Cash Still Dominates in Money Laundering; Bakkt at Financial Risk; Legal Conflicts Arise in Crypto Trials
Summary:
Despite the rise of cryptocurrencies, an evaluation by the U.S. Treasury Department reveals cash remains the preferred method for criminals to launder illicit funds. Bakkt, a crypto fintech enterprise, warns it's running low on cash and could exhaust its financial resources within a year. Meanwhile, U.S. officials are calling for a hearing regarding potential conflicts of interest in the criminal trials of former FTX CEO, Sam Bankman-Fried, and former Celsius CEO, Alex Mashinsky.
An in-depth evaluation of money laundering strategies in the United States identifies cash as the prevalent choice for malefactors looking to clean unlawful earnings. Digital currency company Bakkt has signaled that it is struggling with funds and may deplete its financial resources within a year. Furthermore, American officials are calling for a hearing regarding potential conflict of interest concerns in the criminal trials of Sam Bankman-Fried and Alex Mashinsky.
Despite the rise of cryptocurrencies, the solid currency continues to be the primary modus operandi for illicit money laundering, says an elaborate assessment by the U.S. Treasury Department. As per the report, the anonymous nature and broad acceptance of cash, coupled with its relative stability, make it the favored tool for criminals to legitimize their illegal gains.
Bakkt, a crypto fintech enterprise, has issued a warning that its financial reserves are dwindling and could potentially exhaust within the span of next year. Bakkt, launched in 2019 with the support of the Intercontinental Exchange (ICE) - the proprietorship of NYSE - alerted in its February 7 filing with the U.S. Securities and Exchange Commission that its continuity as an operational entity is under threat.
In the wake of this notice, it's been debated as to how Bakkt exhausted its funds in an environment where traditional financial institutions dominated over startups in the U.S. amidst a crypto market revival.
The company stated that it has struggled to maintain operational profitability and adequate cash flow. Its future viability will hinge on its success in raising capital, considering issuing its registered securities in public markets to bolster its long-term projection. Post the announcement, Bakkt's shares experienced a 7.6% devaluation.
On another front, U.S. prosecutors have highlighted potential conflicts of interest in the criminal trials of former executives - Sam Bankman-Fried of FTX and Alex Mashinsky of Celsius. Correspondences sent to the judges of these cases raised doubts about the representation by attorneys Marc Mukasey and Torrey Young, arguing the possibility of several conflicts.
Authorities noted that Mashinsky partially attributed the collapse of Celsius in 2022 to Alameda Research, affiliated with FTX. Both CEOs face numerous felony charges and were condemned by the courts last year. However, the overall severity of potential conflicts might warrant waiver by the presiding judges. It's crucial to note that this news doesn't endorse any investment advice or recommendations and urges readers to undertake their research before financial decision-making.
Published At
2/8/2024 2:24:02 PM
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