Crypto News Roundup: August 16, 2023 📰

Hello, crypto enthusiasts! Welcome to another edition of Crypto News Roundup, where I bring you the most important and interesting stories from the world of cryptocurrencies.


Today, I have some major news about Binance Connect, a Chinese Filecoin mining firm, a Republican inquiry on Prometheum, and a SwirlLend exit scam. Let’s dive in!

Binance Connect Shutting Down on Aug. 16 ❌

Binance Connect, the regulated buy-and-sell crypto platform of the leading crypto exchange Binance, is reportedly shutting down today. The platform allowed users to buy and sell cryptocurrencies with fiat currencies in over 170 countries and regions.

According to a Binance spokesperson, the decision to shut down Binance Connect was made after a periodic review of the company’s products and services. The spokesperson said that Binance wanted to focus its resources on core efforts that align with its long-term strategy of being a global blockchain ecosystem with multiple business lines.

The spokesperson also said that Binance would continue to adapt and modify its business approach in response to changing market and user needs. However, some analysts speculated that the shutdown was due to the increasing regulatory pressure that Binance has been facing in various jurisdictions, such as the UK, Japan, Singapore, and the US.

Binance Connect users were advised to withdraw their funds from the platform before the shutdown. They can still access other Binance products and services, such as Binance.com, Binance Smart Chain, Binance NFT, and Binance Academy.

Chinese Filecoin Mining Firm Charged for Allegedly Orchestrating $83.3 Million Pyramid Scheme ⚖️

A Chinese Filecoin mining firm and its four executives are facing a lawsuit at the People’s Court of Pingan County in China for their alleged involvement in an $83.3 million pyramid scheme. The firm, named Filecoin Star (FCS), claimed to be an authorized partner of Protocol Labs, the developer of Filecoin.

Filecoin is a decentralized storage network that allows users to rent out their unused disk space and earn FIL tokens in return. FCS offered customers two ways to participate in Filecoin mining: either by paying fees for purchasing mining equipment or by leasing mining machines from FCS.

However, prosecutors allege that FCS was not actually mining FIL tokens, but instead used the fees collected from customers to pay off old investors and recruit new ones. The scheme allegedly attracted more than 57,000 users and secured nearly $100 million from them.

The case was brought to light by a whistleblower who reported FCS to the police in April 2023. The police raided FCS’s offices and arrested the four executives in May 2023. The trial is expected to start soon.

Republican Lawmakers Demand Gensler Tell Them How Prometheum Got SEC Approval 🧐

Republicans on the US congressional committee are demanding Securities and Exchange Commission (SEC) Chair Gary Gensler to hand over documents related to a license issued to digital asset firm Prometheum. Prometheum is a blockchain-based platform that aims to offer regulated security token offerings (STOs) and trading services.

Prometheum received approval from the Financial Industry Regulatory Authority (FINRA) in July 2023 to operate as an alternative trading system (ATS) for digital assets. This made Prometheum the first firm to receive such approval from both FINRA and the SEC.

However, some Republican lawmakers are questioning the timing and rationale of the approval. They sent a letter to Gensler on August 15, 2023, asking him to provide all documents and communications related to Prometheum’s application process. They also asked him to explain how Prometheum’s approval aligns with the SEC’s stance on digital asset securities regulation.

The letter suggested that the approval was aimed at demonstrating that legislation is not needed for regulating digital asset securities, as there is already a workable regulatory framework. The letter also criticized Prometheum for having no operating history and no track record of serving customers.

SwirlLend Disappears With $460K In Apparent Exit Scam on Base and Linea ❗️

SwirlLend, a decentralized finance (DeFi) lending platform based on Base and Linea blockchains, seems to have executed a $460,000 exit scam, according to on-chain analysis from security firm PeckShield. SwirlLend claimed to offer users high returns by lending out their crypto assets to borrowers.

However, PeckShield found that SwirlLend drained $290,000 in crypto assets from Base and $170,000 from Linea on August 16, 2023. The SwirlLend team transferred the funds to Ethereum and then deleted all of their social media accounts.

PeckShield warned users to be cautious of similar DeFi projects that promise high returns with low risk. The firm also advised users to check the code and audit reports of DeFi projects before investing in them.

Uzbekistan Permits Two Banks to Issue Crypto Cards 🏦

Uzbekistan, a Central Asian country that has been exploring crypto regulation, has given permission to two private banks to issue crypto cards. The banks, Kapital Bank and Ravnaq Bank, have received approval from the National Agency for Perspective Projects (NAPP), which oversees the digital sandbox of crypto regulation in Uzbekistan.

The crypto cards, called UzNEK, will be powered by Mastercard and will allow users to link their bank accounts with access to a crypto exchange and an automated exchange mechanism. Users will be able to buy, sell, and store cryptocurrencies such as Bitcoin, Ethereum, and Litecoin using UzNEK cards.

The UzNEK cards are expected to launch in September 2023 and will be available for both individuals and businesses. The cards will also offer other benefits such as cashback, discounts, and loyalty programs.

The NAPP said that the crypto card project is part of its efforts to create a favorable environment for the development of the digital economy in Uzbekistan. The NAPP also said that it plans to expand the scope of the digital sandbox to include other areas such as e-commerce, e-government, and e-health.

Uzbekistan is one of the few countries in the region that has shown a positive attitude towards cryptocurrencies. In 2018, the country legalized crypto trading and mining and exempted them from taxes. However, in 2019, the government banned the use of cryptocurrencies for payments and imposed strict KYC requirements for crypto exchanges. The NAPP was established in 2020 to test and implement new digital technologies in Uzbekistan.

Conclusion

That’s all for today’s Crypto News Roundup. I hope you enjoyed reading it and learned something new. Stay tuned for more updates and insights from the crypto world. And remember, always do your own research before investing in any crypto project. Stay safe and happy trading! 😊

Sources 🔗

1. Binance Connect Shutting Down on Aug. 16 | Source: CoinTelegraph
2. Chinese Filecoin Mining Firm Charged for Allegedly Orchestrating $83.3 Million Pyramid Scheme | Source: The Block
3. Republican Lawmakers Demand Gensler Tell Them How Prometheum Got SEC Approval | Source: CoinDesk
4. SwirlLend Disappears With $460K In Apparent Exit Scam on Base and Linea | Source: The Block
5. Uzbekistan Permits Two Banks to Issue Crypto Cards | Source: CoinTelegraph

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