On Dec. 9, the total market capitalization of cryptocurrencies soared past $535 billion. This is a significant increase from last year, when the cumulative market capitalization of cryptocurrencies was just over $199 billion. With such impressive growth underway, it shouldn’t come as a surprise that companies operating in the cryptocurrency sector are taking additional measures to ensure trust among investors. For instance, some cryptocurrency platforms have begun to publicly announce audits to confirm the number of digital assets held under management. Most recently, the crypto lending and borrowing platform Celsius Network announced the completion of an audit of just over …

The Commodity Futures Trading Commission, or CFTC, is having a banner year in crypto enforcement. Per the commission's annual review released on Tuesday, fiscal year 2020 featured seven monetary relief actions against firms engaged in illegal activity in crypto, which is a new record. The review said: "In conjunction with the Division’s Digital Asset Task Force, the Commission brought a record setting seven cases involving digital assets." These included charges against PanForex for offering leveraged trading to U.S. persons without registering in the United States, as well as against Digital Platinum for classic fraud. The CFTC is the U.S. federal …

Per a Monday announcement, the United States Department of Justice and the Southern District of New York have extradited from Panama a leader of alleged Ponzi scheme AirBit Club. Gutemberg Dos Santos is one of six operators of AirBit Club indicted, and the last to come into the U.S. to face trial before the SDNY. Dos Santos is a dual citizen of Brazil and the United States. Authorities initially apprehended five of the six back in August, with a sixth avoiding authorities until October. The DoJ alleges that AirBit Club sold "memberships" that promised guaranteed returns. The six operators marketed …

Fraudulent actors currently float around the internet claiming association with crypto trading and wallet company Blockchain.com, as confirmed by the Financial Conduct Authority, or FCA, a United Kingdom-based regulatory entity. The copycats assert association with Blockchain.com under Blockchain Ltd, a clone version of the real company. The genuine Blockchain.com, under the agent Blockchain Access UK Ltd and principal entity Modulr FS Limited, holds legitimate FCA authorization, according to a warning posted by the FCA on Friday. “Fraudsters are using the details of firms we authorise to try to convince people that they work for a genuine, authorised firm,” the FCA …

The United States Securities and Exchange Commission has requested a default judgment against three companies and four individuals associated with the allegedly fraudulent art- and gold-backed cryptocurrency Meta 1 Coin. The SEC filed its Nov. 18 motion for a default judgment after the defendants failed to appear for their case, despite having corresponded with both the court and legal representation prior. The defendants are Meta 1 Coin Trust, Clear International Trust, and Ironheart Trust, and individuals Robert Dunlap, Nicole Bowdler, Wanda Traversie-Warner and Alfred Warner, Jr. They are accused of defrauding at least 500 investors worldwide out of $9 million …

The United States Securities and Exchange Commission has brought 56 enforcement actions against initial coin offerings, blockchain and digital asset-related companies since July 2017. On Nov. 16, the SEC released a report on the commission’s selected accomplishments during chairman Jay Clayton’s tenure from May 2017 until November 2020. As part of the 28-page report, the regulator mentioned the SEC’s efforts to combat “cyber-related misconduct” including violations by companies involved in the crypto industry. According to the report, the SEC brought 56 cases involving attempts to defraud investors through the use of digital asset securities as well as violations of the …

A former Microsoft engineer has been sentenced to nine years for stealing more than $10 million in digital value from his past employer in the form of “currency stored value," or CSV, including gift cards. Volodymyr Kvashuk, a 26-year-old Ukrainian citizen residing in Washington, used the accounts and identities of his fellow employees to steal and then sell the CSV — making it appear as though his co-workers were responsible for the fraud. Kvashuk also used a Bitcoin (BTC) mixing service to further obfuscate the paper trail, telling the Internal Revenue Service that the $2.8 million worth of crypto that …

Australian Liberal Senator Andrew Bragg thinks that blockchain technology can solve a number of major regulatory issues in his home country. According to Bragg, blockchain technology could become a useful tool in reducing complications associated with financial regulatory compliance and transparency. “The future is technology by blockchain,” the senator said at an online panel of the Future of Financial Services 2020 conference, ZDNet reported on Nov. 4. Bragg said that blockchain-powered instant cross-border transactions “may well be the solution to one-touch government with international transactions in real time.” The senator stated that blockchain tech can solve major problems associated with …

U.S. federal prosecutors are pushing for a heavy prison sentence to be levied against one of the founders of Centra Tech — the company behind a notorious initial coin offering in 2017 that was promoted by professional boxer Floyd Mayweather and musician DJ Khaled. In a government sentencing submission filed on Oct. 31, the government requested that U.S. District Judge Lorna Schofield sentenced Centra Tech co-founder Robert Joseph Farkas to “a substantial term of imprisonment” to deter other fraudsters from conducting unlawful ICOs. “While legitimate ICOs represent a new and efficient means to raise capital, the loss of investor confidence …

On Nov. 2, the Axion Network launched its new token, known as AXN. The project touted the asset as a new investment vehicle, claiming that it would be the most profitable blockchain of its kind to date. During the interim leadup to AXN’s airdrop, five separate teams allegedly examined the token’s code; industry darlings such as CertiK and Hacken were among those who conducted the audits. A few short hours after the protocol’s freeclaim event, however, it became clear that something had gone awry. An unauthorized actor unexpectedly minted 79 billion AXN and unloaded them on the market. The price …

The NAC Foundation has accused the United States Securities and Exchange Commission of misconduct in an ongoing case. According to court documents Oct. 20, Rowland Marcus Andrade and his company NAC Foundation asked a San Francisco federal judge to dismiss the SEC’s June lawsuit alleging that he and his associate Jack Abramoff defrauded investors in a $5.6 million token offering. Andrade argued that the SEC “purposefully attempted to mislead the court” by accusing him of offering a technology that had never been developed. According to the defendant, the SEC was aware that he held patents for Anti-Money Laundering technology related …

Hackers compromised Telegram messenger and email accounts of multiple cryptocurrency executives last month by exploiting a vulnerability in a decades-old protocol. The fraudsters are believed to have been trying to intercept two-factor authentication codes of victims in an attack on Israel-based telecommunications provider Partner Communications Company, formerly known as Orange Israel. The attacks are currently being investigated by Israel’s National Cyber Security Authority and national intelligence agency Mossad. According to cybersecurity publication Bleeping Computer, the devices of at least 20 Partner Communications Company subscribers were compromised. Israel-based cybersecurity firm Pandora Security’s analysis of the event suggests the devices were likely …