Lưu trữ cho từ khóa: Regulation

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Binance to boost compliance efforts with 1,000 new hires in 2024

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Binance will reportedly increase its workforce by at least 1,000 new employees by the end of 2024, with 20% going to compliance roles.

Richard Teng, who took over the running of Binance in late 2023 as the exchange’s new chief executive, shared those plans in an Aug. 22 interview with Bloomberg. He revealed that the exchange plans to expand its workforce by 1,000, with the compliance department getting an extra 200 people.

At the moment, Binance’s compliance workforce is made up of 500 employees, and the company has reportedly spent more than $200 million to meet regulatory requirements, particularly in the United States.

Teng stated that since the beginning of 2024, Binance had fielded more than 63,000 requests from law enforcement authorities, beating the 58,000 it dealt with in all of 2023.

Binance boosts compliance efforts under U.S. supervision

Binance’s compliance push stems from a recent plea deal with the U.S. Department of Justice, the Financial Crimes Enforcement Network, and several other U.S. authorities, that resulted in a $4.3 billion penalty for the exchange.

The authorities had accused Binance of violating the Bank Secrecy Act, operating as an unlicensed money transmitting business, and failing to maintain an effective anti-money laundering program.

As part of the deal, the DoJ and FinCEN will monitor Binance’s compliance efforts for the next five years. Additionally, Binance founder Changpeng Zhao resigned from his role as Binance’s CEO.

The monitoring agencies have already appointed agents to assess Binance’s financial statements and transaction tracking. However, Teng admitted that Binance’s crypto compliance journey was still in its infancy.

Despite its push for compliance, Binance still faces charges by the U.S Securities and Exchange Commission for allegedly breaking securities laws, misleading investors, and mishandling clients’ funds. However, the crypto exchange has vowed to fight the charges.

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Hong Kong lawmaker calls for legal framework to regulate DAOs

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A Hong Kong lawmaker calls for a legal framework to regulate DAOs following a court ruling on a decentralized organization.

Hong Kong might begin developing a regulatory framework for decentralized autonomous organizations, as lawmaker Johnny Ng Kit-chong advocates for clearer rules to improve stability in the web3 sector.

According to a report from the South China Morning Post, Ng, a member of the Legislative Council, believes that establishing a legal framework could benefit the region by attracting international talent and investment, reinforcing Hong Kong’s position in the rapidly evolving crypto landscape.

It is not the first time Ng has urged regulatory clarity for DAOs. In July, he also publicly called for the creation of clear policy and regulatory recommendations for DAOs to “support and regulate the healthy development” of these entities in Hong Kong.

However, the latest call comes shortly after Hong Kong’s High Court, in what Ng described as a “landmark moment, marking the world’s first judicial examination of a DAO,” ordered six defendants in the Mantra DAO case — alleging misappropriation of HK$6 billion (approximately $767 million) — to disclose financial details.

“I hope the government can improve the ecology of web3 and regulate DAOs legally so that more people in the industry will come to Hong Kong to develop their projects and bring in capital and talent.”

Johnny Ng Kit-chong

Ng has long been a vocal proponent of crypto-friendly regulation in Hong Kong. In early August, crypto.news reported that Ng emphasized the need for the city to intensify its efforts in the crypto space by expanding virtual banking services, particularly as web3 startups continue to face challenges in accessing financial services.

Ng has proposed that virtual banks should better cater to the needs of web3 companies and accelerate the development of Hong Kong’s digital ecosystem, asserting that “virtual asset policies have become the focus of global government discussions.”

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China’s supreme court recognizes crypto in landmark AML law update

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China’s highest court and its public prosecution agency have for the first time recognized crypto transactions in their revised interpretation of the country’s anti-money laundering laws.

At a joint press conference on Aug. 19, representatives of the Supreme People’s Court and the Supreme People’s Procuratorate announced several reinterpretations of China’s AML laws, set to take effect on Aug. 20.

According to the announcement, a key highlight of the new interpretations was the listing of virtual asset transactions as a method of laundering money. Per the Chinese authorities, the conversion and transfer of criminal proceeds through crypto will now be considered as concealing the source and nature of criminal proceeds and their benefits “by other means.”

Those found guilty will face a gamut of penalties, including fines starting at 10,000 Chinese yuan (around $1,400) to 200,000 Chinese yuan (around $28,000 at current exchange rates). Furthermore, more severe offenders could also face jail time ranging from five to ten years. 

The amendments to the AML laws involve 13 articles, and are meant to provide clarity for the identification of money laundering crimes and the specific circumstances where certain regulations prohibiting the “concealing and covering up” of proceeds from criminal enterprise may come into effect. Additionally, the amendments have outlined the amount of fines and prison time breaking the AML laws will attract.

The amendments are the culmination of calls made earlier in the year by Chinese Prime Minister Li Qiang for the country to rewrite its AML laws to include crypto-related transactions. Additionally, authorities in the country made promises to punish people using crypto and blockchain technology to commit crimes, with the People’s Procuratorate claiming that crypto-related money laundering had become a major channel for criminals to hide their illicit wealth. 

As crypto.news reported earlier in the year, China has been experiencing an increase in crypto-related criminal activities, with the trend even becoming a major topic at the Chinese Association for the Study of Integrity and Law’s annual conference in late 2023.

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The Democrats are ignoring crypto — is that a good thing?

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Crypto wasn’t mentioned once as the Democrats set out their priorities for the next four years, but some argue this indicates that Biden’s aggressive crackdown will end.

The 2024 Democratic National Convention kicked off in Chicago yesterday and will see Kamala Harris formally confirmed as the party’s presidential nominee.

In recent days, there have been murmurings that her campaign was gearing up to adopt a more open stance toward crypto regulation, in contrast to Joe Biden’s aggressive clampdown.

Groups such as Crypto4Harris have popped up, with senior Democrats and entrepreneurs arguing that Donald Trump doesn’t have a monopoly on proposing literate policies.

During a virtual town hall, Senate Majority Leader Chuck Schumer even declared that crypto legislation can be passed this year — ending years of paralysis in Congress.

So as the DNC kicked off, with the likes of Joe Biden and Hillary Clinton gracing the podium, there was some optimism that digital assets might get a fleeting mention.

All was going well until the Democrats set out their priorities for the next four years in an official 92-page document, which failed to mention crypto at all. 

This will be a disappointment to ardent believers who firmly believe in this industry’s potential, but don’t want Trump to secure a second term in the Oval Office.

There was further panic when rumors started to circulate that Gary Gensler, who has been accused of “regulation by enforcement” during a controversial stint as SEC chair, could be tapped as the next treasury secretary if Harris wins in the fall. 

Custodia Bank CEO and Bitcoin supporter Caitlin Long poured cold water on those reports by declaring that this speculation is false — and given how this would have swayed the decision of anyone voting based on crypto alone, that’s probably a good thing.

Given crypto’s omission from the agenda, it would be easy to assume that American investors should just expect more of the same: gray areas, inconsistency, and a flight of top talent to rival economies that are more open-minded to digital assets.

But weirdly, many BTC-holding Democrats have been seeking to argue that this is a good thing — and could actually herald a reset when it comes to how crypto is treated by legislators.

A ‘damn good’ pivot

Crypto analyst Adam Cochran believes that the absence of digital assets from the party platform may indicate more of a hands-off approach — and an end to “anti-crypto rhetoric.” 

He pointed to how some Democrats, including Senator Elizabeth Warren, had been lobbying for a much more aggressive stance against crypto, but there are growing signs that the party is now heading in another direction.

Cochran said that there would have been cause for alarm if the party platform had pushed for the SEC to have greater powers, an outright ban on crypto, or a “formal chokepoint strategy” designed to make trading impractical for consumers and businesses alike. He wrote on X:

“Crypto doesn’t need government handouts to succeed. It needs a non-hostile environment. Proactive and supportive policy is great, but it also takes time to develop.”

Not everyone agrees with his analysis here — with some arguing that complete silence on this issue doesn’t mean that things will change for the better.

The Bitcoin Voter Project, which has been established by a number of prominent U.S. mining firms, went on to claim that “the Democrats are missing a huge opportunity to energize and activate millions of left-leaning Bitcoiners.” 

Sure, crypto was worth a mention at some point in a 92-page party platform. But you could argue that Harris may have bigger fish to fry. Global wars are raging and fears are growing around climate change — with economic uncertainty and housing shortages a major concern. Given that the total crypto market cap stands at $2.2 trillion, which is less than 10% of America’s annual GDP, does the industry have an overinflated view of how much attention it deserves?

What’s more, it’ll be interesting to see how much crypto ends up swaying Americans in the ballot box come November. From education to the economy, healthcare to gun control, immigration to abortion, there are many challenges facing the country — and it seems naive to think that many Bitcoiners will cast votes based on this issue alone.

Between now and Thursday, it seems there will be little for the crypto industry to look forward to on stage in Chicago. But given how unpredictable and dramatic the race has already been, a lot can change over the next 76 days.

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Examining crypto Wall Street ties: The good and the bad | Opinion

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On August 5, 2024, a cascade of opposing political and economic news triggered a massive drop in both US and Asian markets. This was swiftly followed by a sharp decline in the cryptocurrency market, which saw its total capitalization plummet by 12% within 24 hours. The broad stock selloff, driven by concerns over the economic outlook and escalating geopolitical tensions, intensified market volatility and dampened investor sentiment across the board, spilling over into the crypto market.

The recent market turbulence is a stark reminder of the growing interdependence between cryptocurrency and traditional financial markets. As cryptocurrencies gain mainstream acceptance and attract significant institutional capital, the lines between these markets are becoming increasingly blurred. While beneficial in many ways, this interconnection also means that tradfi shocks reverberate through the crypto space with greater intensity and speed.

The double-edged sword of institutional capital

The crypto industry has undoubtedly seen a significant influx of institutional capital in recent years. Still, this development has been a double-edged sword. On the one hand, the entry of institutional investors has driven crypto’s mass adoption and contributed to the industry’s maturation. On the other hand, it has also created a stronger correlation between the crypto and tradfi markets. When the stock market crashes, the crypto one often follows suit. 

Institutional capital has brought legitimacy and credibility to the cryptocurrency market. Financial giants and large investment funds entering the space have injected substantial liquidity and enhanced the industry’s image as a viable investment option. This influx has facilitated the development of sophisticated financial products and services—crypto futures, options, and ETFs, which have further integrated cryptocurrencies into the broader financial ecosystem.

However, this integration comes with its own set of challenges. The increased participation of institutional investors means that the crypto market is no longer insulated from the broader economic and geopolitical forces that drive traditional markets. When there is a broad stock selloff, as we witnessed recently, the ripple effects are felt in the crypto market as well due to this interconnectedness that amplifies the volatility and susceptibility of the crypto market to external shocks.

Monetary policy: The invisible hand shaping crypto prices

Monetary policy shifts, particularly changes in interest rates, profoundly impact cryptocurrency prices. The recent bets on US interest-rate cuts have sparked discussions about their potential positive effects on the crypto market. Historically, monetary tightening has posed significant challenges for the crypto industry. The recent significant liquidations in crypto bets serve as a stark reminder of this dynamic. When interest rates rise, liquidity tends to tighten, leading to a contraction in the availability of capital for investment in riskier assets like cryptocurrencies.

When central banks lower interest rates or engage in quantitative easing, the resulting increase in liquidity can flow into higher-risk assets, including cryptocurrencies. This influx of capital can drive up crypto prices as investors seek better returns than traditional assets. Conversely, when central banks shift towards monetary tightening to curb inflation or stabilize the economy, the reduced liquidity and higher borrowing costs can lead to a pullback from riskier investments, including crypto.

The recent market crash underscored this monetary policy impact. As central banks around the world grapple with inflationary pressures and the need to stabilize their economies, their policy decisions have direct and immediate consequences for the cryptocurrency market. Investors need to stay attuned to these developments and understand how shifts in monetary policy can influence market dynamics.

The inevitable crises and why we need to prepare

Despite the challenges, the crypto industry needs institutional capital to continue its growth trajectory. Institutional investments bring financial resources, legitimacy, and a broader acceptance of cryptocurrencies as a viable asset class. However, this reliance on institutional capital still means that the crypto market is increasingly influenced by the same factors that drive the tradfi ones. This growing connection highlights the inevitability of crises like the one we are currently experiencing—and also presents an opportunity for the crypto industry to evolve and mitigate the impact of such crises.

The crypto market’s susceptibility to external shocks is not inherently negative. It reflects the maturing nature of the industry and its integration into the global financial system. Still, it requires a more sophisticated approach to risk management. Crypto firms must recognize the interconnected nature of financial markets and prepare accordingly.

Strategies for resilience

One approach to enhancing the crypto industry’s resilience is the creation of reserve funds. Setting aside funds during stability periods can create a buffer to cushion the impact of market downturns—a concept akin to the tradfi practice of maintaining reserves. 

Reserve funds act as a financial safety net, providing liquidity during periods of market stress. Proactive reserves management lets firms weather short-term volatility without resorting to panic selling or other reactionary measures that could exacerbate market downturns.

Another critical measure is implementing proof-of-reserve mechanisms to demonstrate a commitment to transparency and accountability. These mechanisms involve third-party audits and regular reporting to ensure that firms maintain adequate reserves to cover their liabilities. This transparency reassures investors that their assets are secure and that the firm is operating in a financially sound manner.

As we look forward, it is clear that the relationship between the crypto and tradfi markets will only deepen. The key lies in our ability to adapt and implement measures that will maintain the long-term stability and resilience of the crypto industry. The integration of institutional capital into the crypto market is both a blessing and a curse. It drives the industry’s growth and maturation but also ties it more closely to the tradfi markets, making it vulnerable to the same economic and geopolitical forces. 

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Hong Kong’s crypto ambitions tested by licensing issues: report

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Hong Kong’s crypto hub ambitions face hurdles as more than a dozen exchanges struggle to secure full licenses due to regulatory concerns.

Cryptocurrency exchanges in Hong Kong seem to be grappling with challenges in securing full licenses as the city pushes to become a crypto hub, per a Bloomberg report, which cites people familiar with the matter.

The city’s Securities and Futures Commission has reportedly identified unsatisfactory practices during on-site inspections of 11 “deemed-to-be-licensed” exchanges, raising doubts about their ability to meet full licensing requirements. The investigation revealed that some exchanges were overly reliant on a small number of executives to manage client asset custody, while others are not “properly guarding against cybercrime risks,” the report says.

The exchanges under scrutiny reportedly include big names such as Crypto.com and Bullish as well as local trading platforms like HKbitEX and PantherTrade.

So far, only two platforms — OSL and HashKey — hold full licenses in Hong Kong. While the SFC aims to issue additional licenses by the end of 2024. the process has already led to the withdrawal of 12 applications, including those from Bybit, Huobi HK, and OKX.

Hong Kong scrutinizes regulation for crypto exchanges

The SFC’s findings emerge as the regulator intensifies its efforts to enforce strict compliance among crypto platforms, with a particular focus on safeguarding client assets and enforcing robust know-your-client protocols.

This heightened scrutiny follows a scandal involving JPEX, an unlicensed crypto platform accused of defrauding over 2,600 victims of more than $200 million. The SFC previously reported that JPEX and crypto influencers had made false or misleading claims on social media, falsely suggesting that the exchange had applied for a virtual asset trading platform license in Hong Kong.

However, the regulator later highlighted that JPEX had not submitted any such application, despite its assertions of being a “licensed and recognized platform for facilitating the trading of digital assets and virtual currency.”

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Nigerian tax authority to introduce crypto regulation bill in September: report

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The Federal Inland Revenue Service, Nigeria’s tax authority, plans to introduce a bill to regulate the cryptocurrency sector by the end of 2024.

Speaking at a recent stakeholder engagement session with the National Assembly’s Finance Committees, FIRS Executive Chairman Zacch Adedeji said the country is set to propose a bill that would introduce laws to regulate the crypto sector, mitigate the risks involved, and benefit the nation’s economy, according to a Vanguard report.

“Today, we cannot run away from cryptocurrency. But as we are here today, there is no law anywhere in Nigeria that regulates cryptocurrency. But it is the new thing that is happening, and we cannot run away from them.”

Zacch Adedeji, Executive Chairman of the Federal Inland Revenue Service

The new regulation is part of a broader effort to modernize existing laws in the taxation system to keep up with Nigeria‘s evolving economic landscape. Adedeji urged the FIRS’s collaboration with lawmakers to implement the bill, with the first iteration expected to be introduced in September.

Also speaking at the session, Senator Mohammed Musa, chairman of the Senate Committee on Finance, acknowledged that cryptocurrency has become the “largest way of making money,” adding that the bill would introduce regulations to help Nigeria generate revenue for infrastructure and human capital development.

Nigeria focuses on crypto as its adoption grows

The recent announcement follows calls from Niegria’s Finance Minister, Wale Edun, who has requested Nigeria’s newly inaugurated Securities and Exchange Commission board to focus on regulating the cryptocurrency sector.

Approved by President Bola Tinubu in April, the seven-member SEC board has introduced a compliance program to help crypto businesses comply with local regulations. Further, the commission has announced plans to revamp its digital asset issuance process to include Virtual Assets Service Providers.

The West African country has also turned its attention to blockchain implementation. The National Information Technology Development Agency, Nigeria’s IT sector regulator, has recently restructured the National Blockchain Policy Steering Committee, a government-appointed body that oversees the implementation and regulation of blockchain technology within the country.

More recently, the NITDA disclosed plans to deploy research centers across Nigeria, focusing on key technologies like blockchain and artificial intelligence as part of its efforts.

Cryptocurrencies have become a lifeline for developing countries like Nigeria, where economic difficulties have driven residents to seek alternative means of retaining their wealth. However, this growing reliance has also highlighted the need to regulate the crypto sector, often plagued by illicit activities. As crypto.news reported earlier, Ghana, another key player in the region, also introduced draft guidelines to address these challenges.

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Hybrid crypto exchanges will inevitably reign in the market | Opinion

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As we start to see renewed interest in crypto—with prices hovering near their all-time highs and prominent people and institutions discussing the industry—building a robust crypto exchange is essential.

Crypto traders’ standards for an exchange are higher than ever. They are looking for a sleek user experience, architecture that supports high throughput and low latency, and top-notch security. The latter is especially important given the industry is still recovering from the implosion of FTX and the domino effect it had on other businesses in the space. 

While centralized exchanges excel at building beautiful user interfaces and intuitive user experiences, they operate at speed by custodying users’ funds for them. As the industry has seen many times throughout crypto’s history, funds that the users themselves don’t control can be mismanaged by fraudulent actors. Additionally, CEXs possess the authority to limit access to accounts, such as freezing funds or halting withdrawals. As the crypto adage goes: Not your keys, not your coins. 

Decentralized exchanges, on the other hand, grant users complete control over their funds with self-custody. They leverage blockchain technology and smart contracts to execute trustless trade and settlement. However, this architecture can be clunky and complex for users to navigate. It comes with trade-offs in throughput and latency, the absence of advanced trading features (like advanced order types and conditions), and can also deal out significant fees to pay gas for settlement on a blockchain. 

A new crop of crypto entrepreneurs is thinking about exchange architecture differently. They are looking to combine aspects of a centralized and decentralized exchange with building on the best of both worlds. Enter hybrid crypto exchange. 

A better trading engine for a better crypto trader

CEXs from the last cycle, including Coinbase and Binance, built their businesses by copying the UI of broker platforms and mimicking the mechanics of broker platforms and the UI of fintech apps. They focused on user-friendly UI, robust mobile apps, competitive fees, and an extensive selection of coins and tokens. 

The centralized trading infrastructure offers high throughput and low latency, which is what the world demands for crypto trading. Going deeper, high throughput and low latency enable better liquidity, as market makers can reprice quicker. They also allow for more efficient margin usage, as a centralized risk engine enables the exchange to offer higher leverage. Centralization enables advanced trading features and logic, such as advanced order types and conditions. 

Aside from performance, it allows exchanges to have more control over compliance. CEXs control what customers have access to their platform and can manage the access of those users by implementing robust blockchain analysis, fincrime, and compliance programs. In the wake of FTX, lawmakers and enforcement agencies have been clamping down on the industry, dishing out huge fees and even jail time to businesses and entrepreneurs that are found to be skirting regulations. 

So, to sum up, that’s why the hybrid exchange model inherits the bright side of centralization. The trading architecture is kept centralized to a large extent. UX is also inherited from CEX because DEXs simply lack features, such as simple account creation, which eliminates the need for users to already have a wallet before interacting with the exchange. DEXes are also limited in their on- and off-ramps, fee abstraction, and advanced trading analytics. Especially as another batch of crypto traders enters the space during what appears to be the beginning of a bull run, a powerful feature set on top of a polished user experience is critical. 

It all sounds like a flawless victory for centralization so far. The question is, what do hybrid exchanges inherit from decentralized ones? The answer is simple: The essential feature that enables trust in crypto trading. And centralization has a dark side.  

Give users the keys

Hybrid exchanges still pull from DEX concepts by utilizing blockchain technology to secure funds. Users self-custody their funds, and trades are settled on the blockchain at various periods. Another crucial trait is the on-chain validation of the trading logic, which will prevent operator fraud. As such, trust is provable, and transparency is immutable. 

Operator fraud is one of the most significant risks in crypto. CEX’s control over funds is beneficial for compliance reasons; however, it grants the authority to limit access to accounts, such as freezing funds or halting withdrawals. The collapse of FTX certainly heightened concerns over an operator’s access to user funds. Yet, FTX wasn’t the first or only exchange to mishandle user funds and call into question the CEX model. One of the first-ever crypto exchanges, MtGox, completely shut down and filed for bankruptcy in early 2014 because of an undetected theft over many years that drained the exchange of more than 850,000 Bitcoin (BTC). In 2018, Canadian exchange QuadrigaCX went dark and was later revealed to be a Ponzi scheme, causing the loss of roughly $190 million in user funds. 

These continued instances highlight the importance of self-custody and trustless on-chain settlement, whereby users hold the keys to their own coins instead of trusting a centralized entity that isn’t fully transparent to retain their keys. 

Scaling tech for cutting costs

In the derivatives market, traders often transact in large volumes, which can accrue significant fees. There is no feeless trading. CEXs and DEXs charge fees for trading, but DEX users have an additional cost to settle all their trades on a blockchain. These fees fluctuate depending on the overall usage of the blockchain at any given period. Earlier this year, in March, Ethereum transaction costs skyrocketed to nearly a two-year high due to increased speculation in meme tokens.

The hybrid exchange approach simplifies the fee structure because trading is centralized and relies on layer-2 technology to boost scalability while keeping transaction fees low. Rollups are one such scalability solution that processes transactions on a separate network before bundling the transaction data into batches to submit and settle to the main chain. 

Now’s the time to go hybrid

Blending features from centralized and decentralized exchange architecture is an obvious choice in a market that’s becoming more mature and competitive. 

The speed, usability, and design of CEX help users of all levels of technical know-how trade crypto easily. And the security provided by implementing aspects of DEX will create an ecosystem of trust and reliability that gives users peace of mind. 

The hybrid crypto exchange is poised to be the winning business model in the next bull run, highlighting that it’s not always about reinventing the wheel as much as it’s about creatively putting the pieces together. It’s not a one-size-fits-all industry; it won’t have a one-size-fits-all solution.

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The US to fine for social media boosting: How crypto bloggers may suffer

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The U.S. Federal Trade Commission has banned fake reviews and recommendations. What does it mean for crypto?

According to the latest news, the decision introduces financial and administrative restrictions on individuals who “sell or buy fake social media influencer indicators.”

The FTC leadership unanimously supported the introduction of the new rules. They will take effect 60 days after publication in the Federal Register:

Fake reviews not only waste people’s time and money, but pollute the marketplace and divert business away from honest competitors.

Lina M. Khan, FTC chair

The new policy also applies to crypto influencers. With the release of the latest ban, unfair methods to boost a channel or page on a social network will lead to fines and sanctions from the authorities. The FTC will also prohibit using tools that use artificial intelligence technologies for such purposes.

At the same time, the ban only applies to cases where the account owner specifically ordered or otherwise facilitated such a service. The rules also mention that fines will be imposed if the mentioned methods are used to obtain benefits for commercial purposes.

Social media investment scams continue to grow

Recently, the FTC has noted a sharp increase in social media investment scams, especially in cryptocurrency. These include fake messages promising guaranteed high returns with little or no risk.

FTC consumer education specialist Andrew Raio noted that scammers are increasingly targeting social media users on major platforms with fraudulent investment opportunities, especially crypto:

If you reply, the scammer will say they’ve made lots of money investing in Bitcoin or another cryptocurrency. And they can get you a unique opportunity that guarantees significant returns with little or no risk. But these are all lies designed to convince you and get your money.

The victim is redirected to a fake investment site or app where their investment account looks profitable. However, once the scammer has squeezed out as much money as possible, they disappear, leaving the victim with nothing.

Crypto romance scams

The FTC has also warned about cryptocurrency scammers offering investment advice under the guise of romantic partners.

The regulator noted that scammers build an emotional connection with you, making you more likely to believe they are experts in investing in cryptocurrency.

The scam usually begins with an unsolicited social media contact. The scammer carefully studies the victim’s profile to establish trust and a connection. Once a relationship is established, the conversation turns to investments, with the scammer claiming their top priority is the victim’s financial security.

More restrictions for the crypto sphere are coming

In addition to crypto influencers, betting platforms have previously come under the scrutiny of the U.S. authorities.

Earlier in August, the U.S. Congress called on the Commodity Futures Trading Commission to ban political bets. Authorities noted that they could influence the outcome of the U.S. presidential election.

Five senators and three members of the House of Representatives sent an open letter to CFTC Chairman Rostin Benham. They stated that such mechanisms could undermine public confidence in the electoral system.

The initiative is also aimed at the Polymarket betting platform, where crypto community members guess the presidential election’s outcome. According to the latest data, the bet volume has exceeded $606 million. Vice President Kamala Harris is in the lead — users estimate her chances of winning at 53%, and 44% of people who placed a bet believe in former President Donald Trump’s triumph.

Source: Polymarket

At the same time, the total political section on the platform in terms of funds exceeds $1 billion. Polymarket participants bet on hundreds of events.

U.S. politicians have suddenly fallen in love with cryptocurrencies

Despite the statements of individual regulators and government officials, politicians have also increased their interest in cryptocurrencies in the run-up to the presidential elections. In particular, Trump, who in 2018 instructed the U.S. Treasury to end Bitcoin (BTC), and in 2021, called it a fraud and asked for regulating the industry.

Although the Democrats have not explicitly stated their support for digital assets, they have not recently called for increased regulation or a ban. In addition, with the approval from above, the Securities and Exchange Commission would have approved even one of the documents required to list the Ethereum ETF.

Therefore, it is evident that American politicians have taken a course on a loyal attitude towards cryptocurrency.

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