In an on-going effort to set international standards that aim to prevent illegal activities, the Financial Action Task Force (FATF) released a public consultation on 19 March 2021 for its latest Draft Guidance on a Risk-Based Approach to Virtual Assets and Virtual Asset Service Providers. This draft is an update of the FATF’s March 2019 guidance, which placed anti-money laundering and financing of terrorism obligations on virtual assets (VAs) and virtual asset service providers (VASPs).

As the industry has evolved — and continues to evolve — since then, the latest draft guidance provides updates in six main regulatory areas, as…


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The SEC Releases Compliance Notice on Future Crypto Regulations

As the traditional financial world begins its mainstream adoption of crypto assets, the process of legitimizing digital assets as financial products pose a myriad of risks and regulatory challenges. Today, the U.S. Securities and Exchange Commission (SEC) released an 8-page document that details the framework in which the agency will examine digital asset investments. Demanding regulatory compliance across areas ranging from custody, bookkeeping, registration requirements to conflicts of interest protocols, the SEC has made it clear to major broker-dealers and investment advisers that digital assets will face similar levels of scrutiny as traditional securities. [US SEC]

DeFi Sector May Face Threat from New EU Crypto Regulations — Survey

European crypto and blockchain…


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Tether Faces 500 Bitcoin Ransom

Tether has revealed a ransomware demand in which threat actors are allegedly demanding 500 Bitcoin ($24 million). Over the weekend, the blockchain and cryptocurrency organization said on Twitter that a demand for payment had been made, on pain of documents being leaked online that would “harm the Bitcoin ecosystem.” The wallet address associated with the demand, at the time of writing, has $72 in BTC stored. Tether said that the payment deadline is March 1, but added, “We are not paying.” [ZD Net]

Crypto Fraudster Sentenced to 8 Years in Token-Offering Scam

The 29-year-old founder of a defunct Florida cryptocurrency firm will spend eight years behind bars for duping…


Speed Read

  • FATF is set to revise its June 2019 guidelines (also known as the FATF Travel Rule) for VASPs and stablecoins.
  • The FATF will publish a public consultation draft in March and expects to release the final guidelines in June this year.
  • The FATF also aims to address the risks of disintermediated peer-to-peer transactions in the upcoming guidelines.
  • The FATF also started its second 12-month review of the global implementation of the FATF Standards on virtual assets.
  • The first 12-month review, which was published in June 2020, states that overall both the public and private sectors have made progress…

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US Charges Three North Korean Hackers Over Crypto Attacks and WannaCry Ransomware

On Wednesday, the United States Department of Justice announced charges against three North Korean hackers. Making the announcement, Assistant Attorney General John Demers condemned the North Korean program, the most famous branch of which is Lazarus Group. Demers said: “North Korea’s operatives, using keyboards rather than guns, stealing digital wallets of cryptocurrency instead of sacks of cash, are the world’s leading bank robbers.” With a country largely sequestered from the international economy, North Korea’s hacking program has been a critical source of revenue. [CoinTelegraph]

Troubled NZ Crypto Exchange, Cryptopia, Suffers Another Hack in the Midst of Liquidation Process

Controversy still surrounds a liquidated New Zealand cryptocurrency exchange, which allegedly got hacked again. Adding to…


Regulators around the world are introducing increasingly stringent and specific laws to fight crypto crime. Whilst the global volume of illicit crypto-based activities has significantly reduced, the war against money laundering, terrorist financing and fraud is far from over. Crypto businesses are at the forefront of this fight and asking how they can secure victory.

Beyond the blacklists

Our team is in the business of empowering VASPs to effectively detect, investigate and prevent crypto crime, and to comply with rapidly evolving regulations. As standard, the Merkle Science transaction monitoring tool provides our clients with the ability to identify known bad actors. What sets…


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FinCEN’s Wallet Rule Aims to Close Crypto-Cash Reporting Gap, Official Says

Financial institutions report large cash and crypto transactions differently. This gap led to a controversial rule proposed by the Financial Crimes Enforcement Network (FinCEN) late last year, an official said Monday. Speaking at a virtual panel hosted by compliance firm TRM Labs, FinCEN Deputy Director Michael Mosier was referring to a rule that would require crypto exchanges to report transactions involving private wallets (sometimes referred to as unhosted wallets) worth over $10,000 per day, as well as collect counterparty information for wallets that receive over $3,000 in crypto per day. The rule was proposed in the waning days of the…


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UN Says North Korea Funded Nuclear Weapons With Crypto Hacks in 2020: Report

North Korea has modernized its nuclear weapons and ballistic missiles by flaunting United Nations sanctions, using cyberattacks to help finance its programs and continuing to seek material and technology overseas for its arsenal including in Iran, U.N. experts said. The panel of experts monitoring sanctions on the Northeast Asian nation said in a report sent to Security Council members Monday that North Korea’s “total theft of virtual assets from 2019 to November 2020 is valued at approximately $316.4 million,” according to one unidentified country. [Associated Press News]

UK Teenager Jailed for Two Years for a Dark Web Deal With Ecstasy and Bitcoin

The 19-year-old drug dealer is to serve two years in prison after a…


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Founder of $90 Million Cryptocurrency Hedge Fund Pleads Guilty

A 24-year-old founder of two New York-based cryptocurrency hedge funds with more than US$100 million (S$133 million) in investments pleaded guilty on Thursday (Feb 4) to securities fraud. Stefan He Qin was charged with one count of securities fraud, after duping investors by claiming he used a trading algorithm to take advantage of price differences for a number of cryptocurrencies, federal prosecutors said in an e-mailed statement. Qin stole investor money from his Virgil Sigma Fund, and attempted to dip into his VQR Multistrategy Fund to pay back investors in the first fund, prosecutors said. He admitted trying to steal…


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FinCEN to Impose New Regulation for Crypto Holdings at Foreign Exchanges

The Financial Crimes Enforcement Network (FinCEN) has announced that it will soon propose new regulations affecting cryptocurrency holdings at foreign exchanges. This proposal is separate from the one FinCEN recently proposed on cryptocurrency wallets. FinCEN, a bureau of the U.S. Department of the Treasury, issued a notice on Thursday regarding a new filing requirement for cryptocurrencies. FinCEN detailed: Currently, the Report of Foreign Bank and Financial Accounts (FBAR) regulations do not define a foreign account holding virtual currency as a type of reportable account. [news.bitcoin.com]

Switzerland’s Tokenized Securities Law Ushers in New Chapter for Digital Assets

Switzerland now lets tokenized securities trade on a blockchain with the same legal standing as…

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