Crypto News Headlines (17-Feb-2023)

A trader bought $208,000 worth of Gains Network (GNS) tokens less than 30 minutes before the token was listed on Binance, making a profit of $106,000, according to blockchain sleuth Lookonchain.

GNS, the token that underlies Gains Network’s decentralized exchange, jumped to $12.01 from $7.92 immediately following the listing. The trader bought the tokens on decentralized exchange aggregator 1Inch before selling them on the same venue after the price had surged.

Last month, Conor Grogan, head of product at rival exchange Coinbase, said in a Twitter thread that what appeared to be frontrunning had been occurring on Binance for more than 18 months.

Blockchain analytics firm Elliptic said Tuesday that it has collaborated with cryptocurrency exchanges Binance and Huobi “to freeze Lazarus Group hack proceeds.” Elliptic wrote:

Crypto exchanges Binance and Huobi today froze accounts containing approximately $1.4 million in cryptoassets originating from the June 2022 hack of Harmony’s Horizon Bridge.

“The Horizon cross-chain bridge was attacked on June 24th 2022, resulting in the loss of $99.6 million in cryptoassets. These funds were then laundered through the now-sanctioned Tornado Cash,” the blockchain analytics firm detailed. Ethereum mixer Tornado Cash was banned last August by the U.S. Department of the Treasury’s Office of Foreign Asset Control (OFAC).

Crypto exchange Binance US moved $400 million from its platform to a trading firm managed by Binance CEO Changpeng Zhao, a Reuters report today claims, citing documents.

The cash was moved in the first three months of 2021 from the Binance US account at Silvergate Bank to Merit Peak Ltd, the news agency said.

Merit Peak Ltd is a little-known trading firm reportedly managed by Zhao. The U.S. Securities and Exchange Commission said last year that it was investigating the firm.

Binance US is a digital asset exchange for U.S. customers. It is a partner of the world’s biggest crypto exchange Binance but is ostensibly independently run.

Crypto taxes have been one of the most important topics of concern for the government in the United States. Sources reveal that last November, the taxing agency in the States worked relentlessly hard in the crypto domain.

The Criminal Investigation Division of the Internal Revenue Service (IRS) revealed that they were working on building “hundreds” of crypto cases. IRS is the revenue service of the U.S. federal government, which is responsible for collecting U.S. federal taxes and administering the Internal Revenue Code, the main body of the federal statutory tax law.

Jim Lee, the head of the Criminal Investigation Division, said, “in the last three years, I’ve seen a shift in digital asset investigations.” According to him, previously, most were related to money laundering, but now tax cases make up for approximately half.

California Department of Financial Protection and Innovation has launched a new crypto scam tracker to help traders and investors spot possible industry threats.

zDFPI launched the tracker on Feb. 16. It’s based on user complaints, with the department compiling a list of crypto-related grievances by victims who claim to have been scammed or have identified attempted scams.

The complaints listed represent descriptions of losses incurred in transactions that victims have identified as part of a fraudulent or deceptive operation. However, the DFPI stated that it had not verified any of the scams listed, but noted that it receives thousands of consumer and investor complaints each year.

Later this month, Canada’s umbrella markets regulator, the Canadian Securities Administrators (CSA), will tighten requirements for cryptocurrency exchanges operating in the country, according to two people who have been briefed on the plans.

The collapse of FTX, among other failings in the crypto industry, has speeded the resolve of the CSA, which announced midway through last year that it required certain compliance “commitments” from unregistered crypto trading platforms operating in Canada while they pursue registration.

The CSA declined to discuss updates to the pre-registration undertaking (PRU) regime, but said it would “publish additional details in the near future.”

The bitcoin miner said that the mining machines are expected to be delivered by the end of May. Once fully operational, they will add 2.44 EH/s to Cleanspark’s current 6.6 EH/s of computational power, resulting in a total of 9 EH/s of SHA256 hashpower for the bitcoin mining company.

“Building and owning our own mining campuses at multiple locations provides us with a level of agility and reliability that cannot be achieved otherwise,” Zach Bradford, CEO of Cleanspark, said in a statement sent to News. “As machines are delivered to us we will have rackspace waiting for them at one of our sites.”

The Cleanspark executive added:

This is the advantage of proprietary mining or the ‘prop mining’ model. We exercise tremendous control over our infrastructure and, therefore, our ability to be highly efficient in the way we allocate our resources.

Bitcoin mining firm CleanSpark announced a purchase of 20,000 new ASIC machines on Thursday, after the asset rallied to nearly $25,000 the day prior. 

The new rigs will add 2.44 exahashes per second (EH/s) to its existing computational force of 6.6 EH/s. One exahash equal one quintillion hashes—inputs for solving the complex math problems required to mine new blocks.

That brings the company’s total hashrate to 9 EH/s—a 37% rise—comprising 2.8% of the entire Bitcoin network’s hash rate, going by current numbers from Bitinfocharts.

Crypto or Blockchain was the top area of fintech investment in Singapore in 2022 despite the global slowdown in the space, according to the KPMG Pulse of Fintech report for the second half of 2022.

This is despite the finding of a key trend that investors are shifting to non-crypto based solutions in the wake of the crypto contagion in 2022. The second half of 2022 saw a “particularly noticeable” decline as investors digested the falls of Terra, Three Arrows Capital, and FTX, KPMG’s findings said.

In Singapore, crypto-related funding fell by 21% from $1.5 billion in 2021 to $1.2 billion in 2022. Globally, investments in the space fell from $30 billion in 2021 to $23.1 billion in 2022.

Only days after reports of United States regulatory scrutiny of Paxos and Binance USD BUSD $1.00,  cryptocurrency exchange Binance has minted nearly $50 million worth of TrueUSD (TUSD).

The transaction took place on Feb. 16, according to data from Etherscan, and also comes two days after Binance CEO Chanpeng “CZ” Zhao said in a Feb. 14 Twitter Spaces that Binance would look to “diversify” its stablecoin holdings away from BUSD.

Despite minting nearly $50 million in TUSD from the TrustToken platform’s smart contract, CZ had earlier said that the recent regulatory action by the United States Securities Exchange Commission and the New York Department of Financial Services over the long term may lead to a fall in the dominance of U.S. dollar-backed stablecoins.

“I think with the current stances taken by the regulators on the U.S. dollar-based stablecoin, the industry will probably move away to a non-U.S. dollar-based stablecoin, back to algorithmic stablecoins.”