Crypto Outlook at the World Economic Forum
Cryptocurrency firm Genesis Global Capital plans to file for bankruptcy as early as this week, Bloomberg reported today.
The bankruptcy filing has been expected since the November fall of cryptocurrency exchange FTX.
Meanwhile, the US Department of Justice announced that Anatoly Legkodymov, the Russian operator of China-based crypto exchange Bitzlato, has been arrested. Bitzlato was a crypto exchange that allegedly worked with darknet black market Hydra Market, which dealt in illicit trading and served as a safe haven for ransomware attackers, according to the DOJ.
The US Department of Justice released a vague statement on Wednesday that it would “announce major, international cryptocurrency enforcement action,” and noted that the US Treasury Department would also issue its own statement.
The announcement comes at a time when former FTX Crypto Exchange CEO Sam Bankman-Fried faces charges of wire fraud, securities fraud and conspiracy. The DOJ stressed that criminals using the crypto space for scams and other criminal activities should be aware that the agency will use “every tool” to suppress their activities.
Mr Bankman-Fried’s company – long considered one of the largest crypto exchanges alongside Binance – has declared bankruptcy after allegedly using and losing client funds as investment capital.
Crypto Firms Slash Davos Visibility After Year of Losses and Scandals
In recent years, crypto companies have dominated the boardwalk at the World Economic Forum in Davos, but this year they appear to have reduced their visibility, CNBC reports.
With the exception of a single orange flash crypto advertising sports car, crypto company ads would have been much less prominent this year.
An NFT store that sold digital tokens alongside images shut down this year after asset prices fell significantly in 2022.
Cliff Sarkin, head of strategic relations at Casper Labs, told the outlet that the remaining crypto ventures in Davos are “bottom line projects” and “the real business.”
Graig GraziosiJanuary 19, 2023 07:00
FBI says it will ‘relentlessly’ pursue cybercriminals
FBI Deputy Deputy Director Brian Turner says the law enforcement agency will “relentlessly pursue” criminals operating in the crypto space following the arrest of crypto exchange Bitzlato founder Anatoly Legkodymov .
“The FBI will continue to pursue actors who attempt to hide their criminal activity behind keyboards and use means such as cryptocurrency to evade law enforcement,” he said, according to the DOJ. . “We, along with our federal and international partners, will work tirelessly to disrupt and dismantle these types of criminal enterprises. Today’s arrest should remind us that the FBI will impose risk and consequences on those who engage in these activities.
Mr. Legkodymov, a Russian national living in China, was arrested in Miami on Wednesday.
Graig GraziosiJanuary 19, 2023 06:00
World Economic Forum Davos crypto bash financial leaders insist traditional institutions are safe
Several financial leaders speaking at the World Economic Forum in Davos made it clear that they do not trust cryptocurrencies and insisted to attendees that traditional investment and banking institutions were still safe to use. .
Singapore’s Chief Minister Tharman Shanmugaratnam said crypto assets were “a bit crazy”, prompting laughter from the audience, according to Iris Market IQ.
UBS Chairman Colm Kelleher said regulators have faltered in their ability to police “non-bank” entities, which include cryptocurrencies.
“Regulators have – with respect – averted their eyes from the non-banking sector,” Kelleher said, according to Reuters.
François Villeroy de Galhau, a member of the Governing Council of the European Central Bank, agreed, saying that “we should rush towards urgent non-banking regulation starting with cryptos”.
Graig GraziosiJanuary 19, 2023 04:59
DOJ says Bitzlato chief knew Hydra transactions were illicit, customers were ‘known to be crooks’
The Justice Ministry claimed that Bitzlato founder Anatoly Legkodymov was aware of the illicit nature of trading on Hydra’s marketplace and knew that its users were using fake identities when trading.
“Bitzlato customers routinely used the company’s customer service portal to request assistance for transactions with Hydra, which Bitzlato often provided, and admitted in conversations with Bitzlato staff that they were trading under assumed identities. “, said the DOJ. “Furthermore, Legkodymov and other Bitzlato officials were aware that Bitzlato’s accounts were plagued with illicit activity and that many of its users were registered under other people’s identities.”
According to internal chat logs obtained by the DOJ, Mr. Legkodymov wrote to a colleague that their clients were “known to be scammers.” Bitzlato officials allegedly warned the founder that its users were “drug addicts who buy drugs [at Hydra]and “drug dealers”.
Graig GraziosiJanuary 19, 2023 04:00
ICYMI: Crypto Market Cap Briefly Hit $1 Trillion Before Plunging
Earlier today, the crypto market cap hit $1 trillion for the first time since November, just ahead of the 2022 selloff and FTX crash.
It is unclear whether the decline was the result of the DOJ announcement, or traders selling at the higher price, or both.
Despite the decline, Bitcoin has remained popular among investors, gaining 30% this year.
Graig GraziosiJanuary 19, 2023 03:00
What is the “Hydra Market”?
What was “Hydra Market”, the darknet black market that was one of Bitzlato’s biggest clients?
According to the Department of Justice, Hydra Market is “an anonymous and illicit online marketplace for narcotics, stolen financial information, fraudulent identity documents and money laundering services that was the largest and oldest darknet market in the world”.
“Hydra Market users traded over $700 million in cryptocurrency with Bitzlato, either directly or through intermediaries, until Hydra Market was shut down by law enforcement American and German in April 2022,” the DOJ wrote. “Bitzlato also received over $15 million in ransomware proceeds.”
Graig GraziosiJanuary 19, 2023 02:00
ICYMI: Bitcoin Price Crashes Amid Major DOJ Crypto Announcement
The price of bitcoin fell 5% in the space of an hour after the US Department of Justice announced plans to introduce major international cryptocurrency enforcement measures.
The global crypto leader rose from $21,500 to around $20,500, reversing an upward trend that had seen its price rise by almost a third since the start of the year.
Learn more about The Independents Anthony Cuthbertson in his story below…
Graig GraziosiJanuary 19, 2023 01:00
Economist ‘Dr Doom’ Says ‘90% of Crypto is a Scam’ in Davos
Dr Nouriel Roubini – who is sometimes referred to as “Dr Doom” for his grim economic predictions – said “literally 90% of crypto is a scam” at the World Economic Forum in Davos on Wednesday.
“FTX and SBF are not an exception – they are a rule,” he said during a Yahoo finance an event.
He then predicted an upcoming bust.
“Literally, 90% of cryptos are scams. Criminal activity,” he said. “A real bubble Ponzi scheme that is going bankrupt.”
Graig GraziosiJanuary 19, 2023 12:00 a.m.
ICYMI: Closed Crypto Crime Network Delivers ‘Heavy Blow’ to Fraudsters, DOJ Says
The US Department of Justice announced that it had dealt a “crushing blow” to the crypto crime landscape after arresting a Russian national suspected of founding a major online criminal platform.
Cryptocurrency exchange Bitzlato has processed more than $700 million in illicit funds, according to the DOJ, advertising its services to users “known to be scammers”.
Alleged founder Anatoly Legkodymov was arrested in Miami on Tuesday. Learn more about The Independents Anthony Cuthbertson in his story below…
Graig GraziosiJanuary 18, 2023 11:00 p.m.
Crypto exchange targeted by DOJ responding “oops, sorry” to customers on automated social media channel
China-based cryptocurrency exchange Bitzlato – whose CEO Anatoly Legkodymov was arrested by the DOJ in Miami on Tuesday – responds to its customers through an automated message on Telegraph with the phrase “oops, sorry” with a sad face emoji, according to NBC News.
The DOJ alleges that the company has frequently dealt with Hydra Market, an illicit digital market and haven for ransomware attackers. The agency alleged that Mr. Legkodymov knew his clients were involved in criminal activity and used pseudonyms to hide their identities.
Graig GraziosiJanuary 18, 2023 9:30 p.m.