Lawyers of disgraced FTX founder Sam Bankman-Fried have once again sent a letter to Judge Lewis Kaplan, requesting their client be released from jail before his upcoming trial — only this time, they’ve come up with a plan they hope will satisfy authorities.
In the letter submitted on Monday, lawyers said that they are finding it “exceedingly difficult” to prepare for the complex case. “This is not a point we make lightly but it is the reality of the nature of this case,” the document reads.
“We appreciate the efforts the Government has made to provide our client access to the case materials and his counsel, but we respectfully submit that, in practice, they are not workable.”
Bankman-Fried’s lawyers are concerned by the overwhelming amount of information that the case requires the defense to process and prepare for. The letter explains that prosecutors have submitted:
over 50 potential witnesses,
more than 3,500 pages of material, and
over 1,300 exhibits.
Lawyers have “no indication” of which witnesses prosecutors will actually call upon, meaning that in many cases, they won’t know who will take the stand until the day prior. This means the team must be able to meet with Bankman-Fried far more frequently than what’s possible from jail, at all hours of the day, just to keep up.
“We will not be able to do this unless he is temporarily released for trial,” the letter explains.
Bankman-Fried would live with a security guard under new proposal
In previous letters, Bankman-Fried’s attorneys outlined the realities of jail visiting hours. It detailed insufficient WiFi issues, as well as several instances when Bankman-Fried was barely able to prepare due to trivial jail proceedings out of his control.
The latest letter submitted on Monday, however, proposes a solution that lawyers believe would allow Bankman-Fried to be released for the duration of the trial in a way that will satisfy authorities.
Under this proposed plan, the FTX founder would:
remain with attorneys at their office or temporary workspace, or with a security guard at a temporary residence in New York City for the duration of the trial,
be able to leave the courthouse with his lawyers and travel with them to their office or a temporary workspace in order to prepare for trial, and
have constant supervision from the security guard during the evenings, to ensure he doesn’t use computers, cell phones, or other electronic devices to access the internet or television.
Lawyers have also stated that Bankman-Fried will agree to a gag order to stop him from speaking to anyone about the case, outside of his legal team and family.
Judge Kaplan has yet to respond to this latest letter. However, time is running out — Bankman-Fried’s highly-anticipated trial will begin on October 3.
Last week, the government of Venezuela sent 11,000 police officers and soldiers into Tocorón prison, notoriously run by the Tren de Aragua gang, and seized buckets of bullets, piles of machine gun ammo belts, sniper rifles, explosives, rocket launchers, grenades, and a small army of bitcoin miners.
Backed by tanks and armoured vehicles, the prison was successfully stormed on Wednesday. As police and troops discovered, Venezuela’s most powerful gang has been attempting to make extra cash with rows upon rows of old Bitmain Antminers.
It’s unclear how profitable the bitcoin mining operation was; old equipment aside, Venezuela has temporarily banned crypto mining. And while the country enjoys cheap, subsidised electricity, energy blackouts are frequent.
What is clear, however, is that Tren de Aragua members were having an absolute riot before troops showed up. Authorities found that the prison featured a restaurant, pool, children’s playground, gambling rooms, a disco named Tokio, a baseball field, and a zoo — à la Escobar.
According to reports, the zoo housed tigers, lions, crocodiles, flamingos, ocelots, and pumas, to ‘threaten’ inmates and government officials.
Bodycam footage by authorities reveal the prison also housed a small army of pigs, which likely fed the inmates and gang members.
The prison has served as the gang’s headquarters for some time. From Tocorón, Tren de Aragua is said to have carried out its operations across South America, living in shacks constructed outside of where the other prisoners were housed. Tocorón allowed the gang freedom to do as they please, as well as recruit and train new members.
The gang is known for kidnappings, robberies, drug trafficking, prostitution, extortion, and illegal gold mining.
Tren de Aragua leader and top members fled
Authorities said that 1,600 inmates were evacuated during the raid. Alongside the hoards of weaponry found, police and soldiers discovered that some Tocorón inmates had been kept “in a kind of slavery,” Interior and Justice Minister Remigio Ceballos said.
Four prison guards were arrested under suspicion of helping the gang members enjoy their unusually sweet amenities, and 60 Tren de Aragua members were captured, Ceballos stated.
However, some are reported to have escaped — according to local outlet El Nacional, between 400 to 500 prisoners are still missing. This includes Tren de Aragua leader Héctor ‘Niño’ Guerrero, who was apparently tipped off about the raid and escaped with other high-ranking officials several days before through a hidden tunnel that had several exits.
Guerrero is thought to have raked in over $3 million a year through various operations ran from the prison, including charging inmates for vaccinations.
Now entirely vacated, Tocorón will undergo restoration.
The founder of ‘decentralized’ wallet provider Mixin Network has told users that the firm will ensure only “half” of their assets are safe, following a $200 million hack over the weekend that left users wondering how decentralized the project really is.
In a Mandarin-speaking livestream on Monday, founder Feng Xiaodong said attempts to recover the lost funds were ongoing but “very difficult,” the Block reports. As a result, the company is looking into alternative ways to recoup user assets, as well as a new system for hosting user funds.
While only half of the total user assets on the network are not affected, the other half may be recouped through what Feng called “bond tokens,” which users can claim in the hopes that Mixin Network will buy them back one day.
At press time, Mixin’s token XIN has dropped 9% since the news broke, from $212 to $192. Mixin has temporarily suspended deposits and withdrawals while it sorts itself out.
‘Decentralized’ Mixin likely hacked via Google Cloud
According to Mixin, the hack was made possible through a breach of its cloud service provider’s database.
“In the early morning of September 23, 2023 Hong Kong time, the database of Mixin Network’s cloud service provider was attacked by hackers,” Mixin announced two days later on X (formerly Twitter), “resulting in the loss of some assets on the mainnet.”
The firm continued that it had contacted Google and SlowMist to aid in its investigation — suggesting its cloud provider was Google Cloud.
Crypto influencer Ben Armstrong, formerly known as BitBoy, took to social media yesterday numerous times to collect donations via livestream — and has collected over $80,000 from his followers at press time.
Armstrong has been struggling since his YouTube channel and other social media accounts were taken from him by the Hit Network — a company that he helped to found — after he was accused of drug use and a family affair. Unable to use the BitBoy name, the crypto influencer has reinvented himself as Ben.
Claiming to be down on his luck, Armstrong listed three addresses for individuals to donate to: a Bitcoin address, a Cardano address, and an Ethereum address. So far one of the largest donations appears to be an almost 11,000 USDT donation from an anonymous source.
“The fact is I was under duress, I’ve been under duress.” Armstrong said in a livestream yesterday, “like, when people see what they did to me with this Lamborghini, trying to bleed me out, that’s what they’re trying to do.”
Armstrong’s Lamborghini Huracan Performante was confiscated by Hit Network because it was under the company’s name.
Money floods in as BitBoy sits in his mansion
Armstrong took to a YouTube livestream from the comfort of his Georgia mansion, from which viewers could see two large flatscreens, marbled countertops and walls, and expensive leather stools that lined his kitchen.
Meanwhile, he mostly spent the hour and a half livestream talking about supposed death threats, financial shenanigans, and “a citizen conspiracy.”
“I have the receipts for it,” Armstrong said, without showing anything, “they’re literally threatening to kill me.”
A Thai man has been arrested near Bangkok for shooting his wife in the leg after a fight about losing their bitcoin investments, and subsequently barricading himself in his home for six hours as police surrounded the residence.
Referred to as Kritsada by local outlet The Thaiger, the Thai man tried to kill his 31-year-old wife Pistamai after the couple argued over the loss of 700,000 baht ($19,500) in bitcoin investments. Fearing further violence, police negotiated with Kritsada instead of entering the home. He eventually surrendered.
Officer Manas Atthadod from Uthai Police District said they had seized the .38 calibre gun Kritsada also used to shoot himself in the leg after shooting his wife.
Thai man charged with attempted murder over bitcoin loss
It remains unclear which bitcoin investments Kritsada made. However, Thailand’s Ministry of Digital Economy and Society has said over 200,000 citizens had become victims of crypto scams. In late August, it warned Meta that it needs to curb fraudulent ads on Facebook or risk watching the platform get banned in the country.
The Thai man’s bitcoin loss occurred after Pistamai had reportedly asked to be separated from him, which caused him to regularly visit their home, The Thaiger reports. Though receiving medical treatment, she is said to be safe.
Her husband was charged with attempted murder and unlicensed possession of a firearm and ammunition.
Kenya’s interior cabinet secretary Kithure Kindiki has claimed that US authorities blocked the country from detaining several top executives of controversial crypto project Worldcoin.
Worldcoin’s co-founder and CEO Alex Blania, as well as its chief legal counsel Thomas Scott, were among those arrested in Nairobi’s airport by Kenyan authorities, a spokesperson for Worldcoin’s parent firm confirmed to local outlet Nation.
Co-founded by ChatGPT founder Sam Altman, the crypto company has come under fire across the globe for privacy and ethical concerns. In Kenya alone, it’s estimated that at least 350,000 people had elected to have their irises scanned by the company in exchange for just Sh7,000 ($48) in its volatile cryptocurrency, WLD.
US tells Kenya it wants its Worldcoin bigwigs back
At the committee hearing, Kindiki said that the US blocked authorities from going through with the detainments because Blania, Scott, and the other Worldcoin executives haven’t been “found guilty” of crime.
“They tried to leave the country but were stopped and put in custody. However, the US government intervened, saying they should be allowed to leave because they haven’t yet been found guilty of committing a crime and gave an undertaking that it will produce them when required,” Kindiki said.
The ad hoc committee probing Worldcoin has until September 28 to submit its findings. Last week, co-founder Altman was spotted attending a closed-door meeting with President William Ruto, the US Ambassador in Kenya Meg Whitman, and others.
According to Kindiki, the government has recovered the ‘Orbs’ used by Worldcoin to controversially collect the biometric data of its citizens. “Pertinent documents” have also been recovered, along with “26 statements recorded from witnesses and persons of interest,” the interior cabinet secretary said.
This includes a statement from Blania, who had already appeared before the committee prior to his arrest. During his testimony, Blania said that Worldcoin had already invested Sh700 million ($4.8 million) in Kenya — apparently in the form of blockchain and crypto education and ICT awareness.
Our commitment to the people of Kenya is genuine,” Blania told the committee, “and we have at all times endeavoured to operate honestly, compliantly and above all transparently.”
Chinese fintech giant Ant Group is reportedly pulling out of the crypto market by selling its $100 million stake in A&T Capital, amid market turbulence and increasing focus on AI.
A&T Capital was founded in April 2021 and has invested in various crypto firms including Matrixport and ConsenSys. The firm hit a significant snag several months ago when its founding partner Yu Jun resigned amid an investigation into his workplace conduct.
With the departure of its major investor, Ant Group, it’s unclear whether A&T Capital will shut down or look for new funding.
The move comes amid waning venture capital in crypto. VC funding hit a record low for crypto in June when it dropped by 23% from May, to just $520 million raised in 84 funding rounds, Bloomberg reports.
Meanwhile, Ant Group has decidedly shifted its attention to AI. It entered China’s AI market two weeks ago by unveiling a finance-focused AI model.
Jack Ma-backed Ant Group, which owns Alibaba, is one of the biggest financial service firms in the entire world. Its most recent quarterly profits rose 17.4%, signalling a relief after two years of Chinese regulatory crackdowns that placed financial pressure on the fintech behemoth.
In July, Ant Group was slapped with a 7.12 billion yuan fine ($985 million) in China for violating several regulations surrounding consumer protection, anti-money laundering, and corporate governance.
Troubled crypto exchange Binance has pledged to airdrop up to $3 million worth of its BNB token to users affected by the earthquake in Morocco and up to $500,000 in BNB to those living in areas impacted by the floods in Libya — but some aid experts say that it screams marketing ploy rather than genuine disaster relief.
In two separate press releases, Binance pledged to airdrop $100 worth of BNB to those who have already completed proof of address (POA) checks in Libya and Morocco. Only Binance users identified as living in areas affected by the natural disasters will be eligible — those who provide POA afterwards will receive $25 in BNB, and all active users will be airdropped $10 in the native token.
According to Binance, this POA method “has its limitations and inaccuracies,” however it’s “the best method we have available to us to locate potentially impacted users.” The crypto exchange, currently embroiled in regulatory probes across the globe, has pledged up to $500,000 to 13,000 users in Libya. Up to $3 million has been committed to 70,000 users in Morocco.
However, the number of those affected by the crises pales in comparison to the number of people who will be provided aid by Binance.
Over 2,800 people have died from the earthquake in Morocco and 300,000 people have been affected.
The floods in Libya have killed a staggering 11,300 people and has affected 900,000 so far.
Death tolls and the number of those affected by both disasters are expected to rise.
In addition to the BNB airdrops, Binance Charity has opened a public donation address. Donated funds will be forwarded to a charity that has yet to be named.
Airdropping thoughts, prayers, and BNB
Aid experts have taken aim at Binance for only helping its own users, rather than all those affected. And the decision to airdrop its native token rather than practical aid has also come under fire.
“What people want is food, shelter, medical aid and space to grieve,” Iain Overton, executive director of charity Action on Armed Violence, told the FT. “They’re not looking for crypto.“
According to a spokesperson for the International Federation of Red Cross and Red Crescent Societies, aid needs to come in a form that can “help [people] meet their basic needs immediately.”
“If it is crypto, do they see that this is something that can help? If I don’t have food and I am in the middle of an earthquake, is crypto going to get me food and clean water right now? That’s what I need,” she said.
Binance has defended its decision in its press releases by saying that crypto can provide “fast, low-cost, borderless, and transparent transactions.” As needed, they can also be changed into local fiat currencies — and therefore crypto transfers are a legitimate way to deliver urgent financial aid.
Only, as pointed out by several aid experts, converting crypto into cash is unnecessarily difficult in times of need — and the inherent price volatility can expose disaster victims to unnecessary risk.
“I get that they’re trying to do a good thing, but ultimately it [appears to be] a bit of a PR stunt,” a manager at a major aid agency told the FT.
Will airdropped BNB even reach the right people?
If there’s one crypto exchange currently in need of good press, it’s Binance. The global firm faces lawsuits by the Securities and Exchange Commission and the Commodity Futures Trading Commission in the US, as well as a Department of Justice probe that could end in fraud charges.
The firm has been pushed out of the Netherlands and Germany and is under investigation in France and Australia. The EU and the US are reportedly working together to investigate Binance.
This is also not the first time that Binance has come under fire for publicity stunts masked as goodwill. In 2021, Binance was sued by the Malta Community Chest Foundation (MCCFF), a charity led by Maltese president George Vella. MCCFF claimed it never received over $9 million in crypto (mostly BNB) that Binance promised to terminally ill cancer patients back in 2017. Repeated reminders went unanswered, the foundation claimed.
In the firm’s statement, Binance chief Changpeng Zhao (CZ) said he hoped to “bring some relief to those affected” by airdropping BNB to disaster victims in Morocco. He encouraged airdrop receivers who weren’t impacted by the earthquake to “pass the funds on to those most in need” — suggesting that there’s absolutely no guarantee that airdropped BNB is actually reaching the right people.
“Those affected by the catastrophe will never hear of it, and those unaffected by the catastrophe may come away with a positive notion of [Binance’s] brand. It’s cynical at best,” Overton added.
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It was widely reported yesterday that a Mila Kunis-backed NFT cartoon project called Stoner Cats had been ordered by the Securities and Exchange Commission (SEC) to cease operations, pay a fine of $1 million, and begin a “fair fund” to save money that can go towards reimbursing victims.
However, the move by the SEC has seemingly caused the floor price of Stoner Cat NFTs to skyrocket over 250%. Sale volumes have shot up 2,500%.
EOS famously received what amounted to little more than a slap on the wrist — a $24 million fine for a $4 billion raise. Similarly, the creators of Stoner Cats are walking away from the project with an initial $8 million raised and an additional $500,000 earned from royalties, meaning even if many NFTs are returned, there’s little chance the project will be unprofitable.
If we deduct the $1 million fine and take a guess at how much money will go into the fair fund, (perhaps another $1 million), Stoner Cats would have still raised $6.5 million in a matter of weeks. This implies that the project, which only ever aired seven episodes between five to seven minutes each, spent ~$133,000 per minute of content.
According to the project’s website, Stoner Cats is “a story of a woman who uses medical marijuana to alleviate her early Alzheimer’s symptoms and her beautiful family of cats who will do literally anything to save her.”
Along with Mila Kunis, the star-studded main cast features an odd mix:
There’s certainly arguments to be made about whether or not royalties associated with specific NFTs are instantly a security. However, it’s clear that the creators of Stoner Cats, Chris Cartagena, Ash Brannon, and Sarah Cole, felt it wasn’t worth fighting the SEC over.
When asked if the creators could continue to collect the 2.5% royalty on the NFTs not in their possession, a lawyer familiar with the case replied, “The order is silent as to the actual resale royalty, but contains a blanket order against future violations,” adding “if Stoner Cats doesn’t immediately forfeit any proceeds they have likely violated the agreement.”
The creators have posted the SEC orders on their Twitter account, however the website makes no mention of the action at press time.
The Monetary Authority of Singapore (MAS) has said it has banned the founders of collapsed crypto hedge fund Three Arrows Capital (3AC), Su Zhu and Kyle Davies, from market activity in the country for nine years.
Effective immediately, both founders will be barred from director positions or becoming substantial shareholders of capital markets companies in the city.
“MAS takes a serious view of Mr. Zhu’s and Mr. Davies’ flagrant disregard of MAS’ regulatory requirements,” Loo Siew Yee, assistant managing director for policy, payments and financial crime at the central bank said in a statement. “MAS will take action to weed out senior managers who commit such misconduct.”
3AC went bankrupt in June last year, when it was decimated by the dramatic collapse of the Terra/Luna ecosystem and subsequent market crash. According to MAS, the crypto hedge fund “provided false information” by going over the limit of S$250 million ($184 million) that a registered fund management firm is allowed to oversee.
Zhu and Davies have been accused by the regulator of failing to comply with requirements to monitor and address risks associated with the crypto assets under its control.
Since 3AC’s collapse, the duo have launched controversial crypto exchange OPNX in the Seychelles, which was fined $2.7 million by Dubai’s crypto regulator last month. Zhu and Davies, along with co-founders Mark Lamb and Leslie Lamb were also fined.
Rapper Soulja Boy, real name DeAndre Cortez Way, and singer Austin Mahone have lost against the Securities and Exchange Commission (SEC) in a lawsuit filed in March against the pair, crypto entrepreneur Justin Sun, and Sun’s company BitTorrent.
The suit is wide-ranging, making claims from market manipulation to not disclosing paid advertising. Soulja Boy and Mahone sat on the less troubling of these charges, being accused of promoting Sun’s cryptocurrency TRON without disclosing that they were paid posts.
However, the main defendants in the case who are facing the most serious charges are Sun and BitTorrent. They will respond next week if they choose to fight the SEC. It’s expected that a filing will be made by September 20.
In a final judgment against Mahone, the singer was ordered to not accept securities-related compensation for three years, to pay back the $7,507 he was paid (plus $682 in interest), and to cough up a $37,535 fine to the SEC.
In total, the singer has just under a year to pay the SEC $45,724 for an undisclosed advertisement for Tron.
Soulja Boy off in this h*e, watch me crank it, watch me avoid (the SEC)
Meanwhile, Soulja Boy has refused to respond to the SEC’s charges, which has likely led to him receiving a default judgement. It remains unclear how much the rapper must pay to the SEC, let alone if they’ve been able to contact him since his attorneys were informed of the upcoming default judgement.
Brian Shroder, the chief exec of Binance US, has stepped down and been temporarily replaced by chief legal officer Norman Reed, as the firm cuts one-third of its employees amid mounting regulatory scrutiny.
Shroder’s departure comes hot on the heels of other Binance top executives leaving, including head of Eastern Europe and Russia, Gleb Kostarev, and global head of product, Mayur Kamat. The global crypto exchange is embroiled in numerous regulatory crackdowns and investigations by the US Commodity Futures Trading Commission (CFTC), Justice Department, and Securities and Exchange Commission (SEC), into money laundering, mishandling customer funds, ignoring sanctions, and more.
Binance US has also decided to cut another round of employees, this time more than 100 people. A spokesperson said in a statement that the move was a direct result of regulatory pressure in the US.
“The actions we are taking today provide Binance.US with more than seven years of financial runway and enable us to continue to serve our customers while we operate as a crypto-only exchange,” they said.
“The SEC’s aggressive attempts to cripple our industry and the resulting impacts on our business have real world consequences for American jobs and innovation, and this is an unfortunate example of that.”
Lawyers of disgraced FTX founder Sam Bankman-Fried say that a lack of sufficient WiFi and jail delays are hindering his ability to prepare for his upcoming court trial and he should therefore be granted pre-trial release.
The court filing from September 8 is the second pre-trial release request Bankman-Fried has sought in the past week. Lawyers argued that although the curly-haired former billionaire was promised access to a laptop and a hard drive from 8am to 7pm on weekdays, that hasn’t been the reality. Jail proceedings like inmate head counts have shed hours of prep time already, they said.
According to the filing, Bankman-Fried was held up from visiting rooms for two hours due to another inmate. Once he arrived, he wasn’t allowed to use his laptop without lawyers present, despite assurances that he would be. Additionally, once he did get access to the laptop, the internet was so slow that it took “10 minutes for the home page to load.” After an entire five-hour session, Bankman-Fried was only able to “load one document from the database to review” due to the WiFi and internal delays. Lawyers argued that not only was he brought in late, but he was “forced to return to his unit too early.”
“Despite the Government’s efforts, there does not appear to be a way to solve the internet access problem in the cellblock,” the filing reads. “That means that Mr. Bankman-Fried has no way to review and search documents in the discovery database or the AWS database before the trial. The defendant cannot prepare for trial with these kinds of limitations.”
A previous appeal for pre-trial release failed, given that Bankman-Fried has been found by judges to have violated bail conditions on several occasions — which landed him in jail in the first place.
In a video posted from his new X profile, Ben Armstrong announced that his persona, BitBoy, was dead and a new identity was born: Ben.
Armstrong had his YouTube channel, known as BitBoy Crypto, and his social media accounts taken from him by the Hit Network a couple weeks ago. Since then, the crypto influencer has admitted to “diet pill and steroid abuse” and vowed to a road to recovery and redemption.
Meanwhile, on YouTube Armstrong posted a video claiming he’d “lost everything” while wandering through a cavernous kitchen, lined with marble slabs and four different wall-mounted televisions. The shitcoin connoisseur also announces that “[Hit Network] took my Lamborghini from me because it was in the company name… they sold the Lamborghini out from under me.”
“We’re gonna get it all back,” he adds.
When a listener in his latest Space told Armstrong not to get rid of his Gucci tracksuits, his response was telling: “We’ll see what happens with the designer clothes, I may have to sell them all. That’s the place I’m in right now.” Why Armstrong would have to sell all his designer clothes and accessories is unclear, as no lawsuits or regulatory action have been taken against him yet.
Armstrong’s Ben coin, which is still down 87% from all-time highs, has popped 91% off its lows, and Armstrong has promised that “Going forward I have no enemies… I’m in no position to be telling people what to do.”
The founder of collapsed Turkish crypto exchange Thodex, Farouk Fatih Özer, has been sentenced to 11,196 years, 10 months, and 15 days in prison along with his sister Serap Özer and brother Güven Özer, and fined for 135 million liras ($5 million).
The Anatolian 9th Heavy Penal Court announced the verdict on Thursday. Özer was accused of running off to Albania with $2 billion in customer funds when Thodex, one of the largest crypto exchanges in Turkey at the time, suddenly went dark in April 2021.
The Thodex founder was extradited back to Turkey in April 2023. Serap and Güven Özer were also detained, along with at least 83 others. However, the court acquitted 16 of the 21 defendants and released four of seven in jail due to lack of evidence. Several others were given prison sentences for various offences.
According to the prosecutor’s 22-page opinion, Thodex was established with the intent to deceive and defraud users who wanted to invest in crypto. Farouk Fatih Özer has always denied these allegations.
Özer was found guilty of aggravated fraud, leading a criminal organisation, and money laundering.
Beijing-based social media app Weibo has removed 80 popular crypto influencers in compliance with China’s strict crypto crackdowns.
The influencers each had over eight million followers, according to the South China Morning Post (SCMP). In a statement on Tuesday, Weibo said they had breached eight regulations in the sphere of marketing, internet safety, telecommunications, trade, and finance.
The social media giant has removed these accounts as part of a larger cleansing of misinformation from its platform. Weibo said that it will continuously regulate the site in accordance to China’s laws and initiate crypto probes into “illegal virtual currency trading information.”
Crypto influencers in China have been facing restrictions and bans since 2019, SCMP reports.
China’s crackdown on crypto continues to see strict enforcement at play, though its effectiveness remains in question. In July, police arrested 21 individuals accused of running an illegal Tether money laundering ring.
Crypto exchange Binance has lost its top execs in Russia as regulatory scrutiny and sanctions trouble mounts, adding to a rapidly growing list of the firm’s leaders that have recently resigned.
Binance announced it was considering leaving the Russian market at the end of August — right after a Wall Street Journal article claimed that Binance had committed sanctions violations with Russian banks. Just weeks later, its head of Eastern Europe and Russia, Gleb Kostarev, announced he was leaving the crypto exchange.
“It’s been an incredibly interesting five-year journey, and I’m glad if I’ve been able to contribute to crypto adoption and freedom of money,” Kostarev wrote on Wednesday through a Facebook post. The Binance exec thanked CEO Changpeng Zhao (CZ) and its other co-founder He Yi.
Soon after, Binance’s general manager for Russia and CIS posted his resignation through Facebook as well. “OK it’s all over now,” Vladimir Smerkis wrote (translated from Russian).
Smerkis thanked “the entire top management” and Kostarev. “I do not regret a single day in the company,” he said, and used the opportunity to encourage everyone to make time for holidays. “I will spam you with pictures of the sea, pizza and sunsets.”
Binance execs abandon ship
Kostarev and Smerkis’ words of gratitude, which included no reason for stepping down, mirror the resignation announcement of Binance’s global head of product, Mayur Kamat. On Monday, the exec thanked CZ for “an experience of a lifetime” and said they would be leaving after just over 16 months to “take some time off after 20 years of non-stop product work.”
According to an anonymous source speaking to Forbes, Hillmann, Ng, and Ling decided to leave over CZ’s handling of the US Department of Justice’s ongoing investigation into money laundering and sanctions violations.
Binance is also under investigation across the EU, in the US, and Australia. At the end of July, it laid off over 1,000 employees and cut employee benefits, citing a decline in profits.
Four individuals posing as currency dealers have been arrested and charged in Taiwan for defrauding at least 10 victims out of over NT$50 million ($1.6 million), by tricking them into buying tether (USDT).
As reported by CNA and Taiwan News, after months of investigation prosecutors obtained court approval to detain four individuals with the surnames Li, Hong, Lai, and Zhang. Following police searches on August 29 and September 1, the four fraudsters were arrested in Keelung, a coastal city just 30 minutes northeast of Taipei.
After questioning, all four allegedly admitted to fraud, money laundering, and organized crime.
The group apparently used popular messaging app LINE to message victims, encouraging them to invest in stocks. Once trust was established, they switched to promoting USDT.
Victims were reportedly shown how to set up a crypto wallet and were guided towards fake sites and apps that were secretly controlled by the fraudsters. Victims’ funds were then withdrawn and transferred to an unnamed benefactor to cover tracks and avoid investigation.
Prosecutors are currently investigating whether more victims were targeted. As it stands, the biggest victim identified lost NT$4 million ($144,000).
Crackdowns on Tether fraud are occurring in China as well. In July, authorities arrested 21 individuals involved in a major Tether over-the-counter trading ring that processed 380 million yuan ($55 million) in USDT.
Crypto assets stolen by North Korea’s elite hacking groups and used to fund illicit weapons programs may soon be tracked and frozen by the South Korean government as it gears up to submit a new bill.
According to several South Korean government sources who spoke to Korea JoongAng Daily, officials have been working on legislation for 10 months that aims to “track and neutralize virtual coins and other cryptocurrency assets stolen by the North through hacking,” according to one insider. It has already gone through a round of revisions to include “practical measures to bolster national security” at the order of president Yoon Suk Yeol, several said.
One higher-up who asked to remain anonymous told the outlet that the bill will reflect the president’s concerns that “the country’s cybersecurity framework urgently needs repair” after it was “allowed…to fall into ruin in order to avoid offending North Korea” under its last administration.
According to the South Korean National Intelligence Service, North Korea makes about 650,000 hacking attempts every day in South Korea alone. In April, a group of lawmakers condemned North Korean leader Kim Jong Un’s organised cybercrimes.
“You are turning your country into a giant crime ring, thieving and threatening the safety of other countries,” they said in an open letter read outside the North Korean embassy in the UK.
Alongside a plan to monitor and seize North Korean crypto, South Korea’s new bill will also include the creation of a national cybersecurity committee directly under the president’s control. It will be able to “ban the manufacture, import and sale of the products that interfere with cybersecurity,” according to one anonymous official.
North Korea has made a pretty crypto penny by hacking organizations and individuals over the years. According to Chainalysis, the country has racked up over $3 billion in digital heists. Its missile program has been funded roughly 50% by these cyberattacks, the US deputy national security adviser Anne Neuberger stated last year.
The methods used by government-backed hacking groups are growing more sophisticated. In July, government-backed group Labyrinth Chollima was found responsible for a cyberattack on US-based tech company JumpCloud in an attempt to gain access to its clientele of crypto firms. This method, known as “supply chain attacks” wherein service providers are infiltrated in order to access its wealthy customers, has become a well-honed specialty for North Korean hacking groups.
A Brazilian crypto streamer lost over $60,000 during a livestream by accidentally revealing his private keys. After several seconds of on-screen panic, the man who goes by Fraternidade Crypto ended the stream and tried to transfer his funds — but it was too late.
The Sao Paolo-based influencer then started a new livestream, crying and pleading for the funds to be returned. After filing an official police report, Fraternidade Crypto was contacted by the thief. In a twist of fate, they voluntarily returned $50,000.
“Yesterday was one of the worst days of my life,” the streamer said in a later livestream. “I kind of froze at the time, as you see on the video. I stopped the video about 15 to 20 seconds after. I started to get bad, shaking you know?”
Fraternidade Crypto continued, “I needed to transfer the assets as soon as possible. The assets were in a liquidity pool — they weren’t in the wallet, only about $100 or so.”
“And then I don’t remember,” he said. “It went so fast and I got really bad. When I went to transfer the assets, an error sign appeared. I couldn’t believe that I was going through this.”
At that point, the streamer went back online. Visibly in tears, he pleaded with his viewers to call him and return the funds.
Thief returns $50K to unlucky crypto streamer
Speaking of the experience after the fact, Fraternidade Crypto said, “My mom came over. You get that feeling, you know, that life is over. But then I came to Discord to look for answers — the goal was to start moving, right, because it’s no use for me to cry.”
Upon his return from the police station, he checked his Discord. One of his followers messaged him: “Ivan, I need to talk to you.”
“I almost told him: ‘I can’t talk now, I’m f***ed up here.” But the pair ended up on a call and after a conversation, the funds were transferred back. “He said, ‘I f***ed up here, I know what I did was bad’ and he just hung up and left,” the streamer recounted.
About $50,000 was returned — but some people in the chat weren’t convinced the situation was authentic. “Why would I do this?” the streamer replied. “I didn’t do anything to recover it. The guy wanted to return it for some reason.”
“I won’t say his name because the guy returned it and there’s no reason for me to screw him, even though what he did was wrong. Maybe I went soft… I’m ashamed of going through this, I’m embarrassed. I just want to sleep.”
The crypto streamer is now taking measures to recover the remaining $10,000. Going through transactions made immediately after the mistake occurred, several people attempted to transfer his funds. One address, which took over 1.2 ETH ($1,900), is currently under investigation by contacts of the streamer as well as law enforcement.
As for the videos, which are still up, Fraternidade Crypto said they will remain watchable. “Let this video serve as a warning to everyone,” he said. “I will leave it here because I already lost. It will change nothing… and f*** it.”
Mango markets manipulator Avraham Eisenberg has been accused of possessing child pornography, according to court documents filed on Friday.
On page 37 of the US government’s memorandum of law in opposition of Eisenberg’s motion to dismiss, officials detailed how the FBI stumbled upon child pornography while extracting data from Eisenberg’s cellphone after obtaining a search warrant on January 19. This allowed the government to request a second search warrant, “expanding the scope…to search for evidence of offense related to the possession and receipt of child pornography,” the document said.
Eisenberg was arrested in Puerto Rico in December and charged with commodities fraud and manipulation. He admitted to the $100 million theft on Mango Markets — which he previously defended as a “legal” and “highly profitable trading strategy.”
His trial is set to begin in December. However, these newly discovered allegations of child pornography made in court documents have possibly added time to Eisenberg’s potential prison sentence.
Under US law, possessing child pornography is often treated with the same gravity as knowingly receiving it with the intent to possess. Possession carries up to 10 years in prison, with no minimum sentence. However, the judge will likely take context into consideration. Details of the child pornography found in Eisenberg’s possession remain unknown; factors like amount found and the severity of the content itself make a difference in sentencing.
Eisenberg has so far not been charged with child pornography. However, according to investigative journalist Karlstack, who played a pivotal role in the case and first reported the child pornography accusations, that will change “any minute now.”
An alleged whistleblower of crypto project Worldcoin has announced that they have severed ties with the organization and is currently aiding authorities “in multiple jurisdictions” to conduct “justified probes.”
Worldcoin is led by CEO Sam Altman, who is also the founder of ChatGPT. In a YouTube video self-published on Wednesday, alleged former employee Nadir Hajarabi said they had “many reservations” about the project from the get go. Several red flags were evident “from day one” but multiple attempts to address them were apparently dismissed.
“I wrote to the legal team [and] the CEO, and the answers weren’t satisfactory,” the alleged Worldcoin whistleblower said in the six-minute video. “They only contributed in cementing the conclusion that I came to: this is a great mission and vision but a horrendous execution that deserves whatever will come next.”
Hajarabi is referring to Worldcoin’s idea of “providing universal basic income to everyone around the world simply because they’re a human being.” That core mission drove Hajarabi to stay at the firm — but the Worldcoin token, WRLD, and the subsequent release of its white paper were deeply flawed, they said.
The supposed Worldcoin whistleblower has obtained lawyers, who have advised Hajarabi not to elaborate further. The goal of the video, Hajarabi stated, was to make sure the world knew Worldcoin was no longer associated with their name.
“To anyone who is curious about Worldcoin,” Hajarabi said at the end of the video, “I urge you to thoroughly read what you are getting yourself into.”
Worldcoin aims to scan the irises of the global population in order to confirm online that they are human instead of an AI. Over 2.2 million people have given their biometric data to Worldcoin in exchange for its native cryptocurrency, the project claims.
Sam Altman’s dystopian crypto project launched in July worldwide — though notably not in the US, where it would likely be seen as a security in the eyes of the Securities and Exchange Commission. In response to its rollout, authorities across the globe were quick to investigate the project’s integrity and impact on citizens. Various concerns have been raised, chiefly data misuse and accusations that it exploited those in developing countries by paying just 25 WRLD for their biometric data — around $35.
Worldcoin has been suspended in Kenya, one of its major markets, and a dedicatted committee has just 39 days left to probe the project. Worldcoin’s warehouse in Nairobi was raided as part of the ongoing investigation. Watchdogs in Germany, France, and the UK have launched their own investigations.
Hajarabi said in the video that multiple authorities in several jurisdictions are now benefitting from their alleged information. Protos has been unable to independently verify that Hajarabi worked at Worlcoin. We’ve reached out to Hajarabi and to the firm and will update this piece when we hear back.
In 2021, Protos reported on a disconcerting new claim: that unvaccinated sperm would become the next bitcoin. Amid unfounded fears that Covid-19 vaccines would cause infertility, anti-vaxxers claimed that their ‘pure’ sperm would become a rare commodity.
Vice picked up our story shortly after it came out, which in turn was sourced in a segment on The Late Show with Stephen Colbert. Interest in ‘unvaccinated sperm’ soared to new heights on Google — and anti-vaxxers capitalized on the attention by launching a cryptocurrency called ‘Unvaxxed Sperm’ (nuBTC).
In late November 2021, nuBTC launched as a fork of Ponzi scheme SafeMoon. According to its developers, who remained anonymous, nuBTC was meant to draw awareness to anti-vaxxer sentiments. The group had great ambitions that included launching a “pureblood” version of Tinder and cryogenically freezing unvaccinated sperm to be used when society ‘inevitably’ collapsed from the ‘infertility caused by Covid-19 vaccinations.’
The token’s price surged in its first week and then plummeted to almost zero. It never recovered.
As Covid-19 receded from news reels and vaccinated moms and dads popped out healthy babies, interest in ‘unvaccinated sperm’ quieted down. But instead of disappearing altogether, it’s still very much a thing — if you know where to look.
The underground Facebook market for unvaccinated sperm
Conspiracy theorists and right-wing thinkers in the US predominantly make up anti-vaxxers peddling ‘pureblood’ sperm. Like some kind of Harry Potter nightmare spin-off, if you’re vaccinated, you’re a filthy mudblood — and we won’t have your babies.
A market for unvaccinated sperm has grown alongside a global sperm shortage and a rise in alternative ways to become pregnant. In the US, so-called ‘sperm kings’ are offering their off-shoots for a low price, quite literally filling a gap in the market for couples who can’t get expensive IVF treatments.
Facebook groups like ‘Sperm Donation USA’ match couples with these sperm kings. As reported by New York Times, success stories are normal, with men sending their sperm in the mail and women impregnating themselves with it (known as ‘AI’ or artificial insemination).
Only, this unregulated market has a seedy underbelly. Risks of STDs and genetic abnormalities are high, not to mention there’s no limit on how many times a donor can donate, which raises concerns of smaller gene pools in the future.
Predatory behaviour is also a problem. Some donors will only perform natural insemination (NI) — also known as sex — or partial insemination (PI), which involves the donor masturbating and penetrating the recipient at the last minute.
Protos infiltrated Sperm Donation USA to learn more about the demand for unvaccinated sperm. In 2021 and 2022, several donors advertised that they were unvaccinated. “Located in Atlanta area,” one donor wrote on October 2, 2022. “Plant based. 5’10. Not vaccinated.”
“PS: Do not be upset if I decline you.”
Another advertised that they were a 32-year-old, 280 pound man who enjoyed axe throwing and shooting. “Highly approachable, personable, and energetic professional with a diverse background,” they wrote. “I don’t smoke or do drugs. Unvaccinated. STD free.”
But as time went on and research continued to prove that the Covid-19 vaccine doesn’t cause infertility, anti-vaxxers were ridiculed in the group. Posts discussing the topic soon had comments disabled by moderators. Anti-vaxxers were forced to mention their unvaccinated status as a footnote. Some chose to leave the group altogether.
Where has all the unvaccinated sperm gone?
Marginalized unvaccinated sperm kings have taken matters into their own hands. And in a shift away from free or almost free sperm in Facebook groups, these men are offering their ‘pureblood’ semen at a premium.
“UNVAXED SPERM, $3,400 A LOAD. I’LL CUM TO YOU!” reads the windshield of a car snapped by an X user (formerly Twitter). Bumper stickers, t-shirts, and other paraphernalia can be bought online advertising similar deals. You can regularly find unvaccinated men peddling their personal goods on X.
However, the hype surrounding unvaccinated sperm was truly rekindled in the media this April, when Guo Wengui, a fugitive Chinese billionaire closely tied to Steve Bannon, auctioned his unvaccinated sperm on Gettr. The move was hailed by its right-wing members as a “new era for humanity.”
Then in May, former Trump adviser Michael Flynn announced an online community for those who refused vaccines. According to its website, 4ThePURE aims to become “the next Amazon” for these conspiracy theorists. Members will be able to find ‘untainted’ partners, blood, eggs, breastmilk, and sperm… if they pay a $25,000 lifetime fee or $20 per month.
If 4ThePure takes off, anti-vaxxers would have a dedicated marketplace. And it looks like those who believe the hype are actively searching for them.
Just two weeks ago, a popular pro-Trump user’s post on X claimed unvaccinated blood and sperm will become the next bitcoin. She describes herself as a “Patriot who loves God and country” and a “#PUREBLOOD.”
A user replied that he encountered a person in the hospital who refused a necessary blood transfusion. “Unvaxed deserve unvaxed blood,” he wrote.
Customer service for troubled crypto exchange Binance told a user that it has suspended EUR withdrawals and deposits through SEPA days after its payment processor Checkout.com terminated the relationship — but has since deleted the post.
“We regret to inform you that we have temporarily suspended EUR withdrawals and deposits via SEPA,” Binance customer support replied on X (formerly Twitter).
“Unfortunately, our provider can no longer support these transactions.”
Binance customer support was unable to specify when SEPA transfers would be reinstated and instead directed the EU user to alternative methods.
“At the moment, we don’t have a specific time frame for the restoration of SEPA transfers,” the X post read.
The temporarily available message was posted just days after payment processor Checkout.com terminated its relationship with Binance on the grounds of regulatory action. Binance faces scrutiny in the US, Australia, and Europe.
The uncertainty surrounding Binance SEPA payments in the EU have spread on X. One user wrote, “Binance is cut off from depositing via SEPA and is not able to handle your redraw request in euro.”
However, Protos has not verified whether euro deposits or withdrawals are currently possible and has reached out to Binance for clarification.
China’s state-owned telecoms operator China Mobile is proposing global metaverse guidelines to the United Nations that bear eery similarities to the country’s controversial social credit system, Politico reported on Sunday.
A “digital identity system” for all metaverse users could be based on a mix of “natural characteristics” and “social characteristics.” Data points like occupation can be “permanently” stored and shared with police to “keep the order and safety of the virtual world,” China Mobile proposals state.
The guidelines are part of discussions between officials at the UN’s telecoms agency, the International Telecommunication Union (ITU), and tech experts. Experts who reviewed China Mobile’s proposals said metaverse users would be at risk of privacy and freedom violations if they were adopted.
“To build a unified digital identity system, to give each human a unique digital ID that includes social characteristics from social media and occupation — that sounds a lot like China’s social credit system,” Chris Kremidas-Courtney, a senior fellow at Brussels think tank Friends of Europe, told Politico.
Western officials have warned that China is seeking to push its controversial standards on the future of digital worlds, with both Chinese public and private actors pushing for these guidelines far more consistently than those from the US and Europe, according to a group member who spoke to Politico.
“Imagine a metaverse where your identity protocols are set and monitored by Chinese authorities. Every government must ask themselves: ‘Is that the kind of immersive world we want to live in?’” the group member said.
Under China’s social credit system, residents are ranked and scored based on their behaviour, occupation, social media activity, and a host of other characteristics. This data collection is often used by authorities to control citizens, such as barring international travel.
Major crypto gambling site Stake has been sued by a Sydney-based share trading platform using the same name, as it attempts to enter Australia’s gambling market.
A federal court lawsuit was filed by the trading site, HelloStake.com, last week. Court documents seen by the Australian Associated Press argue that it had already established a strong brand and reputation in Australia and therefore the crypto casino shouldn’t be allowed to operate in the country under the Stake name.
HelloStake.com allows locals to “seamlessly invest” in US stocks. It made the case that the crypto casino broke the law by using its name and making false and misleading statements on its website, which confused Australia-based customers into thinking the companies were related. Features of Stake’s crypto casino, including its e-shop, are already available to locals as it attempts to secure a casino license.
Stake.com is based in Curaçao but operated from Australia. The crypto casino has found widespread success in part through securing partnerships with big names like Canadian singer Drake and infamous crypto shill Ben Armstrong, known as BitBoy.
In 2021, the Sydney Morning Herald discovered Stake.com was founded by Melbourne-based billionaire Ed Craven and American business partner Bijan Tehrani. In June, the duo narrowly dodged a $400 million lawsuit by their former partner Christopher Freeman, who claimed he had been misled and ousted from the firm. The US case was dismissed due to lack of jurisdiction, but Freeman may find better luck suing the pair in Australia.
Stake can profit from Australia’s growing appetite for gambling
The global online wagering industry’s market size was valued at nearly $64 billion in 2022. It’s projected to grow at a compound annual growth rate (CAGR) of almost 12% from 2023 to 2030, according to Grand View Research. Online casinos have expanded as higher mobile phone use and 5G tech have increased customer size in recent years — but blockchain has also played a significant role in the industry’s growth.
With higher transparency, faster transactions, and fewer regulations, crypto gambling has become a convenient option. For Stake.com, the growing Australian market is attractive. The amount of Australians that had gambled in the past six months rose from 7% in 2018 to 11% in 2021, representing 2.8 million people.
However, the risks associated with widespread gambling have caused streaming platform Twitch to ban certain gambling content. Last year, it blocked Stake and three other platforms in response to a streamer scamming his own viewers out of $200,000 to support his gambling addiction.
Two weeks ago, Twitch added two more platforms to its ban list and said that gambling viewership was down 75% since it introduced the ban. Despite this, “new trends” had emerged. Twitch said it was updating its policy to better protect users.
The founder of collapsed crypto exchange FTX, Sam Bankman-Fried, has been dealt another blow in court after prosecutors revealed they had obtained a recording and several notes wherein Caroline Ellison blames him for misusing customer funds.
During a company-wide meeting right before the exchange went bankrupt, Ellison told employees of FTX sister firm Alameda Research that “Alameda will likely wind down once we can, like, repay all of our creditors and sort of wind down a bunch of our, like, whatever remaining obligations we have.”
“I guess, mostly I wanna say, like, I’m sorry. This really sucks.”
“Definitely feel free to take a break,” she told the team, explaining that anyone was free to leave. “I guess for people who do stick around, I think it’s, like, possible that there might be some kind of future thing.“
According to federal prosecutors, one employee asked Ellison who was responsible for using FTX customer deposits. “Um… Sam, I guess,” she replied.
Handwritten and typed notes will also be entered into court that prosecutors say detail the alleged criminal activity that execs at FTX and Alameda carried out. Ellison took notes “to memorialise information supplied to [her]…and to provide a reference to help…carry out [her] role in the conspiracy,” they said.
Among these notes is a memo titled Things Sam Is Freaking Out About which documents negative news about Alameda and FTX — and describes the supposed scheme between FTX and Alameda.
Prosecutors say the recording and notes show Ellison was acting on SBF’s behalf.
Ellison and Bankman-Fried’s legal woes at a glance
Ellison pleaded guilty to wire fraud and money laundering in December. Apart from working alongside Bankman-Fried, the pair dated on and off. She has agreed to become a key witness for prosecutors.
In October, once Bankman-Fried’s trial has begun, Ellison will be called to the stand and describe “when FTX began to unravel and customer withdrawals surged, and how the defendant tried to maintain his charade,” court documents said.
The emergence of this recording comes shortly after Bankman-Fried was accused of leaking Ellison’s personal diary entries to discredit her testimony. On Monday, the FTX founder had his bail revoked for trying to tamper with witnesses.
Bankman-Fried must now trade his parents’ California mansion for the Metropolitan Detention Center in Manhattan. Inmates complain of poor conditions at the jail, like moldy food and raw sewage.
Tai Lopez, the internet guru who has purchased several nostalgic, failing brands over the past few years, is having to part with many of the companies he bought up under his umbrella corporation, Retail Ecommerce Ventures, LLC.
Brands that have already been sold off include the iconic RadioShack, which briefly had its own cryptocurrency in a bid to attract new, younger customers. The token is down about 99% from its all time high and sees only a few hundred dollars in liquidity on a good day.
Protos previously reported on rumors of Lopez’s possible bankruptcy. While that remains unclear, it is clear that the self-help pundit has fallen on some hard times. At the end of May, Unicomer Group — a Salvadoran financial group that had previously controlled RadioShack intellectual property (IP) across much of Latin America — released a statement announcing its purchase of all RadioShack IP. Shortly thereafter the website placed a “we are renovating” banner at the top.
It isn’t known what was paid for the purchase of the RadioShack IP from Retail Ecommerce Ventures, LLC.
Lopez is famous for a video in which he points to his “new Lamborghini” in “his garage” then goes on to point to a bookshelf, saying, “You know what I like a lot more than materialistic things? Knowledge.”
Most recently, Lopez’s retail clothing outlet Tuesday Morning shuttered 200 stores. The website suggests a “next chapter” and a possible re-opening of physical store locations.
It’s vague as to whether or not more IP and brands have been sold off by Retail Ecommerce Ventures, LLC, but it’s likely the struggling fund will sell off more soon. In the meantime, remember to revisit your least favorite RadioShack cringe tweets — they probably won’t be around much longer.
Crypto custodian Prime Trust and several of its affiliates have filed for chapter 11 bankruptcy after months of trouble.
In a statement, the Nevada-based custodian that once served Binance US said that it intends to file several motions in order to evaluate “all strategic alternatives, including potentially a sale of … assets and operations.”
In June, shortly after Binance US was sued by the Securities and Exchange Commission (SEC), Prime Trust customers reported slow withdrawals. The regulator had requested a temporary retraining order to freeze over $2 billion dollars of Binance US assets. In response to growing concerns, Prime Trust’s customers like Swan Bitcoin migrated customer assets away from the custodian, essentially causing a bank run situation.
Prime Trust was forced to halt withdrawals and deposits after receiving cease and desists from the US states it operated in, including its home state Nevada. By June 28, the custodian was accused of using customer funds and venture capital to cover lost deposits by Nevada’s Financial Institutions Division (FID). Attorneys filed a petition to impound Prime Trust assets, ban all employees from accessing accounts, and appoint a receiver for rehabilitation.
The firm’s chapter 11 filing said that the move comes following the appointment of a receiver, Nevada Bank’s chief exec John Guedry, as well as a special restructuring committee comprised of three people: Guedry, John Wilcox, and Michael Wyse.
Troubled crypto exchange Binance filed for a protective court order against the Securities and Exchange Commission (SEC) late on Monday, claiming that the regulator was on a “fishing expedition.”
The operating company of Binance US, BAM Trading, filed the document in the US District Court of Columbia. According to the filing, the SEC has requested a slew of information and documents from Binance, which the firm believes is “inappropriate, unduly burdensome, and well beyond the scope of the Federal Rules and Court Order.” Binance argued that it had already submitted enough information.
This protective order aims to limit the SEC in who it can depose. Particularly, Binance has opposed the depositions of BAM’s CEO and CFO, claiming that the pair don’t have “unique firsthand knowledge that is relevant.”
Binance was first sued by the SEC in June. The regulator claims that the firm and its chief exec Changpeng Zhao (CZ) inflated trading volumes, failed to restrict US customers, misled investors, and diverted customer funds. According to the protective order, the SEC has pushed back against Binance’s requests to limit the required information.
The crypto exchange is likely to have regulators fish in its waters more often. EU regulators are collaborating with the SEC in its investigation, Protos learned in June. Officials suspect that Binance has faked accounts in Ireland and Malta.