US Lawmakers Propose Mixer Ban, Binance Assists in Scammer Arrest, FTX Plans Creditor Payback
Summary:
Five Democratic US Representatives propose a short-term ban on cryptocurrency mixers, with financial institutions facing hefty fines for infractions. In other news, Binance’s on-chain investigations team plays a critical role in the arrest of the ZKasino scammer, using a blend of on-chain monitoring and open-source intelligence. Meanwhile, FTX, a failed crypto exchange, plans to repay creditors over 100% of their claims, proposing a total between $14.5 and $16.3 billion. However, the plan has faced backlash as it only values assets at the time of FTX's bankruptcy back in November 2022.
Five Democratic Representatives in the United States are pushing for a short-term prohibition of cryptocurrency mixers, according to a bill they recently presented to the House. If the proposed "Blockchain Integrity Act" becomes law, financial establishments dealing with funds from mixers will face a hefty penalty of up to $100,000. The legislation, set to last for two years, could give congress members ample time to gather detailed information on mixer usage and its implications. This move, naturally, drew sharp criticism from the cryptocurrency community, accusing fiat currencies, like the U.S. dollar, of aiding terrorist financing and contending that cryptocurrencies are facing unwarranted scrutiny to sidetrack from other profound world financial issues.
The arrest of the culprit behind the ZKasino scam came with assistance from Binance's on-chain investigation team. Public outcry drove the Crime Compliance and Investigations team at Binance, the world's leading cryptocurrency exchange, to dig into the shifty gambling platform's operations. Using a blend of on-chain monitoring and open-source intelligence data (OSINT), the investigation team managed to locate the scammer. Upon detecting the individual behind the dubious smart contracts, Binance tipped off law enforcement, resulting in the arrest of the 26-year-old suspect on April 29, with authorities confiscating crypto assets, properties, and luxury vehicles amounting to nearly 11.4 million euros ($12.2 million).
Meanwhile, the defunct crypto exchange, FTX, intends to reimburse its creditors with more than 100% of their claims, with a proposed total of between $14.5 and $16.3 billion. However, the plan still awaits approval from a Delaware Bankruptcy Court. Almost 98% of FTX creditors, each claiming $50,000 or less, may receive up to 118% recovery. John J. Ray III, FTX's CEO, said the company is glad to have a Chapter 11 plan that anticipates the return of all bankruptcy claim amounts along with interest for non-government creditors. Despite these positive claims, the plan continues to face backlash on social media as it only addresses the value of creditors' assets at the time of FTX's bankruptcy in November 2022. This report is based on the contributions of Geraint Price, Ana Paula Pereira, Sam Bourgi, and Felix Ng.
Published At
5/8/2024 10:21:27 PM
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