Cryptocurrency roundup for June 20: Crypto.com’s alleged secret trading teams, AMF sheds light on DeFi's regulatory challenges, Binance pulls back from UK and more

Governments and public institutions across the world are eyeing blockchain technology as a means to enhance transparency, accountability, and efficiency in their operations.

> Arthur Breitman, co-founder of the blockchain platform Tezos, recently discussed the prospects and challenges of integrating blockchain technology into government systems.

> In a conversation, Breitman highlighted the potential of blockchain in emerging markets, touched upon the unique capabilities of Tezos, and addressed the prospects of collaboration with government entities.

> Breitman noted that Tezos initially gained attention as one of the first proof-of-stake platforms, with a governance mechanism that empowers its community to decide how the blockchain evolves.

> He emphasized that scalability has been a critical focus for Tezos. Continue here.

In a revelation that casts a shadow over the integrity of trading practices in the cryptocurrency space, Crypto.com is allegedly concealing its internal proprietary trading teams.

> The Singapore-based digital currency exchange is said to have made concerted efforts to hide these trading operations.

> Several unnamed insiders have shared insights with the Financial Times, shedding light on how the internal teams operate.

> One of the sources claimed that Crypto.com's management has instructed its employees to publicly deny the existence of such operations, with a directive to “say there is no internal market maker type operation”.

> However, Crypto.com rejected claims of any unethical connection between its internal trading operations, termed as internal market makers, and the exchange itself. More here.

France's premier financial market authority, the Autorité des Marchés Financiers (AMF), has voiced its support for internationally harmonized regulations governing decentralized finance (DeFi).

> In a recently released discussion paper, the AMF revealed its initial contemplations regarding the regulatory challenges posed by the decentralized and disintermediated features of the DeFi ecosystem.

> The AMF’s paper delves into defining critical components of DeFi, such as decentralized autonomous organizations (DAOs) and smart contracts, which automate transactions.

> One of the key statements in the paper reads, "Due to the cross-border nature and reach of DeFi activities, the AMF also supports the development of a globally coordinated approach towards the regulation to ensure a global level-playing field, which should both aim to protect investors and foster innovation." Details here.

Montenegro's court handed down prison sentences to the notorious Do Kwon, often referred to as the “crypto king,” and his accomplice, Han Chang-Joon, for attempting to flee the country using counterfeit Costa Rican passports.

> The incident, which took place in March, saw the duo trying to board a private jet.

> The verdict came on Monday in Podgorica, the capital city of Montenegro, and was closely followed by local media outlets.

> The pair were found guilty and have each been sentenced to a four-month prison term.

> Do Kwon, the ex-CEO of Terra, refuted the accusations in court last Friday. He maintained his innocence, stating that he had procured the Costa Rican passport via an agency based in Singapore. More here.

Binance, the prominent cryptocurrency exchange, is scaling back its operations in key markets in the face of increasing scrutiny from regulatory bodies across the globe.

> Binance Markets Limited (BML), a subsidiary of Binance based in the United Kingdom, has formally withdrawn its registration from the United Kingdom’s Financial Conduct Authority (FCA).

> This withdrawal signifies that, as of now, no Binance company is permitted by the FCA to offer services within the UK, as mentioned on the FCA’s website.

> The FCA completed Binance's deregistration process on May 30, 2023, after Binance submitted a request for the cancellation of BML’s permissions.

> In a statement dated June 7, the FCA announced, “Following the completion of the cancellation of permissions the firm is no longer authorized by the FCA.” Full report here.

The surge in risk assets goes on, although digital assets haven’t been keeping pace with the Nasdaq stock index, lagging by 24% since the start of May.

> This is after they had initially increased by 52% from the beginning of the year, according to a research report published by Bank of America on Friday.

> Bank of America analysts Alkesh Shah and Andrew Moss highlighted that there is a pessimistic outlook toward digital assets.

> "Digital asset sentiment remains poor as the U.S. Securities and Exchange Commission’s (SEC) enforcement actions create regulatory uncertainty, pressuring token prices," Shah and Moss stated.

> They went on to mention that “digital asset trading platforms are just one piece of the broader ecosystem.” More here.

Ether, the cryptocurrency native to the Ethereum network, received a favorable tailwind as the Hinman documents were disclosed in the ongoing legal case between Ripple and the U.S. Securities and Exchange Commission (SEC), according to a research paper released by JPMorgan.

> The documents, released last week, pertain to communications associated with William Hinman's 2018 declaration, in his capacity as the then-Director of Corporation Finance at the SEC, that Ether didn't resemble a security.

> Ripple, which is embroiled in a lawsuit with the SEC, divulged these emails as a part of its defense.

> Notably, the JPMorgan report highlighted that the SEC's upper echelon did not classify Ether as a security in 2018. Details here.