Kategorie: Crypto News

• SafeMoon, once promising, files Chapter 7 bankruptcy amid SEC fraud charges.
• SEC alleges executives diverted $200 million for personal use; arrests follow.
• Safemoon (SFM) token value drops 54% post-bankruptcy, market cap plunges from $1B to $17.18M.

In a startling turn of events, decentralized finance protocol SafeMoon has filed for Chapter 7 bankruptcy amid a cascade of financial and legal challenges.

This move follows the arrest of key company members by the US Department of Justice (DoJ) over allegations of misappropriating clients’ funds. The Securities and Exchange Commission (SEC) had already charged SafeMoon and its executives for defrauding customers.

SafeMoon’s Chapter 7 Bankruptcy filing 

The move by SafeMoon to officially file for Chapter 7 bankruptcy signals a grim outlook for the embattled cryptocurrency venture. The bankruptcy filing, submitted to the United States Bankruptcy Court in the District of Utah, comes in the wake of mounting financial and operational challenges for SafeMoon.

A leaked email addressed to the company’s team revealed that the decision to file for Chapter 7 bankruptcy was prompted by an inability to sustain business operations. As a result, all current employees have been terminated with immediate effect.

SEC charges against Safemoon and executive arrests

SafeMoon’s financial woes are compounded by legal troubles stemming from allegations made by the US Securities and Exchange Commission (SEC).

Last month, the SEC charged SafeMoon and key executives, including Thomas Smith, John Karony, and Kyle Nagy, with defrauding customers of over $200 million and selling unregistered securities.

The SEC complaint accuses the executive team of failing to deliver promised profits to investors, diverting funds for personal gains, and engaging in deceptive practices. The legal saga took a criminal turn when CEO John Karony and CTO Thomas Smith were arrested by the US Department of Justice, while founder Kyle Nagy remains at large. This dual legal onslaught has sent shockwaves through the cryptocurrency community and further fueled scepticism surrounding SafeMoon.

This sequence of events highlights the fragility of the cryptocurrency space, urging investors to exercise caution and due diligence in an industry known for its volatility and regulatory uncertainties. SafeMoon’s precipitous fall from grace serves as a stark reminder of the risks inherent in speculative ventures within the crypto landscape.

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• Bitget says mandatory KYC will align the exchange with global financial regulations and underscore its tier1 status.
• KYC verification is one of the measures aimed at enhancing protection for users, including against theft and fraud, Bitget said.
• Verified accounts will enjoy higher withdrawal limits, exclusive access to Bitget events among others.

Bitget has introduced mandatory Know Your Customer (KYC) requirements for all users, the crypto exchange said in an announcement on Thursday.

The exchange’s new KYC requirements will be effective from December 15, 2023.

Mandatory KYC for all Bitget users

Bitget’s rollout of mandatory verification comes roughly three months after the initial announcement in August. While compulsory user verification is aimed at bolstering platform security, Bitget says it’s also part of the regulatory compliance process.

According to the exchange, this is a path towards enhancing its status as a tier1 platform.

“As a leading player in the cryptocurrency exchange landscape, Bitget is committed to not only offering state-of-the-art services but also ensuring a secure and compliant trading environment for our global community. The introduction of mandatory KYC requirements for all users is a decisive step towards enhancing user security and aligning with global financial regulations,” said Jamie Elkaleh, the Country Manager of Bitget.

The process is also part of anti-money laundering compliance, and adds to other measures aimed at the overall user protection, including against theft and fraud. Bitget’s Proof of Reserves, Protection Fund and cold storage are all geared towards this effort.

Bitget to reward users

Users can complete the KYC checks in two tiers, with Level 1 allowing access to all services and products, including derivatives, copy trading and up to $3 million in daily withdrawal limits.

Although Bitget has phased this implementation to ensure minimal disruption to users as they upgrade their accounts, it is incentivising cooperation via a rewards program.

For instance, the first 5,000 users to upgrade before December 15, will get up to 100 USDT in trading bonuses.

Meanwhile, VIP accounts that complete verification ahead of the deadline will receive a bonus of 200-500 USDT. The exchange has also teased an iPhone 15 Pro prize and 100 USDT for users who take time to complete a short KYC questionnaire.

Bitget launched in 2018 and has grown into one of the top crypto exchange and Web3 companies, with over 20 million users across the globe. 

The company has acquired multiple regulatory approvals. It’s also eyeing licenses in the Middle East and North African (MENA) as part of its global expansion.

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• Flare partners with Kinetic, revolutionizing DeFi lending/borrowing on blockchain.
• Users benefit from liquidity incentives; Kinetic offers over-collateralized borrowing.
• Rome Blockchain Labs facilitates Kinetic launch, leveraging Flare’s oracles for accurate prices.

Blockchain for data, Flare, and lending platform Kinetic, backed by Rome Blockchain Labs, have announced a strategic partnership set to revolutionize decentralized finance (DeFi).

This collaboration aims to introduce lending and borrowing capabilities to the Flare ecosystem, deepening liquidity and fostering a robust DeFi experience.

Powering DeFi with seamless lending and borrowing

Flare, recognized as the blockchain for data, has entered into a groundbreaking partnership with Kinetic, a lending and borrowing platform supported by Rome Blockchain Labs. The collaboration focuses on providing Flare users with a streamlined platform for participating in DeFi, offering the potential to earn block rewards by utilizing their digital assets.

Flare users contributing assets to the platform stand to benefit from incentivized and natural yield through liquidity provisioning.

Kinetic’s lending and borrowing platform operates in an over-collateralized structure, with borrowers enjoying additional perks such as interest rebates and exclusive Discord channel access. Rome Blockchain Labs (RBL), with its extensive experience in creating custom financial markets on various blockchain networks, will facilitate the launch of Kinetic.

The technical infrastructure and design provided by RBL will be instrumental in realizing the seamless integration of lending and borrowing capabilities within the Flare ecosystem.

Integration with FAssets:

The partnership further entails Kinetic leveraging Flare’s native price oracle, the Flare Time Series Oracle, for decentralized asset prices. This integration ensures highly accurate and frequently updated price feeds, laying the foundation for a secure and responsive DeFi experience on the Flare network.

In addition, Kinetic plans to integrate FAssets developed by Flare Labs, enabling traditionally non-smart contract tokens like bitcoin (BTC), ripple (XRP), and dogecoin (DOGE) to actively participate in DeFi activities. This integration marks a significant step in bridging traditional cryptocurrencies with advanced DeFi functionalities, enriching the lending and borrowing landscape.

Kinetic is committed to user security and technological excellence, demonstrated through strategic partnerships in the DeFi landscape. The platform aims for decentralization, seeking to eliminate KYC restrictions while remaining accessible in regions with regulatory uncertainty. Collaborations with Rome Blockchain Labs, Watchpug, and Immunefi underscore Kinetic’s dedication to robust technological infrastructure, smart contract audits, and bug bounty programs.

The initial launch on Flare’s testnet, Coston2, will provide users with a dynamic environment to engage, provide feedback, and gain insights into the innovative decentralized lending and borrowing platform.

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• Taurus and Teylor Partnership.
• Teylor’s credit portfolio tokens, overseen by Allen and Overy, become tradeable on Taurus’ TDX marketplace.
• Taurus’ TDX marketplace, with $1 billion+ in transactions, solidifies Switzerland’s role in institutional-grade blockchain treatment for diverse asset classes.

In a groundbreaking move, Swiss crypto custody firm Taurus, backed by Deutsche Bank, has joined forces with Zurich-based fintech lending platform Teylor.

The collaboration aims to tokenize Teylor’s credit portfolio tokens, allowing them to be traded on Taurus’ TDX marketplace, signalling a significant step in the tokenization of traditional finance.

Tokenizing German SME loans on TDX Marketplace

Taurus and Teylor collaboration centers on tokenizing Teylor’s credit portfolio tokens, a move that aligns with the global trend of digitizing traditional financial assets. Overseen by law firm Allen and Overy, Teylor’s credit portfolio tokens will be eligible for secondary market trading on Taurus’ TDX marketplace, adhering to Luxembourg-based investment structures that comply with Swiss and European regulations.

Taurus co-founder Lamine Brahimi emphasized the landmark nature of this tokenized debt product, expected to attract substantial investments from institutional players in the next two weeks. With Taurus’ TDX marketplace already facilitating over $1 billion in tokenized transactions, this move further solidifies Switzerland’s role in providing institutional-grade blockchain treatment across various asset classes.

Teylor, known for offering loans ranging from €100,000 to €1.5 million to Germany’s Mittelstand economy, has garnered support from investors like Barclays. Teylor CEO Patrick Stäuble highlighted that the tokenized loans would target a diverse range of German businesses, spanning industrials, chemicals, precision machinery, and import/export. This initiative addresses the financing needs of businesses that fall between the capacities of traditional bank branches and corporate finance departments.

This strategic collaboration between Taurus and Teylor not only demonstrates the evolving landscape of digital finance but also showcases Switzerland’s commitment to fostering innovation in blockchain-based solutions.

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• Basel Committee proposes maturity limits for stablecoin reserve assets.
• Overcollateralization required for longer-term assets to ensure stability.
• Credit quality criteria defined for reserve assets to bolster stablecoin stability.

In a move to enhance the stability of stablecoins, the Basel Committee on Banking Supervision, part of the Bank for International Settlements (BIS), has recommended targeted adjustments to its standards on banks’ exposure to crypto assets.

The proposed measures, outlined in a consultative document released on Dec. 14, 2023, focus on refining prudential standards for stablecoin exposure, building on the committee’s initial standards published in December 2022.

Addressing redemption risks with maturity limits

The committee’s first proposal centres on mitigating redemption risks during periods of extreme stress, where stablecoin issuers might face mass withdrawal claims, leading to fire sales. To address this, the committee suggests imposing a maximum maturity limit for individual reserve assets. This measure aims to restrict stablecoin exposures to longer-term maturities, potentially safeguarding against abrupt and large-scale withdrawal demands.

If longer-term assets are allowed, the committee emphasizes the necessity for over-collateralization. This means that such assets must exceed the claims of stablecoin holders, providing a buffer against potential declines in asset values. This ensures that stablecoins remain redeemable at their pegged value, even in challenging market conditions.

Credit quality criteria for stability

The second proposal focuses on establishing criteria for credit quality concerning reserve assets. The committee suggests a list of reserve assets suitable for stablecoin issuers, including central bank reserves, marketable securities guaranteed by sovereigns and high-credit-quality central banks, and deposits at banks with a high credit rating.

By specifying assets with high credit quality, the committee aims to bolster the stability of stablecoins, reinforcing their ability to maintain value, particularly in volatile market conditions.

The Basel Committee invites comments on these proposed amendments until March 28, 2024. Whether amended or not, the prudential standards for stablecoin exposures are slated for implementation on January 1, 2025.

These recommendations reflect the ongoing efforts of global regulatory bodies to address potential risks associated with stablecoins and fortify the resilience of the financial system in the rapidly evolving landscape of crypto assets.

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