Terraform Labs and Do Kwon Held Liable for Fraud in SEC Case

Top Weekly Crypto News: Terraform Labs Found Liable for Fraud, Memecoin Frenzy, Bitcoin Flash Crash, Argentina Crypto Regulations, and BlackRock Updates Bitcoin ETF

Terraform Labs and Do Kwon Found Liable for Fraud in SEC Case

In a landmark ruling, a jury has found Terraform Labs and its co-founder, Do Kwon, liable for defrauding investors in a civil case brought by the United States Securities and Exchange Commission (SEC). The verdict is a significant blow to Kwon, who remains in Montenegro as courts deliberate on whether to extradite him to face charges.

The SEC alleged that Terraform and Kwon misled investors about the safety and stability of TerraUSD (UST), Luna, and wLUNA, resulting in billions of dollars in losses. The jury found that the defendants were liable on six charges, including making false or misleading statements about the offering or sale of these digital assets and acting recklessly in their dealings with investors.

Trader Turns $13K into $2M in Memecoin Frenzy

Amidst the ongoing memecoin craze, a crypto trader has made a staggering gain of over 15,700% within an hour by investing in the novel memecoin Donotfomoew (MOEW). Launched on the Base blockchain, MOEW surged in value shortly after its debut, with its market cap currently standing at $31 million.

The airdrop of MOEW tokens has fueled its rapid growth, with over 8,000 addresses receiving them. The airdrop is accessible to users holding sufficient BWB points.

Bitcoin Flash Crash Leads to $165M in Liquidations

A sudden 5% drop in the price of Bitcoin (BTC) triggered a wave of liquidations, resulting in losses of over $165 million for leveraged traders. The sharp decline from $69,450 to $65,970 sent shockwaves through the market, with Bitcoin longs accounting for the bulk of the losses.

Argentina Implements Registration Requirements for Crypto Firms

The Argentine government has taken steps towards regulating the cryptocurrency industry by implementing registration requirements for cryptocurrency exchanges. The move, in line with Financial Action Task Force (FATF) recommendations, aims to bring virtual asset service providers under the purview of the country's financial regulators.

BlackRock Updates Bitcoin ETF, Adds Wall Street Firms

Global asset manager BlackRock has revised its Bitcoin exchange-traded fund (ETF) prospectus, adding five major Wall Street firms as authorized participants. The inclusion of ABN AMRO Clearing, Citadel Securities, Citigroup Global Markets, Goldman Sachs, and UBS Securities expands the authorized participants list, which previously included JPMorgan Securities, Jane Street Capital, and Macquarie Capital.

Weekly Market Winners and Losers

Bitcoin (BTC) ended the week at $67,570, while Ether (ETH) closed at $3,323 and XRP at $0.58. The total market capitalization stood at $2.53 trillion, according to CoinMarketCap.

Among the top 100 cryptocurrencies, the top three altcoin gainers for the week were Core (CORE) at 112.81%, Ethena (ENA) at 42.57%, and Pendle (PENDLE) at 30.34%. The top three altcoin losers were Wormhole (W) at -32.66%, Conflux (CFX) at -25.42%, and Akash Network (AKT) at -22.19%.

Is the Metaverse Turning Out Like 'Snow Crash'?

Amidst the hype surrounding the metaverse, concerns have been raised about its potential to replicate the dystopian vision presented in Neal Stephenson's 1992 novel, "Snow Crash." The novel depicts a virtual world controlled by corporations and governments, raising questions about the implications for user privacy, autonomy, and the distribution of power in the metaverse.

DAOs: The New Corporate Paradigm?

Decentralized autonomous organizations (DAOs) have emerged as a potential alternative to traditional corporate structures. DAOs are internet-native organizations that use blockchain technology to enable decision-making by consensus among their members. Advocates of DAOs argue that they offer greater transparency, inclusivity, and autonomy than traditional corporations.

Notable Quotations

• "I simply dislike spending long periods helping people who willingly choose to gamble on vaporware meme coins vs actual victims," said ZachXBT, a pseudonymous on-chain sleuth.
• "I never thought that what I was doing was illegal. I'm haunted, every day, by what was lost. I never intended to hurt anyone or take anyone's money," said Sam Bankman-Fried, former CEO of FTX.
• "We're not believers in crypto," said Sharmin Mossavar-Rahmani, chief investment officer at Goldman Sachs.
• "I think this [Bitcoin] is an insurance policy against rogue regimes or against just horrible fiscal and monetary policies," said Cathie Wood, CEO of ARK Invest.
• "People have told me that they desperately want to have substantive discussions with the [SEC] staff but worry that the inevitable result of such a meeting would be a call from enforcement," said Hester Peirce, commissioner at the U.S. Securities and Exchange Commission.
• "DeFi stands out as the only sector with the potential to leverage this narrative, providing a sustainable ecosystem for Bitcoin's evolving use cases," said Nash Lee, co-founder of MerlinSwap.

Bitcoin's 2028 Halving Price Target Estimated at $435K

Historical data suggests that Bitcoin's price could surge to $435,000 before the 2028 halving, a 650% increase similar to its performance since the 2020 halving. However, the diminishing returns trend indicates a potential rally of 360%, resulting in a price of approximately $303,600 per BTC.

AaveDAO Debates Dai Collateral Limit after $600M Mint

The Aave decentralized autonomous organization (AaveDAO) is debating limits on Dai (DAI) collateral following a $600 million mint by MakerDAO. Risk management consultants Chaos Labs proposed a 12% reduction in Dai loan-to-value ratios, while Marc Zeller, founder of the Aave Chan initiative, advocated for a 75% reduction.

OneCoin Legal Boss Sentenced to Four Years for $4B Crypto Scam

Irina Dilkinska, the former head of legal and compliance for the multibillion-dollar OneCoin fraud scheme, has been sentenced to four years in jail after admitting to laundering millions of dollars. She was ordered to forfeit $111 million in restitution and one month of supervised release.

Philippines SEC Accuses eToro of Offering Unregistered Securities

The Securities and Exchange Commission of the Philippines has issued an advisory against eToro, an online trading platform, for operating without authorization in the country. The advisory warns that individuals acting as representatives for eToro in the Philippines could face penalties of up to $88,300 in fines or imprisonment for violating securities laws.

ERC-20 Design Flaws a Crypto Scammer's Dream

Introduced in 2015, ERC-20 tokens have been plagued by security vulnerabilities that make them attractive to scammers. The lack of a central authority to enforce security standards and the limited ability to recover stolen funds exacerbate the problem.

AI Will Build the Metaverse, Says Alien Worlds

Eric Wall, a prominent Bitcoin proponent, has criticized Alien Worlds for its lack of innovation and its CEO's bullish claims about the integration of artificial intelligence (AI) into the metaverse. In response, Alien Worlds argues that AI will play a crucial role in shaping the metaverse, citing its ability to generate immersive experiences and personalized content.

'Web3 Gaming Sucks', Says Ava

The boss of Ava Labs' gaming division, Elijah Bailey, has voiced his criticism of the current state of Web3 gaming during the Game Developers Conference. He argues that Web3 games often focus on financial incentives over gameplay and that they often lack innovation.

Editorial Staff

This article was written and edited by the Cointelegraph Magazine team, including Kate Irwin, Kyle Torpey, William Malkinson, Ana Paula Pereira, and Aidan Sunnenberg.