SFC Alerts Public to Unlicensed Virtual Asset Trading Platform CoinUnited.io
On 25 July 2024, the Securities and Futures Commission (SFC) issued a stern warning about CoinUnited.io, an unlicensed virtual asset trading platform.
- CoinUnited.io claims to offer trading services across a variety of assets including cryptocurrencies, stocks, indices, forex, and commodities, but lacks the necessary licenses from the SFC.
- The SFC’s intervention is driven by the platform’s false claims about having a physical presence and active recruitment in Hong Kong, raising concerns about its legitimacy.
- In response to these violations, the SFC added CoinUnited.io to its Suspicious Virtual Asset Trading Platforms Alert List on 25 July 2024.
- The SFC advises investors to avoid unregulated platforms due to significant risks, including potential total investment loss if the platform ceases operations, collapses, gets hacked, or suffers from asset misappropriation.
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Japan Prepares for Bitcoin ETFs with SBI and Franklin Templeton Partnership
On 26 July 2024, Japan is poised to join the global trend of Bitcoin exchange-traded funds (ETFs) through a strategic partnership between Japanese financial giant SBI Holdings and American investment powerhouse Franklin Templeton.
- A new digital asset management company will be established, with SBI holding a 51% stake and Franklin Templeton 49%, aiming to launch Bitcoin ETFs pending regulatory approval.
- This joint venture plans to introduce cryptocurrency management services and digital asset securities, leveraging Franklin Templeton’s early advancements in tokenization.
- The initiative aligns with Japan’s anticipated regulatory framework, with a targeted launch by the end of the year.
- Bitcoin ETFs have gained popularity globally, offering retail investors simplified access to Bitcoin through regular securities accounts without needing specialized crypto exchanges.
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FINMA Publishes New Guidelines on Stablecoins: Enhancing Regulatory Oversight and Strengthening Financial Security in Switzerland
On 26 July 2024, the Swiss Financial Market Supervisory Authority (FINMA) released “FINMA Guidance 06/2024” to address the growing field of stablecoins.
- The guidance underscores legal, financial, and reputational considerations for stablecoin issuers and banking institutions, aiming to enhance the regulatory framework.
- FINMA’s guidance requires stablecoins to comply with the Anti-Money Laundering Act (AMLA) and outlines the need for robust verification processes to mitigate risks.
- Issuers must navigate banking laws, with specific criteria for default guarantees on public deposits to enhance depositor protection and consumer confidence.
- FINMA emphasizes the importance of thorough due diligence and rigorous oversight by banks to avoid reputational and legal risks.
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Federal Court Orders El Paso Man and His Firm to Pay Over $31 Million for Forex and Cryptocurrency Fraud
On 26 July 2024, the Commodity Futures Trading Commission (CFTC) announced a court order against Abner Alejandro Tinoco and his company Kikit & Mess Investments LLC, requiring them to pay over $31 million for a fraudulent forex and cryptocurrency scheme.
- The order mandates $6.2 million in restitution to 199 defrauded victims, $6.3 million in disgorgement, and a $18.8 million civil monetary penalty.
- Tinoco misappropriated over $7.2 million of investment funds for personal luxuries instead of investing them as promised.
- The CFTC advises the public to verify registration status with the CFTC and report suspicious activities to the Division of Enforcement.
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Donald Trump’s Future Crypto Vision: Making the U.S. the Global Crypto Capital
On 27 July 2024, former U.S. President Donald Trump delivered the keynote address at the Bitcoin 2024 conference in Nashville, Tennessee, proposing an ambitious vision for the U.S. to become the “crypto capital of the world.”
- Trump announced plans to create a national Bitcoin reserve, pledging to keep 100% of all Bitcoin the U.S. government currently holds or acquires.
- Senator Cynthia Lummis introduced a bill to acquire 5% of the world’s Bitcoin supply, aiming to reduce national debt by converting excess reserves into Bitcoin.
- Trump plans to appoint a Bitcoin and crypto advisory council to design regulatory guidance within the first 100 days of his next presidency.
- Data from Santiment and the Crypto Fear & Greed Index reflect a surge in positive sentiment towards Bitcoin following Trump’s speech, despite a short-term decline in Bitcoin’s value.
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Moomoo Becomes First Digital Brokerage in Singapore to Obtain Major Payment Institution License
On 28 July 2024, Moomoo announced it secured a Major Payment Institution (MPI) license from the Monetary Authority of Singapore (MAS), making it the first digital brokerage in Singapore to obtain a license for digital payment token services.
- Founded in 2018 as a subsidiary of Futu Holdings, Moomoo offers low-cost stock trading and now plans to extend its services to include cryptocurrency trading.
- The MPI license allows Moomoo to operate as a regulated crypto business, enabling users to trade cryptocurrencies alongside global stocks and funds.
- The first 5000 clients of Moomoo Crypto will enjoy 0% commission until 30 September 2024.
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Chee Hong Tat Appointed Deputy Chairman of MAS Board
On 29 July 2024, the Monetary Authority of Singapore (MAS) announced the appointment of Chee Hong Tat, the Minister for Transport and Second Minister for Finance, as Deputy Chairman of the MAS Board of Directors, effective from 23 August 2024.
- Mr. Chee has been a Member of Parliament since 2015 and has held various key governmental positions.
- His extensive background includes roles in Health, Communications & Information, Education, Trade & Industry, and Foreign Affairs.
- Mr. Chee holds degrees from the University of California, Berkeley, and Adelaide University.
- His leadership is expected to drive innovative policies and strengthen Singapore’s financial regulatory framework.
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SFC Issues Public Warning Against Proxinex for Suspected Virtual Asset-Related Fraud
On 29 July 2024, the Securities and Futures Commission (SFC) issued a public warning regarding Proxinex, suspected of engaging in virtual asset-related fraud.
- Investors reported significant difficulties withdrawing virtual assets, with some being told their accounts did not exist.
- The SFC found that Proxinex recruited an agent to entice investors via dating apps, using falsified documents to gain their trust.
- The SFC added Proxinex to its Suspicious Virtual Asset Trading Platforms Alert List and advises the public to be vigilant and cautious of similar scams.
- The SFC’s investigation highlights the sophisticated nature of online investment scams and the importance of regulatory oversight to protect investors.
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SEC Charges Nader Al-Naji with Fraud and Unregistered Offering of Crypto Asset Securities
On 30 July 2024, the Securities and Exchange Commission (SEC) charged Nader Al-Naji, founder of the BitClout blockchain protocol (now Decentralized Social or DeSo), with fraud and unregistered offering of crypto asset securities.
- Al-Naji allegedly raised over $257 million through unregistered sales of BitClout’s native token, BTCLT, and diverted more than $7 million for personal use.
- He operated under the pseudonym “Diamondhands” to create the illusion of decentralization and evade regulatory scrutiny.
- The SEC filed the complaint in the U.S. District Court for the Southern District of New York, charging Al-Naji with violating the Securities Act of 1933 and the Securities Exchange Act of 1934.
- The U.S. Attorney’s Office for the Southern District of New York also announced parallel charges against Al-Naji.
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Seoul Court Rules in Favour of Wemade CEO in $7 Million WEMIX Token Dispute
On 30 July 2024, the Seoul Central District Court ruled in favor of Wemade CEO Park Kwan-ho, ordering the defunct virtual asset exchange GDAC to return 7.8 million WEMIX tokens valued at approximately $7.31 million.
- The court supported Park’s temporary injunction application filed on 29 July 2024, requiring GDAC to comply within 30 days or face a daily fine.
- GDAC had accused Park of market manipulation and money laundering, but the court dismissed these allegations.
- This ruling could set a precedent for resolving digital asset disputes and highlights the importance of transparency and integrity for exchanges.
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CFTC Issues Warning on Multi-Stage Crypto Fraud Schemes
On 30 July 2024, the Commodity Futures Trading Commission’s (CFTC) Office of Customer Education and Outreach (OCEO) issued a customer advisory highlighting the risks and complexities of multi-stage fraud schemes in the crypto space.
- These schemes often target victims repeatedly, evolving into fraud-recovery scams and money laundering schemes.
- Victims of initial frauds are frequently lured into recovery scams where they are promised the return of lost funds for an upfront fee, often by the same criminals.
- The CFTC advisory outlines key protective steps: avoid mixing money with long-distance relationships, be cautious of unsolicited communications, ensure trading platforms are registered and headquartered in the U.S., and verify any communications directly with the relevant agency.
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XRP Ledger Revolutionizes DeFi with Tokenized US Treasury Bills
On 30 July 2024, the XRP Ledger introduced tokenized US Treasury bills (T-bills) through a partnership with OpenEden, a leading tokenization platform.
- OpenEden’s TBILL tokens are backed by short-dated US T-bills and reverse repurchase agreements collateralized by US Treasuries, ensuring security and regulatory compliance.
- Ripple committed $10 million to OpenEden’s TBILL tokens, highlighting the importance of real-world asset (RWA) tokenization in decentralized finance (DeFi).
- The XRPL’s infrastructure supports institutional-grade financial applications, making it a prime platform for RWA tokenization.
- OpenEden has attracted diverse institutional clients, and Ripple’s collaboration with Archax aims to bring hundreds of millions of dollars worth of tokenized RWAs onto the XRPL.
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