According to Bloomberg, the SEC is looking into whether Binance's initial coin offering of its Binance coin (BNB) token in 2017 was an unregistered security offering that should have been registered with the regulatory agency. CoinDesk reports: Without commenting on the details of the reported probe, a spokesperson for Binance told CoinDesk via email, "As the industry has grown at a rapid pace, we have been working very diligently to educate and assist law enforcement and regulators in the U.S. and internationally, while also adhering to new guidelines. We will continue to meet all requirements set by regulators." BNB was trading down 4% after news of the report came out.

The SEC is also investigating market-making companies owned or partially owned by Binance CEO Changpeng Zhao that do business with Binance.US, a U.S.-based affiliate of the global exchange, [...]. According to the report, one of the SEC's focuses is on whether Binance.US is wholly independent of the global exchange and whether employees may be involved in insider trading.

New York lawmakers have passed a bill that would temporarily ban new bitcoin mining operations. Early on Friday, state senators voted 36-27 to pass the legislation. It's now bound for the desk of Governor Kathy Hochul, who will sign it into law or veto the bill. The law would come into effect immediately after it's signed. From a report: An attempt to enact similar legislation last year hit a wall when the New York State Senate passed it but Assembly members did not. The latest bill passed the Assembly in April. The legislation seeks to establish a two-year moratorium on licenses for cryptocurrency mining operations that use power-hungry proof-of-work authentication methods for validating blockchain transactions. Right now, bitcoin and ethereum (the two largest cryptocurrencies) fall under that category, though the latter is shifting to a different setup. The moratorium only covers mining operations that run on carbon-based power sources. Any that harness entirely renewable energy sources or an alternative to proof of work that requires less power won't be affected. Existing operations and those already going through a permit renewal process won't be impacted either.

Billionaire bitcoiners Cameron and Tyler Winklevoss are laying off 10% of the workforce at Gemini, a first for the U.S.-based cryptocurrency exchange and custodian. CNBC reports: The twins announced in a blog post on Thursday morning that the industry is in a "contraction phase" known as "crypto winter," which has been "further compounded by the current macroeconomic and geopolitical turmoil." "We are not alone," the memo continued. Fellow crypto exchange Coinbase recently reported that revenue had fallen 27% from a year ago, as had overall usage.

Gemini -- which has been around since 2014 and is valued at $7.1 billion as of its last funding round -- has 1,033 people on its payroll, according to PitchBook, which translates to about 100 employees affected by today's layoffs. CNBC reached out to Gemini to ask for the exact figure, but the press team declined to comment beyond the blog post. As for next steps, Gemini has closed its physical offices today in order to protect employee privacy. Impacted team members will receive a calendar invite for individual conversations about separation packages and health care benefits. On Friday, remaining employees will take part in a "company-wide standup" to talk about its future.

The memo says that Gemini wants to focus only on products that are critical to its mission -- and team leaders will assess whether their teams are "right-sized" for the "current, turbulent market conditions that are likely to persist for some time." "Today is a tough day, but one that will make Gemini better over the long run," the brothers wrote in the staffwide memo.

Adam Neumann made his post-WeWork debut when Flowcarbon, a blockchain-based carbon credits company, announced that it has raised $70 million in its first round of funding. Neumann is both a founder and an investor in the startup. Reuters reports: The company aims to tap into the growing market for carbon credits companies buy to offset their greenhouse gas emissions as the world transitions to a low-carbon economy in the fight against climate change. Despite increasing demand, the market has drawn criticism for being fractured, opaque, hard to access and with question marks over the quality of some credits. To help fix this, Flowcarbon lets project developers sell their carbon credits through tokens, digital assets stored and traded using blockchain technology, allowing them to access cheaper funding and scale their projects more quickly.

"Our mission is to provide the financing necessary to scale projects that reduce or remove carbon from the atmosphere, in particular nature-based projects," said Chief Executive Dana Gibber. Nature-based projects could include those focused on reforestation, conservation or nature restoration. By "tokenizing," developers can access cheaper financing earlier in the life of their project by selling forward their credits, she said. Buyers, meanwhile, will have greater transparency over their holdings and a broader range of them can join in, including individuals, smaller companies and those in the crypto market.

The firm raised $32 million in the funding round led by Silicon Valley financiers Marc Andreessen and Ben Horowitz through their a16z crypto venture capital firm. Other investors included General Catalyst and Samsung Next. The balance was raised through the sale of a token - the Goddess Nature Token - backed by a parcel of certified carbon credits from nature-based projects over the last five years. More such tokens are planned with other parcels of credits. Further reading: WeWork Co-Founder Adam Neumann's New Crypto Project Sounds Like a Scam Within a Scam (Recode)

An anonymous reader quotes a report from BuzzFeed News: Actor and producer Seth Green was robbed of several NFTs this month after succumbing to a phishing scam that inadvertently threw a monkey wrench into the plan for his new animated series. The forthcoming show was developed from characters in Green's expansive NFT collection, but in light of the recent hack, the project's blatant crypto optimism has become a tragically ironic reminder of the industry's shadier side. On Saturday, Green teased a trailer for White Horse Tavern at the NFT conference VeeCon. A twee comedy, the show seems to be based on the question, "What if your friendly neighborhood bartender was Bored Ape Yacht Club #8398?" In an interview with entrepreneur and crypto hype man Gary Vaynerchuk, Green said he wanted to imagine a universe where "it doesn't matter what you look like, what only matters is your attitude."

Unfortunately for Green, what also matters is copyright law. And when the actor's NFT collection was pilfered by a scammer in early May, he lost the commercial rights to his show's cartoon protagonist, a scruffy Bored Ape named Fred Simian, whose likeness and usage rights now belong to someone else. "I bought that ape in July 2021, and have spent the last several months developing and exploiting the IP to make it into the star of this show," Green told Vaynerchuk. "Then days before -- his name is Fred by the way -- days before he's set to make his world debut, he's literally kidnapped." Green did not respond to a tweet from BuzzFeed News regarding the show.

On May 8, an anonymous scammer swiped four of Green's NFTs in a phishing scheme. Green mourned his "stolen" assets on Twitter, where he announced the losses of a Bored Ape, two Mutant Apes, and a Doodle, which were transferred out of Green's wallet after he unknowingly interacted with a phishing site. One of the Mutant Apes was flipped for $42,000, Motherboard reported. Transaction ledgers show the Bored Ape was also sold by the scammer to a pseudonymous collector known as "DarkWing84," who purchased it for more than $200,000. The NFT was then swiftly transferred to a collection called "GBE_Vault," which is where it currently sits. If the current owner "wanted to cause trouble for Seth Green they probably could, because that person becomes the holder" of the commercial usage rights, said Daniel Dubin, an intellectual property attorney at Alston & Bird LLP. [...] Seemingly aware of the problems his ape's new owner could cause, Green has spent the last several days tweeting at DarkWing84 in an attempt to reclaim the Bored Ape [...]. The NFT marketplace OpenSea said it has frozen the tokens and marked all four NFTs taken from Green with "suspicious activity" warnings.

"We do not have the power to freeze or delist NFTs that exist on decentralized blockchains; however, we do disable the ability to use OpenSea to buy or sell stolen items," said OpenSea spokesperson Allie Mack.

GameStop said on Monday it has launched a digital asset wallet that will allow gamers to store, send and receive cryptocurrencies and nonfungible tokens. From a report: The digital wallet will be able to be used across decentralized apps, which run on a blockchain and aren't controlled by a central authority, without players having to leave their web browsers, the company said in a statement. The GameStop wallet is a self-custodial Ethereum wallet, meaning the user controls the keys to their assets, not a third party. The wallet extension can be downloaded from Google's Chrome web store and will allow transactions on GameStop's NFT marketplace, which is expected to launch in the second quarter of the company's fiscal year.

Nicholas Weaver is a senior staff researcher at the International Computer Science Institute and lecturer in the computer science department at UC Berkeley. But he's also a raging cryptocurrency skeptic, arguing that cryptocurrency is useless and destructive, and should "die in a fire."

In a recent interview in Current Affairs he promulgates what he calls Weaver's Iron Law of Blockchain. "When somebody says you can solve X with blockchain, they don't understand X, and you can ignore them." So for those pushing cryptocurrency for "Banking the unbanked," Weaver points to M-Pesa, a payment system Vodafone started in Kenya in 2007 "about the same time as Bitcoin..." It has eaten the Third World. It's huge. Because it just basically attaches a balance to your phone account. And you can text to somebody else to transfer money that way.... So even with the most basic dumb phone you have easy-to-use electronic money. And this has taken over multiple countries and become a huge primary payment system. [Whereas] the cryptocurrency doesn't work."
Weaver also contends that when companies say they accept payments in Bitcoin, "They're lying." (They're using a service which pays them in "actual money" after performing conversions on any Bitcoin proferred-up by a customer.) He believes cryptocurrency is only seriously used for payments for ransomware and drug deals — the things that non-decentralized currencies are legally obligated to block. The reason I've gotten so sour on the cryptocurrency space is the ransomware. It's doing tens to hundreds of billions of dollars worth of damage to the global economy. And it only exists because people can pay in Bitcoin.
Weaver also believes cryptocurrency lets venture capitalists "carry out securities fraud as a business model" when they sell one of their startup's tokens to retail investors. This is blatantly an unlicensed security. This is blatant securities fraud, but they didn't commit the securities fraud. It was just the companies they invested in that did the securities fraud, and the SEC has not been proactively enforcing this. They only retroactively enforce against the initial coin offerings after they fail.... and when things fail, the only people to prosecute are the companies, not Andreessen Horowitz itself. So they've been able to make securities fraud a business in such a way that they are legally remote, so you will not be able to throw them in jail....

The SEC has the authority to stop those proactively rather than reactively. They choose not to.... Basically, there's a fear among regulators — that I think started in the '80s — of being accused of "stifling innovation." There's no innovation to stifle. So regulate away.
He's also skeptical of cryptocurrency's other supposed advantages. Weaver argues cryptocurrency incentivizes green power "the same way that a whole bunch of random shootings would incentivize bulletproof vests." And even as an investment vehicle, Weaver sees it as "a self-created pyramid scheme." [Y]ou have to keep getting new suckers in. As soon as the number of suckers dries up, it collapses. And because it's not zero-sum, but deeply negative-sum, there are actually a lot of mechanisms that can cause it to collapse suddenly to zero. We saw this just the other day with the Terra stablecoin and the Luna side token.
So when asked for the future of cryptocurrency, Weaver predicts "It will implode spectacularly." (By which he means it will "collapse greatly.") The only question is when. I thought it would have actually imploded a year ago. But basically, what we saw with Terra and Luna, where it collapsed suddenly due to these downward positive feedback loops — situations where basically the system is designed to collapse utterly and quickly — those will happen to the larger cryptocurrency space....

[T]he Washington Nationals just the other day started doing a lot of tweets for their business relationship with Terra. That was $5 million for five years prepaid in advance in cash. So for the next five years, the Washington Nationals are obliged to hype a cryptocurrency that failed spectacularly already.

Thanks to Slashdot reader sdinfoserv for sharing the article...

Last week America's Justice Department "launched its first criminal prosecution involving the alleged use of cryptocurrency to evade U.S. economic sanctions," reports the Washington Post. They cite a nine-page opinion from a federal judge approving the government's criminal complaint against an American "accused of transmitting more than $10 million worth of bitcoin to a virtual currency exchange in one of a handful of countries comprehensively sanctioned by the U.S. government: Cuba, Iran, North Korea, Syria or Russia.

"In the ruling, the judge called cryptocurrency's reputation for providing anonymity to users a myth." He added that while some legal experts argue that virtual moneys such as bitcoin, ethereum or Tether are not subject to U.S. sanctions laws because they are created and move outside the traditional financial system, recent action taken by the Treasury Department's Office of Foreign Assets Control [OFAC] require federal courts to find otherwise.

"Issue One: virtual currency is untraceable? WRONG ... Issue Two: sanctions do not apply to virtual currency? WRONG," Faruqui wrote...

"The Department of Justice can and will criminally prosecute individuals and entities for failure to comply with OFAC's regulations, including as to virtual currency," Faruqui said. In the opinion, Faruqui wrote that he adopted guidance issued in October by OFAC, which stated that sanctions regulations apply equally to transactions involving virtual currencies as those involving the U.S. dollar or other traditional fiat currencies.

Ari Redbord, who served in 2019 and 2020 as a senior adviser to the Treasury Department's undersecretary for terrorism and financial intelligence, called the case the first U.S. criminal prosecution targeting solely the use of cryptocurrency in a sanctions case. He said the ruling made clear such conduct is traceable and "immutable — in other words, transactions using cryptocurrency are forever.... What we are seeing is that the Department of Justice is going to actively go after actors that attempt to use cryptocurrency, but also that it is hard to use cryptocurrency to evade sanctions," Redbord said. "It shows, in many respects, cryptocurrency is not a good tool for sanctions evasion or money laundering."
In this case, The Register reports, "An unnamed American citizen allegedly used a US-based IP address to run an online payments platform" in a sanctioned country. The service advertised itself as being "designed to evade US sanctions" and claimed its transactions were untraceable, it was alleged. We're told the defendant bought and sold Bitcoin using a US-based online currency exchange using fiat currency from a US bank account.
The Post argues that this prosecution represents "a new U.S. criminal sanctions enforcement push targeting cryptocurrency transactions at a time of rising concern over the extent to which illicit actors can use or are using such methods to launder money or do business with countries the United States has cut off from the dollar..."

The collapse of the tokens linked to the Terra ecosystem, stablecoin terraUSD (UST) and Luna (LUNA), has led to some major investors coming clean and detailing their losses. Two more backers of Terra are disclosing exactly how their balance sheets have been affected. CoinDesk reports: Delphi Digital, a research firm and boutique investor, said in a blog post that it always had concerns about the structure of UST and LUNA, but believed that the sizable reserves in the Luna Foundation Guard, a nonprofit that supports the Terra network, would prevent the unthinkable from happening. The firm wrote that in the first quarter of 2021, Delphi Ventures Master Fund purchased a small amount of LUNA, worth 0.5% of its net asset value (NAV) at the time. That position grew as LUNA's value increased and the fund increased its holdings, including a $10 million investment in the LFG's funding round in February. That investment is now worthless. While Delphi said that it didn't sell any LUNA, it's now sitting on "a large unrealized loss."

One of Terra's other prominent backers is Hashed, an early-stage venture fund based in Seoul, South Korea. The company played a part in Terra's 2021 venture round, where it helped raise $25 million according to Crunchbase data. Publicly, Hashed has said that it is "financially sound" and Hashed Ventures hasn't been affected by the crisis. Hashed didn't immediately respond to a request for comment, but on-chain data shows that the firm had staked over 27 million in LUNA on the Columbus 3 mainnet, 9.7 million in LUNA for the Columbus 4 mainnet and 13.2 million in LUNA on the current Columbus 5 mainnet. All in all, Hashed's losses amount to over $3.5 billion using pricing data from early April.

An 18-year-old graduate student exploited a weakness in Indexed Finance's code and opened a legal conundrum that's still rocking the blockchain community. Then he disappeared. An excerpt from a report: On Oct. 14, in a house near Leeds, England, Laurence Day was sitting down to a dinner of fish and chips on his couch when his phone buzzed. The text was from a colleague who worked with him on Indexed Finance, a cryptocurrency platform that creates tokens representing baskets of other tokens -- like an index fund, but on the blockchain. The colleague had sent over a screenshot showing a recent trade, followed by a question mark. "If you didn't know what you were looking at, you might say, 'Nice-looking trade,'" Day says. But he knew enough to be alarmed: A user had bought up certain tokens at drastically deflated values, which shouldn't have been possible. Something was very wrong. Day jumped up, spilling his food on the floor, and ran into his bedroom to call Dillon Kellar, a co-founder of Indexed. Kellar was sitting in his mom's living room six time zones away near Austin, disassembling a DVD player so he could salvage one of its lasers. He picked up the phone to hear a breathless Day explaining that the platform had been attacked. "All I said was, 'What?'" Kellar recalls.

They pulled out their laptops and dug into the platform's code, with the help of a handful of acquaintances and Day's cat, Finney (named after Bitcoin pioneer Hal Finney), who perched on his shoulder in support. Indexed was built on the Ethereum blockchain, a public ledger where transaction details are stored, which meant there was a record of the attack. It would take weeks to figure out precisely what had happened, but it appeared that the platform had been fooled into severely undervaluing tokens that belonged to its users and selling them to the attacker at an extreme discount. Altogether, the person or people responsible had made off with $16 million worth of assets. Kellar and Day stanched the bleeding and repaired the code enough to prevent further attacks, then turned to face the public-relations nightmare. On the platform's Discord and Telegram channels, token-holders traded theories and recriminations, in some cases blaming the team and demanding compensation. Kellar apologized on Twitter to Indexed's hundreds of users and took responsibility for the vulnerability he'd failed to detect. "I f---ed up," he wrote. The question now was who'd launched the attack and whether they'd return the funds. Most crypto exploits are assumed to be inside jobs until proven otherwise. "The default is going to be, 'Who did this, and why is it the devs?'" Day says.

As he tried to sleep the morning after the attack, Day realized he hadn't heard from one particular collaborator. Weeks earlier, a coder going by the username "UmbralUpsilon" -- anonymity is standard in crypto communities -- had reached out to Day and Kellar on Discord, offering to create a bot that would make their platform more efficient. They agreed and sent over an initial fee. "We were hoping he might be a regular contributor," Kellar says. Given the extent of their chats, Day would have expected UmbralUpsilon to offer help or sympathy in the wake of the attack. Instead, nothing. Day pulled up their chat log and found that only his half of the conversation remained; UmbralUpsilon had deleted his messages and changed his username. "That got me out of bed like a shot," Day says.

Tether, the operator of the world's most used cryptocurrency, said it had reduced the amount of commercial paper in the reserve backing its $74 billion stablecoin, revealing information about its holdings while dollar-pegged assets face tougher scrutiny from regulators. From a report: Tether Holdings had assets totaling at least $82.4 billion as of March 31, along with $82.2 billion in liabilities relating to the digital tokens it issues, according to an assurance from Cayman Islands-based MHA Cayman. Tether is the issuer of USDT, a stablecoin which relies on a reserve of US dollar and dollar-equivalent assets to maintain a one-to-one peg with the currency. The quality of those reserves have previously been called into question for an over-reliance on assets with limited liquidity, with criticism levied at Tether over its lack of transparency on the matter.

The crypto company was brought under an intense spotlight over the last week following the collapse of algorithmic stablecoin Terra, which briefly knocked USDT off its peg with the dollar during a period of mass market instability. In a statement on Thursday, Tether noted a 17% decrease in its commercial paper holdings to $20.1 billion compared to the previous quarter, and added that it had completed a further 20% reduction on that amount since April 1, which will be included in its upcoming report for the second quarter. Conversely, Tether said it had increased its investments in money market funds and US Treasury bills, rising more than 13% to a total of $39.2 billion. The average rating of its commercial paper and certificates of deposit has increased from A-2 to A-1, it added, while secured loans have decreased by $1 billion.

While the US extended its leading position as the dominant location for Bitcoin mining, China has reemerged as the second-largest locale despite a government ban on the activity last year. From a report: The US accounted for 37.84% of global hashrate, a measure of computing power used to extract the digital currency, between September 2021 to January, according to the Cambridge Centre for Alternative Finance, in a report released on Tuesday. The hashrate, also responsible for securing the Bitcoin network, has made a strong comeback to new highs after falling last year.

Following the mining ban in China last year, the country has seen a sudden surge in activity through "covert mining operations" and has "re-emerged as a major mining hub" grabbing 21.11% of global hashrate, according to the CCAF. "This strongly suggests that significant underground mining activity has formed in the country, which empirically confirms what industry insiders have long been assuming," CCAF wrote in the report. In May (2021), Beijing intensified its efforts to curb the cryptocurrency market. It seems covert mining is still happening in China through routed through virtual private networks that make it appear the computers are operating in another country.

An anonymous reader quotes a report from Quartz: On Feb. 2, the city of Miami cashed out its cryptocurrency MiamiCoin for the first time, depositing $5.25 million into city coffers. Miami mayor Francis Suarez hailed it as a "historic moment" and predicted the cryptocurrency could one day even replace municipal taxes as the government's primary source of funding. MiamiCoin's creator, an organization called CityCoins, has been no less enthusiastic, portraying the coin as a financial experiment that will empower citizens with a "community-driven revenue stream" while spurring new digital city services.

Miami is not the only city with big cryptocurrency dreams. CityCoins announced a similar cryptocurrency for New York in November 2021, and plans to release a coin for Austin, Texas, soon. Other cities have launched their own crypto ventures: Forth Worth, Texas, for example, will soon be running bitcoin mining rigs in city hall. But only Miami's mayor has thrown his full endorsement behind a CityCoin-branded cryptocurrency so far. After promoting MiamiCoin to residents and investors since its launch in August, the city of Miami received millions of dollars through its agreement with CityCoins. Over the last nine months, however, MiamiCoin has lost nearly all of its value, falling about 95% from its September peak to just $0.0032 as of May 13. Its rapid descent has burned investors on the way down, muting the dreams of Miami's city leaders, and possibly raising red flags for regulators now investigating cryptocurrency transactions.

Bitcoin has no future as a payments network because of its inefficiency and high environmental costs, according to one of crypto's most influential chief executives. From a report: Sam Bankman-Fried, founder of the digital asset exchange FTX, said the proof of work system of validating blockchain transactions, which underpins bitcoin, was not capable of scaling up to cope with the millions of transactions that would be needed to make the cryptocurrency an effective means of payment. "The bitcoin network is not a payments network and it is not a scaling network," said Bankman-Fried. His comments came as the fast-growing cryptocurrency market was hit by a punishing sell-off that left bitcoin down by more than 35 per cent since January, at its lowest level since late 2020.

Bitcoin is still seen by some crypto enthusiasts as a way to conduct everyday transactions. Countries such as El Salvador and the Central African Republic have adopted Bitcoin as a legal tender. But recent research by academics in the US found that Bitcoin has scarcely been used for daily payments in El Salvador, despite the rollout of bitcoin ATMs and other measures to encourage its use. The 30-year-old billionaire, who has expanded FTX into one of the world's largest virtual asset exchanges, said an alternative type of blockchain known as proof of stake, or other technological innovations, would be required to create a functional crypto payments network. In a Twitter thread, Bankman-Fried clarified: "To be clear I also said that it does have potential as a store of value. The BTC network can't sustain thousands/millions of TPS, although BTC can be xfered on lightning/L2s/etc."

Crypto investors in Germany won't pay tax on sales of digital assets such as bitcoin and ether -- as long as they're held for more than one year. From a report: Germany's Federal Ministry of Finance shared the ruling in a 24-page document, which formally defined blockchain concepts such as mining, staking, airdrops and masternodes within the context of the country's tax system. The decree marks the first time Germany has issued nationwide tax guidance on cryptocurrency. It was crafted in close consultation with the country's 16 federal states, as well as top financial institutions. Government ministers had held a hearing last summer to gauge sentiment among local crypto associations such as Bitkom and other market participants -- including individual investors. One of the most pressing questions related to whether lending or staking cryptocurrency extends the tax-free period on digital asset sales to 10 years, as is the case with buy-to-let properties.

Luna, the sister cryptocurrency of controversial stablecoin TerraUSD, has collapsed to nearly $0. From a report: TerraUSD, or UST, has been dragged into the spotlight in the last few days after the so-called stablecoin, which is supposed to be pegged one-to-one with the U.S. dollar, fell sharply below the $1 mark. UST is an algorithmic stablecoin which uses code to maintain its price at around $1 based on a complex system of minting and burning. A UST token is created by destroying some of the related cryptocurrency luna to maintain the dollar peg. Unlike rival stablecoins Tether and USD Coin, UST is not backed by any real-world assets such as bonds. Instead, the Luna Foundation Guard, a nonprofit created by Terra's founder Do Kwon, is holding about $3.5 billion of bitcoin in reserve. But in times of market volatility, such as this week, UST is being tested. Its peg has been lost and now investors are rushing to dump the associated luna token. Luna's price has plunged from around $85 a week ago to trade at around 3 cents on Thursday, according to data from CoinGecko, making the cryptocurrency almost worthless. The Luna token was trading at $121 last month. At the time of publication, Binance, the world's largest cryptocurrency exchange, has delisted Luna Futures-USDT margined contract.

Global market regulators are likely to launch a joint body within the next year to better co-ordinate cryptocurrency rules, a senior watchdog official has said. From a report: Ashley Alder, chair of the International Organization of Securities Commissions (IOSCO) said the boom in digital currencies such as bitcoin was one of the three main areas authorities were now focused on, alongside COVID and climate change. "If you look at the risks we need to address, they are multiple and there is a wall of worry about this (crypto) in the conversations at an institutional level," Alder said during an online conference organised by the OMFIF thinktank on Thursday. He cited cyber security, operational resilience, and a lack of transparency in the crypto world as the key risks that regulators are lagging behind on. Focus on crypto markets has intensified again this week amid more wild volatility that has long-alarmed watchdogs.

An anonymous reader quotes a report from Bloomberg: President Nayib Bukele's Bitcoin gambit is becoming onerous for cash-strapped El Salvador but that isn't stopping him from adding to his stockpile. Bukele's bought 2,301 Bitcoins for the government since making them legal tender back in September, based on his announcements on Twitter. That includes a purchase of 500 coins yesterday as their price plunged below $31,000, extending a wild six-month sell-off. Those tokens are worth $74 million today. That's 28% less than the $103 million Bukele paid for them, according to calculations by Bloomberg.

Bukele has shown himself to be a true believer in crypto, winning attention and admirers from around the world in the process, and says he trades the nation's stockpile of coins on his phone. The 40-year-old has said he will push ahead with plans to issue a $1 billion blockchain bond to fund the construction of Bitcoin City, an income and capital gains tax-free jurisdiction he hopes to create on the country's coast. Bukele tweeted pictures on Monday of a mockup for the planned city, which includes an international airport. It would use geothermal energy from a nearby volcano. According to JPMorgan's emerging market bond index, El Salvador's dollar bonds have pluged 24% this year, "as concern mounts that the government will fail to pay back $800 million of notes that come due in January," notes Bloomberg. "Moody's cut the government's credit rating to Caa3 last week, citing an increased risk of default."

An anonymous reader shares a report: Hidden away in Coinbase Global's disappointing first-quarter earnings report -- in which the U.S.'s largest cryptocurrency exchange reported a quarterly loss of $430 million and a 19% drop in monthly users -- is an update on the risks of using Coinbase's service that may come as a surprise to its millions of users. In the event the crypto exchange goes bankrupt, Coinbase says, its users might lose all the cryptocurrency stored in their accounts too.

Coinbase said in its earnings report Tuesday that it holds $256 billion in both fiat currencies and cryptocurrencies on behalf of its customers. Yet the exchange noted that in the event it ever declared bankruptcy, "the crypto assets we hold in custody on behalf of our customers could be subject to bankruptcy proceedings." Coinbase users would become "general unsecured creditors," meaning they have no right to claim any specific property from the exchange in proceedings. Their funds would become inaccessible.

40 days ago Bitcoin sold for $47,454. It's price now is $34,007 — a drop of 28%.

About a third of that drop happened this week, as "Bitcoin, ethereum and other major cryptocurrencies have fallen sharply," Forbes reports, "wiping around $200 billion from the crypto market in just a matter of days (though some fear the bitcoin price could fall far further)." Bitcoin is now at its lowest prince since last July, "in the aftermath of the Federal Reserve's biggest interest rate hike in years". Ethereum and other top ten luna, solana, cardano and avalanche are also struggling with market sentiment falling to lows not seen since January.... Smaller cryptocurrencies that have outpaced the likes of bitcoin and ethereum in recent months have fallen harder during this latest crash. "The future of individual coins or tokens remains dubious, the law remains in control of such solicitations and the approval of social media giants such as Elon Musk," added Tammy Da Costa, an analyst at DailyFX.
CNBC notes the drop occurred "after a broader stock sell-off in the U.S. last week," but points out that bitcoin "is now down 50% from its peak price of $67,802.30 in November 2021."