Japanese Prime Minister Fumio Kishida publicly backed blockchain technologies to boost the country’s economic standing, reports found this week.
At a Budget Committee meeting on 1 February, Kishida explained that the country could tap “various possibilities for using Web3.”
The government could also incorporate non-fungible tokens (NFTs), decentralised autonomous organisations (DAOs), and other digital assets. The initiative aims to boost local economies as part of the government’s Cool Japan national innovation strategy.
Kishida said in a statement: “If you consider DAOs, people who are interested in the same social issues can form a new community. NFTs can also be used to diversify the income of creators and maintain highly loyal fans.”
Masaaki Taira, the Liberal Democratic Party MP raising questions at the meeting, also heads the government’s Web3 policy watchdog. He has also advised Japanese officials on creating a digital Yen, which it aims to pilot in Spring 2023.
Taira said in a statement: “I think that these types of blockchain technology and technology using Web3 are effective in solving the various problems we have.”
According to a 2020 white paper from the Bank of Japan, there was a potential “surge in public demand for central bank digital currency (CBDC) going forward.”
This was due to the “rapid development of technological innovation,” it added.
Explaining further, it stated,
“While the Bank of Japan currently has no plan to issue CBDC, from the viewpoint of ensuring the stability and efficiency of the overall payment and settlement systems, the Bank considers it important to prepare thoroughly to respond to changes in circumstances in an appropriate manner. With this in mind, the Bank decided that it would publish its approach to ‘general purpose’ CBDC — that is, CBDC intended for a wide range of end users, including individuals and firms.”
Kishida remains a longstanding advocate of digital assets and Web3 technologies to assist the nation’s adoption of emerging technologies. His efforts come amid tightening regulations worldwide following the collapse of now-defunct crypto platform FTX in mid-November last year.
Spanish police have detained Bitzlato’s chief executive, marketing director, and sales executive, Turkish reports found on Thursday.
Turkish news agency Anadolu reported that Spanish authorities arrested six Russian and Ukrainian citizens linked to the cryptocurrency platform. French, Cypriot, Portuguese, and United States law enforcement agencies coordinated the arrests.
The news comes after US authorities alleged that Bitzlato had facilitated criminal financial exchanges and had ties to the Hydra darkweb.
Police also seized roughly 19.8 million USD in assets, including cash, vehicles, smartphones, and digital assets. It also blocked more than 100 accounts on the exchange platform.
Bitzlato’s co-founder, Anatoly Legkodymov, was arrested in Miami in what it called a “major international cryptocurrency enforcement action” in mid-January.
US and French authorities added that the crypto exchange was a “primary money laundering concern” with alleged ties to money laundering.
The US Department of Justice (DoJ), US Treasury Department, and other French authorities accused Bitzlato of “conducting a money transmitting business that transported and transmitted illicit funds and that failed to meet U.S. regulatory safeguards.”
The organisations also launched enforcement action against the cryptocurrency platform. The DoJ stated that Bitzlato helped cybercriminals launder more than $700 million USD on the platform.
Bitcoin prices were unaffected by announcements from a Federal Reserve body, remaining roughly around $23,000 following the news, reports revealed.
The Federal Reserve’s Federal Open Market Committee (FOMC) announced on Wednesday it had increased federal fund rates 25 basis points to roughly 4.5 percent to 4.75 percent.
In its statement, the FOMC said that the US received “modest growth in spending and production,” along with low unemployment and high job gains.
It also cited the ongoing Russo-Ukrainian war, which caused “tremendous human and economic hardship” and “elevated global uncertainty.”
From Inflation to Elation
The Committee also aims to return inflation to 2 percent in the long term by raising federal fund rates, with additional increases in the future.
It explained, stating,
“In determining the extent of future increases in the target range, the Committee will take into account the cumulative tightening of monetary policy, the lags with which monetary policy affects economic activity and inflation, and economic and financial developments.
According to analysts, the Federal Reserve could increase basis point rates in 25 point increments once or twice before ceasing measures.
Despite this, Bitcoin remained high amid the news, with Twitter users commenting on the matter. One person stated that crypto had made a “new high” after the meeting.
The user added: “Bitcoin, though, has been stronger than we expected, as it didn’t go down to 22200. After consolidating for a while, it looks ready to go higher.”
The news comes as Bitcoin maintains an upswing in value after recouping from a bearish 2022 market. In January, the cryptocurrency surpassed $23,000 multiple times, indicating a slow return to bullish markets.
A judge involved in the Sam Bankman-Fried criminal case has ordered the disgraced former executive not to contact employees, reports revealed on Wednesday.
Federal Judge Lewis Kaplan from New York’s Southern District demanded that the ex-CEO of bankrupt cryptocurrency exchange FTX cease all contact as part of his bail conditions.
He stated Bankman-Fried was prohibited from communicating with FTX and Alameda Research employees, current and former, on encrypted platforms like Signal to avoid violating his bail terms.
Judge’s Orders for SBF
According to prosecutors, the former exec contacted FTX US general counsel Ryne Miller. In a statement, Kaplan told the courts,
“The undisputed information available to the Court regarding the ‘nature and seriousness of the danger [posed] by [the defendant’s] release’ on the existing conditions has changed substantially since he was released, and there appears to be a material threat of inappropriate contact with prospective witnesses.”
He added that such as risk was “clearly and convincingly sufficient” to indicate imposing further conditions “pending the full argument of the cross-application.”
Bankman-Fried previously supported the automatic deletion of Slack and Signal messages in 2021. He told Caroline Ellison, Alameda Research’s former chief executive, to delete the apps to avoid leaving evidence for potential legal cases.
Additionally, Judge Kaplan has not ruled whether to bar access to funds from the now-defunct companies to comply with bail conditions. The defendant’s trial is set to take place in October in a New York court. He faces eight counts of wire fraud, defrauding investors, misappropriating funds, and other offences.
Courts have ordered his family members to comply with ongoing investigations, reports found.
The measures come after Bahamian authorities arrested him, Ellison, and others involved in the 11 November collapse of FTX, Alameda, and 130 affiliates. After his extradition to the United States, SBF remains under house arrest while awaiting trial for his offences.
HM Treasury has published its white paper outlining a framework for regulating cryptocurrencies, it was reported this week.
The 80-page report discusses numerous topics on digital assets, including stablecoins, initial coin offerings (ICOs), non-fungible tokens (NFTs), and others.
The published document comes amid Britian’s bid to leverage its financial capabilities to become a major hub for fintech and emerging technologies.
The regulations will join those of the UK Financial Services and Markets Act 2000 (FSMA) and will not feature a secondary scheme. This will allow the UK’s Financial Conduct Authority (FCA) to amend existing regulations to accommodate digital assets across the sector.
This will require duplicate processes, both under FCA licencing protocols and the new measures, creating more bureaucracy for investors. Despite this, regulators will not require cryptocurrency companies to report market data at regular intervals but instead ready the data at all times when needed.
Additional Rules and Regulations
The Government did not ban algorithmic stablecoins, countering measures from other nations. Rather than labelling them as stablecoins, they will qualify the assets as “unbacked crypto assets.”
A stipulation is that crypto lenders should monitor collateral valuation and contingencies for potential failures in the market.
Consultations close on 30 April, where the UK Government will seek advice from cryptocurrency firms, trade associations, financial institutions, and others for guidance.
The news comes after the Treasury launched a LinkedIn job posting for a Head of Digital Currency on Tuesday. This signalled the UK’s readiness to launch plans to position as a major crypto hub.
Non-fungible platform Blur is set to launch its native token BLUR along with a governance protocol.
Blur initially aimed to launch its native token in early January but pushed back the date to 14 February, Valentine’s Day, to prepare for the big reveal.
The NFT marketplace is set to release the new digital asset in a bid to keep community control over the platform. NFTs sold on Blur are based on the Ethereum blockchain.
A Blur spokesperson said in a tweet: “We know this is past our initial estimate of January and we’re sorry for the delay. We’re trying new things and the extra two weeks will allow us to deliver a launch that hasn’t been done before. Airdrop 3 will continue until then.”
The digital coin drop comes a month after Bitcoin (BTC) began to surge across cryptocurrency markets, surpassing $23,000 at its peak. To date, it has climbed to over $23,000 amid a strong rally.
Additional news surfaced that Twitter chief executive Elon Musk would launch payment systems for his social media platform, with future cryptocurrency integrations planned. This caused Dogecoin, his long-supported altcoin, to skyrocket to nearly $0.10 this week.
The United States Securities and Exchange Commission (SEC) recently revealed that it did not designate a sale of LBRY Credits (LBC) in secondary markets as a security.
In a recent hearing on Monday, courts ruled in favour of direct sales in a case many see as a victory against the SEC’s regulatory crackdown on cryptocurrencies. Attorney John Deaton attended discussions in the appeal hearing, scoring the major win for digital assets.
He aimed to receive clarity in LBC secondary market transactions due to alleged ambiguities in the injunction launched in November last year.
At the time, courts awarded the SEC a summary judgment and labelled LBC token sales over six years’ time as investment contracts while failing to specify details about the transactions. The SEC hoped to receive backing from New Hamshire district courts in the case.
In the case, Deaton represented technology journalist Naomi Brockwell, an animus curiae of the hearing, to challenge the injunction as ambiguous and broad.
Prior cases found that courts did not acknowledge any security issues of digital assets in the United States a paper from Lewis Cohen, a commercial contractor.
Judges in the case stated told Deaton: “I’m going to make it clear that my order does not apply to secondary market sales.”
SEC-Ripple Labs Legal Row
The news comes amid further litigation against Ripple Labs in an ongoing case, sparking criticisms from the Washington, DC-based Blockchain Association.
The organisation said it would become an amicus brief for the embattled cryptocurrency firm after the latter was hit with an SEC lawsuit over alleged Ripple (XRP)-linked unregistered securities.
The Association tweeted at the time: “This case, which is just one in a long line of SEC efforts to regulate by enforcement, highlights the SEC’s efforts to cement and legitimize its overly broad interpretation of the Howey test.”
It concluded a negative ruling could have “devastating effects” on crypto markets and create laws that “significantly restrict” cryptocurrency networks.
Core Scientific (CORZ), one of the world’s biggest Bitcoin (BTC) mining firms, has struck a deal on a $70 million loan from investment bank B Riley.
The company said in its filing it would request the loan from bankruptcy courts in Houston, Texas as part of its financing plan outlined in December.
Receiving the funds will allow the troubled firm to pay off its debtor-in-possession (DIP) offices, providing the firm up to 15 months of additional time.
It will also use the funds to replace its current facility and maintain its operations amid a massive bankruptcy, reports showed on Tuesday.
According to Core Scientific, the new loan conditions were “reasonable and generally superior” to its DIP facility terms. A hearing is set to take place on 1 February, the document revealed.
“The Replacement DIP Facility lays the foundation on which the debtors will seek to negotiate a consensual Chapter 11 plan with all of their key constituents and maximize value for all stakeholders,” it added.
Crypto Crisis Contagion Spreads
The news comes after last year’s cryptocurrency bear market sent markets reeling due to the collapse of disgraced crypto exchange FTX. The crisis triggered further issues with Core Scientific’s operations due to plummeting cryptocurrency prices and rising gas and electricity fees.
Prior to the collapse, the company held 10 percent of computing shares on Bitcoin’s network. To date, it owes up to 5,000 creditors and faces liabilities from $1 billion USD to $10 billion USD.
Core Scientific continued its operations despite filing for Chapter 11 bankruptcy, financing its operations by selling over 6,900 BTC. Additional firms such as Genesis, Voyager, and Three Arrows Capital (3AC) also failed due to ongoing crises in the crypto market.
Dritan Abazović, Montenegro’s Prime Minister, tweeted this month that his country aimed to create a digital currency in a joint effort with the cryptocurrency platform Ripple.
The official held talks with Brad Garlinghouse, Ripple’s chief executive, and company vice-president James Wallis on the sidelines of the World Economic Forum in Davos, Switzerland.
Wallis is also tasked with engaging with central banks and their digital currencies (CBDCs), which Abazović stated would lead to “the first digital currency or stablecoin” for the Balkan nation.
He said in his tweet: “In cooperation with @Ripple and the Central Bank, we launched a pilot project to build the first digital currency or stablecoin for Montenegro.”
Currently, Montenegro uses the Euro after adopting it in 2002, but remains outside of the Eurozone and European Union following its application to join the bloc in 2008.
Despite this, the nation hopes to become a key crypto hub in the near future and has adopted a crypto-friendly position on digital assets.
Crypto Gains Global Acceptance
The news comes as several nations pivot to developing CBDCs in a bid to expand payment method options to citizens.
The British Government began hiring on LinkedIn for a head of digital currency for HM Treasury. The move aims to allow the United Kingdom to compete with the European Union amid growing interest in stablecoins and sovereign tokens.
Other nations, including El Salvador, China, Fiji, and Tonga, among others, have positioned their economies and natural resources to become a major global crypto hub. China has long proposed a digital yuan, or hongbao, to conduct financial transactions across the nation at major shopping centres. The People’s Bank of China manages the sovereign token, along with support from AliPay and WeChat Pay.
England and Wales’ charity regulator announced on Monday it had launched investigations against Effective Ventures Foundations over links to now-defunct cryptocurrency platform FTX.
The Charity Commission said in its press statement the inquiry aimed to probe FTX’s role as a “significant funder” of the charity, stating it was a “serious incident.”
The Commission added the funds could affect other assets could create knock-on effects, prompting further actions to investigate trustees of the charity.
The Commission said in a statement,
“There is no indication of wrongdoing by the trustees at this time. However, there are indications of potential risks to the charity’s assets, and the inquiry has been opened to establish facts and help ensure the trustees protect the charity’s assets and are running the charity in line with their duties and responsibilities.”
The regulator aims to investigate “the extent of any risk to the charity’s assets” and how much “the trustees are complying with their legal duties.”
It will also probe “the governance and administration of the charity by the trustees and its funders” while identifying and managing conflicts of interest.
Trustees were also “cooperating fully” in the investigation, which launched on 19 December last year following FTX’s Chapter 11 bankruptcy on 11 November. The Commission added it plans to report on its findings in due course.
The news comes after reports found that FTX had splurged roughly $40 million USD on luxury goods, hotels, shipping, travels, and donations to charity. Disgraced former CEO Sam Bankman-Fried also used nearly $400 million USD in investor money to fund obscure venture capital firm Modulo Capital.
The case is widely seen as one of the most disruptive financial fraud cases in history.