Decentralized Diaries for the Week of 11/27/23

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What will the crypto industry look like without Changpeng Zhao of Binance?

Tighten your belts, folks. We are about to find out!

Nothing much changed after that (SBF will most likely remain in jail).

Media reports identified Tron as the new favorite blockchain for terrorists and militants.

California’s DFPI gave a hot take on the most common crypto scams.

Plus, Ethereum is still the king of the Layer-1 hill.

These are your decentralized diaries!


Bitcoin Hovers at $37k, the Altcoins Remain Marginally Sideways

From a $35,670.97 low this past week, Bitcoin prices hit a $38,415.34 high. Prices currently nest at $37,064.08 (as of 11/27/23).

The altcoins are also in similar straits.

Ethereum (ETH) is currently at $20, 20.00, Solana (SOl) at $54.30, Chainlink (LINK) at $14.24, Avalanche (AVAX) at $20.47, Polkadot (DOT) at $5.13 and Litecoin (LTC) at $68.89.

Changpeng Zhao Stepped Down as Binance CEO, Pled Guilty to Charges

In a surprising twist of events, Changpeng Zhao, the CEO of Binance, resigned.

He also pled guilty to money laundering charges brought against him by regulators, including the Department of Justice (DoJ) and the Securities and Exchange Commission (SEC).

Binance will also pay $4.3 billion in settlements, while CZ will pay $50 million.

The CFTC also revealed that the cryptocurrency exchange agreed to pay $1.35 billion and forfeit another $1.35 billion as part of allegations of violating the Commodity Exchange Act (CEA).

Zhao will pay $50 million, while Samuel Lim, former Chief Compliance Officer, agreed to pay $1.5 million.

Changpeng was released on a $175 million bond and posted $15 million in a trust account.

The DoJ deemed Zhao to be a manageable flight risk.

Richard Teng, the former global head of regional markets, is the new CEO.

A Court Denied Sam Bankman-Fried’s Appeal for Release

The U.S. Court of Appeals denied the request of Sam Bankman-Fried for his release from incarceration.

Sentencing is on March 28, 2024, after a guilty verdict by jurors.

In related news, Judge Lewis A. Kaplan approved a request by his lawyers to extend post-trial motions. The move by the attorneys indicates the possibility of an appeal or a reduced sentencing request.

The post-trial motions by the defense will occur on December 1, and the prosecutorial response on December 22.

Media Reports Identified Tron Blockchain as the Preferred Platform for Alleged Terrorist Financing

According to a Reuters report, the Israeli National Bureau for Counter-Terror Financing (NBCTF) seized and froze 143 Tron wallets from July 2021 to October 2023.

The report concluded that the wallets are linked (allegedly) to terrorist groups.

Hayward Wong, a spokesperson for the entity that controls the blockchain, indicated that Tron didn’t have control over its network.

Wong said that technology could “in theory, be used for questionable activities” and cited the dollar’s alleged role in money laundering activities as an example.

In April, Hamas’ armed wing revealed a departure from Bitcoin fund-raising activities.

California’s Regulator Revealed Most Common Crypto Scam Complaints

The California Department of Financial Protection and Innovation (DFPI) revealed the most common crypto complaints received by its Customer Service Office (CSO).

One scenario involved the deception of customers via phishing websites and the subsequent theft of tokens.

A close runner-up used deception techniques by scammers to trick people into investing in fake platforms.

Another scenario is the mistaken transfer of assets to the wrong address.

The DFPI warned the public to be careful of information posted online.

The regulator also stated, “Be especially cautious about online crypto-related investment offers. If it seems too good to be true, it probably is. Go slowly, ask questions, and do your own research.”

Tether Froze $225 Million in Stablecoins Linked to Human Trafficking

Following a request by the Department of Justice (DoJ), Tether, the USDT stablecoin issuer, froze $225 million in USDT tokens allegedly linked to a Southeast Asian human trafficking syndicate.

The action followed months of investigation by the DoJ and is currently the largest stablecoin seizure.

Bitfinex and Tether agreed to drop opposition to the Freedom of Information Law (FOIL) requests by media organizations and journalists regarding reserves.

Tether also indicated that the decision doesn’t imply a release of documents.

Sygnum Launched an Institutional Crypto Index

Across the pond, Sygnum, the Swiss-based crypto-friendly bank, revealed the launch of the “Sygnum Crypto Multisector Index-Linked Certificate (ILC).”

The Sygnum Crypto Multisector Index-Linked Certificate (ILC) is broad and has a multi-niche focus, including blockchains, decentralized finance (DeFi), metaverse and gaming, and Web 3.0.

KMPG Canada Unveiled Chainalysis Partnership to Combat Fraud

Across the border in Maple Country, the Canadian arm of KMPG, one of the big four accounting firms, revealed its partnership with KMPG, a premier blockchain analytics firm.

The cooperation will help KMPG improve its forensic abilities when conducting industry investigations.

Messari: Ethereum Accounted for 90% of Q3 Layer-1 Blockchain Revenues

According to Messari, a boutique crypto research firm, Ethereum still dominates the ecosystem of Layer-1 networks.

The world’s second-largest token accounted for over 90% of $491.5 million in Q3 revenues of the 17 networks analyzed.

The sector fared marginally, with a 9.8% drop in market capitalizations to $272.6 billion.