Cryptocurrency exchange CoinEx has been sued by the New York Attorney General, Letitia James, alleging the firm falsely represented itself as an exchange due to failing to register as a securities and commodities broker-dealer in the state. A 38-page petition filed by James in the New York Supreme Court on Feb. 22 alleged CoinEx “engaged in repeated and persistent fraudulent practices” and violated the state’s Martin Act — considered one of the most strict anti-fraud and securities regulation laws in the United States. She also asserted CoinEx listed various tokens that qualified as “both commodities and securities” naming Amp (AMP), …

The founders behind the alleged $340 million “global Ponzi” scheme Forsage have been indicted by a federal grand jury in the District of Oregon. The four Russian founders — Vladimir Okhotnikov, Olena Oblamska, Mikhail Sergeev, and Sergey Maslakov — have been formally accused of having key roles in the scheme which raised approximately $340 million from victim-investors, according to a Feb. 22 Department of Justice (DOJ) statement. “Today’s indictment is the result of a rigorous investigation that spent months piecing together the systematic theft of hundreds of millions of dollars,” said U.S. Attorney Natalie Wight for the District of Oregon, …

On Feb. 13, a federal judge put the Securities and Exchange Commission and the Commodity Futures Trading Commission cases against former FTX CEO Sam Bankman-Fried on hold. You’ll be forgiven if you missed this story — headlines and social media were dominated by the breaking news that the SEC was suing crypto firm Paxos for minting Binance’s stablecoin, Binance USD (BUSD). But we’re not here to debate whether stablecoins are securities. The Howey test has been discussed to death, and while it’s true that few people expect to profit from a token pegged to a fiat currency, the issue is …

California Representative Maxine Waters, ranking member of the United States House Financial Services Committee, has called for coordination and cooperation between government agencies and lawmakers to address crypto regulation. Speaking to Cointelegraph, Representative Waters suggested that recent enforcement actions on the crypto space from the U.S. Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) may have been to present the image of “doing something substantive and meaningful” following the collapse of major exchanges including FTX. According to Waters, the market crash and related bankruptcies of major firms gave U.S. lawmakers an opportunity of “getting accountability” in the …

The Canadian Securities Administrators (CSA) published a notice on Feb. 22 describing new commitments it expects from crypto asset trading platforms (CTPs) seeking registration in Canada. The CTPs will enter into a new version of preregistration undertakings (PRUs), which are legally binding documents. Registered CTPs will be contacted by their principal regulators about compliance with the new expectations. The new commitments represent investor protections in light of the spate of CTP insolvencies that occurred in 2022, the CSA wrote. The new commitments touch on issues that include segregation of assets, leverage, determination of capital, transparency and others. The notice devoted …

NBA Top Shot Moments nonfungible tokens (NFTs) may be considered a security, as it meets the requirements under the United States security laws, according to court filings on Feb 22. The decision comes as federal judge Victor Marreo denied a motion from Dapper Labs CEO Roham Gharegozlou to dismiss a class action lawsuit claiming its NBA Top Shot NFTs are securities. Upon denying the motion, the court authorized the case to proceed. Dapper Labs now has 21 days to respond to the court's decision. For the verdict, the judge reviewed the Howey Test, which determines whether the NFTs qualified as …

The United States Federal Trade Commission, or FTC, said it had started an investigation of crypto lending firm Voyager Digital parallel to the company’s bankruptcy proceedings. In a Feb. 22 filing in U.S. Bankruptcy Court for the Southern District of New York, the FTC said it was investigating Voyager and its employees “for their deceptive and unfair marketing of cryptocurrency to the public”. The announcement followed Bankruptcy Judge Michael Wiles initially approving of a plan in which Voyager debtors would sell the firm’s assets to Binance.US for more than $1 billion. According to the FTC filing — an objection to …

Minnesota Representative Tom Emmer has introduced legislation in the United States House of Representatives that could limit the Federal Reserve from issuing a central bank digital currency, or CBDC. In a Feb. 22 announcement, Representative Emmer said he had introduced the ‘CBDC Anti-Surveillance State Act’ in an apparent effort to protect Americans’ right to financial privacy. According to the Minnesota lawmaker, the bill could prohibit the Fed from issuing a digital dollar “directly to anyone”, bar the central bank from implementing monetary policy based on a CBDC, and require transparency for projects related to a digital dollar. “Any digital version …

The Bank for International Settlements (BIS) has long taken a cautious approach to Bitcoin (BTC) and cryptocurrencies. No need for caution anymore, however, as the “battle has been won” between fiat and crypto, according to BIS. BIS general manager Agustín Carstens, who made the claim, highlighted that “technology doesn’t make for trusted money,” among further criticisms of crypto in an interview with Bloomberg. Crypto has lost the argument that it's an alternative to fiat currency, the head of the Bank for International Settlements says https://t.co/xZKFHEj3b2 — Bloomberg Crypto (@crypto) February 22, 2023 As the central bank for central banks, the …

The United States Congress needs to take control of crypto legislation to make it a more “open process” where the entire marketplace is looked over “comprehensively,” suggests the chief of the prominent U.S. crypto industry body. In a Feb. 22 Bloomberg interview, Blockchain Association CEO Kristin Smith said the industry needs U.S. lawmakers to lead crypto legislation despite it making the process “very slow” and regulators “stepping in” in the interim. Smith noted that despite regulators “moving very quickly,” progress on legislation is happening “behind closed doors,” suggesting it's vital for more industry involvement in an “open process” which would …

Attorneys working on behalf of former FTX CEO Sam Bankman-Fried have agreed to pay for a security expert to assist the federal judge overseeing his fraud case in navigating modern encryption technology to aid in possibly modifying Bankman-Fried's bail terms. Bankman-Fried’s lawyers Christian Everdell and Mark Cohen sent a letter to Judge Lewis Kaplan on Feb. 21 agreeing with his proposal for a technical professional to aid him. According to the letter, “the defense has already begun researching and contacting possible experts and anticipates being able to propose one or more potential candidates to the court by the end of …

The staking services offered by cryptocurrency exchange Coinbase are “fundamentally different” to what was offered by its peer exchange Kraken — which recently came under fire from the United States securities regulator — according to Coinbase's head lawyer. Paul Grewal, Coinbase’s chief legal officer, made the comments in his response to a shareholder question regarding its staking services during a Q&A session on the exchange’s fourth-quarter results, noting: “The staking products that we offer on Coinbase are fundamentally different from the yield products that were described in the reinforcement action against Kraken. The differences matter.” The first point of difference …