Binance has been hit with a .25 million fine in India for operating in the country in violation of local anti-money laundering rules.
India’s Financial Intelligence Unit (FIU) imposed a multi-million fine on Binance as the cryptocurrency exchange failed to register with the FIU to comply with its anti-money laundering (AML) rules.
In an official Jun. 19 statement, the regulator said it imposed a total penalty of 188.2 million rupees (around .25 million) for violating multiple AML rules as well as directives focused on combating the financing of terrorism. As of press time, Binance made no public statements on the matter.
According to a Chainalysis report, India is one of the fastest-growing crypto economies, with the highest adoption rate as of 2023. In mid-April, crypto.news reported that Binance agreed to pay another million penalty following a four-month ban placed on the exchange by the FIU.
Before the January ban, Binance reportedly dominated over 90% of the Indian crypto trading volume. The exchange’s popularity surged as traders sought to bypass tax implications imposed by the Indian government.
In March, India’s Ministry of Finance mandated that all crypto businesses register with the FIU and comply with PMLA provisions. By December 2023, 28 cryptocurrency firms had already registered with the national AML agency, as reported by crypto.news.
Crypto remains a contentious issue in India, with regulators divided on how to approach the emerging industry. India’s Minister of Finance, Nirmala Sitharaman, called on international collaboration toward building a comprehensive crypto framework and urged governments to consider blockchain’s merits. However, the Reserve Bank of India hasn’t changed its stance on crypto and argued for a blanket ban on digital assets.
Ethereum has achieved a “major win” as the SEC closes its investigation into Ethereum 2.0, confirming that sales of ETH are not considered securities transactions.
Ethereum, the second-largest crypto by market capitalization, has scored a significant victory as the Enforcement Division of the U.S. Securities and Exchange Commission (SEC) announced the closure of its investigation into Ethereum 2.0, blockchain firm Consensys said in an X post.
ETHEREUM SURVIVES THE SEC.
Today we’re happy to announce a major win for Ethereum developers, technology providers, and industry participants: the Enforcement Division of the SEC has notified us that it is closing its investigation into Ethereum 2.0.
The SEC’s decision means that the agency “will not bring charges alleging that sales of ETH are securities transactions,” Consensys explains.
“The closing of the Ethereum investigation is momentous, but it’s not a cure-all for the many blockchain developers, technology providers, and industry participants who have suffered under SEC’s unlawful and aggressive crypto enforcement regime.”
Consensys
The latest development comes after a Jun. 7 letter to the SEC from Consensys, which requested confirmation that the recent approval of spot Ethereum exchange-traded funds (ETFs), assuming ETH to be a commodity, would result in the closure of the Ethereum 2.0 investigation.
Despite the positive outcome, the battle for regulatory clarity between Consensys and the SEC continues as the blockchain firm is seeking a declaration that offering user interface software such as MetaMask Swaps and Staking doesn’t violate securities laws.
The closure of the investigation marks a significant step forward for Ethereum and the whole industry, which has been grappling with regulatory uncertainties and enforcement actions lately. Following the news, ETH price soared 3% and is now trading at ,555, according to data from CoinMarketCap.
David Hirsh, the former head of the Cryptocurrency and Network Division at the U.S. Securities and Exchange Commission, has left his position.
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In his LinkedIn post, he called securities trading a “team sport.” He thanked his SEC colleagues for their cooperation and joint efforts to achieve a common goal.
“As I often say, securities enforcement is a team sport, and that was certainly true throughout my tenure. Every success I was a part of was the direct result of collaboration and combined efforts towards a common goal. Thanks to all of you!”
David Hirsh, the former head of the Cryptocurrency and Network Division at the SEC
He did not specify the details of further employment. However, he wrote that he would take a break and travel with his family.
Nine years in the SEC
Hirsch was an advisor to SEC Commissioner Caroline Crenshaw and has worked on issues related to law enforcement, digital assets, and cybersecurity.
Throughout his SEC career, he has provided training on issues related to digital assets and cybersecurity, including to fellow regulators and law enforcement officials.
Hirsch worked for the SEC for about nine years in total. He joined the organization as a staff lawyer but subsequently headed the department dealing with crypto exchanges and decentralized finance (defi) projects.
New role or rumors?
The meme coin project Pump.Fun wrote that Hirsch is joining the project as Head of Trading. The team noted that David had concluded that his job as a regulator was no longer fulfilling and that he had to start a new chapter.
We are excited to announce our new Head of Trading, David Hirsch!
After months of conversations with @a1lon9, David came to the realization that his work as a regulator was no longer fulfilling. He had to start a new chapter.
Pump.Fun also noted that David has allegedly launched over 100 coins himself and will now be in charge of Pump.Fun’s new internal trading department will be responsible for launching over 1,000 coins per day. However, Hirsch later denied this statement.
The role of Hirsch and the SEC in crypto regulation
Hirsch took charge of the division in October 2022, when the crypto market was in its worst position in recent years. During that period, several large crypto companies went bankrupt at once, and the culmination of the crisis was the collapse of the large FTX exchange, which reduced the coin industry to local minimums during the latest bearish trend.
While Hirsch served as head of the department, the SEC began an aggressive law enforcement campaign against several companies in the industry. Kraken, Coinbase, Binance, Ripple, and many other blockchain industry giants came under pressure.
The lawsuits against Coinbase and Binance, filed separately within days, have led to lengthy legal battles. Kraken reached a settlement agreement with the Commission after paying a million fine.
What’s next for cryptocurrency in the U.S.?
Hirsch’s departure rids the industry of a significant figure who has openly advocated for strict cryptocurrency regulation. However, the question of who will lead the cryptocurrency industry after Hirsh leaves remains open.
The upcoming presidential elections in America in the fall may play a significant role in this process, and the country’s new leader will largely determine the SEC’s policy for the years to come. A survey commissioned by Grayscale showed that Americans have become more actively interested in cryptocurrencies ahead of the U.S. presidential election — 53% of respondents are ready to vote for a candidate who understands cryptocurrencies.
Now, the administration of U.S. President Joe Biden is trying its best to earn the loyalty of voters who own digital assets. Several recent initiatives, including adopting spot Ethereum ETFs, signal this.
Biden’s primary opponent, former President Donald Trump, previously called himself the “crypto president” and promised to do many good things for the industry if elected. He also vowed to end the war on crypto that Biden started and make every effort to ensure the future of Bitcoin (BTC) and other cryptocurrencies in America.
However, Gary Gensler, who likes to call all cryptocurrencies except for BTC, still holds the post of SEC Chairman. Perhaps, it will be possible to achieve an improvement in what is happening after the American elections.
Cloud-based multi-asset platform Uphold has begun notifying some of its customers about its decision to suspend support for Tether’s USDT, and Gemini’s GUSD among other stablecoins.
Multi-asset trading platform Uphold will cease support for a basket of stablecoins due to the European new regulatory framework known as the Markets in Crypto-Assets Act (MiCA).
According to an Uphold email notification shared in an X post by Commercializing Blockchain Research Centre (CBRC) founder Antony Welfare, the New York-headquartered firm will no longer support USDT, GUSD, DAI, FRAX, TUSD, and USDP starting from Jul. 1, referring to “new European Union rules on stablecoins” as the reason behind the move.
As of press time, Uphold made no public statements on the matter. Crypto.news reached out for comments and we will update the article if we hear back.
Following the suspension, Uphold will continue to support Circle‘s stablecoins USDC and EURC, as well as PYUSD issued by Paxos for PayPal. The company urged customers to convert their holdings in the affected stablecoins by Jun. 27. Any remaining balances in these stablecoins will be automatically converted to USDC on Jun. 28, Uphold added.
‘Extremely vulnerable’ regulation
MiCA entered into force in June 2023, though the provisions related to the asset-referenced tokens and e-money tokens will apply from Jun. 30. Under the new regulation, no stablecoins can be offered in the European Union to the public or “admitted to trading on a trading platform for crypto-assets,” unless the issuer is authorized in the region and publishes a “white paper” approved by the national competent authority.
The new regulatory landscape has sparked concerns among some crypto executives. Tether CEO Paolo Ardoino, in an interview with The Block, said that MiCA “could not only render the job of a stablecoin issuer extremely complex but also make EU-licensed stablecoins extremely vulnerable and riskier to operate.”
Under upcoming MiCA rules some stablecoins will face restrictions as unauthorized stablecoins.
Binance won’t delist any unauthorized stablecoins on spot but will limit their availability for EEA users only on certain products, such as launchpool and earn, and will propose…
Crypto exchange Binance said in early June that while it wouldn’t delist unauthorized stablecoins from its spot market, it would limit their availability to certain products for European Economic Area (EEA) users and promote regulated stablecoins as alternatives.
In mid-May, reports surfaced saying Kraken, a U.S.-headquartered crypto exchange, was also “actively reviewing” delisting plans for USDT, a stablecoin issued by Tether. Later on, Kraken’s global head of asset growth & management business Mark Greenberg denied the delisting rumors, saying the exchange is still examining “all options to offer USDT under the upcoming regime.”
South Korea will review the listings of over 600 tokens on domestic crypto exchanges next month under new regulatory measures.
South Korea‘s financial authorities will begin re-evaluating over 600 cryptocurrency listings on domestic trading platforms starting in July, following the implementation of the Virtual Asset User Protection Act, Korean news media Dnews reports, citing sources familiar with the matter.
The Korean financial regulators are reportedly finalizing practices for crypto listings, which are set to be enforced starting Jul. 19 under the new law. The regulations will apply to nearly three dozen registered crypto exchanges, including Upbit, Bithumb, Coinone, Korbit, and Gopax, which will conduct initial reviews to determine whether to maintain or delist each token.
Under the new regulatory framework, crypto exchanges must establish a review committee to evaluate various factors such as the reliability of the issuing entity, user protection measures, technology and security standards, as well as regulatory compliance.
Additional criteria include the issuer’s capabilities and reputation, past business history, information disclosure, operational transparency, total supply and circulation, market capitalization, and potential conflicts of interest between a trading platform and token holders.
The report notes that tokens issued by decentralized autonomous organizations (DAOs) may not meet standard requirements, while tokens that have been traded normally for over two years in regulated markets such as the U.S., U.K., France, Germany, Japan, Hong Kong, Singapore, India, and Australia will be subject to a less strict review process. Additionally, crypto exchanges will be banned from accepting any payments in return for listing a token.
Subsequent reviews will occur quarterly, with tokens deemed “problematic” will be designated as cautionary and potentially delisted, the report says. Crypto exchanges will have a six-month period to assess whether to continue supporting existing crypto listings, followed by maintenance reviews every three months.
Zimbabwe is seeking public comments on crypto regulation as the country aims to integrate emerging tech into its economic framework.
Zimbabwe has called for public feedback on crypto operations as it crafts a policy framework for the burgeoning sector, Bloomberg reports, citing a government statement published in a state-run newspaper.
The government reportedly wants to “assess and understand” the cryptocurrency landscape by “inviting all cryptocurrency service providers,” both domestic and international, who offer services to Zimbabwean customers to submit their comments by Jun. 26. To facilitate the assessment, the government has established a committee to engage with operators within the crypto ecosystem.
Since 1999, Zimbabwe has been excluded from international capital markets due to its default on debt obligations. As a result, the country now seeks new ways to boost its economy.
In 2023, the country issued its first digital token backed by gold in a bid to stabilize its economy after years of financial turmoil. In April this year, the African country introduced another currency, ZiG in its sixth attempt to stabilize the monetary system amid high inflation rates. The new currency replaced the Zimbabwean dollar, which had experienced multiple crashes since its reintroduction in 2019, exacerbating inflation.
Although the Reserve Bank of Zimbabwe has historically been cautious about crypto, emphasizing the need to protect consumers and the financial system, the issuance of the gold-backed token and the launch of ZiG indicate a shift towards exploring digital solutions to economic challenges.
As the International Monetary Fund noted in a research report, only one-quarter of countries in sub-Saharan Africa have formal regulations for cryptocurrencies. Approximately two-thirds have implemented various restrictions, while six countries, including Cameroon and Ethiopia, have outright banned crypto. In Zimbabwe, the government has ordered all banks to cease processing crypto-related transactions.
Beleaguered crypto exchange Zipmex has lost its business license after the Thai authorities found that the exchange had repeatedly failed to comply with orders.
Thai cryptocurrency exchange Zipmex has lost its business license after the Securities and Exchange Commission (SEC) found that the exchange had repeatedly failed to comply with regulatory orders.
In a Jun. 11 press release, the SEC announced that Zipmex’s license revocation followed concerns over the company’s financial instability and inadequate management. Despite several directives to rectify these issues, Zipmex failed to comply within the given timeframe, prompting the SEC to recommend that Thailand’s Ministry of Finance revoke the company’s license.
The Ministry’s decision requires Zipmex to cease crypto operations immediately and transfer customers’ assets back to them within 15 days. If customers don’t claim their assets within the period, Zipmex must store the assets within 30 days and report each step of the process to the SEC. As of press time, Zipmex made no public statements on the matter.
Founded in 2018, Singapore-headquartered Zipmex halted its trading business in Thailand in November 2023, facing penalties from the SEC for alleged misuse of a crypto custodian service and for funneling customers to the Singapore-based exchange Zipmex Pte, creating a conflict of interest. Zipmex also operates in Australia and Indonesia.
Beyond its regulatory difficulties in Thailand, Zipmex’s rehabilitation plan has stalled following significant losses exceeding million due to its exposure to the bankruptcies of Babel Finance and Celsius Network in 2022.
Monica Long, President of Ripple, joined Arjun Kharpal, Senior Correspondent for CNBC, at Money 20/20 to discuss the infrastructure needed for crypto implementation.
Their conversation centered around the theme of “Building Infrastructure Fundamentals,” which focused on traditional financial institutions’ perception and adoption of digital assets.
Long noted a significant shift in U.S. legislation and traditional finance institutions, citing the Bitcoin ETF approval in the U.S. as a crucial moment for crypto adoption. “BlackRock’s involvement was a big moment,” Long said. Many financial institutions have been slowly adopting crypto tech, acknowledging it as a contemporary financial framework, Long said.
Clearer regulations
Despite the recent Ethereum (ETH) and Bitcoin (BTC) ETF approvals, Long emphasized the need for more regulatory clarity. When talking about the real-world uses of digital assets, Long emphasized the advantages of institutional decentralized finance (DeFi) in basic banking transactions.
“Basic financial services like deposits, payments, lending, credit, and capital markets can benefit from a more global, open, and efficient system,” Long said, comparing blockchain’s potential impact on finance to the internet’s impact on communication.
Long mentioned the European Union’s Markets in Crypto-Assets (MiCA) regulation as a prime example of a clear regulatory framework and hinted at the United States’s slow yet steadily improving relationship with crypto.
“Entering the U.S. market through the SEC doesn’t sound like a door that’s going to have a friendly, friendly entryway for us,” Long said.
Long expressed cautious optimism about regulatory clarity in the U.S., noting that stablecoin legislation could be a positive step.
Private vs. public blockchain
Long also discussed the debate between private versus public blockchains and pointed out that private blockchains are still used for tech like central bank digital currencies (CBDCs), but there have been noteworthy advancements in public ledgers.
For instance, Société Générale issued the first euro stablecoin on a public ledger. Ripple is also launching a regulated US dollar stablecoin.
Fraud
Long emphasized the difference between fraudulent behavior and the technology itself when discussing the repercussions of scandals like FTX.
“To clarify, as an industry, there’s fraud, which is what happened in the case of FTX finance. There are blatant violations of compliance, violations,” Long said. “But it’s not that the technology is bad or that all players paint us all with a broad brush of fraudsters and criminals.”
FTX’s collapse and fraud do not reflect the whole crypto industry — positive blockchain applications do remain, Long stressed.
“There’s a hangover from those events, but it’s important to separate fraud from the legitimate applications of the technology,” she said.
Hong Kong’s Securities and Futures Commission chief Julia Leung says Bitcoin is clearly showing its power to stay as an “alternative asset.”
Bitcoin, the largest crypto by market capitalization, is here to stay as it succeeded over the past 15 years to survive multiple cycles of “boom and bust,” Hong Kong’s Securities and Futures Commission (SFC) chief Julia Leung says.
Speaking at the Greenwich Economic Forum, the SFC boss Leung acknowledged the prevailing skepticism among central bankers and economists regarding the intrinsic value of cryptocurrencies.
Yet, Leung underscored the fact that over the past 15 years, Bitcoin “has survived multiple cycles of boom and bust, clearly showing its staying power as an alternative asset,” though she had to point out that her support leans more towards Bitcoin’s underlying technology — distributed ledger (DLT) — rather than the cryptocurrency itself.
“The potential benefits of DLT are plain to see. It has the potential to enhance efficiency and lower costs in the distribution, clearing, settlement, and custody of real-world assets.”
Julia Leung
The SFC head also addressed the hype around non-fungible tokens (NFTs), saying that while digital collectibles “may be a fad,” the enabling technology is being “increasingly used in real-world assets.” As per Leung, tokenization may bring about “wider financial inclusion, fractionalization, custody and ownership, all on chain.”
However, Leung admitted that the full realization of these benefits in the financial sector would require significant advancements to be made. She particularly noted the necessity for blockchain networks to scale up and mature, emphasizing the importance of interoperability across distributed networks among financial institutions and across borders.
Hong Kong’s positive stance towards cryptocurrencies is evident as the region aims to position itself as a crypto-friendly hub, highlighted by the recent approval of spot Bitcoin and Ethereum exchange-traded funds (ETFs). However, despite this progress, authorities appear to be taking a tough stance towards unlicensed crypto exchanges, threatening to shut down all unlicensed crypto exchanges in the region.
