Despite the twists and turns in the crypto industry, innovation remained at an all-time high for both the good and bad actors. Regulatory efforts continued to move in one direction.
The headlines:
- CZ Zhao is back from jail, but not at Binance;
- Caroline Ellison got two years;
- The SEC restricted BNY to ETPs;
- Still on the SEC, Gary Gensler and the representatives had a heated moment on Capitol Hill;
- Plus, New York’s NYDFS called for federal legislation alongside current state efforts;
- And much more!
As always, these are your decentralized diaries!
Bitcoin is at $63k
The bulls came in for Bitcoin, with prices hitting a $66,480.69 high from a $62,669.27 low. Bitcoin is currently at $63,483.44 (as of 9/30/24).
The altcoins are also in positive territory. Ethereum (ETH) is at $2,601.06, Solana (SOL) at $154.42, Avalanche (AVAX) at $28.22, Chainlink (LINK) at $11.94 and Polkadot (DOT) at $4.52.
CZ Completed His Prison Sentence
Things are looking up for the former Binance chief Changpeng “CZ” Zhao following his four-month prison stint. Authorities released Zhao two days early. Subsequently, he will not be involved in operations at Binance.
A Court Sentenced Caroline Ellison to Two Years
The (ongoing) FTX saga continued with former Alameda Research CEO Caroline Ellison’s sentencing. On September 24, a federal court sentenced Ellison to twenty-four months.
Consequently, she will serve three years of supervised release after her sentence.
In related news, the FTX bankruptcy estate revealed that $230 million will be set aside for preferred shareholders. The required sum will be the outcome of government forfeiture actions.
BNY Revealed its SEC SAB 121 Compliance Status
Following guidance from the SEC, banking behemoth BNY Mellon released further details of its custody arrangement per SAB 121 rules. The regulator limited BNY’s custody arrangement to regulated Bitcoin and Ether ETPs.
Moreover, BNY revealed it was negotiating with the SEC about other use cases.
Truflation Offered $500k as Bounty
Following the theft of tokens worth $5 million (approximately), crypto-focused infrastructure firm Truflation revealed a $500,000 bounty aimed at retrieving the stolen funds. The bad actors stole the digital assets across multiple chains.
Additionally, Truflation revealed that the hack didn’t affect the launch of its mainnet.
Tether Revealed $6 Million Seizure Cooperation Efforts with the DoJ
Stablecoin issuer Tether continued collaborating with the Department of Justice in enforcement actions. In a September 27 post, Tether revealed it’s assisting the DoJ in seizing $6 million worth of digital assets linked to Southeast Asian confidence scams.
Moreover, Tether CEO Paolo Ardoino iterated Tether’s commitment to preventing the activities of bad actors.
Gary Gensler Faced Congress Over Crypto Issues
SEC Chairman Gary Gensler was in the hot seat at a hearing on Capitol Hill. During a September 24 House Financial Services Committee hearing, several lawmakers criticized the SEC chief over the agency’s crypto-related regulatory activities.
He also slammed the crypto industry’s (alleged) nonchalance towards the rules.
The CFTC Took Action Against a Phantom Crypto Trading Platform
Enforcement actions continued, with the CFTC filing fraud charges against a fake commodity trading ecosystem that targeted Asian Americans. In a September 27 announcement, the regulator revealed actions against individuals and entities. They include Fidefx Investments Ltd., Aipu Ltd., Lan Bai, and Qian Bai.
The CFTC alleged that (at least) 32 people lost assets worth $3.6 million following solicitation. Additionally, the CFTC indicated in its filing that the defendants made false claims about crypto trading activities.
Ripple Minted its Stablecoins
Following a previous announcement revealing the launch of its “RLUSD” stablecoin, Ripple Labs followed up with the minting of tokens worth $800,000. On September 29, Ripple minted 99% of the total supply.
The RLUSD is available to enterprise users within the XRP ecosystem.
Avalanche Unveiled a $40 Million Grant
Ahead of its “Avalanche 9000” upgrade, smart contract-capable blockchain Avalanche revealed a grant program worth $40 million for developers deploying Layer 1 blockchains. Devs introducing Layer-1 networks or tech tools on the Avalanche 9000 testnet stand a chance of getting a share of the funds.
Consequently, a community-based voting mechanism will determine the recipients of the funding. Avalanche is yet to release a date for the launch.
Vitalik Buterin Called for Increased Project Cooperation Within the Ethereum Ecosystem
Ethereum co-founder Vitalik Buterin pushed his vision further with a new concept. In a September 28 post on his website, Buterin introduced “Ethereum Alignment,” a concept aimed at creating a common basis for projects.
Moreover, Buterin identified several metrics that should serve as guidance. They include an open source focus alongside open, interoperable standards, improved decentralization and security, and the positive impact of each project.
A Malicious Crypto Theft App Got Listed on Google Play
Crypto scammers continued to find new ways to steal tokens. This time, the bad actors bypassed security and safety measures to list an app on the Google Play marketplace.
Cybersecurity firm Check Point Research (CPR) found the app following the theft of $70,000 worth of tokens. Furthermore, the scammers faked legitimacy by deploying the Walletconnect protocol and used fake reviews to instill confidence in 150 users who lost their funds.
The New York State Regulator Advocated for Federal Crypto Legislation
On September 25, at the Digital Asset Compliance and Market Integrity Summit, the NYDFS called for federal crypto laws to enable the government to improve its regulatory activities. NYDFS Superintendent Adrienne Harris stressed the importance of passing laws at the federal level.
Furthermore, Harris iterated that states have a role to play, highlighting the efficient moves several states have made to regulate the industry.
