Tuesday, October 27, 2020


$29 Million in Bitcoin Seized From Dutch Dark Web Money Launderers

26 October 2020, 20:29 GMT+0000
Updated by Ryan Smith
26 October 2020, 20:33 GMT+0000
thailand laundering

The Rotterdam District Court in the Netherlands has seized 2,532 bitcoins (~$29 million) from a couple convicted of money laundering on dark web platforms.

According to a court statement, the man and his wife from the city of Hilversum, located in North Holland, were also sentenced to two years and two and a half years in prison, respectively, for money laundering.

The Dutch Public Prosecution Service successfully prosecuted the couple for laundering more than €16 million ($18.9 million) over the course of two and half years after establishing that the source of the large bitcoin sum in their possession came from illegal dark web transactions.

Particulars of the Case

According to the court statement, two separate sums of 1,488 BTC and 1,044 BTC respectively were seized from the suspects, as well as €250,000 ($295,256) in cash. In addition, both suspects were individually fined €45,000 ($53,137) and forced to forfeit €138,000 ($162,955) and $40,000.

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The court established that the couple purchased bitcoin to exchange large euro sums in cash from private individuals and companies. These transactions were not disclosed to Dutch authorities and were made using methods to keep the customers anonymous.

The court explained that exchanges usually occurred at a fast-food restaurant in a big city, without any due diligence or KYC. This is typically advantageous for dark web criminals looking to swap their bitcoin for fiat without going through the usual checks of fiat-crypto exchanges.

“Traces of the Dark Web”

The court ruled that the acquired bitcoin bore hallmarks of dark web activity. Bitcoin use on the dark web has been linked to criminal activities like child pornography and murder-for-hire, and authorities often target these underground markets.

An excerpt from the court papers reads as follows:

“Traders did not ask customers for identity papers, while large amounts were often exchanged. The suspects, a man and his wife, came into contact with customers through advertisements on the Internet and a marketplace on the dark web. Much of the bitcoins traded bore traces of the dark web. The court has established that the suspects laundered more than 16 million euros in two and a half years.”

Monday, October 26, 2020


 5 Best Crypto Cards That You Should Know About INDUSTRY

5 BEST CRYPTO CARDS THAT YOU SHOULD KNOW ABOUT

BITCOINIST | OCT 26, 2020 | 16:00


  
 

Crypto cards aim to close the gap between legacy banking and digital assets. They allow users to benefit from holding funds in cryptocurrencies, with the flexibility to convert to cash via ATMs or spend them in the same way they can spend their fiat money from a bank account, at over 53 million merchants worldwide.


Crypto cards remove the hassle and slow process of converting crypto to fiat via an exchange and withdrawing to your bank account, mitigating the difficulties of merchant acceptance and lowering the barriers to mainstream adoption. 

The growing interest in the crypto space, and card payment demand in general, has led to a variety of different crypto card offerings, covering markets around the world and providing a range of functionality for users. 

CRYPTO.COM CARD

The metal Crypto.com Visa Card is available to users in Asia, Europe, and the United States. CRO holders can also stake the native token to receive enhanced cashback and rewards.

The card connects to the Crypto.com mobile app, the wallet service providing access to buy and sell 7 fiat and 53 cryptocurrencies. It also links to the entire Crypto.com ecosystem enabling users to earn interest, access credit, invest, accept payments, and exchange their crypto.

  • No minimum balance and no annual transaction fees.
  • No fees on ATM withdrawals up to $1,000.
  • Zero-fee foreign-exchange.
  • Fiat and crypto deposit support, with zero-fee crypto to fiat conversion.
  • Up to 8% CRO cash back rewards on each transaction.
  • 100% rebate for Spotify, Amazon Prime, and Netflix subscriptions.
  • 10% rebate for Expedia and Airbnb purchases.

COINZOOM CARD

The CoinZoom Visa Card offers Bitcoin, Ethereum, XRP, and other cryptocurrency pairs for the US market, expanding internationally. Behind the card is CoinZoom, a traditional brokerage firm aiming to become a digital banking solution for both crypto and fiat. 

The card and corresponding wallet app are combined with CoinZoom’s institutional-grade secure custody and registered digital currency exchange that expects to become the third US platform to be awarded a BitLicense, following Coinbase and Gemini.

  • Apple Pay and Samsung Pay connectivity.
  • Up to 5% cashback on all card purchases.
  • Up to 50% exchange discounts for ZOOM token holders.
  • Earn up to 8% APR on select cryptocurrencies.
  • Free “ZoomMe” instant Venmo-style remittance in USD or crypto, up to $10,000 per day.
  • Referral rewards of up to $50,000.
  • Automatic debit roundups to convert change to cryptocurrencies.

METAL PAY

 

Metal Pay works slightly differently, offering a solution that is connected to existing bank accounts or debit cards, more like a Venmo or PayPal for crypto but providing similar benefits. 

It authorizes the seamless transfer of funds to a Metal Pay account. Users can then create cash and crypto cards in the app to easily buy, sell, send, and receive over 30 cryptocurrencies.

The Metal Pay app supports FDIC-insured banks, so you can essentially get an FDIC insured cash account with Metal Pay. Currently available in the US, it has plans to expand globally.

  • “Pop” transaction rewards of up to 5%, paid in Metal token (MTL).
  • Instant deposits via linked bank account transfers and debit cards.
  • Fee reductions for MTL holders.
  • Free to send to friends and family.
  • Send funds and make payments using phone numbers.
  • Custodial and non-custodial wallets.
  • A cash wallet that is FDIC insured (US residents).

BINANCE CARD

The Binance Crypto Card taps into one of the largest global cryptocurrency exchanges, allowing users to automatically transfer crypto from their main Binance wallet to their Binance Card wallet. It follows Binance’s acquisition of Swipe, a leading digital wallet and debit card platform. 

Currently supporting BTC, SXP, BNB, and BUSD, the card is available throughout Europe, with more countries expected soon. 

  • Zero subscription or maintenance fees.
  • Up to 8% BNB cashback on transactions.
  • Google Pay and Samsung Pay integration.
  • Funds are SAFU benefiting from Binance’s enhanced security features.
  • Auto top-up triggers from your main Binance wallet once the minimum balance hits.
  • Less than 0.9% transaction fees.
  • Spend up to €8,000 daily.

WIREX CARD

Wirex offers a multi-currency Visa card and dedicated smartphone app, supporting 18 traditional and cryptocurrencies, with a built-in utility token, WXT. Users can benefit from cashback on purchases and the highest level of security protection.

Currently operating in parts of Europe and the Asia-Pacific, Wirex is now seeking to expand into Canada, Japan, and the US.

  • Up to 1.5% “Cryptoback” in BTC on all in-store purchases.
  • High limits up to $50,000 per day.
  • Fiat and crypto deposit support.
  • Up to 100% discount on fees using the WXT token.
  • Multi-signature, cold storage cryptocurrency accounts.
  • Flat fee for ATM withdrawals.
  • $1.50 monthly card management fee.

THE FUTURE FOR CRYPTO CARDS

Crypto cards provide a revolutionary step in adoption by simplifying the process of holding, exchanging, and spending cryptocurrencies, expanding market access, and helping entrants navigate a world of growing crypto utility.

The benefits developed so far are just the start, with increasing incentives including staking, interest-earning, and payment acceptance services, only broadening the potential of physical and virtual card-based crypto services in the years ahead.

Monday, October 19, 2020


Drug cartel used Tether to bribe US state gov’t officials: DoJ

An international drug cartel used Tether to bribe public officials in the state of Virginia, the U.S. Department of Justice has revealed. It also revealed some of the intricate methods the suspects used to distribute drugs and launder money for over a decade.

Court documents unsealed by the DoJ revealed charges related to drug smuggling, money laundering, identity theft and more brought against six individuals. The DoJ alleges that the six are part of an extensive crime ring operating in the U.S., Mexico, China, Belize and Guatemala that launders money derived from the sale of cocaine and other illegal drugs.

The criminals are alleged to have used Tether digital currency to bribe a U.S. government official.

As per the court documents, the crime ring was busted by U.S. Drug Enforcement Agency’s undercover agents who posed as corrupt government officials. In June, one of the accused men, Tao Liu, allegedly paid the DEA agent $1,000 in USDT as a bribe to secure a fraudulent U.S. passport. Days later, he paid the agent an additional $4,000 in USDT and then followed this up with two bank transfers worth $3,000 and $2,000, authorities said.

drug-cartel-used-tether-to-bribe-us-state-govt-officials-doj-1

The six, who were born in China but reside in the U.S., Belize, Hong Kong and Mexico, are also charged with importing and distributing cocaine in the U.S., money laundering, attempted identity fraud, bribing a government official and conspiring to launder money.

If convicted of their crimes, the DoJ is seeking the forfeiture of at least $30 million, “representing proceeds the defendants obtained in the course of the drug conspiracies and property involved in the money laundering conspiracy.”

The DoJ further wants Tao Liu to forfeit $5,000 in USDT traced to his bribery charges.

Other than the use of Tether to bribe the public officials, the charges also revealed the continued use of the banking system by money launderers. Some of the banks that the crime ring repeatedly used include the Industrial and Commercial Bank of China and the Agricultural Bank of China, two of the world’s largest banks.

Friday, October 16, 2020

Russian Metal Giant’s Tokenization Firm Expands to America


(Courtesy of Atomyze)

Russian Metal Giant’s Tokenization Firm Expands to America

Atomyze, a tokenization startup by Russian mining and smelting giant Nornickel, is setting up shop in Greenwich, Conn., to sell tokenized metals in the U.S.

The company, whose legal name is Atomyze LLC, will become the second foothold for Nornickel’s tokenization ambitions. It will work in parallel another entity that will tokenize Nornickel’s metals, Tokentrust, which was launched in February in Switzerland. Atomyze does not currently have a presence in Russia. 

There are two use cases for metal-backed tokens, Nornickel CEO Vladimir Potanin told CoinDesk last year. First, industrial producers can use such tokens to flexibly modify their contracts for the delivery of the actual metals. 

Second, people interested in investing in the metal industry might use the tokens to bet on the prices of metals such as palladium, copper or nickel, instead of buying stock in companies like Nornickel. 

Both Atomyze and Tokentrust will use a Hyperledger Fabric-powered backend coded by Nornickel’s engineers together with IBM, and will issue tokens backed by the mining giant’s inventory. Legally, however, their operations will be separated, as each company will only serve users in the country in which it is based – at least initially.

Nornickel did not respond to questions as to why the U.S. and Switzerland will be the first two markets for Atomyze by press time. The large U.S. market has been lucrative for financial service firms in general, even though there can be regulatory hurdles.

In Russia, meanwhile, the regulatory situation is getting clearer. This summer, a new law regulating digital asset issuance was passed, and starting in January issuers registered with the Bank of Russia will be able to launch tokens in a centralized, permissioned way.  

Due to the regulatory differences in Switzerland and the U.S., the two firms will be issuing two distinct sets of tokens. At least in the initial phase, these tokens will not be interchangeable, said Jeanine Hightower-Sellitto, CEO of Atomyze LLC. She added that “Atomyze LLC was created with the vision of building the products that will be familiar and common for the U.S. market.” 

Hightower-Sellitto, a Wall Street veteran and former managing director of operations at the Gemini crypto exchange, was named CEO of the company in September to build a commodity-backed token market fully compliant with U.S. regulations. Before Gemini, Hightower-Sellitto worked at Nasdaq subsidiary International Securities Exchange (ISE) for 13 years.

Along with Hightower-Sellitto, Atomyze now has a few professionals who came from notable crypto and blockchain companies. They include Corey Wendling, former senior vice president of Paxos; Jan Hendrik Scheufen, former chief product officer of the Scotland-based blockchain firm Monax; and Lyon Hardgrave, who used to lead the blockchain oil trading startup Vakt.

Wendling told CoinDesk via a spokesperson he was attracted to Atomyze’s ambition to “disrupt and change the way commodities are traded by allowing customers to bring their own smart contracts and tokens to our platform.” 

“We are building a system that is flexible and highly customizable to be able to support many different types of assets,” Wendling said.

He added that, unlike the already existing tokenization platforms, Atomyze will take a more conservative, permissioned approach, which would give the customers more confidence about the platform’s security. This means new companies willing to issue tokens on the platform will not be able to use the technology independently but will need to work with Atomyze. 

Metal bits

The metals themselves – palladium, platinum, nickel, cobalt and copper – will be kept in a secure vault that is physically located in the U.S., Hightower-Sellitto said. The name of the vault provider is not public, nor are the names of the banks to be involved with Atomyze LLC. 

The contents of the vault will be audited by U.S.-based auditors to make sure the tokens are backed by the actual metals on a 1:1 basis, Hightower-Sellitto said. 

She said that, at the moment, Atomyze is beginning to work on its money transmission and trust licenses in the U.S., and planning to launch in late Q1 of 2021. 

Hightower-Sellitto hopes to see institutional investors like macro funds, hedge funds, endowments and accredited investors among Atomyze’s clients. Investing in metals themselves is different from investing in the stock of metal-producing companies, as this way investors can bet on the performance of entire industries as opposed to particular companies.

“You can invest in the car companies, you can invest in Tesla but there is a lot of noise in Tesla stock. So if you want to invest in the electric car market itself as a directional perspective you could invest in components of the electric car batteries,” Hightower-Sellitto said.

The tokens, which will be tradeable on Atomyze’s own platform, will not qualify as securities, Hightower-Sellitto said, and the company hasn’t had any communications with the U.S. Securities and Exchange Commission about them. This is because every token will be backed by actual metals, so the customers will participate in spot commodities transactions, Hightower-Sellitto said.

“It’s important for our product to be fully deliverable. No customer wants to enter into the spot transaction and then find out they actually are trading a product that is regulated as a swap of another kind of derivative,” she said.

Nornickel CEO Vladimir Potanin told CoinDesk in an October 2019 interview that tokenized metals would attract both industrial consumers and investors who don’t need actual palladium or nickel but would like to bet on their prices.

Swiss-based Tokentrust’s board includes Alexander Stoyanov, the managing director of Nornickel’s subsidiary Global Palladium Fund.

Global Palladium Fund will be the first issuer on Atomyze, Hightower-Sellitto said, but in the future the platform can also become a marketplace for other asset-backed tokens and more issuers might want to use it.