SEC sues Do Kwon, Paxos ready to litigate, SBF’s VPN: Hodler’s…

Top news this week

Paxos 'categorically disagrees' with the SEC that BUSD is a security

United States Securities and Exchange Commission (SEC) has defined the stablecoin Binance USD (BUSD) as a security in a Wells Notice sent to its issuer, Paxos Trust Company. The SEC alleges that the organization failed to register BUSD under federal securities laws. The firm, however, "categorically disagrees" with the opinion of the authority, and is prepared to “aggressively litigate” the matter in US courts. Also this week, Paxos received instructions from the New York Department of Financial Services. to stop the issuance of new BUSD files supposedly the department received a complaint last year from Circle, another stablecoin issuer, stating that Binance's reserves were insufficient to support BUSD.

SEC sues Do Kwon and Terraform Labs for fraud

The US SEC has also filed a lawsuit against Terraform Labs and its founder Do Kwon for allegedly “orchestrating a multi-billion dollar crypto asset securities fraud.” The regulator said Kwon and Terraform offered and sold an "interconnected pool of crypto asset securities, many in off-the-record transactions." He took aim at the firm's now-collapsed algorithmic stablecoin TerraClassicUSD (USTC) and its connected cryptocurrency Terra Classic (LUNC). The complaint seeks charges for violations of the registration and anti-fraud provisions of the securities laws.

Federal judge hints at denying Sam Bankman-Fried any internet access as a condition of bail

Sam Bankman-Fried appeared in court for the first time in days after using a VPN to allegedly watch football. prosecutors claim the use of a VPN raised "several potential concerns" after the former chief executive contacted potential witnesses in his criminal case earlier this month. Prosecutors want Bankman-Fried to be barred from using cell phones, tablets, computers or the Internet, which means no more league of legends or other video games. In the news about the FTX bankruptcy, a federal judge approved the publication of the names of the guarantors for the $250 million bond. Bankman-Fried's criminal trial is scheduled to begin in October, while FTX's bankruptcy case is ongoing.

El Salvador will open a 'Bitcoin Embassy' in the United States

A "Bitcoin Embassy" is opening by El Salvador in the United States. Ambassador Milena Mayorga said that the country's representative office and the state of Texas will work on new joint projects to promote the adoption of Bitcoin. In another headline, the International Monetary Fund advised El Salvador to reconsider plans to increase exposure to Bitcoin, citing the "speculative nature" of the crypto markets, as well as its impacts on fiscal sustainability and consumer protection. Bitcoin is legal tender in El Salvador since 2021.

Celsius chooses NovaWulf's offer to get out of bankruptcy

Bankrupt Crypto Lender Celsius Network has chosen NovaWulf Digital Management as a sponsor of its proposed Chapter 11 restructuring plan, in which the investment advisory firm will take over operations of a new company, with an estimated majority of Celsius' former clients they will recover up to 70% of their funds. The proposed plan has the support of the unsecured creditors' committee and would see the creation of a new public platform called NewCo wholly owned by Earn's creditors. Six companies submitted offers for the Celsius crypto assets, including Binance and Galaxy Digital.

Winners and losers

At the end of the week, Bitcoin (BTC) I sat down $24,372Ether (ETH) in $1,694 and XRP in $0.39. Total market capitalization is $1.11 trillion, according to CoinMarketCap.

Among the top 100 cryptocurrencies, the top three altcoin gainers of the week are Filecoin (FIL) at 51.13%, Computer Internet (PIC) at 46.86% and Astar (ASTR) at 43.80%.

The top three altcoin losers of the week are The Graph (GRT) at -1.62%, Nexus (NEXT) at -1.49% and ONE BUT LEO (LION) at -1.05%.

For more information on cryptocurrency prices, be sure to read Cointelegraph Market Analysis.

most memorable quotes

"Paxos categorically disagrees with the SEC staff that BUSD is not a security under federal securities laws."

Paxos Trust CompanyBinance USD stablecoin issuer

“But regulation by enforcement that does nothing to help consumers and drive innovation abroad is not the answer. Do well in betting matters."

Paul GrewalCoinbase Legal Director

"The SEC has done more to confuse than to clarify the application of US securities laws."

christian smithBlockchain Association CEO

“As an industry, we have the power and the responsibility to prevent digital assets from becoming a haven for money launderers and sanctions evaders.”

Simone MaineElliptical CEO

"Make no mistake: based on how crypto platforms generally work, they cannot be trusted as qualified custodians by investment advisers."

Gary Genslerchairman of the US Securities and Exchange Commission

“When I look at the price action, when I look at the excitement of the customers calling in, the FOMO buildup, I wouldn't be surprised if [Bitcoin] They were at $30,000 at the end of the quarter."

mike novogratzCEO of Galaxy Digital Holdings

prediction of the week

Bitcoin metric prints 'mother of all BTC bullish signals' for fourth time in history

A Bitcoin price indicator has blinked green for the fourth time this week in an important warning for bears.

According to crypto market analyst Mohit Sorout, the dollar average cost gauge was now “suggesting a raging bull market.” Buy signals from him are rare, with Sorout seeing only three throughout Bitcoin history, each excluding a serious BTC price rise.

“Today marks the fourth time this signal suggests a raging bull market,” he wrote in the comments, describing the event as “the mother of all $btc bull signals.”

FUD of the week

Circle squashes rumors of a planned SEC enforcement action

Circle, the company behind the USDC stablecoin, has been plagued by fear, uncertainty and doubt after a Fox Business reporter said on Twitter that the company was ordered by the US securities regulator to stop selling USDC, claiming it is a security not registered. The rumors were later denied by Circle's chief strategy officer, though fears of regulatory action against stablecoin issuers remain high after Paxos, the issuer of stablecoin Binance USD, received a Wells Notice for allegedly failed to register the offering under federal securities laws.

Korean e-commerce executive accused of accepting LUNA for one shilling Terra Labs

South Korean prosecutors have requested an arrest warrant for the former CEO of Tmon, a Korean e-commerce platform, for allegedly receiving billions in bribes from Terra co-founder Daniel Shin in exchange for promoting the Terra token (LUNC) as a method payment. The e-commerce firm reportedly advertised the token as a safe asset, therefore raising its price, before selling it for a multi-million dollar return.

Senator Warren Vows to Reintroduce AML Bill Extending to DAO and DeFi

vocal crypto critic US Senator Elizabeth Warren will resubmit to Congress a bipartisan anti-money laundering (AML) bill that covers "decentralized entities" such as decentralized finance protocols and decentralized autonomous organizations. According to Warren, the crypto community wants decentralized entities that run on code to be exempt from AML requirements.

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