Značka: Terra

South Korea issues arrest warrant for Do Kwon's former colleagues

Amid the ongoing manhunt for Terraform Labs co-founder and CEO Do Kwon, South Korean authorities have spread out their investigations to target other Terra executives. Prosecutors issued an arrest warrant for co-founder Daniel Shin and seven other engineers and investors of the firm following suspicion of gaining illegal profits before the massive collapse of the Terra ecosystem.The Seoul Southern District Prosecutors Office in South Korea suspected that Shin possessed Terra (LUNA) tokens, which were pre-issued without the public knowledge of investors. In doing so, Shin allegedly bagged profits worth 140 billion won (roughly $105 million) by selling the pre-issued tokens during the bull market.Arrest warrants were also sought for three Terraform Labs investors and four engineers responsible for TerraUSD (UST) and LUNA initiatives, confirmed local media Yonhap News Agency. On Nov. 19, South Korean authorities seized assets worth over $104 million from Shin under the same suspicion of making unfair profits.At the time, Shin’s attorney maintained the counter-narrative stating that “Reports that CEO Shin Hyun-seong sold Luna at a high point and realized profits or that he made profits through other illegal methods are not true.” Speaking against the arrest warrant, Shin pointed out:“I left (Terraform Labs) two years before the collapse of Terra and Luna, and have nothing to do with the collapse.”The seizure of funds aimed to minimize further losses for investors in case Shin decided to dispose of the stolen funds. While Kwon maintains that he’s not on the run from South Korean authorities, 4,000 members of a retail investor group are attempting to track down the fugitive’s whereabouts.On Oct. 6, South Korea’s Ministry of Foreign Affairs ordered Kwon to surrender his passport, which, if not done, would result in the permanent cancellation of his passport. The deadline has passed since.Related: Terra Labs, Luna Guard commission audit to defend against allegations of misusing fundsA local report from South Korea claimed that prosecutors obtained evidence regarding Kwon’s order to manipulate the price of Luna Classic (LUNC). However, a Terraform Labs spokesperson dismissed the allegations when speaking to Cointelegraph, highlighting their disappointment in seeing “the Korean prosecutors continue to try to contort the Capital Markets Act to fit their agenda and push baseless claims.”Unconfirmed reports suggest that Kwon moved from South Korea to Singapore before ultimately transitioning to Dubai, United Arab Emirates.

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How stable are stablecoins in the FTX crypto market contagion?

If early November’s FTX collapse was crypto’s “Lehman moment” — as more than a few pundits have suggested — will the FTX contagion now spread to stablecoins? After all, Tether (USDT), the market leader, briefly lost its United States dollar peg on Nov. 10. In normal times, this might have raised alarm bells.But, these aren’t normal times.In fact, in the days following FTX’s Nov. 11 bankruptcy filing, stablecoin “dominance,” i.e., the sector’s share of overall cryptocurrency market capitalization, increased to 18%, an all-time high. Bitcoin (BTC), Ether (ETH), and most altcoins appeared to be feeling the pain from crypto-exchange FTX’s implosion, but not stablecoins.But, what awaits stablecoins in the longer term? Will they really emerge from the FTX fiasco unscathed, or is the sector due for a shake-out? Are stablecoins (still) too opaque, undercollateralized and unregulated for investors and regulators, as many insist? The collapse of the Bahamas-based crypto-exchange FTX hit the crypto world like a tropical storm, and so it bears asking once again: How stable are stablecoins? Is the contagion spreading?“The cracks in the crypto eco-system are increasing, and it would not be surprising to see a significant de-pegging event” in the future, Arvin Abraham, a United Kingdom-based partner at law firm McDermott Will and Emery, told Cointelegraph. Particularly at risk are those stablecoins that use other cryptocurrencies for their asset reserves, rather than fiat currencies like the euro or U.S. dollar, he said.“There is some evidence that FTX contagion did spread to stablecoins,” Ryan Clements, assistant professor at the University of Calgary Faculty of Law, told Cointelegraph, citing the brief USDT de-pegging event. “This shows how interconnected the crypto market is to it.” On Nov. 10, Tether fell to $0.97 on Bitstamp and several other exchanges and to $0.93 for a few moments on Kraken. Tron’s USDD stablecoin also wobbled. Stablecoins are never supposed to fall below $1.00. For its part, Tether blamed the depegging on crypto-exchange illiquidity. Relatively few crypto trading platforms are well capitalized, and sometimes “there is more demand for liquidity than exists on that exchange’s order books and has nothing to do with Tether’s ability to hold its peg nor the value or makeup of its reserves,” said the company.“Tether is completely unexposed to Alameda Research or FTX,” the firm added in its Nov. 9 blog post, further noting that its tokens are “100% backed by our reserves, and the assets that are backing the reserves exceed the liabilities.” Recent: Tokenized government bonds free up liquidity in traditional financial systems“The one thing that has saved Tether so far is that people have generally sold their Tether to others and most users have not actually cashed out,” said Buvaneshwaran Venugopal, assistant professor in the department of finance at the University of Central Florida. “Tether had to pay about $700 million recently and was able to do so.” That said, “the general lack of enthusiasm for crypto and the shrinking options for stablecoins may change this situation,” Venugopal told Cointelegraph. Tether has about $65 billion in circulation, according to CoinGecko, and U.S. Treasury bills make up over 58% of its reserves. “This is a large holding which would be affected if Tether has to sell under a crunch, especially in an increasing interest rate environment.” A darkening outlook for algos?What about algorithmic stablecoins, sometimes called algos? When TerraUSD Classic (USTC), an algorithmic stablecoin, collapsed in May, some forecasted that algos as a sub-class were doomed. Does the FTX failure dampen algos’ prospects?“They aren’t dead, and there are still some prominent ones, including the DAI token which is essential for the functioning of MakerDAO,” said Abraham. But, doubts remain, as algorithmic stablecoins are not easily understood and worries persist that “reserves can be adjusted on a dynamic basis potentially leading to manipulation and facilitating fraud,” said Abraham. Uncollateralized, or substantially under-collateralized, stablecoins are inherently fragile, adds Clements. Terra’s unsuccessful attempt in May to partially collateralize USTC with BTC in defense of its peg is another example of the fragility of an uncollateralized or under-collateralized stablecoin model, he told Cointelegraph, adding:“The industry seems to be accepting this fact and moving away from uncollateralized algorithmic stablecoin models.”“I think algorithmic stablecoins are going to be the sacrificial lamb within the stablecoin regulatory space,” Rohan Grey, assistant professor at Willamette University College of Law, told Cointelegraph. “They’re the ones whose heads will be on the chopping block” in the U.S. to appease regulators and other nay-sayers. Algos might still survive on the global stage, though, he suggested.Looking aheadIt could become very difficult for crypto-backed (i.e., non-fiat) stablecoins to defend their pegs in the event of another major cryptocurrency drawdown, however. In Abraham’s view, it would possibly lead “to an implosion similar to what we saw with the collapse of the Terra stablecoin in the early days of this crypto winter,” he said. What about a collapse of the Tether and/or Circle, the industry’s leaders whose coins are mostly backed by U.S. dollars or related instruments like treasuries? Such an event would be “a catastrophic event for the crypto industry,” said Abraham, because “so much of the industry hinges on using one or the other of these tokens as an intermediate means of exchange.” Many crypto transactions begin with a transfer of dollars into USDT or Circle’s USD Coin (USDC) as a way to avoid “the exchange rate volatility of Bitcoin and other cryptocurrencies.”“Tether is the really big one to watch right now because Tether is intrinsically connected to Binance,” said Grey, who noted that Binance is now playing the role of industry savior, a part played until recently by Sam Bankman-Fried and FTX. Tether’s and Binance’s fortunes are tied together, some believe. Still, one has to be careful when making comparisons between the FTX collapse and the 2008 Lehman Brothers bankruptcy, which foreshadowed the Great Recession of 2008–2009. “There are obvious differences,” said Grey, “one being that at this point, the crypto ecosystem is still relatively segregated from the rest of finance.” Any damage should be relatively contained in the overall scheme of things, i.e., “average people” won’t be hurt as happened in the U.S. financial crisis of 2007–2008. More transparencyIt seems as a given that more transparency, particularly with regard to reserves, will be required for stablecoin issuers post-FTX. “The value proposition of a stablecoin is ‘stability,’” said Venugopal. “Therefore, anything that a company uses to bring about stability must be well-understood by the users.”Absent legislation, stablecoin issuers may need to take it upon themselves to disclose more about their reserves. Grey, for instance, applauded the step that Paxos took in July when it announced that it would provide monthly reserve statements that included CUSIP numbers — Wall Street’s “bar code” for identifying securities — for all instruments backing its Paxos Dollar (USDP) and BinanceUSD (BUSD) stablecoins. Those coins are now backed exclusively by “cash, overnight loans secured only by U.S. Treasuries, and U.S. Treasuries with a less than 90-day maturity,” said Paxos.Stablecoins have long been criticized for being under-collateralized, and this issue arose again with the Terra debacle in May. Has the stablecoin sector made any progress in this area over the past half year in this regard?“Yes, uncollateralized and under-collateralized algorithmic stablecoins are far less popular post-Terra, and there is broader acceptance of the fragility of these stablecoin forms,” Clements told Cointelegraph. “You can see evidence of this in the soon to be launched Cardano DJED project, which will use an over-collateralized reserve model, and the abandonment of the undercollateralized NEAR algorithmic stablecoin project last month.” Collateral, of course, remains a challenge for the traditional finance sector, too, even for commercial banks. It basically means the company, in this case, the stablecoin issuer, “has to forgo lucrative opportunities elsewhere and keep the collateral for a rainy day,” noted Venugopal. “Even the highly regulated banks hate capital adequacy and other liquidity requirements imposed on them and find ways to minimize the amount of money left idle or return less income.” A sector shake-out?Many predict a consolidation in the crypto sector generally post-FTX as weaker coins are winnowed out, much as happened in 2018 as the initial coin offering mania waned. Might something similar happen in the stablecoin world? In September, even before FTX’s fall, an academic paper from researchers at the University of Chicago and Stockholm Schol of Economics noted that partially collateralized stablecoin platforms are always vulnerable to large demand shocks, suggesting some winnowing out might be expected. This seems a reasonable outcome, suggested Abraham, especially since the European Union’s Markets in Cryptoassets Regulation (MiCA) and other legislation will impose high compliance costs on stablecoin issuers. Requirements like auditable reserves “will make it much harder to issue stablecoins and should significantly limit the potential for collapse.”“When disclosure becomes mandatory, we are going to see fewer stablecoins,” Venugopal told Cointelegraph. “In general, I don’t think the world needs thousands of cryptocurrencies/tokens out there acting like securities or assets, especially when they are just speculative. We may need utility tokens but not security tokens.”Boosting investor confidenceGiven the risks, are there steps that coin issuers and/or regulators can take to avoid another industry calamity? “Stablecoins will definitely need to be more transparent with their reserves,” according to Abraham. This is already being prescribed in new legislation. He added:“Both the EU’s new MiCA and the draft Responsible Finance and Innovation Act in the U.S. impose reserve requirements on stablecoin issuers.”In the case of MiCA, an audit of stablecoin reserves will be required every six months.Recent: The metaverse is a new frontier for earning passive incomeVenugopal also agreed that if stablecoins want to become a viable medium of exchange and store of value for the decentralized finance world, they need to be more transparent and make their assets auditable, adding:“Tether has been long accused of lying about its cash reserves which are crucial to its U.S. dollar peg. The fact that Tether has been delaying its audit does not help.”Market perception of reserve instability, or insufficiency, can catalyze investor selloffs which impact a stablecoin’s peg, added Clements. “As a result, more transparency is needed in this area to increase investor confidence and stability, and to this end regulation could help the stablecoin market by requiring proof of reserves, audits, custodial controls on collateral, and other safeguards to ensure collateral transparency and sufficiency.”

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South Korea seizes $104M from Terra co-founder suspecting unfair profits

While crypto exchange FTX stole the limelight from other fallen ecosystems, South Korean authorities continue their efforts to bring closure to the victims of the year’s first crypto crash — Terraform Labs. Nearly six months after the Terra (LUNA) blockchain was officially halted, South Korean authorities froze approximately $104.4 million (140 billion won) from co-founder Shin Hyun-seong based on suspicion of unfair profits.The decision to freeze Shin’s asset worth over $104 million was approved by the Seoul Southern District Court, which was based on a request from the prosecutors. The claim related to Shin’s involvement in selling pre-issued Terra (LUNA) tokens to unwary investors.Based on suspicion of profiting from unwarranted LUNA sales, the district court froze the allegedly stolen funds until further investigations are underway, reported local news media YTN. “Reports that CEO Shin Hyun-seong sold Luna at a high point and realized profits or that he made profits through other illegal methods are not true,” Cointelegraph previously quoted Shin’s attorney.The preindictment preservation of the funds is a way of preventing bad actors from disposing of stolen funds and causing more financial damage or losses for the investors. Shin is currently being investigated by South Korean authorities on two charges — making unfair profits from issuing in-house tokens LUNA and TerraUSD (UST) and leaking customer transaction information of Chai — a Korean payment app linked to Terra — to Terraform Labs.On November 14, the South Korean prosecutors requested the accused co-founder appear in court as part of an investigation into the firm’s collapse.Related: Terra Labs, Luna Guard commission audit to defend against allegations of misusing fundsIn the first week of November, the prosecutors accused Terra co-founder Do Kwon of manipulating Terra’s price.”It’s highly disappointing to see the Korean prosecutors continue to try to contort the Capital Markets Act to fit their agenda and push baseless claims. Prior judicial decisions and statements by the Korean financial authorities, including the FSC, establish that cryptocurrency tokens are not investment contract securities,” said Terraform Labs spokesperson in a written statement to Cointelegraph.

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3 reasons why the FTX fiasco is bullish for Bitcoin

The “Bitcoin-is-dead” gang is back and at it again. The fall of the FTX cryptocurrency exchange has resurrected these infamous critics that are once again blaming a robbery on the money that was stolen, and not the robber. “We need regulation! Why did the government allow this to happen?” they scream.  For instance, Chetan Bhagat, a renowned author from India, wrote a detailed “crypto” obituary, comparing the cryptocurrency sector to communism that promised decentralization but ended up with authoritarianism. Perhaps unsurprisingly, his column conveniently used a melting Bitcoin (BTC) logo as its featured image.Hi all,“Crypto is now dead: FTX, a cryptocurrency exchange, collapsed last week, proving a lot of cool guys horribly wrong,” my column in TOI today.Do read and share! pic.twitter.com/A4ClVdHOt2— Chetan Bhagat (@chetan_bhagat) November 15, 2022Bhagat should have picked a more accurate image for his op-ed (melting FTX (FTT) Token?), particularly after looking at Bitcoin’s decade-plus history that has seen it surviving even nationwide bans. This includes 465 466 obituaries since its debut in 2009 when it traded for a few cents.Bitcoin performance since debut. Source: TradingViewThe FTX/Alameda’s collapse is similar to previous bearish trigger events like Mt. Gox in 2014. Therefore, this failure of centralization will once again underline what makes Bitcoin special, and why FTX is the opposite of Bitcoin and decentralization. Moreover, the incident should also boost growth and development of in, non-custodial exchanges for Bitcoin that will help reduce dependency on trust. FTX may have had zero Bitcoin in custodyTraders responded to FTX’s shocking collapse by pulling their BTC from custodial exchanges. Notably, the total amount of Bitcoin held by all exchanges dropped to 2.07 million BTC on Nov. 17 from 2.29 million BTC at the beginning of the month.United States-based exchanges saw the biggest outflows, in particular, with users withdrawing over $1.5 billion in BTC in the past week alone. Bitcoin reserves across all exchanges. Source: CryptoQuantOn Nov. 9, FTX halted withdrawals of all cryptocurrencies, including Bitcoin, raising suspicions that the exchange did not have adequate reserves to meet the demand. That was further evident in a leaked FTX balance sheet that showed the exchange having zero Bitcoin against its $1.4 billion liabilities in BTC. In other words, FTX enabled fractional-reserve Bitcoin trading. “This is, on the one hand, bad for you as you will only find out if they have been swimming naked once the exchange implodes, accompanied by you losing all your funds,” Jan Wüstenfeld, writes independent market analyst. He adds:”On the other hand, this artificially increases the bitcoin supply in the short-run, suppressing the price and preventing actual price discovery […] Yes, I know these are not real bitcoin, but as long as the exchanges issuing fake paper, Bitcoin remains operational, the effect is there.”Thus, FTX’s little-to-negligible exposure to Bitcoin potentially reduces Its likelihood of selling any remaining funds to raise liquidity. The incident is also likely to produce a new cohort of Bitcoin hodlers by forcing people to not keep their funds on risky exchanges and practice self-custody. While a decreasing amount of BTC on exchanges means fewer coins available to sell. Sam Bankman-Fried was anti-BitcoinFTX founder Sam Bankman-Fried (SBF) was the Democrats’ second biggest donor after George Soros for the midterm elections, giving nearly $45 million to lobby for crypto regulations that would allegedly benefit his firm.Related: US crypto exchanges lead Bitcoin exodus: Over $1.5B in BTC withdrawn in one weekBut speculations are large that SBF attempted to tarnish Bitcoin’s growth through the U.S. lawmakers,  as well as news articles, where he downplayed Bitcoin as an efficient payment system.MSM lionized this shady character. For example, here are 2 of the 219 articles about him on @FT. @SBF_FTX’s anti-Bitcoin, pro-centralisation and pro-heavy-handed regulation values certainly aligned with theirs. Was he the poster boy for an orchestrated propaganda campaign? https://t.co/urJcu6mqB6 pic.twitter.com/PTIn1JudXG— Bitcoms (@bitcoms) November 15, 2022

Other commentators have also pointed out a connection between SBF and anti-crypto U.S. Senator Elizabeth Warren, noting the former’s father, Joseph Bankman, helped the politician draft tax legislation in 2016. This is crazy:Elizabeth Warren is known for being the anti-crypto SenatorWho helped her draft her tax legislation in 2016?None other than Joseph (Joe) Bankman, the father of SBFhttps://t.co/QMYkC2gpE9— Ryan Shea (@ryaneshea) November 15, 2022

SBF’s influence among U.S. lawmakers is now gone with him facing potential criminal charges for illegally using customer funds for FTX trades. Press “F” to flush Past cryptocurrency market downturns have roots in the failure of centralized players as well as “altcoins” that ultimately ended up being a money-grab. FTX’s token FTT is just the latest example. Other failed projects that triggered a market downturn just this year include the Defi lending platform Celsius Network (CEL) and Terra (LUNA). FTX is the opposite of #Bitcoin #Bitcoin ’s protocol was created precisely to prevent Ponzi schemes, bank runs, Enron’s, WorldCom’s, Bernie Madoff’s, Sam Bankman-Fried’s……bailouts and wealth reassignments.Some understand it, some not yet. We’re still early./21m— Nayib Bukele (@nayibbukele) November 14, 2022

Created and operated by centralized entities, the supply of these tokens, and therefore price, becomes vulnerable to manipulation: undisclosed pre-mine allocations, insider VC deals, small float vs. total supply, you name it. It is exposure to such (crap) tokens, particularly in the form of collateral, that ultimately drove crypto hedge funds Three Arrow Capital, FTX’s sister firm Alameda Research, and many others to the ground.”In our view, the bubble in crypto that popped this year was in the atmosphere of tokens being created just for speculative purposes,” noted BOOX Research, adding: “While we can debate which cryptos are ‘bad money driving out the good’, FTT and LUNA are just two examples everyone can agree should not have existed.”Therefore, a market flush of altcoins that should not have ever existed, FTT included, may further strengthen investors’ trust in Bitcoin. Early data is showing the same, with CoinShares reporting an inflow uptick into Bitcoin-based investment funds. Notably, Bitcoin-based investment vehicles attracted $18.8 million to their coffers in the week ending Nov. 11, bringing its year-to-date inflows to $316.50 million.Flow by asset. Source: Bloomberg/CoinShares”The inflows began later in the week on the back of extreme price weakness prompted by the FTX/Alameda collapse,” noted James Butterfill, head of research at CoinShares, adding:”It suggests that investors see this price weakness as an opportunity, differentiating between ‘trusted’ third parties and an inherently trustless system.”Meanwhile, Bitcoin is not witnessing a collapse in demand in the current bear market compared to 2018, on-chain data reveals.The number of non-zero Bitcoin addresses has continued to climb despite the price downtrend, hitting a record high of 43.14 million as of Nov. 16.Bitcoin addresses count with a non-zero BTC balance. Source: GlassnodeIn comparison, the 2018 bear market saw a substantial drop in the number of non-zero Bitcoin addresses, suggesting traders have become relatively more confident about a price recovery, especially as the FTX domino effect clears out the dead wood.The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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South Korean prosecutors call on Terra co-founder Shin Hyun-seong to cooperate: Report

Authorities in South Korea have reportedly requested Terraform Labs co-founder Shin Hyun-Seong, also known as Daniel Shin, to appear as part of an investigation into the collapse of the firm.According to a Nov. 14 report from Hankyoreh, the Seoul Southern District Prosecutor’s Office’s Joint Financial and Securities Crime Investigation Team announced that Shin should appear before prosecutors sometime this week. Authorities reportedly alleged that the Terra co-founder held many LUNA tokens — since rebranded Lun Classic (LUNC) — without the knowledge of retail investors and earned roughly 140 billion won — more than $105 million at the time of publication — in profits from illegal sales before the firm’s collapse.“Reports that CEO Shin Hyun-seong sold Luna at a high point and realized profits or that he made profits through other illegal methods are not true,” reportedly said Shin’s attorney.According to Shin’s LinkedIn profile, he has not been involved with Terraform Labs since January 2020 — though this does not include information on investments in the company. Shin went on to found the fintech firm Chai Corporation, where he is currently CEO.Related: South Korean prosecutors accuse Do Kwon of manipulating Terra’s priceThough Shin reportedly still lives in South Korea, his fellow Terra co-founder Do Kwon was also a target of prosecutors as part of multiple investigations into the firm globally. Reports on Kwon’s location have varied from Singapore to other countries following the collapse of Terra, but the South Korean national has repeatedly said he isn’t “on the run.”Wherever Kwon may be, his passport is reportedly no other valid following an October order from South Korea’s foreign ministry. The Terra co-founder faces lawsuits from investors, investigations from global authorities and the social media ire of many crypto users who lost money following the collapse of Terraform Labs.

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Crypto.com’s CRO is in trouble, but a 50% price rebound is in play

Crypto.com’s native token Cronos (CRO) is showing restraint on Nov. 14 against mounting sell-pressure building in the wake of the FTX’s dramatic collapse last week. Now, the CRO/USD pair is eyeing a watershed price recovery.On Nov. 14, CRO’s price wobbled between profits and losses, trading around $0.069 a day after crashing to $0.05, its lowest level since April 2020 — that’s a 60% price decline from November’s peak of around $0.178.CRO/USD weekly price chart. Source: TradingViewCRO funding rate drops to -3%The period of CRO’s price decline occurred alongside a sharp drop in the token’s perpetual futures funding rates.Funding rates are recurring payments made by traders based on the difference between the prices in the futures and the spot market. A positive funding rate means bullish traders (long positions) pay bearish traders (short positions), representing their confidence about a price rally.Conversely, a negative funding rate means short traders pay long traders to keep their positions open. On Nov. 14, CRO’s funding rates on Huobi and OKX dropped to minus 3%, showing traders are extremely bearish on the token.CRO funding rates history. Source: Coinglass.com“This is literally the exact same dynamic that occurred before Celsius and FTX collapsed,” warned Dylan LeClair, senior analyst at digital asset fund UTXO Management on Nov. 13, when CRO funding rates were near minus 2%.FTX contagion fears spread to Crypto.com The CRO sell-off started from fears of contagion amid the FTX fiasco, particularly concerns that Crypto.com, a Singapore-based crypto exchange, would collapse in the same manner as FTX.At the core of these worries is potential insolvency, with analysts pointing out that Crypto.com is holding low-liquid cryptocurrencies like Shiba Inu (SHIB) and its own token CRO as reserves, which reportedly make up 40% of the exchange’s total assets. 4.https://t.co/INIxikfNzy holds $1.6B worth of BTC/ETH/USDT/USDC/DAI/BUSD assets, accounting for 60%.40% of assets are low liquidity assets.— Lookonchain (@lookonchain) November 13, 2022In addition, Crypto.com also moved $210 million worth of stablecoins from Binance and Circle before demonstrating its reserves to the public. Binance CEO Changpeng Zhao confirmed the move, urging caution, the day before CRO dropped to its April 2020 low.If an exchange have to move large amounts of crypto before or after they demonstrate their wallet addresses, it is a clear sign of problems. Stay away. Stay #SAFU. — CZ Binance (@cz_binance) November 13, 2022

What’s more, Crypto.com also misconducted a $400 million Ether (ETH) transaction, sending it to a Gate.io exchange wallet instead of its cold storage. Later, the exchange did manage to recover the funds, but that also raised a lot of questions. Crypto_com CEO is claiming they “accidentally” sent $400 million of their eth to the wrong wallet.He’s either lying, or incompetent. https://t.co/hWXvPqBime— Coffeezilla (@coffeebreak_YT) November 13, 2022

Overall, Crypto.com saw its users withdraw $14 million in ETH and $39 million in other tokens over the weekend, according to data tracked by Argus Inc.50% Cronos price relief rally ahead?Strictly from a technical perspective, however, CRO’s price could nevertheless see a potential relief rally in the coming weeks.A set of indicators support the said bullish outlook, including CRO’s weekly relative strength index (RSI), which dropped to nearly 30, or nearly “oversold” territory. A similar drop in June earlier this year had preceded a 75% recovery rally from $0.099 to $0.162, as shown below.CRO/USD weekly price chart. Source: TradingViewThe other bullish indicator includes strong historical support of $0.061. In addition, CRO’s current price range of $0.061 and $0.111 has the token’s highest volume profile visible range (VPVR) on record. In other words, CRO price could recover to $0.111, up over 50% from the current price levels, as its next upside target. Related: Exchange outflows hit historic highs as Bitcoin investors self-custodyConversely, CRO/USD falling alongside funding rates suggests that its drop may have been driven by futures markets, which was also the case with Terra’s collapse in May. Thus, the persistent bearish sentiment across the entire cryptocurrency market could dampen CRO’s recovery prospects.The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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South Korean regulators aim to toughen crypto fraud punishments

In the aftermath of the Terra collapse last spring, South Korean legislators intend to ramp up legislation, putting specific emphasis on the protection of investors in virtual assets — i.e. digital currencies — and harshening penalties for unfair trade acts in the industry.According to local media, the Financial Services Commission (FSC) and the National Assembly are working to pass a bill that would enable financial authorities to monitor and punish unfair trade practices such as the use of undisclosed information, price manipulation and fraud while supervising crypto exchanges. The legislation bears an emergent character — while there are already 14 different proposals regarding crypto and digital assets circulating in the National Assembly and the ambitious comprehensive Digital Asset Basic Act in making, this one should guarantee more investors protection starting from 2023. As an unnamed official from the National Assembly told the press:“In the U.S., since the Securities and Exchange Commission (SEC) exercises a wide range of powers, it is possible to punish unfair trade in virtual assets without separate legislation, but in Korea, related legislation is absolutely necessary.”While there are no  details on the specific penalties for various malpractice, it is expected that they will be designed in order to synchronize the supervision and punishment at a level similar to that of the traditional financial industry. Related: The SEC should be aiming at Do Kwon, but it’s getting distracted by Kim KardashianSouth Korean authorities issued an arrest warrant for the Terra co-founder Do Kwon in September, which was subsequently dismissed, and Interpol added Kwon to its Red Notice list, requesting law enforcement locate and potentially detain him. On Oct. 6, South Korea’s foreign ministry ordered the Terra co-founder to surrender his passport or it would be canceled.At the end of October, FSC revealed that it would monitor crypto whales with assets of over 100 million won ($70,000) to prevent money laundering efforts using digital assets.

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Stablecoins have a new name in Great Britain: Law Decoded, Oct. 24–31

The first full week under the leadership of the newly-elected Prime Minister Rishi Sunak saw a major landmark for crypto regulation in the United Kingdom. The Financial Services and Markets Bill, made public on Oct. 25, aims to enhance the U.K.’s position as a “global leader in financial services” — but what is more important is that it contains some new definitions for crypto products. The bill moves stablecoins from the category of crypto assets to digital settlement assets (DSA) — a new category marked by its potential “to develop into a widespread means of payment.” It’s yet to be seen what regulations the DSA will be subject to and if this change of status will guarantee them a green light for adoption. But, even that scope of change brings optimism. It seems we may witness unprecedently active pro-crypto regulation on the islands, given Sunak’s known ambitions on the matter. The new PM voiced has previously voiced his support for crypto and even commissioned the Royal Mint to issue a nonfungible token (NFT) by the end of the year during his time as the head of the treasury. However, the industry still faces pressure from local banks, which try to block businesses and individuals from investing in cryptocurrency. Singapore intends to ban cryptocurrency creditsIn one of two consultation papers on proposals for regulating the digital payment token service providers, issued last week by the central bank of Singapore, there is a proposition to ban digital payment tokens (DPTs) from providing retail customers with “any credit facility,” whether in the form of fiat currencies or crypto. According to the regulator, crypto service providers should also not be allowed to accept any deposits made using credit cards in exchange for crypto services. According to the authority, “Any form of credit or leverage in the trading of DPTs” would result in the “magnification of losses,” potentially leading to bigger losses than a customer’s investment.Continue readingAn agreement on adoption between Lugano and El Salvador The Swiss city of Lugano and the country El Salvador have signed an economic cooperation agreement based on crypto and blockchain. Speaking to Cointelegraph, former Blockstream chief strategy officer Samson Mow said the agreement was the “next step” in nation-states and cities adopting BTC: “[El Salvador and Lugano are] going to start working together and collaborating on joint initiatives. I think that’s the way we push each other forward — basically create alliances between places that have adopted Bitcoin.”Continue reading Yet another lawsuit for troubled Do KwonDo Kwon, the co-founder of Terraform Labs — who may be facing legal actions in South Korea and the United States — is the target of a lawsuit in Singapore along with the Luna Foundation Guard (LFG) and Terra founding member Nicholas Platias. In a lawsuit filed in Singapore’s high court, 359 individuals allege Kwon, Platias, the LFG and Terra made fraudulent claims, including that Terra’s stablecoin, TerraUSD (UST) — now TerraUSD Classic (USTC) — was not “stable by design” and unable to maintain its U.S. dollar peg. The claimants are seeking compensation for roughly $57 million worth of “loss and damage” combined based on the value of UST tokens they purchased and held or sold amid the market downturn in May. Continue reading

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Terra co-founder Do Kwon faces $57-million lawsuit in Singapore

Do Kwon, the co-founder of Terraform Labs who may be facing legal actions in South Korea and the United States, is the target of a lawsuit in Singapore along with the Luna Foundation Guard (LFG) and Terra founding member Nicholas Platias.In a lawsuit filed in Singapore’s high court on Sept. 23, 359 individuals allege Kwon, Platias, the LFG and Terra made fraudulent claims, including that Terra’s stablecoin, TerraUSD (UST) — now TerraUSD Classic (USTC) — was not “stable by design” and unable to maintain its U.S. dollar peg.The claimants are seeking compensation for roughly $57 million worth of “loss and damage” combined based on the value of UST tokens they purchased and held or sold amid the market downturn in May. They also request an order to pay for “aggravated damages.”According to the individuals filing the lawsuit, the four parties tied to Terra “knew or ought to have known that the Claimants wished to buy and hold cryptocurrency stablecoins that were not subject to the volatility of the wider market and earn a decent passive return.” The court document specifically alleges that Kwon had been aware of “the structural weakness of algorithmic stablecoins” based in part on his role in the fall of Basis Cash.“The Defendants made the said representations fraudulently either well knowing that they were false and untrue, or recklessly not caring whether they were true or false,” says the lawsuit.Related: 4,400 disgruntled investors are hunting for Terra’s Do KwonKwon has been the target of numerous legal actions and threats since the collapse of the Terra blockchain ecosystem in May. South Korean authorities issued an arrest warrant for the Terra co-founder in September, which was subsequently dismissed, and Interpol added Kwon to its Red Notice list, requesting law enforcement locate and potentially detain him. Kwon has been active on social media during the controversy and said in September he was “making zero effort to hide” despite not revealing his location. One Redditor said Kwon was “doing a terrible job at acting innocent for a guy who is innocent” in response to the lawsuit. Others wildly speculated that he had gotten plastic surgery to disguise his appearance.Idk, its pretty good whiskey— Do Kwon (@stablekwon) October 24, 2022The Sept. 23 lawsuit placed Kwon’s address in Singapore, but some reports have suggested that he may have fled the country. On Oct. 6, South Korea’s foreign ministry (Kwon is a Korean national) ordered the Terra co-founder to surrender his passport or it would be canceled.

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