The good news of the past week is that Bitcoin (BTC) has continued to rally, rising around 10% from January 16-23. But the worrying trend of crypto companies making headlines for their run-ins with the law remains unchanged.
The US Department of Justice launched a “major international cryptocurrency enforcement action” against China-based cryptocurrency firm Bitzlato, arresting its founder, Anatoly Legkodymov. The department views Bitzlato as a “major money laundering issue” related to illicit Russian finance. While the exchanges had attracted little attention until the DOJ action, they reportedly received $206 million from darknet markets, $224.5 million from scams, and $9 million from ransomware attackers.
The United States Financial Crimes Enforcement Network stated that cryptocurrency exchange Binance was among Bitzlato’s “top three receiving counterparties” in terms of Bitcoin transactions. However, he did not mention Binance among the top issuing counterparties.
The US Securities and Exchange Commission has followed the Commodity Futures Trading Commission in filing parallel charges against the cryptocurrency user allegedly behind the multi-billion dollar exploit of decentralized exchange Mango Markets. Avraham Eisenberg is accused of tampering with Mango Markets’ MNGO governance token to steal some $116 million worth of cryptocurrency from the platform.
Iran and Russia want to issue a new gold-backed stablecoin
The Central Bank of Iran is reportedly cooperating with the Russian government to jointly issue a new gold-backed cryptocurrency. The “Persian Gulf region token” would serve as a method of payment in foreign trade. The stablecoin is intended to allow cross-border transactions in lieu of fiat currencies such as the US dollar, Russian ruble, or Iranian rial. The potential cryptocurrency would reportedly operate in a special economic zone in Astrakhan, where Russia began accepting Iranian shipments.
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The EU postpones for the second time the final vote on MiCA
The final vote on the European Union’s long-awaited set of crypto standards, the Regulation on Markets in Crypto Assets (MiCA), has been postponed to April 2023. This marks the second delay in the final vote, which was previously postponed from November 2023. 2022 to February 2023. The latest delay is due to a technical issue whereby the 400-page official document could not be translated into all 24 official EU languages. Legal documents such as the MiCA, drawn up in English, must comply with EU regulations and be published in the 24 official languages of the union.
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Japanese regulators want cryptocurrencies to be treated like traditional banks
“If you want to apply effective regulation, you have to do the same thing that you regulate and supervise traditional institutions,” said Mamoru Yanase, deputy director general of the Japan Financial Services Agency’s Office of Strategy Development and Management. The official added that countries “have to strongly demand” consumer protection measures from crypto exchanges, also calling for money laundering prevention, strong governance, internal controls, auditing, and disclosure for crypto brokers.
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