Cryptocurrencies extended declines as Russia’s attacks on targets across Ukraine sent risk assets reeling, with Bitcoin slumping to a one-month low. The largest token fell as much as 8.5% to $34,337 after Vladimir Putin’s push to demilitarize Ukraine started with a barrage of missile attacks on Thursday. While Bitcoin pared its loss, it’s still down almost 50% from its all-time high set in November. Second-ranked Ether declined as much as 12% to $2,301.84. Other coins like XRP, Cardano and Solana were down as well. Bitcoin’s swings during the past weeks of escalating geopolitical tensions have undermined the argument that cryptocurrencies offer a hedge in times of trouble. That’s in large part a result of its deepening integration into global financial markets, which causes it to move more like other risk assets, according to Ben Caselin, head of research and strategy at crypto exchange AAX. The traditional safe haven gold, meanwhile, surged to the highest level in nearly two years on Thursday. “This is a different level of anxiety,” said Kenny Polcari, managing partner at Kace Capital Advisors. “When push comes to shove, and people think about safety and where to put their money, I think gold trumps Bitcoin.” The Russia-Ukraine crisis “could drive prices significantly lower in the short-term,” said Jonathan Tse, head of trading at crypto platform Copper.co. “However, it could be what’s needed to find a bottom sooner, rather than an ongoing crypto winter for prices slowly grinding lower.” The next key level to watch for Bitcoin in […]

The Justice Department named a veteran cybersecurity prosecutor to lead a new team dedicated to investigating and prosecuting illicit cryptocurrency schemes carried out by cyber criminals and nation states including North Korea and Iran. Eun Young Choi will be the first director of the National Cryptocurrency Enforcement Team, which will serve as the focal point for efforts to identify and dismantle the misuse of cryptocurrencies and other digital assets, Deputy Attorney General Lisa Monaco announced Thursday. “If we’re going to see — as I think we will — cryptocurrency gaining more traction and gaining wider adoption, we’ve got to make sure that the ecosystem that they operate in can be trusted and, frankly, can be policed,” Monaco said in an interview. “We’re going to make it our business to go after them and get those proceeds back and make it clear to them that they can’t hide.” The $2 trillion market for cryptocurrencies has boomed as companies and investors look to reap higher returns and get a foothold in a technology seen as still in its early days. Prosecutors and regulators are rushing to determine how to police that space — as well as the market for other digital assets such as nonfungible tokens — which has become a new frontier for criminals and rogue nations to steal and launder billions of dollars through anonymous avenues like blockchain transactions, encryption and digital wallets. Illicit transactions jumped almost 80% to $14 billion, an all-time high, in 2021, according to blockchain analytics firm Chainalysis. […]

The U.K.’s tax watchdog seized three nonfungible tokens as part of a suspected case of value-added tax fraud worth 1.4 million pounds ($1.9 million), in the first ever domestic enforcement action of this kind. Three people have been arrested on suspicion of attempting to defraud the authority, allegedly using a web of 250 fake companies, Her Majesty’s Revenue and Customs said by email. Authorities also seized other crypto assets worth about 5,000 pounds, while the NFTs have yet to be valued. NFTs, a type of digital asset that can be traded over blockchain networks, gained widespread popularity among crypto traders and art aficionados alike last year, even breaking their way into top auction houses such as Christie’s and Sotheby’s with multimillion-dollar sales. The market is worth a total of about $16 billion, an analysis of NFTGo data by crypto research firm Messari showed this month. The tokens, which symbolize ownership of a digital artifact like music or an image, are typically bought and sold using the cryptocurrency Ether. The most popular ones take the form of digital avatars that owners can use as their profile picture online, like those featured in collections from the Bored Ape Yacht Club or CryptoPunks. These assets can be worth millions of dollars, and have attracted celebrity attention in recent months from the likes of Paris Hilton, Reese Witherspoon and Serena Williams. “Our first seizure of a Non-Fungible Token serves as a warning to anyone who thinks they can use cryptoassets to hide money from HMRC,” said […]

Who walks away with the $3.6 billion in Bitcoin that the U.S. recovered from the Bitfinex currency exchange hack has become the cryptosphere’s favorite guessing game. David Silver, a lawyer who specializes in financial and cryptocurrency-related fraud, said since the seizure was announced Tuesday he’s received dozens of calls from individuals saying they lost money in the 2016 online heist and they want to get their coins back. Twitter has been whipped into a frenzy as well, with posters asking how to claim lost crypto. Justice Department officials said they plan to establish a court process for victims to reclaim the stolen digital assets, which have since surged in value. Figuring out whom the crypto belongs to may not be simple, however. Bitfinex considers that it’s made investors whole, and said in a statement that it will “follow appropriate legal processes to establish our rights to a return of the stolen Bitcoin.” If Bitfinex and users start off on a collision course, the legal battle would likely be protracted. “The world has changed dramatically since 2016, and everyone is going to lay claim to this newfound bag of Bitcoins,” Silver said. Bitfinex, a unit of British Virgin Islands registered iFinex Inc., declined comment. Does this get distributed to the people who were stolen from? — Glenn Mack (@glenn_mcan) February 8, 2022 At the heart of Bitfinex’s argument is a long-ago token distribution. After the attack in August 2016, when a hacker made away with more than 119,000 Bitcoin, Bitfinex allocated losses of more than […]

A Washington judge halted a decision to grant bail to two people charged with trying to launder billions of dollars worth of Bitcoin stolen in a 2016 hack of the Bitfinex currency exchange. Late Tuesday, the judge granted an emergency request by the U.S. government to continue to hold Ilya Lichtenstein and Heather Morgan in jail while the bail decision is reviewed. “The defendants are sophisticated cyber criminals and money launderers who present a serious risk of flight,” prosecutors said in their filing. The government said that while the majority of the stolen funds have been seized, there are several other virtual currency addresses that the government believes the couple control that hold about 7,506 Bitcoin, valued at more than $328 million. Lichtenstein and Morgan had been granted bail by a judge in lower Manhattan Tuesday night, after being arrested at 7 a.m. in New York. They face trial in Washington. The U.S. government said it seized about $3.6 billion worth of cryptocurrency from the married couple, the largest financial seizure ever. The two allegedly conspired to launder 119,754 Bitcoin, currently valued at about $4.5 billion, stolen after a hacker breached Bitfinex’s systems. U.S. Magistrate Judge Debra C. Freeman had set bail at $5 million for Lichtenstein and $3 million for Morgan. Both bonds were to be secured by their parents’ homes. But prosecutors asked a judge in Washington for an emergency delay to allow that court to consider whether Lichtenstein and Morgan should be released. Chief Judge Beryl Howell agreed with the […]

Bitcoin donations have soared to Ukrainian volunteer and hacking groups, some of which have supplied equipment to government forces, according to a report showing such groups received more than $550,000 worth of cryptocurrency in 2021. The report, published on Tuesday by blockchain researcher Elliptic, suggests digital currencies are growing in importance as a funding method for volunteer groups backing Ukraine’s government as fears of an attack by Russian troops massed near its border grow. Moscow denies planning an attack. Cryptocurrency worth just $6,000 was raised by the groups in 2020, Elliptic said. Cryptocurrencies can be sent and received anonymously, allowing organisations to raise money even if financial firms do not allow – or impose strict checks on – transfers of funds. “Cryptocurrency has proved to be a robust and growing alternative (to traditional currency) – especially when it comes to donations from other countries,” Elliptic said. In 2020, Ukraine tightened checks to curb money laundering, demanding ID verification for some domestic cash transfers. Cross-border transfers are also subject to mandatory monitoring, according to the Ukrainian National Bar Association. Elliptic tracks the movement of cryptocurrency on the blockchain for financial firms and government agencies. It said one group, Kyiv-based Come Back Alive, began raising funds in crypto in 2018 and received crypto worth almost $200,000 in the second half of 2021 alone. Come Back Alive says it provides materiel and medical supplies to Ukraine’s army including drones, sniper-rifle scopes and mobile surveillance systems. The donations page of its website lists a Bitcoin […]