Coinbase to discontinue services in India later this month

Coinbase plans to cease all exchange services for users in India, it has warned some customers in email, over a year after the company’s debut in the South Asian market faced regulatory challenges. The global crypto exchange is warning customers that it will be discontinuing services for them after September 25 and advising them to […]

Dream11-backed NFT startup Rario founders to leave a year after $120M funding

The two founders of Rario, the cricket NFT startup in which India’s Dream11 led a $120 million funding round last year, are leaving the firm, people familiar with the matter said. Ankit Wadhwa, who serves as Rario CEO, and Sunny Bhanot, Rario CTO, are being pushed out as investors at the startup, including largest backer […]

Sam Altman’s Worldcoin eyeball-scanning crypto project launches

Worldcoin, Sam Altman’s crypto startup with the vision to “drastically increase economic opportunity,” has started the global rollout of its services, more than three years after it began its work.

The startup, which has raised about $250 million altogether and counts Andreessen Horowitz, Khosla Ventures and Reid Hoffman among its backers, said it’s rolling out its identity technology as well as the token internationally. Individuals can download World App, the startup’s protocol-compatible wallet software and visit an Orb, the startup’s helmet-shaped eyeball-scanning verification device, to receive their World ID.

As TechCrunch has previously noted, Worldcoin is perhaps one of the most audacious efforts to bribe the world to embrace their currency. The startup, founded by OpenAI CEO Altman and Alex Blania, wants to put a crypto wallet (and some of their currency) onto every human’s smartphone, but in order to do so they have to build a way to determine whether someone is a unique human.

Worldcoin has been quietly signing up individuals in many countries, including India, giving those onboarding 25 Worldcoin tokens.

Worldcoin is holding about 20% of all its tokens, which are not launching in the U.S. for now, the startup told Financial Times.

“If successful, we believe Worldcoin could drastically increase economic opportunity, scale a reliable solution for distinguishing humans for AI online while preserving private, enable global democratic processes, and eventually show a potential path to AI-funded UBI,” said the statement in a statement.

Worldcoin is an “attempt at global scale alignment,” it said, prompting a jab from Jack Dorsey, Twitter co-founder and no stranger to the world of cryptocurrency, who found it “cute.”

More to follow.

Crypto startup Pillow, backed by Accel and Quona, to discontinue all services

Singapore-headquartered Pillow plans to discontinue all its services and app in the coming weeks, it warned customers Friday, citing regulatory uncertainty that has claimed countless other crypto startups in recent quarters.

Pillow allowed customers to invest in Bitcoin, stablecoins and altcoins, and promised returns of up to 18% — a figure that dropped to 14% as the market started to cool. It had raised about $21 million altogether and counted Accel India, Quona Capital, Elevation Capital and Jump Crypto among its backers. Pillow revealed its $18 million Series A funding in October last year.

In a post on Telegram, the two-year-old startup asked customers on Friday to withdraw all their funds from the Pillow app and said it will be terminating all its current services on July 31, 2023.

The move follows Pillow’s chief rival Flint shutting down its services last month due to what it termed as “regulatory hurdles” and “negative market sentiment.”

Both the startups, founded and operated in India, counted the South Asian nation among their largest markets. The Reserve Bank of India, the nation’s central bank, has been pushing lenders to stop engaging with crypto startups for over a year, making it virtually impossible for web3 startups to operate in the country.

Crypto giant Coinbase, one of the world’s largest exchanges, found this out the hard way. It suspended support for UPI payments instrument on its app in India last year, making its eponymous exchange nonfunctional for any purchase orders less than four days after launching the trading service in the world’s second-largest internet market.

Coinbase chief executive Brian Armstrong alleged last year that there are “elements in the government there, including at Reserve Bank of India, who don’t seem to be as positive on it. And so they — in the press, it’s been called a ‘shadow ban,’ basically, they’re applying soft pressure behind the scenes to try to disable some of these payments, which might be going through UPI.”

Crypto startup Pillow, backed by Accel and Quona, to discontinue all services by Manish Singh originally published on TechCrunch

Crypto exchange Coinbase sues SEC over rulemaking petition

Coinbase has filed a petition to compel the U.S. Securities and Exchange Commission to respond to a months-old petition that asks whether the securities regulator would allow the industry to be regulated using existing SEC frameworks, the exchange firm said on Monday, escalating its tensions with the regulator that has ramped up enforcement actions and warnings against crypto firms, including the American giant.

In the July 2022 petition, Coinbase asked whether the SEC would “propose and adopt rules to govern the regulation of securities that are offered and traded via digitally native methods.” The SEC never responded to the petition.

“The rulemaking process exists so that agencies can develop regulation with the benefit of public input, and have their position tested through judicial review. To date, more than 1,700 entities and individuals have submitted comments to Coinbase’s petition echoing the request for clarity,” Coinbase chief legal officer Paul Grewal wrote in a blog post.

Grewal asserted that from the SEC’s public statements and enforcement activity in the crypto industry it appears that the regulator has already made up its mind to deny Coinbase’s petition, “but they haven’t told the public yet.”

The petition, filed in the U.S. Court of Appeals for the Third Circuit on Monday, is the latest pushback the SEC has received in recent months as the regulator pushes actions against crypto firms Bittrex, Gemini, Genesis, as well as entrepreneurs including Justin Sun and Do Kwon.

Last month, the SEC threatened to sue Coinbase over some of the exchange’s products. Coinbase is the gold standard among the crypto exchanges for compliance with the laws but the American firm has suffered over the years because it couldn’t develop and roll out new products because of legal uncertainties even as its rivals scaled in international markets.

Brian Armstrong, co-founder and chief executive of Coinbase, has said the exchange may consider moving its headquarters outside the U.S. unless the country changes its approach to regulation. “Anything is on the table including, you know, relocating or whatever is necessary,” he said last week.

“Coinbase does not take any litigation lightly, especially when it relates to one of our regulators. Regulatory clarity is overdue for our industry. Yet Coinbase and other crypto companies are facing potential regulatory enforcement actions from the SEC, even though we have not been told how the SEC believes the law applies to our business,” Grewal wrote.

Crypto exchange Coinbase sues SEC over rulemaking petition by Manish Singh originally published on TechCrunch

Crypto giant Binance temporarily suspends spot trading

Binance, the world’s largest crypto exchange, said Friday it has temporarily suspended all spot trading on its platform as it works to resolve an issue.

The exchange did not identify the nature of the issue.

More to follow.

Crypto giant Binance temporarily suspends spot trading by Manish Singh originally published on TechCrunch

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India probing ‘several’ crypto cases for money laundering, seizes over $115 million

India’s Enforcement Directorate is investigating “several” crypto cases for money-laundering schemes and has seized $115.5 million to date in such crimes, the Ministry of Finance said, the latest in a series of crackdown by the authorities on the nascent space that is already reeling from the tremulous market conditions.

The Indian crime fighting agency has also arrested five individuals in crimes abetted by cryptocurrency and in the past sent a show cause notice to local exchange WazirX and its directors for crypto transactions exceeding $338 million, the ministry said.

The disclosure comes at a time when India is pushing ahead with rules to better scrutinize the activities of cryptocurrency firms, even as until now New Delhi has resisted formulating a blanket law to regulate the virtual digital assets.

Last week, the Ministry of Finance said (PDF) that crypto will be governed by anti-money laundering rules in the South Asian market. Under the new change, crypto exchanges, NFT providers and custody wallet operators will be responsible for monitoring suspicious financial activities.

Firms operating in the crypto space will be required to perform know your customer verifications. “Exchanges and wallet providers will be required to implement AML/CFT controls, and to be licensed or registered and supervised or monitored by national authorities,” the Ministry of Finance said this week.

India, in its ongoing G20 presidency, has also said that it will priortize the development of a framework for global regulation of unbacked crypto assets, stablecoins and decentralized finance.

Last year, New Delhi took a stringent approach with cryptocurrencies by levying a 30% tax on all gains and a 1% deduction on each crypto transaction. The nation’s move, alongside the market downturn, has severely depleted the transactions that local exchanges CoinSwitch Kuber, backed by Sequoia India and Andreessen Horowitz, and CoinDCX, backed by Pantera, process in the nation.

Changpeng “CZ” Zhao, founder and chief executive of the world’s largest crypto exchange Binance, told TechCrunch last year that the firm doesn’t see India as a “very crypto-friendly environment.” He said the firm is attempting to relay its concerns to the local authority about the local taxation, but asserted that tax policies typically take a long time to change.

India probing ‘several’ crypto cases for money laundering, seizes over $115 million by Manish Singh originally published on TechCrunch

Crypto exchange Binance expects to pay penalties to settle US investigations

Binance, the world’s largest crypto exchange, expects to pay monetary penalties to settle probes into its business in the U.S., a top executive said, in a major about-face after publicly disputing the idea that it was under any investigation and mocking media outlets that reported otherwise.

In an apparent admission of breaking laws, Binance chief strategy officer Patrick Hillmann told the WSJ that the company’s executives were unfamiliar with laws and rules written surrounding bribery, corruption and money laundering.

Binance is “working with regulators to figure out what are the remediations we have to go through now to make amends for that,” he said. The outcome could range from “like a fine” to “could be more.”

Reuters reported in December that prosecutors at the U.S. Department of Justice have been investigating Binance since 2018 over any lapses in compliance with U.S. anti-money laundering laws and sanctions and was split about whether it was the right time to conclude the probe.

Binance publicly disputed the report, alleging Reuters was “wrong again” and “attacking our law enforcement team, a team that we’re incredibly proud of.”

Binance founder and chief executive Changpeng Zhao launched a campaign on Twitter, alleging newsrooms were “still working for” FTX founder Sam Bankman-Fried. As usually, Zhao presented no evidence to back up his claims and urged his followers to “ignore the FUD.”

The change in tack for Binance comes as it’s becoming publicly apparent that things are not all okay for the firm. The SEC has told Paxos, which issues BUSD stablecoin for Binance, that it plans to take action against the firm over such issuance, the WSJ earlier reported.

Earlier this week, Paxos said it had stopped issuing new BUSD tokens at the direction of the New York Department of Financial Services.

Crypto exchange Binance expects to pay penalties to settle US investigations by Manish Singh originally published on TechCrunch