Also today, Cash App has been accused of facilitating fraud on a massive scale and distorting user metrics.
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New York charges Do Kwon with fraud 🚨
Federal prosecutors in the U.S. have charged Do Kwon with fraud — hours after his sensational arrest in Montenegro. The Terraform Labs co-founder had been on the run for months after UST and LUNA collapsed. Bloomberg reports he was detained at an airport in Podgorica, and had attempted to board a flight to Dubai using falsified Costa Rican travel documents. Do Kwon has been charged with conspiracy to defraud, two counts of commodities fraud, securities fraud, wire fraud, and conspiracy to defraud and engage in market manipulation by the Southern District of New York. If he ends up being extradited to the U.S. over South Korea, the state will be prosecuting the two largest criminal cases to emerge from the bear market.
Cash App rocked by bombshell report 😱
Cash App has been accused of facilitating fraud on a massive scale and distorting user metrics. The explosive report by Hindenburg Research argues that the Bitcoin-friendly platform has failed to tackle money laundering and the use of its payment tools by criminals and bad actors. It claims that ex-employees believe up to 75% of accounts reviewed were involved in fraud — with Hindenburg claiming it managed to get a Cash App debit card in Donald Trump's name without any questions. Block's stock declined as much as 20% on Thursday, and is down 55% over the past 12 months. In a statement given to CoinMarketCap, Block says it will explore legal action — adding the report is "factually inaccurate and misleading."
Coinbase reveals fight plan for the SEC 🔥
Fresh from receiving a Wells Notice from the SEC — indicating enforcement action is likely — Brian Armstrong has revealed how he plans to take on the regulator. Speaking in a Twitter Spaces discussion, the CEO called on crypto supporters to donate to and "elect pro-crypto candidates." Saying Coinbase would begin trying to organize the approximately 50 million Americans who own or have owned crypto, Armstrong warned the industry could move offshore — as the U.K. and EU step up. Coinbase is "going to start putting out content where people can contact their Congressman, donate to pro-crypto candidates, show up at town halls, make your voice heard," Armstrong declared.
SEC warns public on crypto investments ❌
Meanwhile, the SEC has issued a stark warning that tells investors to stay away from crypto. In an Investor Alert, the regulator said consumers face a "significant" risk of loss if they dabble in such assets. It went on to stress that trading platforms might not be complying with the law — and even though some will offer proof of reserves, this isn't as trustworthy as a financial audit. The SEC then delved deeper into warnings of the high risk of volatile crypto assets and the prevalence of fraud and scams, ending with standard investing advice to have an investment plan, have a diverse portfolio of assets and understand the risks. Chairman Gary Gensler believes that Bitcoin is a commodity, but all other cryptocurrencies are securities.
A bull run on virtual land in the metaverse? 📈
The sales of NFTs linked to metaverse virtual worlds have spiked this year, according to a new DappRadar report. An estimated $502 million was invested into blockchain gaming and metaverse projects in the first quarter of 2023 — and of that, $311 million was linked to digital plots of land. Pointing to a 277% increase in trading volumes, the site added: "The virtual world market has been on a bull run since the start of the year." This is the best quarter for the metaverse since Terra crashed last May. The number of land trades also hit an all-time high, with 146,690 plots sold and resold — an 83% increase over Q4 2022.