Compiled by Golden Finance
Since last year, U.S. law enforcement agencies have been cracking down on companies and practitioners in the encryption field. A professor at Rutgers Law School said that this may be the result of a combination of factors: First, the scale of cryptocurrency projects has expanded, and illegal income has also increased. Second, law enforcement agencies hope to encourage compliance development in the encryption industry.
Changpeng Zhao (CZ), founder of Binance
In the early morning of May 1, 2024, Beijing time, Changpeng Zhao accepted the verdict in the Federal District Court for the Western District of Washington. The judge in the CZ case rejected the 36-month sentence recommended by the Department of Justice and officially sentenced CZ to 4 months in prison. The judge said that after this painful lesson, he believed that CZ had the ability and willingness to reform.
CZ posted on social media to respond to his sentence of 4 months in prison. In the post, CZ expressed his gratitude for everyone's concern and support, whether it was letters, support on the X platform, or other forms, which inspired him to stay strong. He said he would serve his sentence, end this stage, and focus on the next chapter of his life (education).
In addition, CZ said he would continue to be a passive investor (and holder) in cryptocurrencies. He pointed out that our industry has entered a new stage and compliance is very important. CZ also talked about the silver lining of the whole process. Binance has been under the microscope and the funds are SAFU (i.e. safe). Finally, he emphasized that protecting users is of vital importance.
In November 2023, he pleaded guilty to violating the Bank Secrecy Act for failing to maintain an effective anti-money laundering program.
For more details, please click:
"Changpeng Zhao may serve sentence in the same prison as "crypto-anarchist" Jim Bell"
"Full text of He Yi's letter to US judge: What is a more real Changpeng Zhao like? 》
Bitcoin early investor Roger Ver
Beijing time on May 1, 2024, early Bitcoin investor Roger Ver was charged by the Department of Justice with suspected mail fraud, tax evasion and filing false tax returns. Roger Ver was arrested in Spain this week on U.S. criminal charges. The United States will seek to extradite Roger Ver to the United States for trial. The Department of Justice believes that Roger Ver has caused a total loss of at least $48 million to the IRS.
It is reported that Roger Ver originally lived in Santa Clara, California, and owned two companies, Memory Dealers.com Inc. and Agilestar.com Inc., which sell computers and network equipment. Since 2011, Roger Ver began to purchase Bitcoin for himself and his company. He is personally keen on promoting Bitcoin and even earned the nickname "Bitcoin Jesus". Roger Ver renounced his U.S. citizenship on February 4, 2014. After moving abroad, U.S. law required Roger Ver to file a tax return to report the capital gains from the sale of his assets (including Bitcoin) worldwide, and he was required to pay taxes on these capital gains.
ConsenSys CEO Joseph Lubin
On April 26, the U.S. SEC issued a Wells Notice to ConsenSys, accusing MetaMask of operating as an unlicensed broker. On the same day, Consensys sued the SEC, saying: "The SEC's illegal seizure of power over ETH will bring disaster to the Ethereum network and Consensys." The SEC's infringement on Ethereum's power violates its past statements that cryptocurrency is a commodity, not a security (citing former director Bill Hinman's 2018 speech), and also violates the authority of the SEC's sister regulator, the Commodity Futures Trading Commission (CFTC), over Ethereum.
On April 10, 2024, Consensys received a Wells notice from the SEC, indicating its intention to take enforcement action against the company for violating securities laws through its MetaMask wallet product. Consensys denied that it acted as a broker and said that the wallet was "simple and interface" and "neither held customers' digital assets nor performed any trading functions."
For more details, please click:
Consensys sues SEC in attempt to classify Ethereum as a security
2022 Ward, left, and McNutt, right, at Geosyn's facility in Springtown, Texas, in 2017.
The SEC's complaint, filed April 24 in federal court in Fort Worth, Texas, alleges that Geosyn, its CEO Caleb Joseph Ward and former operating CEO Jeremy George McNutt defrauded approximately 64 investors between November 2021 and December 2022 through service agreements sold as securities.
The SEC also alleges that Ward and McNutt misappropriated approximately $1.2 million of investor funds for personal use, such as meals, nightclubs, vacations, guns, watches and legal fees, including McNutt's alleged use of the company's credit card for a $20,000 "Las Vegas nightclub wedding." Also included were Ward's celebrations and a $49,000 family trip to Disney World.
For details, please click:
"US SEC sues Bitcoin miner Geosyn, accusing its founder of defrauding $5.6 million"
Tron founder Sun Yuchen
On April 17, 2024, the SEC amended the lawsuit against Sun Yuchen, claiming that he frequently traveled to many places in the United States, thereby giving the court corresponding jurisdiction.
The SEC claims that Sun traveled to the United States for more than 380 days between 2017 and 2019, including to New York City, Boston, Massachusetts, and San Francisco.
The SEC alleges that Sun and his companies sold unregistered securities through TRON TRX tokens and BitTorrent (BTT) tokens, and that Sun engaged in “manipulative wash trading.”
For details, please click:
"SEC: Sun Yuchen "frequently travels" to the United States and the United States has jurisdiction"
Uniswap founder Hayden Adams
On April 11, 2024, Uniswap received the SEC Wells Notice, and founder Hayden Adams responded that he would fight to the end.
Uniswap Labs founder Hayden Adams wrote. "I'm not surprised. Just angry, disappointed, and ready for a fight that will last for years and may go all the way to the Supreme Court."
Uniswap did not disclose the specific content of the Wells notice, but claimed in a blog post about the notice that UNI is not a security and does not meet the U.S. legal definition of a securities exchange or broker.
For details, please click:
《Uniswap team vows to fight SEC threats, UNI price plummets 10%》
Terraform Labs founder DoKwon
On April 5, 2024, a jury at the United States District Court for the Southern District of New York ruled that Terraform Labs and DoKwon are liable for crypto asset securities fraud.
In a filing with the U.S. District Court for the Southern District of New York on April 19, the SEC required Kwon and Terraform to pay approximately $4.7 billion in disgorgement and prejudgment interest following the adjudication of the civil case, as well as a total of $520 million in civil penalties — $420 million from Terraform and $100 million from Kwon. The Commission, Terraform, and Kwon simultaneously filed briefs on possible remedies in the civil case, with the crypto companies arguing for a maximum civil penalty of $3.5 million, while Kwon only argued for a fine of $800,000.
For details, please click:
《US SEC requires Terraform Labs and Do Kwon to pay a fine of US$5.3 billion》
《Do Kwon’s huge fine shows that the SEC is increasing its penalties on crypto companies》
Former FTX CEO Sam Bankman-Fried (SBF)
On March 28, 2024, SBF was sentenced to 25 years in prison in New York for defrauding billions of dollars. SBF was also fined $11 billion, including forfeiture of agreements to sell assets such as private jets.
The U.S. Department of Justice said SBF should be severely punished on the grounds that FTX, once valued at $32 billion, lost almost all of its funds due to his malfeasance. During the trial, prosecutors said SBF stole $8 billion in customer funds to fund venture capital, real estate purchases, political donations, etc.
For details, please click:
"SBF Sentenced to 25 Years in Prison, Case Review"
Ripple CEO Brad Garlinghouse
On March 25, 2024, the SEC plans to ask a judge to impose a $2 billion fine on Ripple Labs.
On April 22, Ripple Labs filed a court document opposing the U.S. Securities and Exchange Commission's request that the company pay a nearly $2 billion fine.
For details, please click:
《The US SEC plans to ask the judge to impose a $2 billion fine on Ripple Labs》
《Ripple objects to the $2 billion fine proposed by the US SEC》
Su, co-founder of Three Arrows Capital On February 6, 2024, New Jersey Bankruptcy Court Judge Michael Kaplan approved a settlement agreement between the two companies to prevent further legal disputes.
For details, please click:
"Three Arrows Capital and BlockFi Settlement Agreement Has Been Approved by a US Judge"
Kraken co-founder Jesse Powell
On November 20, 2023, the SEC charged the cryptocurrency exchange Kraken with commingling customer and corporate funds while operating as an unregistered broker, clearing agency, and dealer.
Federal regulators claim that the San Francisco-based company violated federal securities laws by repeatedly filing lawsuits against other cryptocurrency trading platforms.
For details, please click:
《Kraken accused by SEC of operating an unregistered platform and improperly mixing customer funds》
Former Genesis CEO Michael Moro
In October 2023, the New York Attorney General filed a lawsuit against Digital Money Group, DCG CEO Barry Silbert, and former Genesis CEO Michael Moro, Gemini and Genesis launched a “sweeping lawsuit” alleging they defrauded more than 230,000 investors, including at least 29,000 New Yorkers, of more than $1 billion.
For details, please click:
《Gemini, Genesis, DCG are sued by the New York Attorney General for suspected $1 billion fraud》
Former Celsius CEO Alex Mashinsky
On July 14, 2023, Celsius and its former CEO Alex Mashinsky was successively charged by the SEC, the U.S. Department of Justice, the U.S. Commodity Futures Trading Commission, and the Federal Trade Commission. At the same time, Alex Mashinsky was arrested.
On June 13, 2022, Celsius suspended withdrawals, transactions, and transfers from all accounts. After that, Celsius stabilized its liquidity and operations while stating that it would explore the possibility of seeking strategic transactions and debt restructuring. In mid-July 2022, Celsius filed for bankruptcy in order to maximize value for all stakeholders.
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Coinbase CEO Brian Armstrong
On June 6, 2023, the SEC accused Coinbase of operating as an unregistered exchange.
The SEC believes that Coinbase has violated the Exchange Act, the Securities Act and other codes due to a series of "unregistered" behaviors. Coinbase believes that the current rules of the digital asset industry are imperfect, and the SEC's actions actually damage the competitiveness of the US economy.
For details, please click: "SEC strikes again. How do industry insiders view the Coinbase lawsuit"
On June 5, 2023, the SEC filed 13 charges against the Binance entity and its founder Zhao Changpeng.
Binance was required to appoint an independent compliance monitor to report its compliance work to the US government; the US Treasury Department will retain access to Binance's books, records and systems for five years; the US CFTC fined Binance's former chief compliance officer $1.5 million.
Binance's total fine is $4,316,126,163, including $3.4 billion from the US Treasury Department's FINCEN (Financial Crimes Enforcement Bureau) and $968 million from OFAC (Office of Foreign Assets Control).
"A List of Disputes between the US Department of Justice and Binance"
Disabling automatic media downloads on Telegram Desktop can potentially mitigate the reported vulnerability, although Telegram itself has categorised the threat as likely to be a hoax.
KikyoXRP faces a challenging period with analysts predicting a significant correction. Ongoing legal uncertainties and mixed market sentiments contribute to the token's struggles. Investors cautiously watch for potential further declines.
BerniceSocial media users noted that the regulator’s “no FOMO” warning comes amid growing expectations for the approval of a spot Bitcoin ETF.
JinseFinanceBitTrade, a Japanese crypto exchange, broadens its lending program to include XRP and SHIB, offering users a 2% annual yield over 90 days, amid market buzz surrounding Shiba Inu's burn rate surge and XRP's projected "mega pump."
Jasper
BitcoinworldThe ongoing legal battle between blockchain firm Ripple and the Securities Exchange Commission (SEC) is projected to impact the general crypto market.
FinboldIf the regulator is successful in this case, it might have very negative repercussions for XRP, its investors, and the cryptocurrency sector as a whole.
FinboldIn the ongoing legal case between the SEC and Ripple Labs, the commission declared XRP as a security.
BitcoinistAs the case against Ripple rages on, the SEC wants to see certain “friends of the court” in support of Ripple be barred from providing legal aid to the defense.
CointelegraphRipple's boss says his company has been unfairly treated, giving ethereum an edge.
Cointelegraph