US Regulator Sues Crypto Hedge Fund Founder — $25 Million in Digital Assets to Be Frozen
The U.S. Securities and Exchange Commission has filed a lawsuit against a cryptocurrency hedge fund founder for fraud. The regulator is seeking an emergency order freezing $25 million in digital assets held by a crypto hedge fund he controls.
The U.S. Securities and Exchange Commission (SEC) has sued a crypto hedge fund founder in Manhattan federal court. The regulator alleges that Stefan Qin, a 23-year-old Australian, defrauded investors in his $92.4 million cryptocurrency arbitrage fund, according to Tuesday’s court filing.
Qin founded New York-based Virgil Capital and four other entities. He allegedly fabricated records, failed to redeem $3.5 million for investors, and tried to withdraw $1.7 million of investor funds to pay off Chinese loan sharks, the SEC said. According to Reuters:
The SEC has asked U.S. Judge Lorna Schofield for an emergency order freezing $25 million in digital assets held by another Qin-controlled fund.
The SEC explained that Qin controls two cryptocurrency funds: the Virgil Sigma Fund and the VQR Multistrategy Fund.
He “claims to trade for the Sigma Fund by taking a market-neutral ‘arbitrage approach to the cryptocurrency market,’ utilizing ‘a proprietary algorithmic trading system that continually scans for price differences between cryptocurrency markets,’” the SEC noted. Qin further claimed that his trading algorithm can “generate better returns than an investment in bitcoin.”
The Sigma Fund documentation provided to investors claimed that the fund “held millions of dollars worth of digital assets at 39 trading platforms, including three of the largest U.S.-based platforms,” the SEC wrote, emphasizing:
In reality, the Sigma Fund held no assets at any of those U.S.-based platforms, and the purported platform account balances were fabricated.
Moreover, the SEC explained that the crypto hedge fund founder told investors wanting to redeem investments totaling $3.5 million in the middle of this year that their funds would be moved to the VQR Multistrategy Fund. However, in reality, the funds were not transferred.
In December, Qin asked VQR head trader Antonio Hallak to help him withdraw $1.7 million from that hedge fund, according to a declaration by Hallak filed in the case. Qin claimed he had a “liquidity issue” and needed to repay a loan that he had taken out “from lenders he feared in China,” the SEC detailed. After Hallak informed him that he could not use the investors’ capital in the VQR Fund, Qin threatened to “fire everyone if necessary” to make the full withdrawal.
“Bank records show that several large wire transfers totaling approximately $2.5 million have been received by the Sigma Fund since June 2020,” the SEC continued. “Approximately $1.3 million of the $2.5 million was transferred by Qin first to a foreign bank account in the Sigma Fund’s name and then transferred immediately to a U.S. bank account in Qin’s name.”
The SEC has asked the court to permanently restrain Qin and his companies from participating in “the issuance, purchase, offer, or sale of any security,” as well as order them to “disgorge their ill-gotten gains according to proof, plus prejudgment interest” and pay civil penalties.
What do you think about Qin’s case? Let us know in the comments section below.
The post US Regulator Sues Crypto Hedge Fund Founder — $25 Million in Digital Assets to Be Frozen appeared first on Bitcoin News.
- Bitcoin New ATH $15,000 Now Beats Visa by Mcap | Crypto Corner ep.126
- Biden Administration May Roll Back Some Crypto Regulations, Top Banking Regulator Warns
- Ripple XRP NEW CRYPTO REGULATIONS!!! What Will The Biden Administration Do!? | Coin Crypto News
- Australian Crypto Adoption Increased With 20% Citizens Owning Crypto
- Russian Parliament Foresees a Wave of Token Issuance for 2021 in the Wake of Crypto Law Promulgation
Bitcoin New ATH $15,000 Now Beats Visa by Mcap | Crypto Corner ep.126
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Biden Administration May Roll Back Some Crypto Regulations, Top Banking Regulator Warns
The top U.S. banking regulator is concerned that the Biden administration may roll back some cryptocurrency regulations aimed at protecting consumers. This includes allowing national banks to custody crypto assets put in place during the Trump administration.
Acting Comptroller of the Currency, Brian Brooks, shared several concerns regarding cryptocurrency regulations in an interview with CNBC last week.
Brooks is the administrator of the federal banking system and chief officer of the Office of the Comptroller of the Currency (OCC). The OCC supervises almost 1,200 national banks, federal savings associations, and federal branches of foreign banks.
He was asked to comment about the recent bitcoin bull run from the regulatory viewpoint. Brooks replied:
I will tell you what I am worried about is all of this is happening in the environment where we are about to have a change of presidential administration, and there are calls on Capitol Hill to dismantle some of the regulatory protections we put in place for this stuff.
The OCC green-lighted banks under its supervision to provide cryptocurrency custody services in July. Brooks explained that his agency “is trying to make it safer for people to custody in national banks.” He added: “We’ve talked about banks supporting some of these stablecoin projects. If those protections aren’t in place, I really worry about the environments for these kinds of things. That’s what I’m most focused on. How do we preserve the safety for the people who participate in that market.”
He noted that “We are at a really critical inflection point right now is what I’d tell you. It’s kind of a fork in the road.” He proceeded to outline two paths for crypto regulation. “One path forward is that we find ways of addressing money laundering risks and we find ways of addressing terrorism financing which I think can be done. But we make this safe for the consumers and investors who participate, that’s why the banking system has such an important role to play,” he asserted, adding:
The other path which is a very real potential here is that we politicize some of these tech issues, whether it’s crypto or fintech more broadly. We politicizing it by undoing all of the good work this administration has done to make it safer, to make it more real.
Brooks then referenced the letter by Congresswoman Maxine Waters urging the Biden administration to roll back some of the regulations the OCC put in place. Among the recommendations was rescinding allowing national banks and federal savings associations to provide crypto custody services. Regarding the suggestions Waters put forth in her letter, Brooks said, “If we do those things, then I’m not sure we have enough of a foundation to move forward. It’s all about consolidating regulatory gains and consumer protection that we are trying to put in place. That’s got to stick around.”
He further detailed that “The role of the government is to make sure that markets are well-regulated and well-organized so that people who are transacting know that they are transacting with good people and not bad people.” He emphasized, “Part of that means that, as in any financial markets, there has to be tracing and no anonymity.”
The acting comptroller of the currency clarified that people who hold cryptocurrencies need to know that they are not going to lose them. “That’s why it’s important to people that they be able to custody their assets in a bank, for example, the same way you might custody your stock certificates or any other assets that you own,” Brooks opined.
“This is a real political debate right now,” Brooks noted, emphasizing:
People may not realize this but there’s leadership in Congress who’s urging the incoming Biden administration to roll back some of those protections. I think, in the name of politics not in the name of protecting investors.
Recently, the Financial Crimes Enforcement Network (FinCEN) proposed new regulation for cryptocurrency wallets. Public comments can be submitted before Jan. 4. Meanwhile, the U.S. Securities and Exchange Commission (SEC) is taking action against a number of crypto firms for selling unregistered securities, including Ripple Labs.
Do you think the Biden administration will roll back some crypto regulations? Let us know in the comments section below.
The post Biden Administration May Roll Back Some Crypto Regulations, Top Banking Regulator Warns appeared first on Bitcoin News.
Ripple XRP NEW CRYPTO REGULATIONS!!! What Will The Biden Administration Do!? | Coin Crypto News
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Australian Crypto Adoption Increased With 20% Citizens Owning Crypto
December 26, 2020December 26, 2020
The Australian crypto adoption increased with about 20% of the citizens owning crypto according to the latest reports that we have in today’s cryptocurrency news.
A new survey conducted by the Australian crypto exchange independent Reserve shows that about 90% of the locals heard of at least one crypto asset and nearly one in every five respondents said that they own a digital asset. The report highlighted that its Independent Reserve Crypto index survey reached everyday Australians and reflected the nation as a whole rather than focusing on digital asset users.
The number of people who heard of at least one crypto asset increased by over 90% in a year to 91.4% which is somewhat expected, as the first cryptocurrency leads the market awareness with 89%. The difference with the second biggest crypto asset Ethereum is also substantial as the charts show. Bitcoin’s popularity was equal among women and men but men were 3 times more likely to have heard of any crypto-like EOS, Litecoin or Ethereum.
The report said that younger generations between 18-24-year-olds, are more likely to be aware of the Defi tokens with 14.4% while the overall figure reached 7.8%. when it comes down to buying crypto, the report numbers are more compelling. The paper classified this as the key indicator of Australian attitudes to crypto as an actual adoption. About 18.4% of the respondents answered that they own one digital asset at least which is an increase from the past year’s percentage of 16.8%. The age group between 25 and 44 displayed the most growth in one year while 10% of UK citizens noted that they bought digital assets according to the study.
The Australian crypto adoption results reaffirmed the stance that BTC is still the most popular asset for Australians but Ripple surpassed ETH and took over the second spot. More people took advantage of the 2020 bull run in the crypto market and about 40% made profits by expanding their digital asset portfolio. 21.8% said that their wealth dropped because of bad crypto investment. But, older citizens made some profits as the report noted, due to their conservative trading approaches.
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Author: by admin
Russian Parliament Foresees a Wave of Token Issuance for 2021 in the Wake of Crypto Law Promulgation
The head of the Russian parliamentary committee on financial markets and the country’s first crypto law’s author is forecasting a “surge in token issuance” for 2021 in the wake of the promulgation expected to take place in January.
According to the Parliamentary Gazette, Anatoly Aksakov claimed that a “big number of large enterprises” had asked the State Duma (Russian Parliament) to pass the law as soon as possible. Also, he adds that such businesses plan to issue stablecoins.
The crypto law, “On Digital Financial Assets,” is expected to be promulgated on January 1, 2021. Moreover, the report suggests that companies showing interest in crypto regulation are related to the financial sector. Many of them are also in the exploitation of minerals, who are looking to tokenize their processes.
But the lawmaker didn’t only talk about the general status of the crypto law, as he referred to the digital ruble, stating that many parliamentarians are still discussing topics related to such digital asset:
From my point of view, digital ruble is one of the future forms of our ruble, and it should contribute to the development of the financial assets market.
On July 31, 2020, Russian President Vladimir Putin signed the “crypto bill” approved by the State Duma, the lower house of the Russian parliament, on July 22 and by the Federation Council on July 24.
As news.Bitcoin.com reported, the law grants a definition to the digital currency, stating that “it is recognized as an aggregate of electronic data capable of being accepted as the payment means, not being the monetary unit of the Russian Federation or a foreign state, and as investments.”
However, it adds that cryptocurrencies “cannot be used simultaneously to pay for any good and services.”
Also, on November 13, 2020, the Russian Ministry of Finance announced new amendments to the country’s cryptocurrency regulation, outlining a new set of rules for cryptocurrency owners, exchanges, and miners.
What do you think about the opinion of the nonprofit organization? Let us know in the comments section below.
The post Russian Parliament Foresees a Wave of Token Issuance for 2021 in the Wake of Crypto Law Promulgation appeared first on Bitcoin News.