Crypto Headlines of the Week: NBA Sued, Crypto Oversight

The National Basketball Association is being sued for its promotion of defunct crypto exchange Voyager Digital Holdings, which allegedly led to losses of more than $4.2 billion.

There has also been a surge in crypto regulatory efforts amid the legal challenge.

For one, South Korea has introduced legislation requiring thorough vetting of cryptocurrency company executives, while Hong Kong’s financial regulators have launched a crackdown on unlicensed crypto exchanges. 

Here are this week’s important crypto stories.

Key Takeaways

  • NBA sued by investors over ties to Voyager.
  • Genesis seeks approval to sell $1.6B worth of trusts.
  • Spain proposes crypto to be seized for unpaid taxes.
  • South Korea to mandate vetting process for crypto executives.
  • Biden administration requires miners to report energy use.
  • Most institutional traders don’t want crypto exposure.

NBA Sued by Investors Over Ties to Voyager

The NBA faces legal challenges from investors due to its association with the now-defunct crypto exchange Voyager. The NBA was “grossly negligent” for approving a marketing deal between Voyager and the Dallas Mavericks, according to a lawsuit filed in a Miami district court.

NBA sued by investors over ties to failed crypto exchange Voyager (CBS News)

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Genesis Global Settles NY Fraud Lawsuit

Genesis Global has reached a settlement in a fraud lawsuit filed by New York authorities. The settlement agreement, which needs to be approved by the U.S. Bankruptcy Court for the Southern District of New York, disclosed that Genesis has agreed to cease conducting business in the state of New York.

Bankrupt Genesis Global settles NY Attorney General’s lawsuit (Reuters)

Genesis Seeks Approval to Sell $1.6B Worth of Trusts

In a move to address liquidity issues, Genesis is seeking court approval to sell substantial holdings in Bitcoin and Ether trusts. In a filing, the company said it needs to obtain approval to sell the trust assets ahead of any potential fluctuations in the prices of the underlying assets.

Genesis Global Seeks Approval to Sell $1.6B of Trust Assets (CryptoMinded)

Spain Proposes Crypto To Be Seized for Unpaid Taxes

The Spanish government is tightening its grip on tax evasion by proposing reforms that would enable the seizure of cryptocurrency assets for unpaid taxes. The proposed changes would grant the Spanish Tax Agency the authority to identify and take control of crypto assets owned by taxpayers who have outstanding debts.

Spain targets crypto and NFTs with a new tax reform (The Paypers)

South Korea to Mandate Vetting Process for Crypto Executives

In an effort to enhance the integrity of the crypto industry, South Korea has introduced legislation requiring thorough vetting of cryptocurrency company executives. If enacted, new executives at South Korean crypto companies will not be able to start work until the FSC approves their personnel change applications.

South Korea proposes a vetting process for crypto executives to strengthen oversight (The Block)

Unlicensed Crypto Exchanges Face Shutdown in Hong Kong

Hong Kong’s financial regulators are cracking down on unlicensed crypto exchanges. The state’s Securities and Futures Commission (SFC) told unregistered Virtual Asset Trading Platforms (VATPs) within its region to submit their licensing applications by February 29 or close their businesses by May 31.

SFC urges investors to check regulatory status of virtual asset trading platforms (SFC.hk)

Biden Administration Requires Miners to Report Energy Use 

In a push for environmental accountability, the U.S. government is mandating large-scale crypto miners to disclose their energy consumption. “As cryptocurrency mining has increased in the United States, concerns have grown about the energy-intensive nature of the business and its effects on the US electric power industry,” the EIA said in a report.

Tracking electricity consumption from US cryptocurrency mining operations (EIA)

Cyber Gangs Record $1.1B in Crypto Ransom in 2023

Cybercriminal activities involving cryptocurrency have reached new heights, with gangs securing over $1 billion in ransom payments last year. The 2023 figure is a vast increase from the $567 million extorted in 2022, indicating that ransomware is “an escalating problem,” according to a report by Chainalysis. 

Ransomware Payments Exceed $1 Billion in 2023, Hitting Record High After 2022 Decline (Chainalysis)

South Korea Probes OKX for Alleged Unregistered Operations

South Korea’s financial watchdog is investigating OKX for potentially operating without proper registration. Reportedly, OKX promoted its “Jumpstart” token sales platform to local users, despite not offering a Korean-language website and lacking proper registration. 

South Korea Financial Authorities Probes Crypto Exchange OKX for Alleged Unregistered Operations (Yahoo! Finance)

Most Institutional Traders Don’t Want Crypto Exposure

A recent survey by JPMorgan reveals a cautious stance among institutional traders towards cryptocurrency, with a majority indicating a lack of desire for crypto exposure amidst market volatility and regulatory uncertainty. 

The survey found that 78% of institutional traders aren’t planning to trade cryptocurrencies in the next five years, and just a small group sees blockchain/distributed ledger technology (DLT) as the most influential technology in shaping the future of trading over the next three years.

JPMorgan Survey Shows Over Half of Institutional Traders Don’t Want Crypto Exposure (CoinDesk)

The Bottom Line

This week, there has been a noticeable increase in cryptocurrency regulatory activities worldwide.

From Spain proposing to seize crypto for unpaid taxes, South Korea seeking background checks on crypto executives, and Hong Kong cracking down on unlicensed crypto exchanges, the world continues working out how blockchain fits into the world. 

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Ruholamin Haqshanas

Ruholamin Haqshanas is a cryptocurrency and financial journalist with over three years of experience in the field. He holds a Bachelor's degree in Mechatronics and has a strong interest in FinTech. He started as a freelance technology writer, but moved into cryptocurrency as he delved deeper into the industry in 2019. Ruholamin has been featured in several financial and crypto news outlets, including Cryptonews, Investing.com, 24/7 Wall St, The Tokenist, Business2Community, ZyCrypto, EthereumPrice.org, Milk Road to name a few. Ruholamin has also worked on major crypto and DeFi projects as a content producer, including Midas Investments, BullPerks/GamesPad and Equalizer Finance.