From the erratic ups and downs in bitcoin and ethereum value, to the explosion in initial coin offerings, and the unstoppable demand for mining-ready GPUs, cryptocurrency has become an inescapable story. It’s also become increasingly difficult to make sense of — as the industry expands, new currencies sprout up, and companies form overnight. Check here for the complete coverage of bitcoin, ethereum, litecoin, monero, Venezuela’s petro, cryptocurrencies at large, and the ways that ICOs and the underlying blockchain technology are helping shape a burgeoning industry and giving life to a new wave of startups and entrepreneurs.
Tigran Gambaryan, a compliance officer at crypto giant Binance, has been detained in Nigeria since February on charges of tax evasion and money laundering. In March, Binance founder Changpeng Zhao was sentenced to four months in prison in the US.
Reuters reports that Gambaryan, a US citizen, has once again applied for bail, saying he is suffering from a herniated disc and “bouts of malaria and pneumonia.”
Insider accounts of the company reveal a chaotic work environment, ever-shifting priorities, and troubles with the SEC
The fourth collection of digital trading cards shows Trump in typical over-the-top fantasies, like wielding a lightning bolt that apparently represents his role as the “crypto president.” There’s also a physical “collector’s edition” card with a piece of Trump’s debate night suit.
It’s not clear how this ties into Trump’s cryptocurrency platform, which we still don’t fully understand.
Ryan Salame is due to begin his seven-year prison sentence next month, but now he claims prosecutors reneged on an agreement to drop a campaign finance investigation into his partner, Michelle Bond, in exchange for his guilty plea.
Charges filed today in the SDNY accuse the two of faking a $400k consulting payment from FTX to fund her unsuccessful run for Congress in 2022.
Michael Lewis has a new essay to accompany the paperback version of Going Infinite, a book about Sam Bankman-Fried that appeared just before his trial. Sure, SBF did crimes because he was an arrogant gambler, but Lewis still loves his gamer son.
[Washington Post]
Conway wrote a furious, and occasionally all-caps, email to his former crypto allies, including Marc Andreessen and Ben Horowitz, after finding out they were going to try to unseat Senator Sherrod Brown. “Im the one using my 25+ year old personal relationships to help this movement the most significantly and not one person bothered to inform me.”
Sam Altman’s crypto-adjacent Worldcoin has irritated global regulators:
It has been raided in Hong Kong, blocked in Spain, fined in Argentina and criminally investigated in Kenya. A ruling looms on whether it can keep operating in the European Union.
The New York Times profiled the guy who ran Silk Road 2.0 — apparently after eight months in prison he worked for the feds as “a full-time, ankle-monitor-wearing cybercrime consultant, paid in freedom and a stipend that covered dollar pizza slices, toothpaste and subway rides.”
Now he’s shilling his crypto compliance startup, arguing that “his criminal experience can help unmask fraud before it leads to another scam like FTX.”
[The New York Times]
The former tech investor likes the FTC’s Lina Khan and wants to break up Google, citing its liberal bias.
German law enforcement seized over 50,000 bitcoin (worth over $2 billion at the time) while busting a movie piracy site earlier this year. Now the government is liquidating so much crypto at such a fast pace that the price of bitcoin is dropping in response.
It’s not helping that Germany’s sell-off coincides with repayments to creditors (in crypto) by the Mt. Gox bankruptcy estate.
The sleepy town of Granbury, TX was in for a rude awakening when Marathon Digital Holdings opened a bitcoin mine — an operation that not only draws a lot of energy, but creates a tremendous amount of noise:
“We’re living in a nightmare,” Sarah Rosenkranz says... As rock music blares from the speakers and other patrons chatter away, Rosenkranz pulls out her phone and clocks 72 decibels on a sound meter app — the same level that she records in Indigo’s bedroom in the dead of night. In early 2023, her daughter began waking up, yelling and holding her ears. Indigo’s room directly faces the mine, which sits about a mile and a half away. She soon refused to sleep in her own room. She then developed so many ear infections that Rosenkranz pulled her from school in March and learned how to homeschool her for the rest of the semester.
This feature in Time by Andrew Chow is expertly reported. It’s difficult to prove a casual link between the mine’s constant racket and the town’s health, but it’s hard not to be alarmed by what Granbury residents are suffering from: migraines, vertigo, nausea, leaking ear fluids, and a number of other horrifying ailments.
Two former execs of a German AI data center company, Northern Data, say they were fired for raising concerns the company was “misrepresenting the strength of its financial condition,” in a wrongful termination lawsuit. Northern Data, which is backed by Tether, has been looking into an IPO in the US.
I’m pretty skeptical that the “crypto voter” exists — there are plenty of other issues that weigh higher in people’s minds — but there’s a lot of spending happening. That said, Sam Bankman-Fried spent a great deal and got nothing, so...
[The New York Times]
The settlement will resolve the SEC’s lawsuit that accused the bankrupt crypto firm and its former CEO Do Kwon of securities fraud. In addition to the hefty penalty, the settlement bans Terraform Labs and Kwon from buying or selling crypto assets. Kwon is still awaiting extradition in Montenegro.
A few years ago, Facebook accused Epoch Media Group of laundering pro-Trump posts using networks of fake accounts. Today, prosecutors announced the arrest of The Epoch Times CFO Bill Guan and accused him of laundering at least $67 million for himself and the company using gift cards and crypto.
The “media company” allegedly claimed the money came from donations, profits, or subscriptions, as NBC News reported last year.
People who participated in Gemini’s lending program, which suspended withdrawals in the wake of the FTX collapse, will get “approximately 97 percent” of their money. Perhaps predictably, the Earn program also had some legal issues.
Ryan Salame, a top lieutenant at FTX, got over seven years in prison. He’s the second FTX official sentenced, after SBF himself, and did not cooperate with the government — unlike several other members of the inner circle.
New York Attorney General Leticia James announced the state settled with Genesis, which it sued in October 2023, along with the crypto trading firm Gemini, owned by Cameron and Tyler Winklevoss. Genesis, one of the largest lenders to FTX, filed for bankruptcy in January last year.
James’ office reached a $1.1 billion settlement with Gemini in February.
Perhaps of note: their Binance accounts and their Deltec accounts; Deltec was allegedly key in giving FTX secret money to buy Tether. Criminal complaint here.
And though the charges are for laundering at least $73 million, the wallet in question received $341 million between April 2021 and the date of the indictment. Hm!
Canada’s financial intelligence agency issued the fine after finding that Binance didn’t comply with the country’s anti-money laundering and terrorist financing laws. In April, Binance CEO Changpeng Zhao was sentenced to four months in US prison for not doing enough to prevent money laundering on the crypto exchange.
Binance posted a blog in which Chief Executive Officer Richard Teng claimed Binance was approached about a “secret” payment “to make these issues go away.” Nigerian officials reject these claims in the strongest terms.
NBC News reports that a former Block employee is talking to the feds about apparent sanctions violations.
Prosecutors are allegedly finding that Square and Cash App failed to report certain Bitcoin, credit card transactions, and dollar transfers — some originating from terror groups. Block leadership apparently knew, according to internal documents.
You can read the details of Ver’s alleged misconduct here, but, with this news arriving as Binance founder Changpeng Zhao was sentenced for failing to establish adequate anti-money laundering protections, I’m reminded of this line from Ver, quoted in 2014:
“Money laundering is not a crime,” Ver says. “It’s just because certain men with guns don’t like what other people are doing with their own money, so they decide it’s okay to lock those people in a cage.
[www.justice.gov]
