Launch of the NFT integration software; NFTs used to file lawsuits in civil actions
According to a recent press release, a major US software company has released a suite of tools that will allow users to "enter the Web3 and NFT space securely and purchase directly from your trusted brand website." instead of third-party marketplaces." .โ The new product reportedly includes "drag and drop tools" to help brands set up NFT collections and API integration that allows brands to access data and "link customer activity across Web2 and Web3." According to the press release, the new tools will enable organizations to gain "a holistic view of each customer across physical and digital environments."
According to a recent report, a federal judge in Florida entered a default judgment in favor of a party that delivered โcomplaints to more than a dozen unidentified suspects via a non-fungible token.โ According to the report, it is "possible to track the NFT when it is opened." A lawyer for the plaintiff in the case said allowing the service via NFT will "pave the way" to start suing the scammers. The Florida federal judge's order is reportedly the first of its kind to award a default judgment after service of a complaint via an NFT.
According to recent reports, the NFT markets have accounted for $73.8 billion in trading volume, but the report suggests that "more than 42% of the volume is fake, with $31.2 billion attributed to laundering." The report notes that two popular NFT platforms have marked 98% and 85% of their transaction volume as suspect. The report suggests that fake NFT trading volume may "[i]inflated prices and manufacturing[e] popularity of certain collectionsโ and allowing criminals to use NFTs โas a means of money laundering.โ
In a final development, a recently filed class action lawsuit alleges that a popular NFT platform "illegally sold unregistered securities when it launched non-fungible tokens through its own marketplace." The complaint reportedly alleges that the "NFTs were not decentralized" and that the company controlled "all aspects" of the NFTs, including the ledger that recorded their ownership. According to a report, the popular platform "began to lose to other NFT markets," and with the decline in NFT demand for the platform, "its value plummeted."
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US Treasury Official Signals Upcoming Illicit Financing Risk Assessment of DeFi
This week, the US Treasury Department released prepared statements made by the Under Secretary for Terrorist Financing and Financial Crimes, Elizabeth Rosenberg, in a meeting with representatives of the banking industry. The Under Secretary's comments included comments on the illicit financing risk of decentralized finance (DeFi), with her noting that "my team is actively working and will publish an illicit financing risk assessment in DeFi soon." The undersecretary also raised concerns about the use of digital assets by North Korean-affiliated actors who "carried out ransomware attacks, stole hundreds of millions of dollars in virtual assets, and laundered their ill-gotten funds through mixers and other assets." virtual". service providers to finance North Korea's illegal nuclear and ballistic missile programs."
In an overseas development, the Securities and Exchange Commission of Thailand recently published a notice that it is seeking public comment on a draft regulation that would prohibit digital asset merchants from (1) accepting digital asset deposits from customers and lend, invest, bet or use such digital assets; (2) accept deposits of digital assets from customers and pay them regular interest or other types of benefits from your own source of funds, unless those activities are in accordance with the sales promotion rules; and (3) advertise, persuade, or otherwise act in support of deposit-taking and lending services. Comments on the proposed regulation must be submitted by April 7.
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SEC Chairman Comments On Crypto Activities, NYAG Sues Crypto Exchange
US Securities and Exchange Commission (SEC) Chairman Gary Gensler recently published an opinion piece titled Getting crypto companies to do their job within the limits of the law. Among other things, in the article, Chairman Gensler addressed "the talking point that there is a lack of clarity in securities laws" and said that he found such claims "unconvincing." In paragraphs littered with hyperlinks to SEC materials, Chairman Gensler cited several previous SEC actions that addressed crypto market activities, including lending, staking, "crypto-security listing," function mixing, accounting of crypto assets, disclosure and custody obligations. Key SEC materials cited in Chairman Gensler's article include the CAD report; he Framework for the analysis of "investment contracts" of digital assets; SEC Actions Against FiBlocka US crypto trading platform, a major US crypto exchange, nexus, Poloniexand EtherDelta; a previous speech made by the President; Personnel Accounting Bulletin No. 121; previously aired disclosure guide; a recent SEC proposed rule; and a list of SEC cryptocurrencies enforcement actions. Addressing the SEC's enforcement actions, Chairman Gensler said, "The goal is to hold market participants in compliance with laws and regulations and to protect ... American investors."
In separate comments recently covered by the media, Chairman Gensler reportedly addressed proof-of-stake tokens and protocols. In his comments, Chairman Gensler reportedly said that staking participants are "anticipating a return... of those proof-of-stake tokens" and suggested that "a protocol that is often a small group of entrepreneurs and developers" should " try to comply." โ
In another recent development, the New York Attorney General (NYAG) announced a lawsuit against cryptocurrency exchange KuCoin "for failing to register as a stock and commodity broker and falsely representing itself as an exchange." According to a press release, the enforcement action "seeks to prevent KuCoin from operating in New York and block access to its website until it complies with the law." In a notable statement, the press release read: โThis action is one of the first times a regulator has claimed in court that ETH, one of the largest cryptocurrencies available, is a security.โ
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US and International Law Enforcement 'Killing' Crypto Mixing Service
On Wednesday, the US Department of Justice (DOJ) announced a coordinated international "takedown" of ChipMixer, an unlicensed darknet cryptocurrency "mixing" service that the DOJ says laundered more than $3 billion in cryptocurrency from multiple criminal schemes involving ransomware, darknet markets, fraud, cryptocurrency thefts, and other hacking schemes around the world, including those perpetrated by North Korea's Lazarus Group. According to the Department of Justice, ChipMixer allowed customers to deposit bitcoins, which ChipMixer then mixed with the bitcoins of other ChipMixer users to prevent criminal transactions from being tracked by enforcement agencies or regulators. ChipMixer allegedly also offered other additional features to hide the identities of its criminal clients and concealed the operational location of its servers to prevent seizure by law enforcement. As part of the deactivation, the US government seized two domains directing users to the ChipMixer service and a GitHub account, and charged a person with operating an unlicensed money transfer business, money laundering, and identity theft in connection with the operation of ChipMixer. German police reportedly seized ChipMixer's back-end servers and more than $46 million worth of cryptocurrency. Law enforcement agencies from Belgium, Poland and Switzerland also assisted in the criminal investigation, as did Europol.
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Hackers use 'flash loan attack' to steal $199 million from DeFi protocol
According to recent reports, โcrypto lending protocol Euler Finance suffered a $199 million loss on the morning of March 13, following a quick lending attack.โ The attacker reportedly exploited a flaw in one of Euler Finance's smart contracts to steal USDC, Dai, WBTC, and Staked Ether, and then laundered the proceeds using Tornado Casha decentralized mixing service that has previously been sanctioned by the US government. Blockchain data reportedly shows that an address associated with the hack sent 100 ETH to a wallet associated with Lazarus Group, a cybercrime group. affiliated with the North Korean government.
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