NY sues crypto firms, FTX’s Nishad faces 75 years in jail, and Grayscale’s new BTC filing: Hodler’s Digest, Oct. 15-21

Published

2 years ago

October 21, 2023

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Grayscale files for new spot Bitcoin ETF on NYSE Arca

Major cryptocurrency investment firm Grayscale Investments has filed a new application with the U.S. Securities and Exchange Commission for a new spot Bitcoin exchange-traded fund (ETF). The new filing aligns with Grayscale’s ongoing effort to convert its Grayscale Bitcoin Trust into a spot Bitcoin ETF, according to a statement from the firm. The news comes weeks after Grayscale won an SEC lawsuit for its spot Bitcoin ETF review, with a court of appeals ordering the SEC to explain why it rejected Grayscale’s application in June 2023. The company also filed with the SEC to list an Ether futures ETF in September.

New York Attorney General sues Gemini, Genesis, DGC for allegedly defrauding investors

New York’s attorney general has filed a lawsuit against cryptocurrency firms Gemini, Genesis and Digital Currency Group (DCG) for allegedly defrauding more than 23,000 investors through the Gemini Earn investment program. The suit claims that Gemini assured investors that the program was a low-risk investment, while investigations carried out by the office of New York State Attorney General Letitia James found that Genesis’ financials “were risky.” The lawsuit also charges Genesis’ former CEO, Soichiro Moro, and its parent company’s CEO, Barry Silbert, with defrauding investors by attempting to conceal more than $1.1 billion in losses. In addition, the court case looks to ban Gemini, Genesis and DCG from operating in the financial investment industry in New York.

Former FTX engineering director faces up to 75 years in prison following guilty plea

Nishad Singh, the former engineering director at now-defunct crypto exchange FTX, faces up to 75 years in prison for charges related to defrauding users of the crypto exchange. He pleaded guilty to fraud charges as part of his cooperation agreement with the U.S. prosecutors. During his testimony this week, Singh said that when liquidity issues at FTX began in November 2022, he felt “suicidal for some days” while dealing with alleged inconsistencies between the exchange’s public statements and its activities behind the scenes. Singh also claimed that Bankman-Fried had the habit of deciding on purchases through Alameda Research by himself.

Binance shutting down European Visa debit card in December

Binance Visa debit card services will close down in the European Economic Area in December, marking the latest setback for Binance. The termination of the card services was announced a day after the exchange restored euro deposits and withdrawals, which had been unavailable for a month after payments processor Paysafe dropped the exchange. Binance is still not onboarding new users in the United Kingdom due to the loss of a third-party service provider.

Elon Musk, Mark Cuban team up to contest SEC trial strategies

Elon Musk, Mark Cuban and others have collaboratively submitted a shared amicus brief to the Supreme Court of the United States to raise concerns about the U.S. Securities and Exchange Commission’s (SEC) approach to conducting internal proceedings without the inclusion of juries. The context of this legal challenge centers around the SEC vs. Jarkesy case. George Jarkesy argues that the SEC’s internal adjudication process, which lacks a jury and is overseen by an administrative law judge appointed by the commission, contradicts his Seventh Amendment rights. Effectively resulting in a single entity fulfilling the roles of judge, jury and enforcer.

Winners and Losers

At the end of the week, Bitcoin (BTC) is at $29,590, Ether (ETH) at $1,607 and XRP at $0.52. The total market cap is at $1.12 trillion, according to CoinMarketCap.

Among the biggest 100 cryptocurrencies, the top three altcoin gainers of the week are Bitcoin SV (BSV) at 59.00%, Stacks (STX) at 25.91% and MX TOKEN (MX) at 25.26%.

The top three altcoin losers of the week are Conflux (CFX) at -8.03%, Frax Share (FXS) and Sui (SUI) at -6.35%.

For more info on crypto prices, make sure to read Cointelegraph’s market analysis.

Most Memorable Quotations

“We are all part of a bigger game, and Bitcoin is one of the strongest levers in that.”

Edward Snowden, technologist and whistleblower

“Using publicly available information to learn is not stealing. Nor is it an invasion of privacy, conversion, negligence, unfair competition, or copyright infringement.”

Google

“I felt betrayed, something I’d put in blood, sweat and tears for five years turning out so horrible.”

Nishad Singh, former engineering director of FTX

“The games funded 2 years ago are going live over the next 12 months. We will see hits.”

Robbie Ferguson, co-founder and president of Immutable

“After extensive DAO forum discussion followed by community vote, the sunsetting of the Lido on Solana protocol was approved by Lido token holders and the process will begin shortly.”

Lido Finance

“Any innovation — especially this one with financial impact, cultural value and status — will attract questioning during its downs.”

Anjali Young, co-founder of Collab.Land

Prediction of the Week

BTC price hits 2-month high amid bet Bitcoin will break $32K ‘soon’

On Oct. 20, data from Cointelegraph Markets Pro and TradingView captured new two-month Bitcoin highs of $30,233 on Bitstamp. BTC price showed continued strength during the Asia trading session on the same day, with a slight comedown taking the spot price back below $29,500.

With volatility still evident, market participants argued that a weekly candle close was needed in order to establish the rally’s true staying power. For Keith Alan, co-founder of monitoring resource Material Indicators, the 100-week moving average (MA) at $28,627 was of particular importance.

“This move is one to watch, but what I’m watching for right now is to see if this Weekly candle closes above the 100-Week MA and if next week’s candle can stay above it with no wicks below,” Alan wrote in part of an X post on the day. “Some might consider that a confirmation of a bull breakout, but this market is known for squeezes and fake outs so I’m looking for more confirmations. For me BTC will also need to take out prior resistance at $30.5k, $31.5k and ultimately $33k to call a bull breakout confirmed and validated.”

FUD of the Week

Fantom Foundation hot wallet hacked for $550K

The Fantom Foundation, the developer of the Fantom network, has been hacked for over $550,000 worth of cryptocurrency. The foundation confirmed the attack on X, claiming that most of the funds stolen belonged to other users and that 99% of the foundation’s funds remain safe. Blockchain security researchers initially reported that the attacker stole approximately $7 million in crypto. The Fantom Foundation later released an official statement saying that some of the wallets labeled “Fantom: Foundation wallet” were mislabeled by block explorers and that not all the stolen funds were from the foundation.

TrueCoin’s third-party vendor breach potentially leaks TUSD user data

TrueUSD (TUSD) announced a potential leak of certain Know Your Customer (KYC) and transaction history data after one of TrueCoin’s third-party vendors was compromised. The company was the operator of the TUSD stablecoin until July 13, 2023. The impact of the attack and the resultant data leak is yet to be identified, as the total number of users’ data was not revealed during the announcement. Data collected from such breaches — names, email addresses and phone numbers, among others — are typically used for phishing attacks. Attackers reach out to unwary investors by mimicking various crypto services, often promising high profits in short amounts of time.

Web3 game project allegedly hired actors to pose as executives in $1.6M exit scam

The development team for gaming project FinSoul carried out an alleged exit scam, siphoning away $1.6 million from investors through market manipulation, according to a recent report from blockchain security platform CertiK shared with Cointelegraph. The FinSoul team allegedly hired paid actors to pretend to be its executives, then raised funds for the sole purpose of developing a gaming platform. However, instead of actually creating the platform, the FinSoul team allegedly transferred $1.6 million in bridged Tether from investors to itself. Blockchain data indicates developers then laundered the funds through cryptocurrency mixer Tornado Cash.

Big Questions: What did Satoshi Nakamoto think about ZK-proofs?

What was once a passing interest of Bitcoin inventor Satoshi Nakamoto, zero-knowledge-proof technology is now a major part of the crypto world.

Ethereum restaking: Blockchain innovation or dangerous house of cards?

“Restaking” involves reusing staked Ether to earn fees and rewards. The restaked tokens can then help secure and validate other protocols. But many fear restaking could disrupt Ethereum’s chain itself.

Bitmain’s revenge, Hong Kong’s crypto rollercoaster: Asia Express

Bitmain allegedly fires staff for speaking out against salary cuts, Hong Kong investors lose faith in crypto after JPEX scandal, Bitget gets a new crypto credit card and more.

Editorial Staff

Cointelegraph Magazine writers and reporters contributed to this article.

Politics

Tories repeat calls for Rayner to resign after lawyers claim they did not provide tax advice

Published

2 hours ago

September 4, 2025

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Tories repeat calls for Rayner to resign after lawyers claim they did not provide tax advice

The Conservatives have repeated calls for Angela Rayner to resign after a legal firm she used said it did not provide her with tax advice in a row over underpaid stamp duty.

Party leader Kemi Badenoch said more “damning evidence” had come to light regarding the deputy leader’s tax affairs, which is now subject to an investigation by the prime minister’s independent ethics adviser Sir Laurie Magnus.

Politics latest: Former Tory minister Nadine Dorries defects to Reform

The Daily Telegraph reported that Verrico & Associates, a conveyancing firm that handled the purchase of her £800,000 flat in Hove, East Sussex, did not in fact give tax or trust advice to Ms Rayner – and that they believed they had been made “scapegoats” in the political row.

Joanna Verrico, the managing director, told The Telegraph: “We acted for Ms Rayner when she purchased the flat in Hove. We did not and never have given tax or trust advice. It’s something we always refer our clients to an accountant or tax expert for.

“The stamp duty for the Hove flat was calculated using HMRC’s own online calculator, based on the figures and the information provided by Ms Rayner. That’s what we used, and it told us we had to pay £30,000 based on the information provided to us. We believe that we did everything correctly and in good faith. Everything was exactly as it should be.

“We probably are being made scapegoats for all this, and I have got the arrows stuck in my back to show it. We are not an inexperienced firm, but we’re not qualified to give advice on trust and tax matters and we advise clients to seek expert advice on these.”

Sky News has approached representatives for Ms Rayner for comment as well Verrico & Associates.

The deputy prime minister, who is also the housing secretary, has been under scrutiny after the newspaper claimed she avoided £40,000 in stamp duty on the flat in Hove by removing her name from the deeds of another property in Greater Manchester.

Ms Rayner said she sold her stake in her family home in Ashton-under-Lyne to a trust that was set up to provide for her teenage son, who has lifelong disabilities – meaning she did not technically own that home when she purchased the one in Hove, and so was not subject to the higher rate of stamp duty that applies to second homes.

On Tuesday Sir Keir Starmer’s deputy claimed she made an honest mistake owing to her “complex” living situation and that lawyers initially advised her she only owed the basic rate of stamp duty for the Hove property.

In an interview with Sky News’ Electoral Dysfunction podcast, Ms Rayner became tearful as she claimed she received incorrect tax advice and spoke to her family about “packing it all in”.

However, following subsequent media reports, Ms Rayner sought further legal advice on Monday this week which advised her that the higher rate of stamp duty was in fact due on her East Sussex flat.

The deputy prime minister has claimed she made an honest mistake as lawyers initially advised her she only owed the basic rate of stamp duty when she bought a flat in Hove in May.

On the statement from Verrico & Associates, Ms Badenoch said: “This is yet more damning evidence that Angela Rayner has not been honest with the British public.

“From the start we’ve had nothing but excuses, deflections and lies. Enough is enough.

“How many final straws can there be for Angela Rayner? She must resign or Keir Starmer must finally find the backbone to sack her.”

Sir Keir Starmer has so far said he would not be drawn on Ms Rayner’s political future, but said he would “of course” act on the findings of Sir Laurie who will look into whether she broke ministerial rules.

In an interview with the BBC, Sir Keir said: “There’s a clear procedure. I strengthened that procedure. I am expecting a result pretty quickly.

“I do want it to be comprehensive … and then of course I will act on whatever the report is that’s put in front of me.”

Politics

SEC’s agenda proposes crypto safe harbors, broker-dealers reforms

Published

4 hours ago

September 4, 2025

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SEC’s agenda proposes crypto safe harbors, broker-dealers reforms

The proposed rule changes potentially affecting SEC guidelines on broker-dealers, custody and reporting could allow crypto companies to operate in the US with less oversight.

Politics

Fate of ‘Red Queen’ Rayner in hands of ‘quango king’ baronet

Published

5 hours ago

September 4, 2025

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Fate of 'Red Queen' Rayner in hands of 'quango king' baronet

The backgrounds of Angela Rayner and Sir Laurie Magnus – the sleaze watchdog who holds her fate in his hands – couldn’t be more different.

Labour’s “Red Queen” is a working-class council house girl who got pregnant at 16. He’s an old Etonian “quango king”, a City grandee and a pillar of the establishment.

He’s so posh he wasn’t awarded his knighthood in the usual way by the Monarch after being nominated by 10 Downing Street. He’s a baronet whose title is hereditary.

But though Sir Laurie’s a proper toff, he’s no pushover and he doesn’t waste time. In 2023 his investigation into former Tory minister Nadhim Zahawi’s tax affairs took just six days.

Sir Laurie concluded that Mr Zahawi’s conduct had fallen below what was expected from a minister. So the then PM Rishi Sunak sacked him for a “serious breach of the ministerial code”.

This year, Labour minister Tulip Siddiq quit after Sir Laurie said she should have been more alert to “potential reputational risks” of ties to her aunt in an anti-corruption investigation in Bangladesh.

That inquiry took eight days, so might Sir Laurie’s Angela Rayner probe take about a week? Perhaps, though it has been suggested he’s due to go on holiday on Saturday. So could his report come before then?

Sir Laurie was appointed by Mr Sunak more than eight weeks after he became PM. At the time, there were claims that he was struggling to find a candidate.

That was because the two previous holders of the post, veteran mandarin Sir Alex Allan and former Royal courtier Sir Christopher Geidt, both quit after disagreements with Boris Johnson.

Sir Alex quit in 2020 after finding former home secretary Priti Patel guilty of bullying. But then Mr Johnson declared that she had not breached the ministerial code.

Sir Christopher, a former private secretary to the Queen, quit in June 2022 after concluding Mr Johnson may have broken ministerial rules over party-gate.

So Mr Sunak turned to Sir Laurie, a former merchant banker who served on half a dozen quangos and whose long business career involved links with disgraced retail tycoon Sir Philip Green and the late tycoon Robert Maxwell.

There was immediately controversy because Mr Sunak refused to give Sir Laurie the power to launch his own investigations into allegations or ministerial wrong-doing. That changed when Sir Keir Starmer became PM last year.

But before then, Sir Laurie couldn’t launch his own inquiry into the conduct of Dominic Raab over bullying allegations or Suella Braverman over claims of leaking and ignoring legal advice over asylum.

The role of independent adviser on ministerial standards, to give Sir Laurie his official title, was created by Tony Blair in 2006. Ministers can refer themselves for investigation, as Tulip Siddiq and Angela Rayner both did.

Why was Sir Laurie chosen? A senior Square Mile insider told Sky News: “Laurie Magnus is very much a member of the City’s great and the good.”

Sir Laurence Henry Philip Magnus, 3rd Baronet is the third in a baronetcy that dates back to 1917, when it was awarded to an ancestor who represented London University in the House of Commons.

His quango CV includes the chairmanship of Historic England, a former trustee of the conservation charity the Landmark Trust, ex-chair of the National Trust, membership of the Culture Recovery Fund, a trustee of English Heritage Trust and deputy chair of the All Churches Trust.

As Historic England boss, Sir Laurie entered the row over the tearing down of the statue of slave trader Edward Colston in Bristol, claiming such statues should not be removed but have “counter-memorials” placed alongside them.

Besides his quango roles, Sir Laurie remains a major figure in the City, as a senior adviser at investment banking group Evercore and chairing two FTSE 250 listed investment trusts.

Which means that the class divide between the old Etonian City grandee and the former shop steward and champion of workers’ rights whose fate is in his hands couldn’t be greater.