Lee Jeong-hoon, the former chairman of Bithumb, a prominent cryptocurrency exchange in South Korea, is currently embroiled in a legal battle that could result in an eight-year prison sentence.
The verdict for his case is scheduled to be delivered on January 18, 2024.
Reports from Korean local media indicate that prosecutors allege Lee’s involvement in a scheme to manipulate Bithumb’s governance in order to profit from exchange tokens while evading financial regulations.
This complex legal saga dates back to October 2018 when Lee, then-chairman of Bithumb, supposedly engaged in fraudulent activities during negotiations for the acquisition of Bithumb by Kim Byung-gun, the chairman of the cosmetic surgery firm BK Group.
Prosecutors assert that Lee was aware of difficulties related to the listing of the BXA token but failed to disclose this crucial information to Kim.
Despite the challenges with listing, Lee allegedly received payments without informing Kim about the decision not to proceed with the BXA token listing.
As a consequence, South Korean prosecutors have requested an eight-year prison sentence for Lee.
READ MORE:Tech CEO Calls for Inclusive Blockchain Solutions and Warns Against Web3 Cash Grabs
In his defense, Lee has raised objections to the prosecution’s claims, highlighting inconsistencies in Kim’s statements and questioning his credibility.
Lee maintains that Kim was fully aware of the progress regarding the BXA token listing and argues that Kim was well-equipped to lead Bithumb.
Lee is facing legal charges under the Act on Aggravated Punishment for Specified Economic Crimes, particularly pertaining to allegations of fraud.
The outcome of Lee’s ongoing appeal could potentially set a precedent for future legal proceedings involving cryptocurrency exchanges and their governance.
This development is particularly significant as Bithumb is actively preparing for an initial public offering (IPO) on Kosdaq by 2025.
The verdict of the appeal carries substantial implications for both Bithumb’s future and the fate of BXA tokens.
A guilty verdict could trigger a reevaluation of governance structures within cryptocurrency exchanges, potentially leading to heightened regulatory scrutiny.
As the cryptocurrency community and investors eagerly await the outcome of the appeal, this case underscores the ever-evolving nature of the industry and the pressing need for well-defined regulatory frameworks to address governance issues and uphold trust among investors and stakeholders.
Yearn.finance’s governance token experienced a tumultuous ride on November 18, plunging by more than 43% within a mere five hours.
This drastic downturn followed a remarkable surge of nearly 170% earlier in the month, sparking concerns of a potential exit scam.
Data from CoinMarketCap revealed that this sharp decline resulted in the erasure of over $300 million in market capitalization, effectively wiping out the gains made in November.
Presently, the YFI token is valued at $9,069, down from $14,185 just a day prior.
Nevertheless, it’s worth noting that the token remains 83% higher in value compared to its position 30 days ago.
The sudden sell-off instilled a sense of fear, uncertainty, and doubt (FUD) within the cryptocurrency community over the weekend.
Speculation on X (formerly Twitter) raised suspicions, with some users suggesting that 50% of the token supply resided in 10 wallets controlled by developers.
However, data from Etherscan hinted that some of these holders might actually be crypto exchange wallets.
Furthermore, some X users pointed out that the plunge might have been triggered by an influx of short positions.
READ MORE:Singapore’s Central Bank Launches Live Pilot for Singapore Dollar-Based CBDC
Coinglass data indicated a surge in YFI open interest, implying that traders were betting against the coin following its substantial gains in November.
One trader on X commented, “I bought the dip… someone sold 1000 coins perhaps that’s why it dropped massively.
Will see.” Another user noted that YFI’s price movement after the decline appeared atypical for an exit scam, stating, “Doesn’t look like a rug pull at all.
Because despite so much sell-off, the price is still stable at 9k, which is 80% above its bottom.”
Yearn.finance, founded by Ethereum developer and entrepreneur Andre Cronje in July 2020, is a decentralized finance protocol that offers automated trading solutions for the DeFi market.
Despite attempts to reach out to Cronje and Yearn.finance for comment, Cointelegraph did not receive an immediate response.
In conclusion, the rollercoaster ride of Yearn.finance’s governance token has left the crypto community on edge, with suspicions of a possible exit scam amidst a backdrop of market volatility.
The situation underscores the inherent risks associated with investing in the cryptocurrency space.
Mike Belshe, the CEO of cryptocurrency exchange BitGo, is optimistic about the prospects of a spot Bitcoin exchange-traded fund (ETF) gaining approval.
However, he acknowledges that there are hurdles to overcome in this journey.
In an interview with Bloomberg on November 16, Belshe revealed that discussions between companies seeking Bitcoin ETF approval and the United States Securities and Exchange Commission (SEC) indicate a favorable outcome is on the horizon.
Despite his optimism, Belshe cautioned that challenges lie ahead.
He believes that the SEC may still reject more ETF proposals before granting approval.
One key requirement emphasized by the SEC is the separation of cryptocurrency exchanges from custodial services. Belshe stresses that addressing this condition is essential to securing approval.
Belshe referenced Sam Bankman-Fried, the former CEO of the now-defunct crypto exchange FTX, who advocated for multifaceted operations.
Bankman-Fried proposed taking on various functions within the industry to improve efficiency and compliance with regulations.
READ MORE:Singapore’s Central Bank Launches Live Pilot for Singapore Dollar-Based CBDC
The anticipation surrounding the potential approval of a spot Bitcoin ETF has led to a significant increase in fees on the Bitcoin blockchain.
On November 16, transaction fees on the Bitcoin blockchain reached $11.6 million, representing a 746% rise in average transaction fees compared to 2022.
Despite these challenges, Bitcoin has remained stable, trading near 18-month highs and surpassing its previous bear market range.
Currently, 12 asset management firms are awaiting decisions on their Bitcoin ETF applications.
Bloomberg analyst James Seyffart predicts a 90% chance of approval for these applications by January 10, 2024.
In summary, Mike Belshe, CEO of BitGo, remains hopeful about the approval of a spot Bitcoin ETF.
While he anticipates a positive outcome, he acknowledges the need to address market structure concerns outlined by the SEC.
The surge in Bitcoin blockchain fees underscores the growing excitement surrounding the ETF’s potential approval, and the cryptocurrency market continues to show resilience despite regulatory challenges.
Singapore’s central bank, the Monetary Authority of Singapore (MAS), has taken a significant step in its pursuit of a central bank digital currency (CBDC) with the announcement of a live pilot program for a Singapore dollar-based CBDC.
The program aims to facilitate instant settlements between local commercial banks, marking a crucial development in the world of digital currencies.
MAS Managing Director Ravi Menon unveiled the pilot program on November 16 during the Singapore Fintech Festival.
This initiative represents a departure from earlier simulated CBDC issuance, signaling the central bank’s commitment to moving forward with practical testing.
In the near future, MAS intends to collaborate with local banks to explore the use of CBDCs as settlement assets for domestic payments.
Under this testing program, participating banks will issue tokenized liabilities that represent claims on their balance sheets.
Retail customers can then utilize these tokenized liabilities to conduct transactions with merchants, and settlements will occur seamlessly through the automatic transfer of a wholesale CBDC.
This streamlined process eliminates the traditional lag associated with clearing and settlement, where these activities typically occur on separate systems.
READ MORE: Paxos Secures Initial Approval from MAS for U.S. Dollar-Backed Stablecoin Launch in Singapore
Wholesale CBDCs primarily serve central and commercial banks, as well as other large financial institutions, to facilitate efficient payment settlements.
By introducing a live pilot program for a Singapore dollar-based CBDC, MAS aims to enhance the efficiency and speed of financial transactions within the country’s banking ecosystem.
This announcement follows the MAS’s expansion of its financial infrastructure test program, Project Guardian, on November 15.
The program now boasts 17 members, including major financial institutions like BNY Mellon, HSBC, and Citigroup, up from its original 12.
Project Guardian focuses on assessing various use cases for asset tokenization, further demonstrating Singapore’s commitment to staying at the forefront of fintech innovation.
Moreover, the MAS, in collaboration with the New York Federal Reserve, recently concluded a six-year-long trial program, known as Project Ubin, aimed at evaluating the utility of CBDCs in cross-border payments.
The results underscored the potential for CBDCs to enhance the efficiency and cost-effectiveness of cross-border transactions, reinforcing the importance of ongoing experimentation in the digital currency space.
In summary, Singapore’s central bank is actively pushing the boundaries of CBDC development with its live pilot program, bringing the nation closer to realizing the benefits of digital currencies for efficient and secure financial transactions.
CoinShares, the prominent European digital asset manager, has recently secured an exclusive option to acquire Valkyrie Funds, the exchange-traded fund (ETF) unit of its United States-based competitor, Valkyrie Investments.
This strategic move, announced on November 17, signifies CoinShares’ intent to expand its operations into the United States, potentially positioning itself at the forefront of the burgeoning ETF market in the country.
Jean-Marie Mognetti, CEO of CoinShares, expressed his optimism about this acquisition, emphasizing its potential to capitalize on the current fragmentation within the global ETF market.
He noted that the establishment of crypto spot ETPs in Europe since 2015 is an indicator of the evolving landscape, with the U.S. poised to follow suit.
Mognetti believes that this market disparity presents both challenges and significant opportunities for CoinShares.
The option to acquire Valkyrie Funds will remain active until March 31, 2024.
During this period, Valkyrie Funds will continue to operate as an independent entity until the acquisition by CoinShares is finalized, marking an exciting development in the digital asset investment sphere.
In addition to the acquisition option, CoinShares and Valkyrie have also agreed on a brand licensing term.
This agreement allows CoinShares’ name to be used in future S-1 filings with the U.S. Securities and Exchange Commission (SEC), which are typically filed when companies plan to go public.
READ MORE: New York Tightens Cryptocurrency Listing and Delisting Rules to Enhance Investor Protection
If the SEC approves the Valkyrie Bitcoin Fund, it will incorporate the CoinShares name into the ETF, further solidifying their collaboration.
Valkyrie had previously filed for the spot Bitcoin (BTC) ETF on June 21, along with other financial heavyweights like BlackRock.
CoinShares, overseeing more than $3.2 billion in assets under management, had already expressed optimism about the U.S. cryptocurrency ETF market in September.
They emphasized that the United States, as an economic powerhouse, is actively addressing digital asset regulation, dispelling any notion of lagging behind in this rapidly evolving space.
In summary, CoinShares’ exclusive option to acquire Valkyrie Funds marks a strategic leap towards expanding its presence in the United States and tapping into the potential of the growing ETF market.
This move holds the promise of reshaping the digital asset investment landscape on a global scale.
Tether, a prominent stablecoin company, is gearing up for a substantial expansion into the realm of Bitcoin mining, as revealed by Paolo Ardoino, who is slated to assume leadership of the company in the near future.
In an interview with Bloomberg, Ardoino disclosed that Tether is contemplating an investment of approximately $500 million over the next six months.
This capital will be allocated towards the development of mining facilities and investments in other mining entities.
To bolster its mining capabilities, Tether intends to establish mining facilities in Uruguay, Paraguay, and El Salvador.
The aim is to command 1% of the Bitcoin mining network’s computational power. These forthcoming sites will boast impressive capacities ranging from 40 to 70 megawatts (MW).
Interestingly, a portion of Tether’s mining investment is derived from the $610 million debt financing arrangement recently announced with the German mining firm Northern Data Group.
This move aligns with Tether’s strategic approach, which has seen the company extend loans throughout the year.
READ MORE: Solana (SOL) Achieves New Yearly Highs with 17% Surge after Cathie Wood’s Praise
In September, Tether had already made a strategic investment in Northern Data Group to support their artificial intelligence initiatives.
Ardoino further outlined Tether’s ambitious plans, with expectations to elevate its direct mining operations to 120 MW by the end of the year, and a grander vision of reaching 450 MW by the close of 2025.
Notably, the company is also exploring the possibility of establishing a 300-MW facility, and they are setting up their mining facilities within mobile containers that can be relocated to leverage favorable electricity prices.
Ardoino emphasized that their approach to mining involves gradual learning and growth, underscoring that they are not rushing to become the largest mining entity globally.
Paolo Ardoino is slated to assume the role of Tether’s CEO in December while maintaining his position as the Chief Technical Officer of the parent company, Bitfinex, as per the plans disclosed in October.
As of the time of this publication, Tether had not responded to an inquiry from Cointelegraph.
Grayscale Investments has adopted a strategic approach to navigate the regulatory landscape surrounding Ether-based exchange-traded funds (ETFs) in the United States.
Bloomberg ETF analyst James Seyffart suggests that Grayscale is employing its Ether futures ETF application as a “trojan horse” to push the United States Securities and Exchange Commission (SEC) towards approving its spot Ether ETF.
On November 15th, Seyffart took to Twitter to express his viewpoint following the SEC’s decision to delay Grayscale’s ETH futures ETF application.
He believes that if the SEC were to give the green light to Grayscale’s application for an Ether futures ETF, it would set a precedent that could be leveraged to argue for the approval of its spot Ether ETF application.
Conversely, if the SEC were to deny Grayscale’s bid for an Ether futures ETF, the asset management firm could argue that the SEC is applying different standards to Bitcoin and Ether futures ETFs.
This differentiation would manifest by permitting one under the Securities Act of 1933 while rejecting the other.
READ MORE: Kazakhstan’s Chairman Conducts Historic Transaction with Digital Tenge
Seyffart predicts that the SEC will be faced with a challenging decision: either approve the Ether futures ETF and justify its differentiation from spot ETFs, or deny it and defend why products governed by the 1933 act are substantially distinct from those regulated by the 1940 act.
In his opinion, both scenarios pose difficulties for the SEC, making Grayscale’s move strategically astute.
Notably, Grayscale submitted its Ether futures ETF application via a 19b-4 form, a filing intended to inform the SEC about a security-based swap request.
Seyffart observed that none of the approximately 40 approved Ether ETF products had followed this 19b-4 approval process, initially leaving him puzzled about Grayscale’s choice.
However, Seyffart now interprets this move as part of Grayscale’s strategic “chess” game with the SEC.
By using the Ether futures ETF as a “trojan horse,” Grayscale seeks to secure a 19b-4 order from the regulator, positioning itself to corner the SEC into a precarious situation, regardless of their decision.
In summary, Grayscale Investments is strategically maneuvering within the regulatory framework to gain approval for its spot Ether ETF by leveraging its Ether futures ETF application as a catalyst for change in the SEC’s stance on cryptocurrency-based ETFs.
This calculated approach aims to leave the SEC in a challenging position, regardless of their ultimate decision.
New York’s financial regulator, the New York State Department of Financial Services (NYDFS), has recently introduced stricter guidelines for cryptocurrency firms listing and delisting digital assets in the state.
The primary aim of these new regulations is to enhance investor protection and mitigate potential risks associated with cryptocurrencies.
Under these new rules, cryptocurrency companies are now required to submit their coin listing and delisting policies for approval by the NYDFS.
These policies will be subject to a comprehensive evaluation based on more rigorous risk assessment standards established by the NYDFS.
The evaluation will encompass various factors, including technological, operational, cybersecurity, market, liquidity, and illicit activity risks associated with the tokens.
These regulations apply to all digital currency businesses operating in New York, including those licensed under the New York Codes, Rules, and Regulation, or limited purpose trust companies governed by the state’s Banking Law.
The NYDFS initially sought public feedback on these proposed regulations in September.
READ MORE: Poloniex Prepares to Resume Operations Following $100 Million Hack
One notable provision in these regulations is that cryptocurrency firms with previously approved coin listing policies are no longer allowed to self-certify tokens unless they obtain approval from the NYDFS.
Prominent cryptocurrency firms like Circle, Gemini, Fidelity, Robinhood, and PayPal are among those obligated to comply with these new rules.
These companies are required to meet with the NYDFS by December 8, 2023, to present their draft coin listing and delisting policies, with final submissions due by January 31, 2024.
Adrienne A. Harris, the Superintendent of Financial Services, emphasized that the NYDFS plans to adopt an “innovative and data-driven approach” to oversee coin listings, delistings, and the broader cryptocurrency market.
She clarified that these regulations are not indicative of a state-wide crackdown on the cryptocurrency industry but rather an effort to ensure that New Yorkers have a well-regulated means of accessing the virtual currency marketplace while positioning New York as a hub for technological innovation and forward-looking regulation.
The NYDFS has been proactive in addressing cryptocurrency-related concerns, expanding its capacity to identify illicit activities such as insider trading and market manipulation within the cryptocurrency space.
With approximately 690 blockchain-based companies headquartered in New York and nearly 19% of New Yorkers owning cryptocurrencies, these regulations are pivotal in creating a safer and more regulated environment for cryptocurrency investors and businesses in the state.
Blockchain security firm CertiK recently released a video that raised concerns about a potential security vulnerability in Solana’s crypto-enabled Saga phone.
CertiK claimed that the Saga phone contained a “critical vulnerability” known as a “bootloader unlock” attack, which they suggested could allow malicious actors to install a hidden backdoor in the device.
They further asserted that this could compromise sensitive data, including cryptocurrency private keys.
In response, Solana Labs disputed CertiK’s claims, stating that the video did not reveal any legitimate threat to the Saga device.
According to Solana Labs, unlocking the bootloader and installing custom firmware would require multiple steps, which can only be performed after unlocking the device with the user’s passcode or fingerprint.
Additionally, unlocking the bootloader would result in the device being wiped, a process that users are made aware of through multiple warnings.
READ MORE: Kazakhstan’s Chairman Conducts Historic Transaction with Digital Tenge
This means that the process cannot take place without the user’s active participation and awareness.
The Solana Saga phone, initially priced at $1,099 when it was released in April 2022, aimed to provide users with a Web3-native decentralized application store, integrating cryptocurrency applications into the device’s hardware.
However, four months after its launch, Solana reduced the phone’s price to $599 due to a decline in sales.
It is essential to note that CertiK’s claims and Solana Labs’ response highlight the ongoing debates and discussions within the blockchain and crypto industry regarding security vulnerabilities and their potential impact on users.
While concerns about security should not be dismissed, Solana Labs has argued that the claimed vulnerability is not as straightforward to exploit as initially suggested by CertiK.
As the industry continues to evolve, maintaining robust security standards and addressing potential threats remains a priority for both companies and users in the crypto space.
The chairman of Kazakhstan’s National Payment Corporation (NPC), Binur Zhalenov, made history by conducting the inaugural transaction using the country’s newly introduced central bank digital currency (CBDC) known as the digital tenge.
This significant milestone took place during his address at the XI Congress of Finance in Almaty on November 15, where he used a debit card linked to the CBDC account for the payment, as reported by the local news outlet, Kapital.kz.
Zhalenov officially launched the digital tenge on Kazakhstan’s retail market, signaling the beginning of what he described as the “massive platform’s development” set to unfold in 2024.
Kazakhstan forged partnerships with global payment giants Visa and Mastercard, in addition to collaborating with local banks, to seamlessly integrate the CBDC into plastic cards.
Zhalenov noted that this innovation enables users to make payments using the digital tenge from anywhere in the world, including through popular payment platforms like Apple Pay and Samsung Pay.
Emphasizing the digital tenge’s versatility, Zhalenov highlighted its programmable capabilities, paving the way for applications in smart contracts, cutting-edge financial services, and digital asset transactions.
READ MORE: Global Leaders Gather at APEC Summit in San Francisco to Discuss Economy and Digital Assets
Looking ahead, the development of the CBDC will shift its focus to enabling offline payments in 2024, with the National Payment Corporation (NPC) aiming to implement the digital tenge in cross-border trade by 2025.
The journey towards the digital tenge commenced in February 2023, with an initial target launch date of 2025. The NPC, established in September, assumed the pivotal role of spearheading the development and execution of the CBDC project.
Concurrently with the swift rollout of the CBDC, Kazakh authorities have intensified their oversight of the cryptocurrency market.
In September, local media reported difficulties in accessing major international cryptocurrency exchanges such as Coinbase and Kraken without a valid local license.
Subsequently, in October, local crypto mining operators collectively addressed President Kassym-Jomart Tokayev, urging a revision of the newly introduced tax rates imposed on mining activities.
The debut transaction with the digital tenge marks a significant step forward in Kazakhstan’s digital financial landscape, showcasing the nation’s commitment to embracing innovative digital payment solutions while concurrently addressing regulatory challenges in the broader cryptocurrency ecosystem.