The implosion of Do Kwon’s Terra was one of the devastating events in the crypto space last year. Investors lost funds worth billions of dollars to UST and Luna, in addition to crypto asset prices plunging drastically due to the contagion caused by the implosion.
Subsequently, prosecutors have been investigating the crisis. It finally got headway late Thursday when the United States Securities and Exchange Commission charged Terraform Labs, the company behind Terra and its founder, Do Kwon, alleging they conducted a multibillion-dollar crypto asset securities fraud.
On the brighter side. Bitcoin reached a new 2023 high of $25,000 on Thursday. Recall that the last time Bitcoin’s price was around $25,000 was mid-2022. Since then, it had been hovering between $19,000 and $21,000 until last month.
Here are major crypto stories from around the world this week
El Salvador is expanding Bitcoin strategy to the US
After becoming the first country to adopt Bitcoin as legal tender in 2021, El Salvador is expanding its Bitcoin strategy in a new partnership with the government of Texas, United States. The intergovernmental collaboration aims to set up a Bitcoin Embassy, or El Salvador’s representative office, in Texas to work on new joint projects to promote Bitcoin adoption.
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Milena Mayorga, the Salvadoran Ambassador to the United States, announced the development in a Twitter statement on Tuesday.
“In my meeting with the assistant secretary of the government of Texas, Joe Esparza, we discussed the opening of the second Bitcoin Embassy and the expansion of commercial and economic exchange projects,” Mayorga said.
Recall that El Salvador opened the first Bitcoin embassy in Switzerland’s southern city of Lugano in October 2022.
Do Kwon has been charged with fraud
The United States Securities and Exchange Commission (SEC) has filed a lawsuit against Terraform Labs and its founder, Do Kwon, for allegedly “orchestrating a multi-billion dollar crypto asset securities fraud.”
The SEC filed the 55-page complaint in the United States District Court for the Southern District of New York with charges relating to violations of the registration and anti-fraud provisions of the Securities Act and the Exchange Act. In the late Thursday statement, the SEC said Do Kwon and Terraform offered and sold an “inter-connected suite of crypto asset securities, many in unregistered transactions.”
It pointed to its now collapsed algorithmic stablecoin, TerraClassicUSD (USTC) and its connected cryptocurrency Terra Luna Classic (LUNC).
“We also allege that they committed fraud by repeating false and misleading statements to build trust before causing devastating losses for investors.”
Do Kwon, a South Korean, is believed to be in Serbia after leaving his residence in Singapore sometime in September 2022 following a Seoul court issuing an arrest warrant. However, Do Kwon has denied he’s hiding from authorities.
Binance is ready to pay fines
In the wake of the regulatory crackdown it has been facing recently, especially around the issuance of its stablecoin BUSD, Binance is now preparing to face fines and penalties. According to a report by Wall Street Journal on Wednesday, the crypto exchange’s chief strategy officer, Patrick Hillmann, said Binance has been “working with regulators to figure out what are the remediations we have to go through now to make amends for that.”
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In addition, he said the outcome of ongoing investigations will likely be fines but could be more, stating “that is for regulators to decide.” Patrick Hillmann concluded that resolving issues with U.S. regulators would benefit the firm and its future.
“It will be a good moment for our company because it allows us to put it behind us.”
Rock picture sold for $235,000
According to data on Etherscan, a picture of a rock, existing as an NFT on Ethereum, was sold for 139ETH on Thursday. At the time of buying, the 139 ETH was worth around $235,000.
Described as “EtherRock,” the NFT is among the earliest in Ethereum and across the NFT ecosystem. Only 100 of these NFTs were minted, and they have been changing hands since then.
At the moment, it is not clear who the buyer of the NFT is. It is, however, coming at a time when the DeFi, crypto, and NFT markets are recovering from the 2022 winter, which saw trading volumes and floor prices drop by over 90%.
United Kingdom crackdown on illegal crypto ATMs
The United Kingdom’s financial regulator, the Financial Conduct Authority (FCA), is coming for unregistered cryptocurrency ATMs nationwide.
Announcing on Tuesday, the FCA emphasized that all crypto exchange providers, including crypto ATM operators, must be registered with the FCA and comply with money laundering regulations. FCA’s executive director of enforcement Mark Steward said Unregistered crypto ATMs operating in the UK are doing so illegally.
He added that the regulator would continue to disrupt unregistered crypto businesses in the country. The exec also noted that crypto products are “currently unregulated and high-risk,” warning investors to be prepared to lose all their money with crypto.
The FCA action against crypto ATMs would affect many ATM operators. According to data from Coin ATM Radar, at least 28 locations are providing Bitcoin ATMs in the United Kingdom.
Here is all from us this week. See you same time next week!
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