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Super Bowl LVIII: Crypto Ads Absent Amid Global Expansion Plans

Sunday, February 11th, marks the annual Super Bowl LVIII in the United States, and there’s intrigue within the crypto community regarding rumours of no crypto ads appearing this year, akin to 2023.

However, an executive of crypto exchange Kraken suggests that the event’s American-centric focus clashes with its global plans.

The now-defunct crypto exchange FTX stood out as a major advertiser during the 2022 Super Bowl, featuring comedian Larry David, just nine months before its collapse.

On February 1st, Cointelegraph reported that David regretted taking part in the FTX promotion, in which he encouraged viewers “not to miss out on the next big thing.”

“So, like an idiot, I did it,” David declared.

In a recent Fox Business report, Kraken’s chief marketing officer, Mayur Gupta, emphasised a transition in crypto advertising, moving away from generating hype toward educating the public about the potential of crypto for the future.

“If the last wave of crypto marketing was all about hype and FOMO [fear of missing out], this current wave has to be rooted in education and awareness for the substance and true value proposition of crypto as a movement that will bring financial freedom and inclusion.”
Furthermore, Gupta pointed out that the Super Bowl mainly caters to an American audience.

He anticipates that the next major wave of crypto users will come from locations worldwide, suggesting the exchange’s preference for events with a more global appeal.

“The Super Bowl is a very US-centric event, and the next wave of crypto users will come from all around the world, not just the United States,” he stated.

Meanwhile, Reuters recently reported that the US federal government is working to increase the global viewership of the Super Bowl this year.

The game will reportedly be broadcast in 190 countries, and the US State Department will help organise watch parties in 30 locations abroad.

According to data from Nielsen, the Super Bowl has reached over 100 million viewers every year since 2010.

There was speculation that with the United States Securities and Exchange Commission (SEC) approving 11 spot Bitcoin exchange-traded funds (ETFs) on January 10th, some asset management firms would consider advertising to the Super Bowl audience.

However, the world’s largest asset manager, BlackRock, reportedly has not secured any advertisement slots for its spot Bitcoin ETF product.

Another recently approved applicant, asset management firm VanEck, recently shared on X that seeing no crypto ads in this year’s Super Bowl will be a positive.

Cointelegraph recently reported that during Super Bowl LVII in 2023, the first game following bankruptcy filings from several crypto firms and a market downturn, crypto advertisements were absent.

According to Paul Hardart, a clinical professor of marketing for New York University’s Stern School of Business, “fun, humour and entertainment” will likely be the theme of ads for Super Bowl LVIII, in a “notable shift away” from artificial intelligence and crypto firms.

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NY Attorney General Expands Complaint Against Genesis Holdco Amid Settlement Talks

Crypto News Today/DeFi

On 8th February, the New York State Office of the Attorney General (NYAG) resolved its case involving the Gemini Earn programme by reaching an agreement with Genesis Global Holdco.

Yet, the following day, the NYAG submitted an expanded complaint in the same case, identifying Genesis Global Holdco and all its codefendants.

The Genesis holding company petitioned the New York Southern District Bankruptcy Court on 8th February to ratify a settlement pact between itself and the NYAG. According to the filing, the settlement was the result of extensive negotiations.

Under the Genesis settlement, the NYAG would be reimbursed for its claims on equal terms with the United States Securities and Exchange Commission (SEC), but only after creditors were paid.

Genesis previously reached a $21 million settlement with the SEC on 31st January. Both settlements will be deliberated on 14th February.

In October, New York Attorney General Letitia James initiated a lawsuit against Genesis Holdco, Genesis Global Capital, Genesis Asia Pacific, their parent company Digital Currency Group (DCG), cryptocurrency exchange Gemini, former Genesis CEO Michael (Soichiro) Moro, and DCG CEO Barry Silbert for fraud linked to the Gemini Earn programme.

The NYAG alleged that the parties had defrauded over 230,000 investors, including 29,000 New Yorkers, of more than $1 billion.

On 9th February, James revealed that the NYAG was broadening its allegations against DCG, Silbert, and Moro, having identified additional investors who suffered losses:

“In total, OAG [Office of the Attorney General] found that these companies defrauded more than 230,000 investors out of more than $3 billion.”

Despite the settlement reached the previous day, Genesis Holdco (as one of the “Genesis/DCG Defendants”) was implicated in five of the ten causes of action in the new complaint. According to the revised complaint:

“Gemini solicited money from the public with false assurances that Earn was a highly liquid investment and that Genesis Capital was creditworthy based on Gemini’s ongoing risk monitoring. In reality, however, Gemini’s confidential risk reports found that Genesis Capital posed a high risk of default.”

Allegations that the Genesis loan book was overcollateralised were unfounded, and a significant portion of Gemini customers’ funds were invested in FTX-affiliated Alameda Research, according to the complaint. Genesis also incurred losses due to the collapse of Three Arrows Capital, the complaint continued.

It seeks a permanent injunction against the defendants from conducting related businesses in New York state and the disgorgement of illegally obtained funds along with the reimbursement of investors.

Gemini and Genesis collaborated on the Gemini Earn programme, introduced in 2021. Genesis halted withdrawals in November 2022 and declared bankruptcy in January 2023, triggering a series of legal actions.

The SEC filed a complaint against Gemini and Genesis in January 2023. Gemini sued Genesis in July and again in October.

In January, Genesis settled with the New York Department of Financial Services over Anti-Money Laundering shortcomings and inadequate cybersecurity. As part of the agreement, it forfeited its New York BitLicense.

Cryptocurrency exchange Coinbase, based in the United States, anticipated that crypto-oriented voters in California would have a significant impact on the 2024 elections based on their ownership and views on digital asset-related policies.

In a blog post on 9th February, Coinbase referenced data from business intelligence firm Morning Consult, indicating that 27% of Californians — approximately 8.2 million individuals — owned cryptocurrency.

The majority of crypto owners in the state — 78% — believed that policymakers should favour “new, innovative, and disruptive technologies,” and many indicated they would vote accordingly.

“California crypto owners overwhelmingly report that they would be much more likely to support candidates that hold pro-crypto and blockchain positions,” said Coinbase.

“Almost 4 in 5 CA crypto owners say they would be more likely to support a candidate who supports the U.S. crypto industry as a job creator and source of U.S. geopolitical strength.”

According to Coinbase, a slightly larger majority — 51% — of U.S. voters nationally among Generation Z and millennials expressed willingness to support candidates favourable to crypto in the 2024 elections.

U.S. President Joe Biden and former President Donald Trump, the likely candidates for both major political parties for president, have already appeared on primary ballots in South Carolina and New Hampshire.

Coinbase’s findings mirrored a survey released in January by the Crypto Council for Innovation, which suggested that most U.S. voters prefer lawmakers who seek “to write clear rules for cryptocurrency,” indicating that crypto users could be a “key swing voting bloc” in 2024.

“Congress and other policymakers should take note that crypto voters are engaged in their states and they want rules, not an unpredictable regulation-by-enforcement approach.”

Digital assets have become a campaign issue for Republican Party presidential candidates in the United States.

Before withdrawing from the race, Florida Governor Ron DeSantis opposed central bank digital currencies in the country. Trump has since adopted the issue, pledging to never allow a digital dollar if re-elected.

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UN Probes North Korea-linked Cyberattacks on Crypto Firms, Profits Totaling $3 Billion

Crypto News Today/DeFi

The United Nations (UN) is reportedly probing hacking groups linked to the Democratic People’s Republic of Korea (DPRK) for orchestrating cyberattacks on cryptocurrency firms over six years, amassing profits of approximately $3 billion.

As per a recent Reuters report citing unpublished UN documents, an independent sanction committee is overseeing the investigation into the DPRK-linked hacking groups.

The groups purportedly targeted 58 crypto-related firms to aid their weapon of mass destruction (WMD) development work between 2017 and 2023.

“The panel is investigating 58 suspected DPRK cyberattacks on cryptocurrency-related companies between 2017 and 2023, valued at approximately $3 billion, which reportedly help fund DPRK’s WMD development.”

The UN is reportedly expected to release a published report of its findings within the next two months.

In 2023, Chainalysis estimated that the hacking groups pilfered approximately £1 billion worth of crypto from 20 hacks.

However, there was a notable decrease compared with 2022, when crypto losses from North Korea-linked exploits totalled £1.7 billion across 15 hacking incidents.

Blockchain intelligence firm TRM Labs foresees that this year will witness even more significant damage from hacking groups, as their attack methods are anticipated to advance beyond those of previous years.

“Despite notable advancements in cybersecurity among exchanges and increased international collaboration in tracking and recovering stolen funds, 2024 is likely to see further disruption from the world’s most prolific cyber-thief.”

Meanwhile, Cointelegraph recently reported that the United Nations Office on Drugs and Crime has cautioned that crypto is being misused in illicit economies developing in East and Southeast Asia.

It highlighted poorly regulated or illicit casinos and “pig-butchering” romance scams that have witnessed major growth in the Mekong region.

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European Commission Proposes Mandate for Tech Platforms to Detect AI-Generated Content

Crypto News Today

The European Commission is set to mandate tech platforms such as TikTok, X, and Facebook to detect artificial intelligence (AI)-generated content, aiming to safeguard the upcoming European elections from misinformation.

In a move towards enhancing election security, the commission has launched a public consultation on proposed guidelines for very large online platforms (VLOPs) and very large online search engines (VLOSEs).

The recommendations seek to mitigate the democratic threats posed by generative AI and deepfakes.

Outlined in the draft guidelines are various measures to counter election-related risks, including specific strategies pertaining to generative AI content, pre- and post-election risk mitigation planning, and providing clear directives for European Parliament elections.

Generative AI has the potential to mislead voters and manipulate electoral processes by fabricating and circulating synthetic content that is inauthentic and misleading, including depictions of political figures, events, polls, and narratives.

The draft election security guidelines are presently open for public consultation in the European Union until March 7.

They advocate for alerting users on relevant platforms about potential inaccuracies in content generated by generative AI.

According to the draft, the guidelines also propose directing users to authoritative information sources and advocate for tech giants to implement safeguards against the creation of misleading content that could significantly influence user behaviour.

Regarding AI-generated text, the current recommendation for VLOPs/VLOSEs is to “indicate, where possible, in the outputs generated the concrete sources of the information used as input data to enable users to verify the reliability and further contextualize the information.”

The proposed “best practices” for risk mitigation outlined in the draft guidance draw inspiration from the EU’s recently approved legislative proposal, the AI Act, and its non-binding counterpart, the AI Pact.

Concerns surrounding advanced AI systems, such as large language models, have escalated since the widespread adoption of generative AI in 2023, bringing tools like OpenAI’s ChatGPT into the spotlight.

While the commission has not specified the timeline for companies to label manipulated content under the EU’s content moderation law, the Digital Services Act, Meta announced plans in a company blog post to introduce fresh guidelines concerning AI-generated content on Facebook, Instagram, and Threads in the coming months.

Any content identified as AI-generated, whether through metadata or intentional watermarking, will be visibly labelled.

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Bitcoin Retreats from Peak Amidst Volatility Surge

Bitcoin/Crypto News Today

Bitcoin took a rain check on a sudden upswing at the Wall Street open on February 9th as 24-hour gains reached 6%.

Data from Cointelegraph Markets Pro and TradingView illustrated BTC’s price trajectory retracting after hitting $47,700.

The move, fuelled by spot markets, barely paused overnight as consecutive Asia and United States trading sessions posed little challenge for bulls.

At the time of writing, attention focused on $47,400 as volatility persisted, with Bitcoin still assessing its highest levels since late 2021.

The week’s performance also marked Bitcoin’s strongest since last October.

“Strong bounce from the midrange, attacking $48,000 again, as expected,” popular trader Jelle wrote in part of his latest analysis on X (formerly Twitter).

“Last hurdle for Bitcoin to overcome, not much standing in the way of new all-time highs once it breaks.”
Jelle additionally described the current price range as a “moment of truth.”

Fellow trader Skew, meanwhile, cautioned that the entire day would likely remain “pretty volatile.”

More reserved about the immediate outlook was Keith Alan, CEO and co-founder of trading resource Material Indicators, who noted significant sell-side liquidity just below the two-year range highs and $50,000.

“Something to consider before you FOMO into BTC at this level.

There is ~£175M in BTC ask liquidity (aka resistance) stacked between here and $50k, and only ~£50M in bid support down to $43k,” part of his own X post read.

Alan nonetheless suggested that a weekly close above $45,000 would benefit bulls, with whales easily able to drive the market higher should $50,000 be breached — to the detriment of short positions.

“If you are considering a short, be prepared to get squeezed. IF whales manage to push above $50k there is currently very little friction up to $55k,” he concluded.

An accompanying chart illustrated buy and sell liquidity and cumulative volume delta, or CVD, on the BTC/USDT order book of the largest global exchange, Binance.

The day’s movements among the newly launched U.S. spot Bitcoin exchange-traded funds (ETFs) continued an encouraging narrative for bulls.

The Grayscale Bitcoin Trust (GBTC) saw outflows as anticipated, while the previous day’s cumulative netflows among the remaining nine ETFs were the third-largest since their Jan.

11 launch, according to data uploaded to X by Bloomberg Intelligence ETF analyst James Seyffart.

As Cointelegraph reported, the ETFs from BlackRock and Fidelity Investments recorded the most successful first month’s trading of any ETF product in the past thirty years.

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Bitcoin’s L2 Ecosystem is Booming as Halving Approaches

Bitcoin

To say Bitcoin has dominated the crypto headlines of late would be an understatement. Even setting aside the SEC’s landmark approval of multiple spot bitcoin exchange-traded funds (ETFs) in January, BTC enthusiasts have had plenty to celebrate with the asset’s value growing by almost 15% in the last fortnight.

With the fourth quadrennial Halving coming up, Bitcoin’s Layer-2 ecosystem is also enjoying a moment in the sun, smashing several significant milestones that underscore the appeal of solutions built on Satoshi’s network. At long last, supporters of the blockchain have more than the “digital gold” narrative to trumpet: Bitcoin-based DeFi solutions are proving a smash hit.

Bitcoin L2 Comes of Age

As with Ethereum, Layer-2s on Bitcoin run atop the main chain with the goal of increasing its capacity to process transactions. These auxiliary networks, and the dApps they support, essentially build out the architecture of Bitcoin and broaden the appeal of its ecosystem.

When DeFi took off in 2020, Ethereum activity exploded and a number of Layer-2s (Arbitrum, Optimism etc) subsequently appeared offering superior throughput, lower costs, chain specialization, and dApp utility. The idea that Bitcoin L2s could follow a similar trajectory is undeniably appealing to BTC maxis.

Although Bitcoin L2s are at a much earlier stage than the preponderance we see on Ethereum, they are growing at a rapid rate. Payments on the Lightning Network, one of the best-known L2 solutions designed to lighten the load on the main chain, have grown by over 1200% in two years. Recent hype around BTC has also seen other significant developments.

Stacks, a Layer-2 network enabling smart contracts and dApps to use Bitcoin as a secure base layer, has been one of the big winners. The Total Value Locked (TVL) on Stacks surpassed all-time highs in January, peaking at $63 million on the day the ETFs were green-lit. Another L2 project, Rootstock, also hit its highest TVL in two years.

The feel-good factor extends to solutions anchored to L2s, like StackingDAO, a liquid staking protocol operating on Stacks. In just a month, the project became the second-largest DeFi protocol on Stacks by TVL, with over 10 million $STX tokens locked.

BitFlow, a native Bitcoin DEX, has also announced $2m TVL in its $stSTX LSD pool. Liquid staking derivatives – which let users access the liquidity of staked tokens that would otherwise be locked in a smart contract – was a major trend last year, with Lido becoming the single biggest defi dApp on Ethereum.

Given how many bitcoiners simply hodl their satoshis, LSDs – which let them stake for yield and put their capital to use in DeFi – could end up at the center of a veritable BTC L2 boom.

The recent uptick in Layer2 activity on the Bitcoin network is a sight to behold. The emergence of projects that advance the network’s utility through sophisticated L2 solutions seems destined to unlock new BTC use cases and accelerate demand for digital gold. If Bitcoin-based L2s can replicate those that spawned from Ethereum, the next 18 months will prove very interesting.

Ether Surges 10% in February Amidst Bullish Cryptocurrency Market

Crypto News Today/DeFi

Ether‘s value surged by 10% in the initial nine days of February, surpassing the $2,450 mark for the first time in three weeks.

This upturn correlated with the wider bullish trend in the cryptocurrency market and was notably influenced by the macroeconomic landscape.

While the reasons underpinning Ether’s surge are evident, there’s mounting optimism among investors as deposits on the Ethereum network rise.

Yet, the question lingers: is this momentum potent enough for a sustained ascent beyond $2,800?

Weak economic indicators from China and concerning fiscal debt trends in the United States are fostering an environment favourable for risk-on assets.

US Federal Reserve Chair Jerome Powell highlighted the necessity for a more sustainable approach to public debt.

Neil Irwin, of Axios Macro, predicts a decrease in the Fed’s policy interest rate due to projections of escalating US debt service costs.

Meanwhile, China’s manufacturing activity saw a decline for the fourth straight month, prompting the central bank to implement measures supporting the real estate market.

This economic backdrop led to investors divesting fixed-income assets, causing the two-year US Treasury yield to rise to its highest level in two months.

Despite these developments, the S&P 500 index hit a record high above $5,000 on February 9, suggesting a lack of immediate concern regarding an economic downturn.

However, the US fiscal debt trajectory, as highlighted by Powell, creates a conducive setting for scarce alternative assets like Ether.

While cryptocurrencies face competition from the stock market for risk-on capital, they also present an opportunity for alternative investments.

Stocks such as Nvidia and Amazon, trading at significantly high earnings multiples, contribute to this narrative.

Assessing the sustainability of Ether’s February gains requires scrutiny of on-chain activity within the Ethereum network.

Smart contract deposits, particularly on the EigenLayer liquid staking solution, surged to an 11-month high, indicating growing demand for ETH.

Moreover, Ethereum’s dominance in transaction fees underscores its robust demand compared to competitors like Tron and BNB Chain.

Beyond its current applications, optimism among Ether investors stems from the potential of a new nonfungible token format, ERC-404, which could boost sector activity.

Additionally, the impending Dencun network upgrade scheduled for March 13 promises reduced transaction costs for layer-2 rollups.

With fixed-income investors exploring alternatives and the Ethereum network’s continuous expansion, Ether investors remain undaunted by recent gains or resistance at $2,650, indicating a resilient price trajectory compared to previous tests in January.

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OpenAI CEO Sam Altman Pursues Trillions in Funding for Semiconductor Development

Crypto News Today

Sam Altman, the CEO of the artificial intelligence (AI) developer OpenAI, is reportedly engaging with investors globally to secure trillions of pounds for the development of semiconductor chips.

As per a report by The Wall Street Journal on 8th February, Altman’s endeavour would necessitate fundraising in the range of £5–7 trillion.

Sources close to OpenAI indicate that these funds would alleviate the company’s scaling limitations and address the scarcity and expense of chips crucial for advancing high-level AI systems.

Altman has purportedly been advocating for collaborations between OpenAI and “various investors,” chip manufacturers, and energy suppliers, expressing OpenAI’s willingness to become a “significant customer” of new factories.

An OpenAI spokesperson remarked:

“OpenAI has had productive discussions about increasing global infrastructure and supply chains for chips, energy, and data centres — which are crucial for AI and other industries that rely on them.”

Altman recently conferred with the United States Commerce Secretary Gina Raimondo to deliberate on the initiative, recognising the necessity for involvement from patrons, industry partners, and governments worldwide.

An OpenAI spokesperson affirmed their commitment to keeping the U.S. government informed due to the topic’s significance to the country’s “national priorities.”

The CEO of OpenAI also held discussions with the United Arab Emirates National Security Advisor, Sheikh Tahnoun bin Zayed al Nahyan.

According to insiders, the UAE could play a pivotal role with U.S. government approval.

Masayoshi Son, the CEO of SoftBank, and representatives from chip fabrication firms such as Taiwan Semiconductor Manufacturing, have reportedly engaged in discussions with Altman regarding his project.

An individual familiar with the matter disclosed that Microsoft — a majority stakeholder in OpenAI — is cognisant of the company’s fundraising endeavours and extends support.

In December 2023, reports surfaced indicating OpenAI’s discussions with investors contemplating investments exceeding £100 billion in the company.

Nvidia continues to dominate the market for chips used in AI computation.

Amidst a surge in AI model development over the past year, the company has reported record-breaking revenue and a valuation surpassing £1 trillion.

Meta, a prominent tech conglomerate owning social media platforms Facebook and Instagram, has recently unveiled its entry into the AI chip market.

It introduced its latest chip, “Artemis,” intending to deploy it in its data centres to enhance AI capabilities and lessen reliance on Nvidia.

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Spot Bitcoin ETFs Surge Despite GBTC Outflows: British Investors Pour £403 Million Into Market

Bitcoin/Crypto News Today

On 8th February, spot Bitcoin exchange-traded funds (ETFs) encountered their third-largest surge, amounting to £403 million.

The substantial inflow occurred despite over £100 million exiting the Grayscale Bitcoin Trust (GBTC).

The total influx into spot Bitcoin ETFs has surpassed £2.1 billion since their introduction on 11th January, indicating robust demand for BTC in the market.

The third-largest inflow day for spot BTC ETFs coincided with BTC’s price surpassing $46,000 to mark a fresh multiweek high, just £2,000 shy of new yearly highs.

Leading the ETF flow chart is BlackRock iShares Bitcoin Trust (IBIT) with an inflow of £204 million, followed by Fidelity with £128 million, ARK 21Shares with £86 million, and Bitwise with £60 million.

The remaining seven ETFs collectively witnessed £27 million in inflows, while GBTC recorded another £102 million in outflows.

IBIT also clinched the distinction of becoming the first ETF to surpass GBTC’s daily trading volume.

Nonetheless, the total trading volume of all 11 spot Bitcoin ETFs dipped below £1 billion for the first time since their inception.

Bloomberg senior analyst Eric Balchunas underscored BlackRock’s overtaking of Grayscale in trading volume as a significant achievement, noting that it typically takes about five to 10 years for a new fund to surpass the category’s “liquidity king.”

Market analysts interpret the positive flow into Bitcoin ETFs as indicative of investors’ appetite and burgeoning demand.

The net flows into the ETFs imply that approximately £403 million, or roughly 8,698 BTC, was withdrawn from the market and transferred into cold storage.

Spot Bitcoin ETFs received approval from the United States Securities and Exchange Commission for listing on 10th January and commenced trading the following day.

Since their launch, spot BTC ETFs have witnessed record trading volumes, with over a billion dollars traded daily, indicating robust investor interest.

The forthcoming Bitcoin halving is less than 70 days away, which will halve the market supply of BTC from 6.25 BTC per block to 3.125 BTC.

With mounting demand from institutional investors, the dwindling supply could propel BTC to reach new market highs.

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Australian Court Ruling Sets Precedent for Crypto Yield Products Regulatory Framework

Crypto News Today/DeFi

An Australian federal court has seemingly drawn a nuanced line regarding crypto-yield products, ruling that while products promising a managed yield will require a financial services license, “pass-through” decentralized-finance (DeFi) products may not.

In an order dated February 9, federal court judge Ian Jackson ruled that Block Earner would face penalties over its “Earner” product offering in 2022, which provided yield for loans denominated in USD Coin, Bitcoin (BTC), Ether, and PAX Gold (PAXG), stating that it needed to obtain an Australian Financial Services License (AFSL).

However, Jackson refrained from categorising Block Earner’s DeFi “Access” product similarly, explaining that it did not operate under a managed investment scheme and, therefore, no AFSL was required.

“The Court’s decision carries nuanced implications for Block Earner and the broader crypto industry in Australia,” Block Earner stated on February 9.

“The decision provides guidance to the industry as to the applicability of Australian financial services laws to crypto-related products and services.”

The case was initiated by the Australian Securities and Investment Commission (ASIC), which alleged that both Block Earner’s Access and Earner products violated corporation laws.

In an interview with Cointelegraph, Piper Alderman digital asset lawyer Michael Bacina clarified that Access was simply a pass-through to decentralized finance (DeFi).

“The Earner product involved a representation that users’ crypto would be used to generate a return (but users would only receive a fixed interest amount),” said Bacina.

Meanwhile, the Access product does not depend on Block Earner generating a return at all and is “completely dependent on Aave or Compound,” he added.

The crucial aspect to examine lies in how these products are marketed, Bacina emphasised.

“The takeaway for Australian crypto businesses is how important it is that marketing and representations clearly align and that the features of products are very carefully considered.”

The Earner product operated from March 17, 2022, to November 16 of the same year.

Block Earner confirmed to Cointelegraph that it terminated the Earner product before proceedings commenced and that the findings do not affect any of Block Earner’s current products.

In a statement, Block Earner said the dismissal of ASIC’s case against Access “is an important development in showing how DeFi can coexist with Australia’s regulatory frameworks, paving the way for further development and adoption of DeFi solutions.”

Aaron Lane, a senior research fellow at the Royal Melbourne Institute of Technology’s Blockchain Innovation Hub, believes the Australian Treasury’s proposed legislation for the crypto sector is likely to impose licensing conditions on Block Earner, should it be passed.

ASIC will now seek orders from the court imposing monetary penalties. The proceedings have been listed for a case management hearing at 9.30 am on March 1, 2024.

ASIC said the decision was a step forward in protecting consumers from digital asset products.

“ASIC remains concerned that consumers do not fully appreciate the risks associated with products involving crypto-assets and today’s decision is an important step forward to ensuring there are appropriate protections for consumers.”

The securities regulator called on firms offering cryptocurrency products to “carefully consider” whether their offerings constitute financial products under the existing regime.

If products do fall under the definition of a managed investment scheme, firms should seek licensing before offering them, ASIC stressed.

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