• WazirX, an Indian cryptocurrency exchange, lost $230 million (45% of customer funds) in a hack on July 18, 2024.
• The exchange is considering various options for fund recovery, including reaching out to other exchanges and projects for help.
• WazirX proposed a controversial plan to distribute the loss impact among all users, even those not directly affected by the hack.
• Custody provider Liminal denies its infrastructure was compromised in the hack, contradicting WazirX’s claims.
• WazirX did not have insurance for customer funds, citing a lack of viable options.

Indian cryptocurrency exchange WazirX is grappling with the aftermath of a significant security breach that occurred on July 18, 2024.

The hack resulted in the loss of $230 million, representing about 45% of customer funds held on the platform. As the exchange works to address the situation, it faces multiple challenges, including determining the best path forward for fund recovery and maintaining user trust.

WazirX co-founder Nischal Shetty told CoinDesk that the exchange is exploring all possible options to recover the stolen funds. This includes reaching out to other exchanges and cryptocurrency projects for assistance. Shetty emphasized that these outreach efforts “are going to be crucial” in the recovery process.

The exchange has proposed a controversial “socialized loss strategy” to distribute the impact of the hack across all users.

Under this plan, 55% of assets would be available for trading and withdrawals for all users, including those not directly affected by the hack. The remaining 45% would be locked, with the timeline for unlocking dependent on ongoing recovery efforts.

This proposal has faced criticism from customers and industry peers. Some argue that it unfairly impacts users whose funds were not stolen. WazirX maintains that the plan aims to provide a faster and more flexible solution compared to situations where users face years of uncertainty and limited fund access.

Adding to the complexity of the situation, there is a dispute between WazirX and its custody service provider, Liminal. WazirX’s internal investigation claims that the hack involved Liminal’s infrastructure.

However, Liminal has pushed back against these accusations, stating that its systems were not compromised and that the affected wallet “originated from an external source.”

One factor contributing to the severity of the situation is the lack of insurance for customer funds.

Shetty confirmed that WazirX did not have insurance, citing a lack of viable options. This absence of insurance means that the exchange and its users must bear the full brunt of the losses, leading to the proposed socialized loss strategy.

WazirX has taken several steps in response to the hack. The exchange has paused trading and withdrawals, filed a police complaint in Mumbai, and reported the incident to the Indian Computer Emergency Response Team (CERT-In). Shetty also mentioned that various Indian and international authorities have reached out, though he did not disclose specific names.

The exchange is currently running two parallel phases: immediate revival to unlock collateralized assets for customers, and finding ways to fill the gap left by the stolen funds. WazirX has launched a bounty program and is exploring potential assistance from project teams and their emergency funds.

The exchange plans to make decisions based on community consensus, as evidenced by the opinion poll it conducted to gather user feedback on the proposed recovery plan. However, WazirX has emphasized that no unilateral decisions will be made without proper consent from its users.

As of July 31, 2024, WazirX has not announced a definitive timeline for resuming operations or implementing its recovery plan.

The exchange continues to investigate the hack and explore various options for fund recovery, leaving users in a state of uncertainty about the future of their assets on the platform.

The post WazirX Explores Recovery Options Following $230 Million Hack appeared first on Blockonomi.

• BitClout founder Nader Al-Naji has been charged with wire fraud and selling unregistered securities by the SEC and DOJ.
• Al-Naji allegedly raised $257 million from token sales but spent $7 million on personal expenses.
• The SEC claims Al-Naji misled investors about BitClout’s decentralized nature to avoid regulation.
• BitClout was controversial for creating profiles of celebrities without permission.
• Major venture capital firms like Sequoia and Andreessen Horowitz had invested in BitClout.

Nader Al-Naji, the founder of crypto social media platform BitClout, is facing legal trouble. On July 30, 2024, the U.S. Securities and Exchange Commission (SEC) and Department of Justice (DOJ) charged Al-Naji with wire fraud and selling unregistered securities.

According to the SEC, Al-Naji raised about $257 million by selling BitClout’s native token, BTCLT. He allegedly told investors this money would pay for BitClout employees. However, the SEC claims Al-Naji spent over $7 million on personal items. These included renting a mansion in Beverly Hills and giving large cash gifts to family members.

Al-Naji was arrested on Saturday, July 27, and appeared before a judge in California on Monday. The DOJ has charged him with one count of wire fraud, which could lead to up to 20 years in prison if he’s found guilty.

The SEC says Al-Naji tried to make BitClout seem like a decentralized project with “no company behind it…just coins and code.” He used the online name “Diamondhands” to hide his identity. The SEC also claims Al-Naji got a letter from a law firm saying BTCLT tokens were likely not securities. But this letter was based on information that Al-Naji had misrepresented, according to the SEC.

Gurbir S. Grewal, Director of the SEC’s Enforcement Division, said, “Al-Naji attempted to evade the federal securities laws and defraud the investing public, mistakenly believing that ‘being fake decentralized generally confuses regulators and deters them from going after you.'”

BitClout launched in early 2021 as a blockchain-based social media platform. It quickly became controversial for creating profiles of celebrities without their permission. The project copied information from Twitter profiles onto the BitClout site.

This led to legal issues. A law firm sent Al-Naji a letter demanding BitClout stop using people’s identities without permission. Even Lee Hsien Loong, the former Prime Minister of Singapore, asked for his BitClout profile to be removed.

Despite these problems, BitClout had backing from major investors. According to Al-Naji, these included well-known firms like Sequoia, Andreessen Horowitz, Coinbase Ventures, and others. Sources say Sequoia invested $1 million and Andreessen Horowitz invested $3 million in an early funding round.

Many investors were willing to support Al-Naji because of his previous company, Basis. In 2018, Basis raised $140 million to create a stablecoin. But Al-Naji ended up returning most of the money when he realized regulations would make it hard to continue.

When Al-Naji approached investors with the idea for BitClout in early 2021, he presented it as a broad concept for decentralized social media. The controversial “social stock market” feature, where users could buy and sell tokens tied to people’s reputations, was not the main focus at first.

Some tech industry figures defended BitClout after its launch. Investors like Andrew Chen from Andreessen Horowitz and others bought tokens on the platform. Shaun Maguire from Sequoia Capital called BitClout “instantly electrifying” in a post.

The SEC’s complaint also names Al-Naji’s wife, mother, and related business entities as relief defendants. This is because they allegedly received some of the investor funds from Al-Naji.

Al-Naji has not yet responded to requests for comment on the charges. In late 2021, he expressed confidence in BitClout’s legal position, saying he had learned a lot about crypto regulations from his previous company.

The post Where Did $257 Million Go? BitClout Founder Faces Fraud Charges from SEC and DOJ appeared first on Blockonomi.

• Former FTX executive Ryan Salame has requested a delay in reporting to prison due to a dog attack
• Salame was bitten in the face by a German Shepherd on June 29 while visiting a friend’s home
• His lawyers have asked to postpone his prison reporting date from August 29 to October 13
• A federal judge has granted the motion, giving Salame an additional 45 days before he must report to prison
• Salame was sentenced to 7.5 years in prison after pleading guilty to criminal charges related to his work at FTX

Ryan Salame, the former co-CEO of FTX Digital Markets, has been granted a 45-day delay in reporting to prison following a severe dog attack. U.S. District Judge Lewis Kaplan approved the motion on July 30, 2024, pushing Salame’s self-surrender date from August 29 to October 13.

Salame’s legal team filed the request on July 26, citing medical complications from a dog bite to his face. According to the motion, Salame “was mauled by a German Shepherd while visiting a friend’s home” on June 29. The incident occurred just one month after Salame was sentenced to 7.5 years in prison for his role in the FTX scandal.

Got bit in the face by a dog (my fault not the dogs) and all I can think is I hope this surgeon isn't a democrat who knows I'm a republican

— Ryan Salame (@rsalame7926) June 29, 2024

The former executive sought medical attention on July 3, where he was evaluated for a “dog-bite injury to the face.” His lawyers argued that Salame requires “urgent and necessary medical treatment and surgery” before beginning his prison term. The court filing included a physician’s letter and other medical information, though much of it was redacted to protect Salame’s privacy.

Salame’s case is part of the larger legal fallout from the collapse of cryptocurrency exchange FTX in November 2022. He pleaded guilty in September 2023 to conspiracy to operate an unlicensed money-transmitting business and engaging in campaign finance fraud. These charges stemmed from his close work with former FTX CEO Sam Bankman-Fried, who was convicted on seven felony charges and sentenced to 25 years in prison in March 2024.

The dog attack adds an unusual twist to the ongoing FTX saga. Salame broke a two-year silence on social media platform X (formerly Twitter) to comment on the incident, saying, “Got bit in the face by a dog (my fault not the dogs) and all I can think is I hope this surgeon isn’t a democrat who knows I’m a republican.” This statement raised eyebrows, suggesting Salame’s concern that political differences might affect his medical treatment.

Salame’s sentencing and subsequent prison delay come as other former FTX executives await their fates. Nishad Singh and Gary Wang, who also pleaded guilty and cooperated with prosecutors, are scheduled for sentencing in October and November, respectively. Caroline Ellison, former CEO of Alameda Research, is still awaiting a sentencing date.

The FTX case has been a landmark event in the cryptocurrency industry, revealing the misuse of over $8 billion in customer funds between FTX and its sister company, Alameda Research. Salame’s role in the scandal, while significant, was less central than that of Bankman-Fried. In addition to his prison sentence, Salame has been ordered to pay a combined $11 million in forfeiture and restitution.

The post Former FTX Executive Ryan Salame Granted Prison Delay After Dog Attack appeared first on Blockonomi.

• WazirX, an Indian cryptocurrency exchange, suffered a $230 million hack on July 18, 2024, losing about 45% of its assets.
• The exchange proposed a “socialized loss strategy” and conducted a poll asking users to choose between two options for fund recovery.
• WazirX faced significant backlash from customers and industry players for its handling of the situation.
• The exchange clarified that the poll was not legally binding and was meant to gauge user opinions.
• There are concerns about the fairness of the proposed strategy and its impact on the broader crypto ecosystem in India.

Indian cryptocurrency exchange WazirX is under fire for its handling of a recent security breach that resulted in the loss of approximately $230 million in user funds.

The hack, which occurred on July 18, 2024, saw about 45% of the exchange’s assets drained, including significant amounts of popular cryptocurrencies such as Shiba Inu, Matic, Pepe, USDT, and Gala.

In response to the breach, WazirX proposed a “socialized loss strategy” aimed at distributing the impact among all users. On July 27, the exchange launched a poll asking customers to choose between two options.

• The first option would allow users to access 55% of their funds without the ability to withdraw, but with priority for potential recovery proceeds.
• The second option offered access to 55% of funds with withdrawal capabilities, but with second priority for recovery proceeds.

This approach, however, quickly drew criticism from both customers and industry leaders. Many viewed the strategy as unfairly penalizing users for the exchange’s security failure. Sumit Gupta, co-founder of rival exchange CoinDCX, argued that “the first contribution to losses should ALWAYS come from the Company.”

He added that WazirX’s handling of the situation “isn’t community first” and could harm other participants in the crypto ecosystem.

Other industry players echoed these sentiments. Giottus co-founder Arjun Vijay suggested that the poll was designed to force customers into choosing the option that best suited the exchange. Unocoin co-founder Dr. Sathvik Vishwanath expressed concern that the way the issue was being handled was “worsening the situation” for the entire crypto industry in India.

1. This poll is a preliminary step to understand your opinions.
2. This poll is not legally binding upon the users or WazirX
3. We will soon launch feedback form to collect more ideas
4. We are now looking into next steps based on all the feedback received

This is a major… https://t.co/tcdDjWzIYI

— Nischal (Shardeum) (@NischalShetty) July 29, 2024

Customers also voiced their frustration, with many questioning the legality and fairness of the proposed strategy. Some labeled it as “socialized loss, privatized profits,” while others asked why users with non-stolen tokens should be penalized.

Facing mounting backlash, WazirX and its co-founder Nischal Shetty issued statements clarifying that the poll was not legally binding. They described it as a “preliminary step to understand” customer opinions and promised to launch a feedback form to gather more ideas from users.

Shetty defended the socialized loss approach, arguing that it would allow the exchange to reopen and continue operations while exploring other options for recovering lost tokens and reimbursing affected users. However, critics maintain that this method unfairly shifts the burden of the hack onto customers.

Adding to the complexity of the situation, Indian news outlet The Print reported that India’s Enforcement Directorate (ED) had deposited nearly $1.1 million in seized crypto assets into a WazirX wallet account in January 2024, months before the hack occurred.

This revelation has led to further questions about the exchange’s security protocols and its relationship with regulatory bodies.

The post WazirX Faces Criticism Over Proposed Recovery Plan Following $230 Million Hack appeared first on Blockonomi.

• Tornado Cash has seen a resurgence in 2024, with $1.9 billion in deposits in the first half of the year.
• This increase comes despite ongoing US sanctions and legal issues for its founders.
• Hackers continue to use Tornado Cash to launder stolen funds from various crypto exploits.
• WazirX, an Indian crypto exchange, recently suffered a $235 million breach linked to Tornado Cash.
• The US Treasury views crypto mixers as a national security threat, but some in the industry are challenging the sanctions.

Tornado Cash, a cryptocurrency mixing service, has experienced a significant resurgence in 2024 despite ongoing sanctions and legal challenges.

According to data from Flipside Crypto, the platform received about $1.9 billion in deposits during the first six months of the year. This marks a 50% increase compared to the total deposits for all of 2023.

The Office of Foreign Assets Control (OFAC) sanctioned Tornado Cash in August 2022 after discovering that the North Korean hacking group Lazarus had used it to launder around $455 million in stolen funds.

These sanctions mean that any wallet interacting with Tornado Cash could be blacklisted, making it difficult to withdraw funds through legal crypto exchanges.

Despite these restrictions, Tornado Cash remains popular among hackers looking to hide the source of stolen cryptocurrencies.

Recent data from blockchain analytics firm Arkham Intelligence shows that the hacker behind the $100 million Poloniex exchange exploit transferred $76 million to Tornado Cash since May. Similarly, hackers responsible for the HECO Bridge and Orbit Chain exploits moved $166 million and $48 million respectively through the mixer in the first half of 2024.

The ongoing use of Tornado Cash by hackers was highlighted in a recent incident involving WazirX, an Indian crypto exchange.

On July 18, 2024, WazirX reported a security breach resulting in the loss of $235 million. One of the wallet addresses linked to this hack was funded through a Tornado Cash deposit, further demonstrating the mixer’s role in cryptocurrency-related crimes.

The crypto industry has been challenging the Tornado Cash sanctions through a lawsuit filed in 2022.

Supporters argue that the sanctions are “unlawful and unconstitutional” because Tornado Cash is not a country or an “entity,” and blocking it violates free speech rights under the US Constitution.

Major crypto firms like Coinbase and advocacy groups such as The Blockchain Association and Coin Center have backed this lawsuit.

However, the US Treasury maintains that crypto mixers pose a national security threat, and Tornado Cash failed to implement adequate controls to prevent money laundering.

This stance has led to legal troubles for the platform’s co-founders. Alexey Pertsev was sentenced to over five years in Dutch prison on money laundering charges. Roman Storm was arrested in the United States and pleaded not guilty to similar charges, while Roman Semenov remains at large.

The resurgence of Tornado Cash highlights the ongoing challenges in regulating decentralized finance (DeFi) platforms. While US authorities have cracked down on crypto-related crimes, the decentralized nature of protocols like Tornado Cash makes them difficult to police effectively.

The post Tornado Cash Deposits Surge to $1.9 Billion in 2024 Despite Sanctions appeared first on Blockonomi.

• Former Ethereum developer Virgil Griffith’s prison sentence has been reduced by 7 months.
• Griffith was originally sentenced to 63 months for violating US sanctions on North Korea.
• A federal judge agreed to reduce his sentence to 56 months, effective August 2.
• Griffith pleaded guilty in 2021 to charges related to a 2019 cryptocurrency conference in North Korea.
• The judge noted Griffith’s lack of criminal history and hardships faced in prison when reducing the sentence.

Virgil Griffith, a former Ethereum developer, is set to be released from prison earlier than expected after a federal judge agreed to reduce his sentence by seven months.

Griffith, who was originally sentenced to 63 months in prison for violating US sanctions on North Korea, will now serve 56 months following a decision by US District Court Judge P. Kevin Castel of New York.

Griffith’s legal troubles began in 2019 when he attended and spoke at a cryptocurrency and blockchain conference in Pyongyang, North Korea. US prosecutors alleged that his presentation contained information on how to use cryptocurrency to evade sanctions, a claim that Griffith’s supporters argued was merely a recapitulation of publicly available information.

MASSIVE news, frens — Virgil Griffith is coming home! Moments ago, the Court granted our motion to reduce Virgil's sentence and Judge Castel shaved seven months off the sentence. pic.twitter.com/568nPKtOsC

— Alexander Urbelis (@aurbelis) July 17, 2024

In 2021, Griffith pleaded guilty to conspiring to violate the International Emergency Economic Powers Act, which prohibits US citizens from exporting goods, services, or technology to North Korea without proper authorization.

His guilty plea came just as jury selection for his trial was set to begin.

Judge Castel’s decision to reduce Griffith’s sentence took into account several factors.

The judge noted that Griffith had “zero criminal history points at the time of sentencing” and acknowledged the “significant hardships the defendant has experienced while incarcerated.” However, the judge also pointed out some “rule infractions” Griffith had incurred while in custody.

Explaining the decision, Judge Castel stated,

“The need to protect the public from further crimes of this defendant has somewhat dissipated, although the Court does note the defendant’s ‘rule infractions’ while in Bureau of Prisons custody.”

He added, “The need to impose just punishment for this serious offense, to promote respect for law, and to deter others from committing similar crimes, however, tilts against a substantial sentence reduction.”

Griffith’s legal team had argued for a lower sentence, citing their client’s lack of criminal history and the absence of financial hardship caused by his actions.

They also addressed the rule infractions mentioned by the judge, explaining that one incident occurred when Griffith was caught out of his designated cell during a facility count after being instructed to move by a unit officer.

The US government, represented by US Attorney Damian Williams, had opposed the sentence reduction, emphasizing the seriousness of Griffith’s actions.

Williams stated,

“Griffith acted despite knowing that North Korea was committing atrocities against its own people and had made threats against the United States, including nuclear capabilities.”

Griffith’s case has drawn attention to the intersection of cryptocurrency, international sanctions, and national security.

North Korea has become increasingly associated with cryptocurrency-related cybercrime, with the Lazarus group, linked to the country, estimated to have stolen at least $3.4 billion in cryptocurrencies since 2007.

The reduction in Griffith’s sentence comes at a time when other high-profile figures in the crypto space, including former Binance CEO Changpeng Zhao and former FTX CEO Sam Bankman-Fried, are facing legal consequences for their actions. .

The post Ethereum Developer Jailed for North Korea Visit has Sentence Reduced by 7 Months appeared first on Blockonomi.

• A Nigerian court has issued an arrest warrant for a prison doctor who failed to produce medical reports for detained Binance executive Tigran Gambaryan.
• Gambaryan appeared in court in a wheelchair, complaining of back pain and deteriorating health.
• The judge ordered Gambaryan to be taken to a hospital for a 24-hour medical checkup under security.
• Gambaryan has been detained since February on charges of money laundering and forex manipulation.
• U.S. Congressmen have intervened, urging for Gambaryan to be considered a wrongfully detained hostage.

A Nigerian court has escalated the ongoing legal drama surrounding detained Binance executive Tigran Gambaryan by issuing an arrest warrant for a prison doctor.

The warrant, issued by Justice Emeka Nwite of the Federal High Court in Abuja, targets Dr. Abraham Ehizojie of the Kuje Correctional Centre for failing to produce Gambaryan’s medical reports or appear in court as previously ordered.

The case has drawn international attention, with Gambaryan, Binance’s head of financial crime compliance, having been held in Nigerian custody since February.

He faces charges alongside the cryptocurrency exchange for alleged money laundering and foreign exchange manipulation involving $35.4 million.

The court proceedings took a dramatic turn when Gambaryan appeared in a wheelchair, visibly in distress.

His lawyer, Mark Mordi, emphasized the urgency of the situation, stating,

“My client came in here in a wheelchair. He has been complaining of back pain. We need to be careful of the life in our hands.”

This development underscores growing concerns about Gambaryan’s health while in detention.

Justice Nwite, expressing frustration at the disregard for court orders, not only issued the bench warrant for Dr. Ehizojie but also ordered Gambaryan to be taken to Nizamiye Hospital for a 24-hour medical checkup under full security. The case has been adjourned to October 11 for continuation.

The health concerns surrounding Gambaryan have escalated beyond Nigeria’s borders. Two U.S. Congressmen, Rep. French Hill (R-AR) and Rep. Rich McCormick (R-GA), have intervened, submitting a resolution to the House Committee on Foreign Affairs.

They urge the U.S. government to consider Gambaryan a wrongfully detained hostage, with Rep. Hill reporting that the executive’s health is “deteriorating” in custody.

Gambaryan’s family has been vocal about his condition. His wife, Yuki, released a statement expressing deep concern:

“I am heartbroken to see my once fit and healthy husband reduced to such a condition. This ordeal has taken a severe toll on him, leaving him in so much pain that he can hardly walk.”

She pleaded with Nigerian authorities to release her husband on humanitarian grounds.

The case against Gambaryan and Binance is part of a larger crackdown by Nigerian authorities on cryptocurrency exchanges.

The government accuses Binance and its executives of conspiring to conceal the origins of substantial financial proceeds from alleged unlawful activities in Nigeria. Additionally, Binance faces a separate suit from the Federal Inland Revenue Service for tax evasion.

This situation has put a spotlight on the challenges faced by international cryptocurrency executives operating in markets with evolving regulatory landscapes.

Binance CEO Richard Teng has publicly demanded Gambaryan’s release, arguing that the executive is being held in

“a dangerous prison in order to control Binance.”

The case has also raised questions about the treatment of foreign nationals in Nigeria’s legal system.

The U.S. Representatives’ resolution accuses Nigeria of trying Gambaryan “in lieu of pursuing legal action against his employer,” suggesting that the executive may be caught in a larger dispute between Nigerian authorities and Binance.

The post Health Concerns Escalate for Detained Binance Executive in Nigeria as Doctor is Arrested appeared first on Blockonomi.

• U.S. Senator Robert Menendez has been found guilty on all 16 counts in his corruption trial.
• Charges include bribery, acting as a foreign agent for Egypt, and obstruction of justice.
• Menendez accepted bribes in the form of cash, gold bars, and a Mercedes-Benz.
• The senator faces up to 222 years in prison if sentences are served consecutively.
• Menendez has vowed to appeal the verdict and maintains his innocence.

U.S. Senator Robert Menendez (D-N.J.) has been found guilty on all 16 counts in his federal corruption trial. The verdict, delivered on Tuesday after a two-month trial, marks a dramatic downfall for one of the most influential figures in Washington D.C.

Menendez, 70, was convicted on charges including bribery, acting as a foreign agent for Egypt, obstruction of justice, extortion, and conspiracy.

The case centered around accusations that Menendez accepted lavish gifts and hundreds of thousands of dollars in exchange for political favors and using his influence to benefit wealthy New Jersey businessmen and foreign governments.

Prosecutors described Menendez as a “senator on the take” who abused his power for personal gain. U.S. Attorney Damian Williams stated, “This case has always been about shocking levels of corruption. Hundreds of thousands of dollars of bribes, including gold, cash, and a Mercedes-Benz. This wasn’t politics as usual; this was politics for profit.”

The evidence presented during the trial painted a damning picture of corruption. FBI raids on Menendez’s home in 2022 uncovered approximately $480,000 in cash and over a dozen gold bars, which prosecutors linked to bribes. Some of the cash envelopes bore fingerprints of Fred Daibes, one of the businessmen involved in the scheme.

Menendez’s defense team attempted to shift blame to his wife, Nadine, portraying her as the mastermind behind the bribery scheme. However, prosecutors argued that the senator was fully aware and complicit in the corruption, citing instances where he intervened in criminal investigations on behalf of his co-conspirators and shared sensitive information with foreign governments.

The conviction has led to immediate calls for Menendez’s resignation from both sides of the political aisle. Senate Majority Leader Chuck Schumer stated, “In light of this guilty verdict, Senator Menendez must now do what is right for his constituents, the Senate, and our country, and resign.”

Despite the verdict, Menendez maintains his innocence and has vowed to appeal. Speaking to reporters outside the courthouse, he said, “I am deeply, deeply disappointed by the jury’s decision.

I have every faith that the law and the facts did not sustain that decision and that we will be successful upon appeal. I have never violated my public oath.”

The conviction of Senator Menendez has exposed hypocrisy in his stance on cryptocurrencies. In 2017, Menendez wrote a letter to FinCEN stating,

“Because of the anonymous nature of Bitcoin transactions, the digital currency is an ideal choice for criminals.”

He also co-sponsored the Accountability for Cryptocurrency in El Salvador (ACES) Act, which aimed to scrutinize how adopting Bitcoin as legal tender might empower “malign actors” and encourage money laundering.

Menendez’s own criminal activities involved traditional forms of value transfer – cash, gold bars, and luxury goods – rather than cryptocurrencies.

It seems that while Menendez was quick to point fingers at emerging technologies as potential tools for criminals, he was engaging in old-fashioned corruption using the very forms of value he deemed more legitimate.

Menendez faces a maximum of 222 years in prison if his sentences are to be served consecutively. Sentencing is scheduled for October 29, and it remains to be seen whether he will resign his Senate seat or face a potential expulsion vote.

The post Cash, Gold & Corruption: Menendez Convicted & Facing Potential 222-Year Sentence After Guilty Verdict appeared first on Blockonomi.

• Craig Wright has admitted he is not Satoshi Nakamoto, the creator of Bitcoin.
• A UK court ordered Wright to publicly declare he is not Bitcoin’s creator.
• Wright is barred from filing further lawsuits related to his claims of being Satoshi.
• The case has been referred to prosecutors for potential perjury charges.
• Wright was found to have forged documents “on a grand scale” to support his false claims.

Craig Wright, the Australian computer scientist who has long claimed to be Satoshi Nakamoto, the pseudonymous creator of Bitcoin, has finally admitted he is not the cryptocurrency’s inventor.

This admission comes after a UK High Court ruling that found Wright had “lied extensively and repeatedly” in his attempts to prove he was Satoshi.

On July 16, 2024, Wright issued a legal disclaimer on his website, emphatically stating that he is not Satoshi Nakamoto. The disclaimer, ordered by UK Justice Mellor, cites the recent ruling from the United Kingdom High Court of Justice and directs visitors to the summary of findings presented by the Crypto Open Patent Alliance (COPA).

The court-ordered declaration states that Wright is not the author of the Bitcoin white paper, does not own its copyright, did not adopt or operate under the pseudonym Satoshi Nakamoto between 2008 and 2011, did not create the Bitcoin system, and is not the author of the initial versions of the Bitcoin software.

This public admission marks the end of Wright’s years-long claim to be the creator of the world’s first and most valuable cryptocurrency.

Since 2016, Wright had been asserting that he was Satoshi Nakamoto, a claim that has now been thoroughly debunked in court.

The legal battle reached its peak in 2024 when COPA presented over 50 pieces of evidence dismantling Wright’s claims. During the trial, forensic experts and on-chain analysts testified that Wright had produced a trove of elaborate forgeries and metadata that showed signs of tampering.

Judge James Mellor agreed with COPA’s arguments, concluding that the creator of a highly technical system like Bitcoin would not make the careless errors found in Wright’s forgeries and distorted metadata. The judge ruled decisively that Wright was not Satoshi.

In addition to the public declaration, Wright has been barred from filing any future lawsuits in the UK related to his claims of being Satoshi. The court order states,

“Dr. Wright has been ordered not to commence any legal proceedings based on his false claims (by claim or counterclaim) or procure any other person to do so.”

The repercussions of Wright’s false claims may extend beyond civil court. Judge Mellor has referred the case to the Crown Prosecution Service (CPS) for consideration of potential perjury and forgery charges against Wright.

The CPS will now decide whether to prosecute Wright for what the judge called “wholescale perjury and forgery of documents,” and determine if a warrant for arrest and possible extradition is necessary.

The post Faketoshi: Craig Wright Admits He’s Not Bitcoin Creator, Faces Potential Perjury Charges appeared first on Blockonomi.

• John Bigatton, a promoter of BitConnect in Australia, has been convicted of providing financial advice without a license.
• He has received a three-year good behavior bond and a five-year ban from managing corporations.
• BitConnect was a cryptocurrency platform that promised substantial returns to investors.
• Bigatton promoted BitConnect via seminars and social media from August 2017 to January 2018.
• In 2020, the Australian Securities and Investments Commission (ASIC) prohibited Bigatton from offering financial services for seven years.

John Bigatton, known for his role in promoting the now-defunct cryptocurrency platform BitConnect in Australia, has been convicted by the Sydney District Court for delivering financial advice without proper authorization.

The court’s ruling on July 12, 2024, resulted in a three-year recognizance of good behavior for Bigatton, along with a five-year disqualification from managing any corporations.

The case against Bigatton focused on his activities from August 2017 to January 2018, during which he held seminars and utilized social media to dispense financial advice, violating Australian financial regulations.

BitConnect, launched in 2016, was a cryptocurrency exchange platform that created BitConnect Coin (BCC).

Investors were enticed to trade Bitcoin for BCC and take part in various investment opportunities with promises of high returns. At one seminar, Bigatton boldly claimed that BCC’s value would skyrocket from $253 to over $1,000 within a year.

The Australian Securities and Investments Commission (ASIC) was pivotal in prosecuting Bigatton. ASIC Deputy Chair Sarah Court emphasized,

“Providing unlicensed financial advice denies Australian investors access to key protections and undermines trust and confidence in Australia’s financial services industry.”

This conviction is not Bigatton’s first encounter with regulatory bodies. In 2020, ASIC barred him from offering financial services for seven years.

In 2018, ASIC successfully sought a Federal Court order to freeze Bigatton’s assets, including his cryptocurrency holdings. This was the first instance of an Australian regulator obtaining freezing orders over digital assets.

BitConnect’s operations and Bigatton’s promotion activities have drawn international scrutiny. In 2021, the U.S. Securities and Exchange Commission (SEC) charged BitConnect’s founder, Satish Kumbhani, with fraudulently raising about $2 billion from retail investors. Kumbhani’s current location remains unknown as of 2024.

Despite Bigatton’s assertions that his advice was not financial in nature, the court found that his actions indeed constituted financial advice. During seminars, he promoted BitConnect as a superior investment compared to traditional term deposits and made optimistic predictions about the future value of BitConnect Coins.

Investors in BitConnect were required to purchase BitConnect Coin to access investment opportunities. They could invest or loan BCC for set periods, with promises of high interest rates.

However, they had no control over their loans and could not withdraw their capital until the lending period ended.

Bigatton’s guilty plea in May 2024 to one count of providing unlicensed financial advice culminated in this conviction, following a series of legal proceedings.

The post Australian Promoter of BitConnect Sentenced for Unauthorized Financial Advice appeared first on Blockonomi.