Blockchain
China Sentences ‘OTC King’ Zhao Dong to Seven Years in Prison for Unlicensed Crypto Operations
In a significant move underscoring its stringent stance against cryptocurrency, China has sentenced Zhao Dong, known as the “OTC King” and founder of the over-the-counter (OTC) crypto trading desk RenrenBit, to seven years in prison. This sentencing comes after a detailed investigation by the Supreme Procuratorate of China, which unveiled Zhao’s involvement in unlicensed crypto business activities and foreign exchange transactions.
The investigation, conducted on December 27, delved deep into the intricate network of financial transactions tied to Zhao’s alleged crimes. Using an array of evidence, including bank records, communication logs, confessions, and witness statements, the authorities meticulously constructed their case. This comprehensive approach highlighted the complexity and depth of the illegal operations.
RenrenBit, Zhao’s enterprise, was known for facilitating transactions between cryptocurrencies and local currency, a service that landed him in legal turmoil. Despite cryptocurrencies being illegal in China, Zhao and his team navigated this murky terrain until their recent sentencing.
In the series of public hearings, Zhao and his associates presented their defense, arguing that their actions were purely digital currency transactions and not foreign exchange trading, thereby not constituting illegal business operations. However, this argument was countered effectively by the prosecution, which provided evidence of foreign exchange dealings in Zhao and his group’s chat records, undermining their defense.
This case is not just a singular instance but part of a broader crackdown on cryptocurrency operations in China. The government’s stance on crypto remains unyielding, with this sentencing serving as a stark reminder of the legal boundaries within which crypto operations must maneuver in the country.
Also Read: Base Network Sees Steady Growth, Surpasses $735 Million in Total Value Locked
Zhao Dong’s sentencing, therefore, marks a pivotal moment in China’s ongoing efforts to regulate and control the burgeoning world of cryptocurrency and its related activities.
Blockchain
US GAO Issues Key Recommendations to SEC Prior to Historic Spot Bitcoin ETF Approval
Blockchain
Bitcoin ETFs Witness Surge in Trading Activity as SEC Approves 11 Products
In a significant development for the cryptocurrency industry, the U.S. Securities and Exchange Commission (SEC) recently approved 11 spot Bitcoin exchange-traded funds (ETFs). This approval comes after a decade-long struggle between regulators and the digital asset industry, marking a watershed moment for the acceptance of digital assets as mainstream investments. Among the approved ETFs are BlackRock’s iShares Bitcoin Trust, Grayscale Bitcoin Trust, and ARK 21Shares Bitcoin ETF.
Unprecedented Inflows:
On the first day of trading, these ETFs saw impressive activity, with $4.6 billion worth of shares changing hands across all the products, according to LSEG data. Bitwise, a crypto asset manager, reported that its spot Bitcoin ETF alone attracted $240 million, making it the most popular among the newly introduced products. Grayscale, BlackRock, and Fidelity dominated total trading activity, according to the LSEG data.
Also Read: Grayscale Court Decision Crucial in SEC’s Approval of Bitcoin ETFs, Says Chairman Gary Gensler
Bitwise’s Chief Investment Officer, Matt Hougan, expressed optimism about the future, stating, “We think that this will become a market measured in the tens of billions of dollars.” This surge in interest highlights a growing acceptance of Bitcoin and other cryptocurrencies among traditional investors.
Competition and Fee Wars:
The SEC’s approval has sparked intense competition among issuers to gain market share. Franklin Templeton, reacting swiftly, slashed the fee for its Bitcoin ETF to 0.19 percent, the lowest in the market. Additionally, the company waived fees entirely on the product’s first $10 billion in assets under management until August. Valkyrie, another player in the space, reduced its fees to 0.25 percent after its ETF started trading. This fee war is indicative of the fierce competition among ETF issuers to attract investor capital.
Grayscale’s Transition to ETF:
Grayscale, a prominent player in the cryptocurrency investment space, received approval to convert its existing Bitcoin trust into an ETF. This move instantly made it the world’s largest Bitcoin ETF, managing over $28.6 billion in assets. Despite this success, the ETF experienced outflows of $95 million on the first day of trading. The ability of Grayscale to navigate this transition will be closely watched, as it sets a precedent for other trusts considering a similar shift.
Regulatory Caution:
While the SEC’s approval is a significant step forward, it is important to note that SEC Chair Gary Gensler emphasized that the decision should not be interpreted as an endorsement of Bitcoin. Gensler referred to Bitcoin as a “speculative, volatile asset,” highlighting ongoing concerns about investor protection. The regulatory nod indicates a willingness to explore the potential of digital assets, but caution is warranted as the market continues to evolve.
Conclusion:
The approval of 11 spot Bitcoin ETFs by the SEC marks a turning point for the cryptocurrency industry. The influx of billions of dollars within the first day of trading demonstrates a growing acceptance of digital assets among traditional investors. The fee wars among ETF issuers and Grayscale’s transition into an ETF further highlight the competitive dynamics and challenges in the market. As the cryptocurrency market matures, ongoing regulatory scrutiny and investor sentiment will play crucial roles in shaping the future of these innovative financial products.
Blockchain
Tether CEO Advocates for Real-World Use Cases in Crypto Without Blockchain or Tokens
In a recent exclusive interview with Cointelegraph, Tether CEO Paolo Ardoino has voiced his belief that the future of the crypto industry lies in providing real-world use cases without necessarily relying on tokens or blockchain technology. Ardoino argues that the next breakthrough in the industry should focus on the fundamental value proposition offered by cryptography, emphasizing peer-to-peer transactions and privacy protections.
“Crypto doesn’t need a blockchain. It doesn’t need a token,” Ardoino stated, challenging the conventional reliance on these technologies. He proposes that the industry should shift its focus towards practical applications that offer tangible benefits to users.
Ardoino suggests that potential killer apps in the crypto space could take the form of everyday solutions, such as a booking system or a competitor to ride-sharing services like Uber. The key, according to him, is to leverage the core strengths of cryptography in facilitating secure and private peer-to-peer transactions.
One of the primary concerns raised by Ardoino is the centralization and regulatory scrutiny associated with token issuance. He argues that introducing a token creates a centralized point of failure, increasing the likelihood of regulatory challenges. Ardoino notes that many projects that issued tokens are currently under the scrutiny of regulatory bodies like the U.S. Securities and Exchange Commission (SEC).
“To be decentralized, this system wouldn’t need blockchain technology, which is slow and requires a global shared state,” Ardoino explained. He cited BitTorrent as an example of a decentralized system that achieved success without relying on blockchain technology.
The Tether CEO contends that departing from the conventional blockchain and token model could lead to more innovation and adoption in the crypto industry. By focusing on the core principles of cryptography, projects can potentially avoid regulatory challenges and offer solutions that resonate with a broader audience.
Also read:Bitcoin-Centric Firms Surge in Pre-market as BTC Soars Past $45K
As the crypto industry continues to evolve, Ardoino’s perspective challenges the status quo, encouraging a shift towards real-world applications that prioritize user experience and practicality over traditional blockchain and token-centric approaches.