Author: Faith Yakubu

Binance, one of the world’s largest cryptocurrency exchanges, is embroiled in a new legal battle in Canada as a class-action lawsuit alleges violations of securities laws. Ontario’s Superior Court of Justice published a certification motion for the lawsuit on April 19, reigniting legal scrutiny against the exchange.

The lawsuit accuses Binance of selling cryptocurrency derivative products to retail investors without proper registration, in violation of Ontario Securities Act (OSA) and federal laws. Plaintiffs represented by Christopher Lochan and Jeremy Leeder seek damages and recissions of unlawful derivative trades for Canadian Binance users, numbering in the tens of thousands.

This legal action comes after Binance announced plans to cease operations in Ontario in response to regulatory warnings from the Ontario Securities Commission (OSC) in 2023. Despite this announcement, the OSC’s investigation into Binance remains ongoing, highlighting continued regulatory scrutiny.

The lawsuit further tarnishes Binance’s reputation, already marred by previous controversies, including former CEO Changpeng Zhao’s guilty plea to US anti-money laundering violations in 2021. Although current CEO Richard Teng has made efforts to steer Binance towards regulatory compliance, including securing a Dubai crypto license, the exchange’s past regulatory issues continue to overshadow its progress.

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In the wake of the memecoin frenzy, over $25 million invested in pre-sold Solana memecoins has been left stranded, with more than half of the top projects abandoned within just one month.

ZachXBT’s investigation identified 12 Solana memecoin projects that have been deserted by their founders, leaving investors in the lurch. Solana Co-Founder Anatoly Yakovenko expressed skepticism towards the trend, stating, “Pre-selling a meme doesn’t make any sense to begin with.” Yakovenko previously cautioned against investing in memecoin pre-sales, highlighting the riskiness of such endeavors.

Of the 22 projects initially scrutinized, ZachXBT revealed that 12 have already been deserted within a month. Notable among these are LIKE, MOONKE, FROG, TEMPLE, and SORRY, which collectively raised over $2 million. Other projects, including those like @Jared_eth, raised substantial funds without even launching a token, with one account flagged as compromised by the web3 security platform Pocket Universe.

The memecoin frenzy has now shifted to the Coinbase-backed Base blockchain, indicating a lack of lessons learned from the Solana debacle, according to ZachXBT.

Meanwhile, the price of SOL, Solana’s native token, has witnessed a significant decline since the memecoin boom. Although SOL surged to over $200 during the peak of the frenzy, largely fueled by memecoin speculation, it has since plummeted to $154 as of the latest data. This represents a 23% decrease, despite SOL having already bounced back approximately 30% from its recent low of $117 on April 13.

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As scrutiny over the misuse of Tether’s USDT stablecoin intensifies, the company pledges to take decisive action against addresses linked to sanctions violations.

Tether, the issuer of the popular USDT stablecoin, has announced its commitment to freezing any addresses associated with sanctioned entities. This proactive stance follows reports indicating the exploitation of USDT tokens by certain state actors to evade US sanctions.

A spokesperson for Tether stated, “Tether respects the Office of Foreign Assets Control (OFAC) SDN list and is committed to working to ensure sanction addresses are frozen promptly.”

In the past year, Tether has actively frozen addresses holding substantial amounts of its digital assets involved in illicit activities. For example, the company froze 32 addresses containing $873,118.34 linked to unlawful activities in Israel and Ukraine.

Tether’s CEO, Paolo Ardoino, emphasized that these actions underscore the company’s dedication to establishing robust safety standards within the emerging cryptocurrency industry.

Despite Tether’s compliance efforts, recent reports have highlighted ongoing exploitation of the USDT stablecoin by terrorist groups and sanctioned nations seeking to bypass restrictions. Venezuela’s state-owned oil giant, PDVSA, reportedly utilized USDT for crude oil and fuel exports amid renewed US sanctions. Additionally, Russia has increasingly turned to alternative payment avenues, including Tether’s USDT stablecoin, to evade economic sanctions, according to US Treasury Deputy Secretary Adewale Adeyemo.

A United Nations report also revealed the prevalence of cryptocurrency-based money laundering, with Tether’s USDT on the TRON blockchain being a favored choice, particularly within illegal online gambling platforms.

In response to these developments, US Senator Elizabeth Warren has advocated for stringent regulatory measures, emphasizing the importance of including stablecoin issuers and other decentralized finance (DeFi) intermediaries under anti-money laundering (AML) and combating the financing of terrorism (CFT) requirements in any proposed stablecoin regulations. Excluding such entities, Warren argues, could enable bad actors to exploit the growing crypto trading activities facilitated by the legislation.

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Kenya is preparing to extradite Nadeem Anjarwalla, a Binance executive wanted by Nigerian authorities for alleged involvement in tax evasion and a dramatic escape from custody. Anjarwalla was apprehended in Kenya over the weekend in a joint operation involving several agencies, including the EFCC, Nigeria Police Force, Kenya Police Service, FBI, and INTERPOL, following weeks of search efforts. He is expected to be extradited to Nigeria within the week to face trial on tax evasion charges, with the possibility of additional charges related to illegal passport use and escape from custody.

Anjarwalla, Binance Africa’s regional manager, along with another executive, Tigran Gambrayan, encountered legal issues in Nigeria in February due to their association with the crypto exchange. Anjarwalla evaded custody in March using a Kenyan passport and had been evading authorities until his recent capture.

This development adds to the ongoing tension between Binance and Nigerian authorities. Gambrayan, who has been detained since February, is currently facing trial for alleged tax evasion. However, the proceedings have faced delays, with the court adjourning the case twice due to issues with formally serving charges to the exchange. Binance CEO Richard Teng has expressed willingness to cooperate with Nigerian authorities, but specific efforts to secure the release of the detained executives remain undisclosed.

Similarly, Gambrayan’Kenya to Extradite Binance Executive Linked to Tax Evasion to Nigeria attempts to secure bail have encountered obstacles, with a federal high court in Abuja postponing his bail application hearing. He is presently held at the Kuje Correctional Center pending further legal proceedings.

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In a bid to prevent the illicit use of cryptocurrency for money laundering, Thailand’s Securities and Exchange Commission (SEC) announced plans to block local access to unauthorized crypto platforms. Investors are urged to withdraw funds from such platforms as authorities move to restrict their operations.

Following a meeting with a government committee on technology-related crimes, the SEC was tasked with identifying and submitting information on unauthorized digital asset service providers to the Ministry of Digital Economy and Society. Once approved by the courts, access to these platforms will be prohibited.

While specific criteria for disqualifying platforms were not disclosed, the SEC provided a verification website to help investors assess legitimacy. Blocking access aligns with efforts to combat criminal activity, drawing parallels with similar actions taken in India and the Philippines.

Previously, the SEC initiated legal proceedings against unauthorized exchanges of Binance and Bybit. The agency emphasizes the risks associated with unregulated operators, highlighting the lack of legal protection and the potential for fraud.

This crackdown follows recent crypto-friendly measures by Thai authorities, including the extension of VAT exemption on crypto trading gains and permission for local institutions to invest in U.S. spot bitcoin exchange-traded funds.

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