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Crypto regulation in the world: weekly digest #74

BVI

This week Tether, the USDT stablecoin issuer, froze 41 crypto wallets tied to sanctions as a precautionary measure. These wallets were controlled by individuals on the Office of Foreign Assets Control's (OFAC) Specially Designated Nationals (SDN) List. Tether's CEO, Paolo Ardoino, stated that by executing voluntary wallet address freezing of new additions to the SDN List and freezing previously added addresses, they aim to strengthen the positive usage of stablecoin technology and promote a safer stablecoin ecosystem for all users.

Tether is registered in the British Virgin Islands. The stablecoin issuer has been actively involved in freezing funds in cryptocurrency addresses linked to terrorism and warfare, in collaboration with law enforcement agencies and counter terror financing bureaus. Tether's actions demonstrate its commitment to promoting responsible blockchain technology use and standing as a robust defense against cybercrime.

Tether, as the world-largest stablecoin issuer, has blacklisted a total of 1,029 addresses as of the present time. The company has been working with various law enforcement agencies across 19 jurisdictions to freeze assets connected mainly to theft, hacks, and other illicit behaviors. Tether has also partnered with Israel's National Bureau for Counter Terror Financing (NBCTF) to mitigate the use of crypto to fund terrorism and warfare. In October 2023, Tether froze funds in 32 cryptocurrency addresses linked to terrorism and warfare in Israel and Ukraine, seizing over $870,000 worth of USDT.

It is possible to find out that several recently frozen wallets had been using coin-mixing service Tornado Cash. One of the frozen wallets is also associated with the $625 million Ronin Bridge attack, which, according to the U.S. Treasury Department, was executed by North Korean hacking group Lazarus Group.

France

Société Générale, one of the France largest banks, has launched its own euro-pegged stablecoin called EUR CoinVertible (EURCV). This stablecoin is the first of its kind in the region and is fully backed by the Euro. It is available for trading on the Luxembourg-based Bitstamp crypto exchange, making it the first euro stablecoin issued by a fully regulated bank to be listed on a cryptocurrency exchange.

The stablecoin, developed by Société Générale's crypto division, SG Forge, is built on the Ethereum blockchain and is designed to facilitate the settlement of trades involving digital bonds, funds, and various assets. It is also intended to be embraced across different financial service providers, highlighting the bank's role in the evolving crypto domain. The stablecoin has a maximum total supply of 10.5 million and its reserves are fully collateralized by cash reserves and high-quality securities.

The launch of EURCV is a significant development in the European stablecoin market, especially with the European Union's Markets in Crypto-Assets Regulation set to come into force in 2024. The listing of EURCV on Bitstamp extends its access to retail traders and marks a major step in building markets beyond the current dominance of USD-backed stablecoins.

Salvador

El Salvador, where Bitcoin is a legal tender, has partnered with Tether to launch the «Adopting El Salvador Freedom Visa Program» which is a citizenship-by-investment initiative using cryptocurrency. The program aims to attract wealthy investors who can put $1 million in BTC or USDT, with a non-refundable $999 deposit, and successful applicants are also eligible for a Salvadoran passport and citizenship. This partnership reinforces El Salvador's position as a leader in mainstream crypto and aims to drive progress through blockchain payment technology. Tether supports the program by providing essential technology and payment infrastructure.

Key aspects of Tether's support for the Freedom Visa Program include:

  • Streamlining the application process to encourage visionary contributions to El Salvador's cultural enrichment and societal upliftment.

  • Ensuring a secure and efficient investment process for participants, who must pass KYC checks.

  • Allowing accepted applicants to deposit their non-refundable $999 USD deposit in Bitcoin or USDT, which will be credited towards the $1 million investment required to secure the Freedom Visa.

The partnership between El Salvador and Tether aims to elevate the country as a trailblazing hub for tourism and economic liberty, marking a significant step toward societal evolution and innovation. The collaboration highlights Tether's role as a technology enabler, supporting cities, countries, and communities.

News from other countries:

  • The BRICS (Brazil, Russia, India, China, South Africa) countries have discussed the possibility of creating a common stablecoins for trade and investment between each other, but there are no concrete plans to do so. The plans were announced this week by Russian authorities.

  • Anatoly Legkodymov, the founder and majority owner of the Hong Kong-registered cryptocurrency exchange Bitzlato, has pleaded guilty to operating an unlicensed money transmitting business in the United States. As part of his plea agreement, Legkodymov agreed to dissolve Bitzlato and release any claim over approximately $23 million in seized assets. Bitzlato was sanctioned by the U.S. government in January, with the Treasury Department and DOJ alleging that the exchange laundered around $700 million worth of funds.

The TokenScope Team
#TokenScope #CryptoNews #AML #Salvador #Tether #OFAC #sanctions #BitZlato
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