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| Here is a look at the hits from today's Inside Cryptocurrency newsletter: - 📝 The recently released court filings revealing that Binance.US laid off 200 employees following the top U.S. securities regulator's lawsuit against it,
- 🤝 Revolut's partnership with MetaMask,
- 🔎 Spanish data protection agency's crackdown on Worldcoin, and more.
Enjoy your reading! Doğa
p/dogayurduneri | |
| 1 | | Recent court filings have revealed that Binance.US, the U.S. arm of the largest crypto exchange by trading volume, had to lay off two-thirds of its workforce shortly after facing a lawsuit by the U.S. Securities and Exchange Commission (SEC) in June last year. The move was recorded in the court filings through a deposition given by Binance.US chief operating officer (COO) Christopher Blodgett in December 2023 but released on Tuesday. More: - The SEC filed a 136-page complaint against Binance, former CEO Changpeng Zhao (CZ), and Binance.US over U.S. law violations with 13 charges in June last year.
- At the time, the agency also applied for a temporary restraining order, asking the court to freeze the assets of Binance.US and appoint a receiver for the firm.
- In his deposition, Blodgett said the SEC's attempt to freeze Binance.US' assets and operations caused the platform's trading volumes and business to implode, even though there was no actual wrongdoing involved with the exchange.
- Blodgett also stated that around $1B in crypto and fiat currencies left Binance.US immediately after the SEC's attempt since they experienced a loss of trust from customers, resulting in a more than 75% decline in revenue in the subsequent period.
- Binance.US COO added that they had to lay off 200 employees amid these regulatory challenges, their legal costs skyrocketed to $10M, and their auditor expenses increased by 10 times.
- Also, the Binance.US executive underlined that the platform also lost its fiat payment channels during that period as their banking partners parted ways with Binance.US to protect themselves from potential legal action, preventing Binance.US customers from depositing and withdrawing fiat currencies.
- Blodgett further said they have been unable to find new banking partners since then, and Binance.US is seen as radioactive by the banks.
Zoom Out: - Binance also recently had to agree to pay a $4.3B fine in the U.S. to settle the authorities' charges of money laundering, unlicensed money-transmitting business operations, and sanction violations and continue its operations.
- At the time, Binance and co-founder CZ pleaded guilty to violating anti-money laundering requirements and sanctions in the U.S. by allowing terrorist groups to make crypto transactions on the platform.
- The settlement deal resolved a years-long investigation conducted by the U.S. Department of Justice (DOJ), the U.S. Treasury Department, and the U.S. Commodity Futures Trading Commission (CFTC) into Binance.
- However, the agreement did not resolve the SEC's case.
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| 2 | | 
What the numbers say: The mobile app of Coinbase, the largest U.S. crypto exchange, has surged into the top 100 again on the App Store's ranking based on the app ratings and user reviews. The move marked the first time Coinbase ranked among the top 100 since February 2022. The platform started the year by ranking 489th. The exchange is also among the top 100 finance apps on the Google Play Store's ranking. Relevance: Coinbase's app surged back into the top 100 on App Store's ranking as of March 4, one day before Bitcoin (BTC), the largest cryptocurrency by market cap, hit its new all-time high above $69,000. The recent price jump in Bitcoin triggered a broader crypto market rally, causing some other leading cryptocurrencies, such as Ether (ETH) and Dogecoin (DOGE), to see a strong increase in value. The market rally paved the way for increased user interest in the apps of popular crypto exchanges like Coinbase as investors sought to trade digital assets much more. However, the sudden surge in traffic caused Coinbase to experience two outages in less than a week, which caused some users to see zero balances in their accounts. The platform also saw flash crashes, which refer to a sudden price decline in an asset's price due to an abnormal market activity, in some trading pairs of Bitcoin. Brands that should care: Within the past week, some of the rival crypto exchanges, including Binance, Kraken, and Bybit, also suffered technical issues due to the sudden surge in traffic triggered by the crypto market rally. | | | |
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| 3 | | Crypto platform ShapeShift has offered a settlement deal to the U.S. Securities and Exchange Commission (SEC), agreeing to pay a $275,000 fine and stay away from any future securities law violations. The SEC accepted the offer, resolving its years-long investigation into ShapeShift. More: - The SEC filed a cease-and-desist order against ShapeShift, demanding the platform to halt its alleged illegal operations.
- In the filing, the agency accused the firm of allowing users to trade securities in the form of digital assets between 2014 and 2021 without registering with the regulator.
- The SEC also pointed out that ShapeShift offered trading services in at least 79 crypto assets at its peak and acted as a market maker for these assets, marketing itself as a crypto vending machine.
- ShapeShift was founded in Switzerland in 2014 and previously operated out of the U.S. state of Colorado.
- The firm's crypto exchange allowed customers to purchase and sell digital assets without creating an account and providing personal information.
- In July 2021, the company shut down its crypto exchange after drawing scrutiny for suspicious transactions by criminal entities on the platform.
- ShapeShift currently offers a browser-based crypto wallet, and its corporate entity has no revenue or full-time employees.
Zoom Out: - The SEC classifies all crypto assets other than Bitcoin (BTC) as securities in light of current chair Gary Gensler's approach, claiming jurisdiction over the digital asset market.
- Within the past few years, many other crypto firms, including Ripple, Coinbase, Binance, Gemini, Kraken, and Bittrex, came under increased crackdown by the SEC over alleged securities law violations.
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| 4 | | Digital bank Revolut has recently partnered with crypto wallet MetaMask to offer its Revolut Ramp service, which lets users buy crypto and send it to an external wallet, to MetaMask customers. The partnership will allow users to make crypto purchases and directly deposit them in their MetaMask wallets. More: - The feature will only be available to users in the U.K. and European Economic Area (EEA).
- The collaboration will mainly aim to make it easier for users to add crypto to their self-custody wallets.
- Users will be able to use both the fiat currency balance in their Revolut account or their Visa and Mastercard cards while making payments for their crypto purchases.
- MetaMask wallets allow users to manage their private keys, or the passwords used to access crypto assets, and have complete control of their crypto assets, reducing personal financial risks from the potential collapse of a third-party custodian.
Zoom Out: - Revolut currently offers basic crypto services to its 40 million customers worldwide on its main app.
- Last month, the platform also announced its plans to launch a new crypto exchange for advanced traders that would offer lower fees and deeper market analytics than the Revolut app.
- In 2023, the digital bank suspended certain crypto services in the U.S. and the U.K., some of the largest crypto markets in the world, four months apart, citing regulatory environments in the two countries.
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| 5 | | Luxembourg-based Bitstamp, one of the oldest crypto exchanges, has received in-principle approval for a major payment institution license in Singapore. The approval was granted to the firm by the Monetary Authority of Singapore (MAS), the city-state's financial market regulator. More: - The initial approval will allow Bitstamp to operate in Singapore and offer its digital payment token services while waiting for the full approval.
- The firm must first demonstrate its commitment to complying with the strong anti-money-laundering measures before obtaining the full license.
- The exchange defined itself as the first crypto trading platform with a major presence in the European Union (EU) to obtain such a license from the MAS.
- Bitstamp's Asia-Pacific (APAC) general manager, Leonard Hoh, said Singapore was a first mover in establishing a regulatory framework for crypto exchanges, underlining that this leadership will strengthen its future as a center for the digital assets ecosystem.
- Bitstamp pointed out that it will focus on serving financial institutions and intermediaries, such as payment processors, brokerages, and financial technology (fintech) firms, in Singapore.
- The European exchange also has over 50 licenses and registrations in many other countries, including the U.K., the Netherlands, France, and the U.S.
Zoom Out: - The MAS is most famous for its strict stance on the crypto market and stingy attitude toward approving a license.
- Several other crypto-related firms have also managed to obtain full or in-principle approval in the city-state so far, including Upbit, Revolut, Coinbase, Crypto.com, Blockchain.com, Paxos, Ripple, and Circle.
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| 6 | | Spain's data protection agency, Agencia Española de Protección de Datos (AEPD), has ordered OpenAI CEO Sam Altman's crypto project Worldcoin to immediately stop collecting personal information of Spanish users and using the data it has already gathered over concerns related to the privacy. The order will require the project to halt its operations in the country for up to three months as the agency investigates it. More: - The AEDP's move came after several complaints that Worldcoin provided insufficient information on the use of personal data, collected data from minors, and did not allow users to withdraw their consent.
- The Spanish regulator pointed out that the processing of biometric data involves high risks related to people's rights due to their sensitive nature.
- The agency also cited the potential irreparable damages while explaining its urgent measure, underlining that not taking any action would deprive citizens of the protection.
- Worldcoin scans the irises of its users through biometric imaging devices dubbed the Orb, verifying them in person to prove their identity, humanness, and uniqueness securely and privately.
- In return, verified users receive a digital ID, which they can use to validate their identity across various games and apps, and free cryptocurrencies in the form of Worldcoin's native token, WLD.
- More than 4 million people across 120 countries have signed up to have their irises scanned by the Orbs so far.
- The project is backed by some of the most well-known venture capital (VC) firms, such as Bain Capital Crypto and Andreessen Horowitz's crypto investment unit, a16z crypto.
Zoom Out: - Since its launch, Worldcoin has come under scrutiny by data watchdogs in many other countries, including the U.K., Hong Kong, France, Germany, Kenya, Argentina, South Korea, and Portugal, over data protection and privacy concerns.
- The project previously reiterated several times that it does not store the data once the Orbs generate a unique iris code, underlining that it complies with all laws and regulations governing personal data processing in the markets where it is available.
- Sam Altman is most famous for his CEO position in OpenAI, the AI research lab behind the popular AI-powered chatbot ChatGPT.
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- The U.S.-based crypto conglomerate Digital Currency Group (DCG) and its CEO, Barry Silbert, have requested that a U.S. court dismiss a lawsuit filed by New York Attorney General Letitia James against them.
- Spot Bitcoin (BTC) exchange-traded funds (ETFs) in the U.S. reached a record $10B daily trading volume on Tuesday, renewing their previous record.
- Coinbase, the largest U.S. crypto exchange, has asked a U.S. judge to disregard a previous ruling, which classifies the trading of certain crypto assets on secondary markets like crypto exchanges as a securities transaction, made by another court in an insider trading case involving the exchange.
- The U.S. Securities and Exchange Commission (SEC) has recently stated that Binance, the largest crypto exchange by trading volume, denied providing answers to key questions related to the custody of customer assets in its ongoing investigation over the platform, asking a U.S. court to help it speed up the discovery process.
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 | Staff Writer | | Doga is a tech and science editor who has been writing news for nearly 10 years. She worked for leading tech platforms and mainstrem media channels as an editor and presenter throughout his career. Then, she carried her know-how to more than one platform. She is a part-time cat lover and binge-watcher, and also fond of science, space, and emerging tech. She always has a story to tell. She is a bit addict to the laughter and -unfortunately- the '90s culture. | | This newsletter was edited by Aaron Crutchfield | |
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