As global regulators step up their efforts, Genesis Global is insolvent.

The past week has seen a notable increase in crypto-focused global regulatory efforts and a corresponding increase in government interest across the board. Gemini and the DCG case saw some updates, with Genesis Global officially filing for bankruptcy. Meanwhile, FTX remained in the spotlight as bankruptcy attorneys sought money to settle distressed creditors.

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Increasing global regulatory efforts

Last week, an expected trend in the crypto industry was an increase in regulatory efforts by various financial institutions around the world. This has been cited in recent crypto implosions and scams, which have resulted in massive losses for investors.

A notable development came from Iran, where Govt introduced Policies to provide a regulatory framework for the local crypto industry. However, some analysts have expressed pessimism, citing restrictions that could destabilize the crypto space. One such restriction is the ban on futures and margin trading. Iran has also banned foreign nationals from using local crypto exchanges. Notably, the government was also given access to consumer data. After that they now have the option to terminate any user’s account at their discretion.

In the wake of the collapse of FTX, which also hurt Japanese consumers, financial regulators on January 16, shed light The local cryptosphere needs to be regulated with the same scrutiny as it is applied in the traditional banking sector. They note that FTX exploded due to a lack of proper oversight.

Meanwhile, there were crypto exchanges in France to advise To apply for licensing by January 1, 2024. The government pointed to the FTX failure as an example of why they should step up regulatory efforts.

The United States is at the forefront of enforcement actions.

As it turned out, French law enforcement agencies cooperated with the US Department of Justice (DoJ) to crack down on the alleged illegal activities of Bitzlato, a cryptocurrency exchange registered in Hong Kong.

On January 18, the US DoJ said it would announce a global enforcement action. A few hours later the agency revealed that he had arrested Anatolii Legkodimov, the founder of Butzlato. Ramp is accused of money laundering and illegal Russian financing.

Amidst the DoJ’s enforcement efforts, other U.S. regulatory agencies, including the Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC), turned their attention to Mango Markets’ alleged fraud. equalize Multiple charges of $116 million fraud against Abraham Eisenberg, who exploited the mango markets.

These US enforcement actions were in place not only last week, but throughout 2022 as well. Reports From Cornerstone Research, dated Jan. 18, indicated that enforcement actions taken by U.S. regulators have increased by 50 percent in the past year.

As regulators step up their efforts, the crypto industry gradually sees the need for compliance. Many industry players believe that the current regulatory landscape still needs to be improved for safety and stability in the crypto market. Venture capitalist and former FTX spokesperson, Kevin O’Leary, emphasized The importance of proper regulation in developing a safer and more mature crypto market.

Additionally, in the wake of witnessing multiple bankruptcies within the space, Christy Romero, a CFTC commissioner, Called Addressing the risks of crypto entities self-certifying and listing products without oversight. Another CFTC commissioner, Carolyn Pham, Indicated End the need for global crypto regulations in 2023.

Increased interest from federal governments

Increased global regulatory efforts have also coincided with increased interest from governments. This trend was particularly evident last week when several countries announced updates on their central bank digital currencies (CBDCs) and stablecoin projects.

In Spain, the central bank gave Green light to launch trial phase for EURM, a stablecoin for the euro. The pilot, which is expected to last between six and twelve months, will be run by fintech firm Monei. After completing the testing phase, it will debut on the mainnet.

Meanwhile, a crypto-focused transcontinental partnership was formed between Iran and Russia. Over the years, both countries have had an interest in crypto due to the many restrictions imposed by the West. last sunday, Reports revealed that the two countries will launch a stablecoin backed by gold.

Australia too announced Plans to launch its own stablecoin, “AUDN” on the Ethereum and Algorund networks. The stablecoin will be pegged to the Australian dollar (AUD) and is set to launch in mid-2023. According to reports, the country’s central bank will be the sole body in charge of token minting.

CBDCs: China’s growth and England’s indifference.

While others were planning to launch their own local stablecoins, China was already improving its already launched CBDC. On January 17 Reports revealed that the government has added smart contracts support for the digital yuan (eCNY), a feature already being used by Chinese shopping platform Meituan.

Even with this growing global interest, England’s CBDC dream faced some opposition last week. Andrew Bailey, Governor of the Bank of England, Expressed Doubts about the importance of the digital pound. While not completely ruling out the need for it, Bailey noted that the British economy would not need a digital pound.

Governments are welcoming crypto.

Last week, Ukrainian Deputy Prime Minister Mykhailo Fedorov, claimed Speaking at the World Economic Forum (WEF) this year, the European country will be the biggest boomer for digital assets.

Fedorov mentioned that the country is working towards establishing a regulatory framework to legalize cryptocurrencies in Ukraine. Last February, Parliament passed the Digital Assets Bill. He also noted that Ukraine is receiving financial aid in cryptocurrencies as the Russian war continues and expressed gratitude to the crypto community.

In Davos, UAE Minister for Foreign Trade, Thani Al Zayoudi, revealed That they want to make cryptocurrencies an important aspect of its economic development and trade. He noted that the country will periodically enact legislation to guide the use of crypto to ensure that the local crypto industry is properly regulated.

FTX lenders greeted with unfavorable reports.

The FTX saga occasionally reserved the spotlight last week, as updates emerged about bankruptcy proceedings amid efforts to resolve creditors. FTT, FTX’s native token, Start On a reasonable basis Saturday, up 60 percent in 24 hours till January 16. It reached a high of $2.50 before recovering. However, some attributed the rally to a pump and dump scheme.

As its native token soared, FTX was still battling bankruptcy proceedings. As a result of scrambling efforts for funds The investigation Crypto theft of $415 million last year. According to current FTX CEO John Ray, the stolen funds included $90m from FTX US. Nevertheless, Sam Bankman-Fried maintained that FTX was US solvent, urging Ray to concede that claim.

Furthermore, Reports 17 January suggested that FTX was still far from securing enough funds to settle creditors despite disclosing $5.5b in liquid assets. The company received $3.5b worth of Bitcoin (BTC), $1.7b in cash, and $0.3b in securities, but a major funding shortfall remains. As a result, investors and consumers may still not receive all of their lost assets.

Nevertheless, Ray has led recovery efforts. They filed On January 17, a motion seeking to retain attorneys for Sullivan and Cromwell in the ongoing bankruptcy case was filed, citing their compatibility with the motion to remove the attorneys from the case due to a conflict of interest. The previous proposal was contested.

Ray too Disclosure FTX plans to relaunch, the collapsed international platform of the ecosystem. In an interview with The Wall Street Journal last Thursday, Ray mentioned that users believe the technology behind the platform is commendable despite the poor management. Ray and his team are considering relaunching the exchange to raise funds for investors.

Following this revelation, the FTT token surged again within two hours, this time by 34%. Also Sam Banksman Freud Answered On Ray’s comments. He welcomed the decision but claimed Ray was only “paying lip service” to the move, alleging that the FTX CEO had been against plans to implement the decision for months. were working

As Ray tried to recover the funds, Alameda Research’s liquidators lost the funds to the liquidated positions. Arkham Intelligence revealed Last Wednesday that the liquidators in charge of the Alameda wallets and accounts had suffered massive losses, more than $4m of which could have been prevented.

Birth becomes bankruptcy.

FTX reports that last week there was no update on the situation between Digital Currency Group (DCG) and Gemini, as Genesis Global joined the long list of bankrupt cryptocurrency firms. Reports As of January 18, it was revealed that creditors and the firm were working on a pre-packaged bankruptcy plan.

Two days later, Genesis Global filed for Chapter 11 bankruptcy protection, disclosing that it has 1 to 49 creditors, with assets ranging from $100m to $500m, and liabilities between $100m and $500m. The bankruptcy filing also covered its subsidiaries. After filing, court documents revealed That the lender owes its creditors $5.1b.

In response, Gemini co-founder Cameron Winklevoss Expressed His pleasure, claiming that this gives Gemini and other creditors a good chance of recovering lost funds. In his view, bankruptcy proceedings would subject Genesis Global to judicial oversight that would help uncover the cause of the current situation.

Prior to the bankruptcy, reports suggested continued efforts by Barry Silbert’s DCG to raise funds for a creditor settlement and navigate the liquidity storm. Firm Notified Its shareholders said last Wednesday that it would temporarily suspend dividend payments to maintain liquidity.

CoinDesk, DCG’s media unit, is already in. The conversation with Lazard, a Bermuda-based asset management company, regarding a potential acquisition agreement. Cardano founder Charles Hoskinson is also interested. Last week, he Disclosure Plans to acquire CoinDesk to “rehabilitate journalistic ethics”

A terrible start to the year for Nexo

It was mostly quiet in the Nexo camp last week after the legal and regulatory troubles it faced two weeks ago. After calming down, on January 19, the US SEC accused of Nexo to offer its Earned Interest Product (EIP) to US investors without prior registration. The SEC revealed that Nexo agreed to settle charges and pay a $22.5m fine to stop offering products to US-based investors.

The development comes a week after Bulgarian authorities raided Nexo’s offices to investigate allegations of illegal financial activity. Nexo addressed rumors that the developments in Bulgaria were politically motivated. However, Bulgarian authorities came out this week to counter the claims is saying The investigation had nothing to do with politics.

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