosing their compensation.

.@espn I don’t need you. I got
@ethereum_max I made more money with this crypto in the past month then I did with y’all in a year. TRUTH shall set u Free 🤪🤪 my own Boss

–Paul Pierce (May 26, 2021)

Pierce has agreed to pay a penalty of $1,115,000, plus approximately $240,000 in disgorgement and prejudgment interest, without admitting or denying guilt, to avoid greater sanctions from regulators. He is also prohibited from promoting any crypto asset securities for three years.

The SEC alleges that Pierce fraudulently promoted the purchase of the EMAX token without publicly disclosing that EthereumMax paid him over $244,000 in EMAX for promoting it. The accused even posted screenshots of a fake account that showed significant profits and holdings using EMAX. However, it was all fake, as “his own personal holdings were, in fact, much lower than those in the screenshot.”

Former FTX Executive Nishad Singh to Plead Guilty to Fraud Charges and Potentially Cooperate with Authorities

Former FTX executive Nishad Singh is reportedly preparing to plead guilty to fraud charges related to the collapse of the crypto exchange platform. Singh was the former director of engineering and had a major role in FTX’s day-to-day operations. He is now working out a plea deal with prosecutors that could see him plead guilty to fraud charges and possibly cooperate with authorities against Sam Bankman-Fried, the former CEO and disgraced founder of FTX. Singh’s cooperation is hoped to shed light on FTX’s alleged illegal campaign contributions to US political candidates and their relationship to Bankman-Fried.

Singh would be the third member of Bankman-Fried’s inner circle to cut deals with authorities in the criminal case against the former crypto billionaire. Last year, former Alameda Research CEO Caroline Ellison and FTX co-founder Gary Wang pleaded guilty and agreed to collaborate with prosecutors.

The Commodity Futures Trading Commission and the Securities and Exchange Commission plan to sue Singh over his role in the alleged scheme, according to a Bloomberg report. The plea deal is still to be finalized.

Bankman-Fried has been charged with eight criminal charges, including wire fraud and conspiracy by misusing customer funds. He is facing more than 100 years in prison for the crimes he is accused of. The latest development in the FTX saga is that a New York judge has put the cases against Bankman-Fried brought by the SEC and the CFTC on hold until the criminal cases against him are concluded. New court documents have also revealed the identities of the two mysterious co-signers on Bankman-Fried’s bond, who turned out to be Stanford University professors and close friends of his parents.

New Malware Threats Targeting Crypto Investors: Here’s What You Need to Know

The rise of cryptocurrency has led to an increase in cyberattacks targeting crypto investors. Hackers and cybercriminals are always on the lookout for new ways to exploit vulnerabilities and steal funds. Recently, two new malware threats have been discovered that specifically target cryptocurrency investors.

The first threat is the MortalKombat ransomware, which is used to encrypt a victim’s files and demand payment in cryptocurrency in exchange for the decryption key. The second threat is the GO variant of the Laplas Clipper malware, which steals cryptocurrency wallets and passwords from victims.

According to a report by Malwarebytes, the attacks are mainly targeted at victims in the United States, with a smaller percentage of victims in the United Kingdom, Turkey, and the Philippines. The attackers use a phishing email to lure victims into downloading a malicious ZIP file containing a BAT loader script. The script then downloads the malware payload, which is either the MortalKombat ransomware or the GO variant of Laplas Clipper malware.

To make the phishing emails look more legitimate, the attackers impersonate CoinPayments, a legitimate global cryptocurrency payment gateway. The emails come with a spoofed sender, “noreply[at]CoinPayments[.]net”, and the email subject “[CoinPayments[.]net] Payment Timed Out.” The malicious ZIP file is attached with a filename resembling a transaction ID mentioned in the email body, which tricks the victim into unzipping the malicious attachment.

It is important for crypto investors to be vigilant and take steps to protect themselves from such attacks. They should never download attachments from unknown senders or click on links in suspicious emails. It is also recommended to use anti-malware software and keep all software and operating systems up to date to prevent vulnerabilities.

Related: Why Cybersecurity in Crypto is More Important than Ever

While ransomware and cyberattacks continue to rise, victims are becoming more reluctant to pay attackers their demands. This is a positive trend as it reduces the profitability of such attacks and may discourage cybercriminals from targeting cryptocurrency investors. It is crucial for the authorities to take strict action against cybercriminals to protect the integrity of the crypto market and prevent financial losses for investors.

Illinois introduces “the most unworkable state law” against blockchain transactions

A recently introduced bill in the Illinois Senate has received criticism from the crypto community over its “unworkable” proposals to force blockchain miners and validators to reverse transactions if ordered by a state court. The “Digital Property Protection and Law Enforcement Act” bill would authorize courts to order a blockchain transaction executed via a smart contract to be altered or rescinded. This would apply to any blockchain network that processes a transaction originating in the state of Illinois. The bill states that miners and validators may be fined between $5,000–10,000 for each day they fail to comply with court orders. However, it would be “impossible” for them to do so according to Florida-based lawyer, Drew Hinkes. The bill would also mandate that any person using a smart contract to deliver goods or services in the state include smart contract code capable of responding to court orders.

Hinkes has described the bill as “the most unworkable state law” related to blockchain and cryptocurrency that he has ever seen. Other members of the crypto community have similarly ridiculed the bill, with one analyst calling it “hilarious” and a lawyer explaining that it would essentially try to ban immutability on blockchains.

blockbank: Where innovation meets finance. Experience the future of Digital Asset Management and Banking with our cutting-edge blockchain platform that combines security, transparency, centralized and decentralized solutions.
We provide our users with a custodial wallet, a non-custodial private wallet, a bank account, and a Visa debit card. It’s the Crypto Super App!

Learn More: Website | Twitter | Reddit | LinkedIn | Telegram | Discord

OpenSea Drops Fees and Changes Creator Royalties Model Amidst Tension with Blur

The NFT marketplace is going through a period of transformation as OpenSea and Blur fight for dominance. OpenSea, the largest NFT marketplace, recently announced it would drop its fees to 0% for a limited time, and only enforce a 0.5% mandatory creator royalty fee on NFT trades. This move comes after rival marketplace Blur made a case for creators to list on its platform instead of OpenSea, citing that creators cannot earn royalties on both platforms simultaneously. Blur’s platform does not charge a marketplace fee for traders.

OpenSea has cited events such as Blur’s decision to roll back creator earnings and the false choice they’re forcing creators to make between liquidity on Blur or OpenSea as the reason for the shift. OpenSea’s enforcement tool blocks marketplaces that do not fully enforce creator royalty settings, including Blur. However, Blur was able to find a workaround to that blocklist in January, helping it pull more users away from OpenSea in recent weeks.

OpenSea is attempting to find a path forward that benefits both NFT creators and traders, and it hopes its new model will find the right balance of incentives and motivations for all ecosystem participants — creators, collectors, and power buyers and sellers. The marketplace is also allowing sales using competitors with the same policies, so creators won’t have to make the choice between receiving earnings on OpenSea or Blur.

The NFT marketplace is in the midst of a rapid shift, with marketplaces trying to maximize market share by having the lowest fees for high-frequency trading. The fight for dominance between OpenSea and Blur is likely to continue.

SEC Charges Terraform Labs and Do Kwon with Securities Fraud

The US Securities and Exchange Commission (SEC) has filed a lawsuit against Singapore-based Terraform Labs and Do Hyeong Kwon, the founder of Terra, for allegedly defrauding investors in a scheme involving multiple unregistered securities. The SEC alleges that the company raised billions of dollars from investors through unregistered transactions between April 2018 and May 2022, by repeatedly claiming that their tokens would increase in value. Kwon and Terraform Labs allegedly misled investors about the stability of the TerraUSD (UST), an algorithmic stablecoin. UST was meant to have a constant $1 value through a mix of algorithms and trader incentives involving a sister token, Luna. However, UST lost its US dollar peg in May of last year and never recovered despite several rescue attempts. The SEC further alleges that Terraform Labs offered five securities, including Luna, Wrapped Luna, TerraDollars (UST), Mirror (MIR), and Anchor (ANC). The lawsuit points towards Kwon and Terraform Labs’ efforts to create, advertise, and maintain the unsustainable lending protocol Anchor.

The news of the lawsuit has raised questions from the crypto community about how the SEC expects enforcement to work when Do Kwon and Terraform Labs are not based in the US but in Asia. There is uncertainty about Do Kwon’s whereabouts as he is believed to be in Serbia, but South Korean authorities have been unable to locate him. It is unclear how a potential arrest order from the US would be received in Serbia, should Do Kwon be confirmed to be there.

Binance’s Fan Token Platform Brings Sports Teams Closer to Fans

Binance, has launched an update to its fan token platform, which aims to bring sports teams closer to their fans by offering various rewards to token holders. The platform will allow fans to gather points that they can exchange for rewards ranging from tickets to games, meet and greets with athletes, video clips from favorite players, and exclusive dinners with the team.

The fan token activities will allow participants to collect points, and the level of participation will determine access to better rewards. The program’s head, Lisa He, has pointed out that fan tokens are the future of fan engagement, allowing sports fans to feel more connected to their favorite teams.

Binance has been consistently trying to link sports with the Web3 space. The exchange partnered with soccer superstar Cristiano Ronaldo to help him connect with his fans through non-fungible tokens, and it has also partnered with Società Sportiva Lazio to use NFT tickets for the club’s home matches at the Stadio Olimpico.

blockbank is an all-in-one crypto application that streamlines the user experience without compromising security, privacy, or decentralization. We provide our users with a custodial wallet, a non-custodial private wallet, a bank account, and a Visa debit card. It’s the Crypto Super App!
Stay up-to-date with all the developments by joining our community!
Product Hunt | Website | Twitter | Reddit | LinkedIn | Telegram | Discord Instagram
Download: Apple or iOS