14/07/2021 USDC Expands to New Blockchains, NFT Sales Continue, FATF Publishes Review of Crypto Standards, US and Global Crypto Enforcement Actions Continue

USDC Expands to 10 New Blockchains, Crypto Payment Initiatives Launch

By Jordan R. Silversmith

The Centre Consortium recently announced that USDC, a stablecoin that is backed 1:1 by U.S. dollars, will soon be added to 10 additional blockchain networks. In related news, Circle, “the principal operator” of USDC, has announced that it will go public through a business combination with a publicly traded special purpose acquisition corporation. According to a press release, the transaction values Circle at $4.5 billion.

As part of a recent deal between an enterprise payment company and digital-asset management firm NYDIG, 650 U.S. banks, including major community banks and credit unions, will soon be able to offer bitcoin purchases to an estimated 24 million customers. Rather than undertaking regulatory requirements related to having custody of cryptocurrencies, financial institutions choosing to make the bitcoin service available will rely on NYDIG’s custody services. Separately, the world’s largest interdealer broker recently announced that it intends to launch a cryptocurrency trading platform with two major U.S. financial services corporations in the second half of the year, with the goal of making cryptocurrency trading similar to the trading of traditional financial assets.

According to a recent press release, an international hotel chain has become the first international hotel group to accept cryptocurrencies. The growth in cryptocurrency payments was recently noted by a major U.S. credit card corporation, which said that its customers spent more than $1 billion using its cryptocurrency-linked cards in the first half of 2021.

NFT Sales Continue Across Sports and Art Markets

By Keith R. Murphy

The market for non-fungible tokens (NFTs) reached new highs during the second quarter of 2021, resulting in year-to-date sales of $2.5 billion as compared with sales of $13.7 million during the same period a year ago, according to a report this week. While the numbers vary depending on which types of NFT transactions are included, the included transactions are “on-chain” transactions, with sports and collectible NFTs leading in popularity among buyers.

Major League Baseball (MLB) recently closed its first NFT auction, which featured a clip of Lou Gehrig’s famous “luckiest man” speech, according to recent reports. MLB reportedly plans to auction an NFT that also includes as a package a physical 2020 Los Angeles Dodger World Series Ring and the chance to throw the first pitch at a Dodgers home game.

A major art auction house recently held several NFT-related auctions, including an NFT of an artwork celebrating rap artist Jay-Z’s debut album. A report discussing the sale notes that the NFT includes smart contract provisions enforcing royalties on secondary sales. Another auction by the house reportedly combines the sale of an actual painting by Pablo Picasso, along with an NFT of the painting created with a special scanner that can be used to confirm the painting’s authenticity. A third recent auction by the house involved an NFT of the source code for the creation of the World Wide Web by British computer scientist Tim Berners-Lee. The NFT reportedly sold to an anonymous buyer for $5.4 million.

According to a recent report, the digital artist known as Beeple has helped launch a platform that will sell moments in sports, politics, fashion and art as NFTs, including NFTs with tangible assets and opportunities, such as meetings with athletes. Separately, actor Anthony Hopkins is set to have his most recent film sold on an NFT marketplace for movies, according to a report this week, and the related NFT’s will include extras based on which token is purchased. And a popular social media forum has reportedly jumped on the NFT bandwagon by creating NFTs that take the form of cartoon avatars based on the company’s logo.

FATF Issues Review of Crypto Standards Amid Regulatory News in US and UK

By Robert A. Musiala Jr.

The Financial Action Task Force (FATF) recently published a report that provides FATF’s findings from its second 12-month review of the FATF Standards on virtual assets and virtual asset service providers (VASPs). The report states that “many jurisdictions and the VASP sector have continued to make progress in implementing the revised FATF Standards on virtual assets and VASPs but implementation is still far from sufficient.” The report notes that “[t]he lack of regulation or the lack of enforcement of regulation in jurisdictions is allowing for jurisdictional arbitrage and the raising of ML/TF [money laundering and terrorism financing] risks.” Among other things, the 46-page report includes findings related to the implementation of the travel rule, trends in the use of virtual assets for ML/TF purposes and virtual asset peer-to-peer market metrics. The report notes the following five areas where FATF intends to make updates to the FATF Standards on virtual assets and VASPs: (1) the definitions of virtual asset and VASP, (2) peer-to-peer transactions and unhosted wallets, (3) so-called stablecoins, (4) licensing and registration of VASPs, and (5) implementation of the travel rule.

The Financial Crimes Enforcement Network (FinCEN) recently announced the addition of its first-ever chief digital currency advisor, a role focused on preventing and mitigating illicit financial practices and exploitation involving cryptocurrencies. In a related development, according to reports, a team of engineers from five of the largest U.S. cryptocurrency exchanges and custodians recently demonstrated version 1.0 of a tech platform intended to drive compliance with the Travel Rule by VASPs. Separately, another recent report noted that in the UK, where new regulations require cryptocurrency firms to register with the Financial Conduct Authority, only six firms have registered while 64 have withdrawn their applications.

In tax regulatory news, last month the U.S. Internal Revenue Service published a memorandum addressing like-kind exchanges of certain cryptocurrencies completed prior to Jan. 1, 2018. According to the memorandum, “If completed prior to January 1, 2018, an exchange of (i) Bitcoin for Ether, (ii) Bitcoin for Litecoin, or (iii) Ether for Litecoin does not qualify as a like-kind exchange under § 1031 of the Code.”

Major Crypto Exchange Faces Global Scrutiny, Announces Compliance Efforts

By Kayley B. Sullivan

Binance, the world’s largest cryptocurrency exchange by volume, has of late received increased scrutiny from multiple global regulators. The Securities and Exchange Commission of Thailand, according to a recent notice posted on its website, has filed a criminal complaint against the company for operating a cryptocurrency exchange without a license after Binance failed to submit a response to the agency’s April 2021 warning letter. Japan’s Financial Services Agency similarly sent a warning to Binance last week, accusing the company of offering crypto services in the country without a registration.

The U.K. Financial Conduct Authority said in a recent statement that Binance Markets Limited “is not permitted to undertake any regulatory activity in the U.K.” Additionally, the Cayman Islands Monetary Authority, in a recent press release, noted that it “wish[ed] to inform the public” that Binance is not registered, licensed or otherwise authorized to operate from or within the Cayman Islands and that the Authority is currently investigating whether the companies may fall within the scope of its regulatory oversight.” Likewise, the Polish Financial Supervision Authority (PFSA) recently published a warning to consumers that the company is “neither regulated nor subject to supervision” by the PFSA.

Amid such crackdowns, Binance has suspended euro deposits via the Single Europe Payments Area, according to recent reports. Binance recently announced that it has hired a new director of compliance and chief administrative officer.

DOJ Targets Unlicensed Crypto MSBs, Global Enforcement Actions Continue

By Joanna F. Wasick

A New Orleans resident was recently charged by the Department of Justice for illegally operating an unlicensed money transmitting business. According to court documents, the defendant owned and managed Nervous Light Capital LLC, through which he sold bitcoin and other cryptocurrencies. Similarly, last week a Texas resident pleaded guilty to running a business that converted U.S. dollars to cryptocurrency (primarily bitcoin) for a fee without registering to engage in a money transmitting business. Both individuals face up to five years in federal prison.

Last week, detectives from London’s Metropolitan Economic Crime Command reportedly seized cryptocurrency valued at £114 million – the largest cryptocurrency seizure in the U.K. The detectives were investigating money laundering offenses. A recent article in The Korea Times reports that South Korean officials, while investigating a suspected crypto fraud and money laundering scheme, found $1.48 billion in illegal overseas cryptocurrency transactions. According to the report, 33 people have been implicated by the Seoul Central Customs for contravening the country’s ban on overseas cryptocurrency trading.

According to reports, earlier this week Israel’s National Bureau for Counter Terror Financing issued a seizure order against 84 cryptocurrency addresses allegedly controlled by Hamas or otherwise associated with donation campaigns carried out by Hamas. These addresses collectively received over $7.7 million in cryptocurrencies, in a wide range of denominations including tron, dogecoin, tether, bitcoin and ether. This action comes after a material rise in donations to Hamas in May, when fighting between Hamas and Israeli forces escalated.

Arts

https://www.jdsupra.com/legalnews/usdc-expands-to-new-blockchains-nft-5588912/

Interesting NFTs
Dai ni-danme (Act II), the house of Wakasanosuke. Honzo lopping the pine-branch, from the series Newly Published Perspective Picture of the Loyal Retainers
Katsushika Hokusai (1760-1849) Dai ni-danme (Act II), the house of Wakasanosuke. Honzo lopping the pine-branch, from the series Newly Published Perspective Picture of the Loyal Retainers 1801-1804 - Japan
Galactic Rainbow
"Thrust through the shadows, fly into orbit and discover the wonders & splendor of the universe ". Limited edition 1/1 art piece by Jonny Caplan (FutureSurfer) Emoji Renaissance Collection = Human + AI + 1000's of emojis.
Crossroad
LIMITED EDITION 1/1 | includes signed limited edition prints of all 3 states (pre-election, Trump win, Biden win) This piece is a first for Nifty, a token that will change based on the outcome of the election. If anything is constant about the times we now live in, it's uncertainty. This uncertainty is perfectly encapsulated in this piece of artwork as the person buying the piece will not know the final artwork. The artwork will be one state at auction before the election, and after the results of the election are known, will forever change to reflect a Trump or Biden win. PLEASE FUCKING NOTE: If trump wins, this token will change to that video of sexy boi king trump stomping through hell FOREVER. I don’t want you coming back to me bitching that you spent $2M* on this and now it’s a video of orangeman going HAM and it’s keeping u up at night popping mad boners. should have voted bruh. *and stfu that this isn’t gonna be worth a fuckton more when I hit 30 years of everydays and have a permanent collection in the MOMA. smh.
Mars House
Mars House is the first NFT digital house in the world. Upon purchase of Mars House NFT, 3D files will be sent to the new owner by Krista Kim Studio Inc. for file upload to the owner’s Metaverse. Technical support for Mars House integration on Metaverse is provided. (Architectural Digest, March 14, 2021) “Kim ventured into NFTs while exploring meditative design during quarantine; her hope was to use the influx of digital life as an opportunity to promote wellbeing. Comprised entirely of light, the visual effects of her crypto-home are meant to omit a zen, healing atmosphere. The artist also partnered with musician Jeff Schroeder of The Smashing Pumpkins to create a calming musical accompaniment. So what makes the file a compelling purchase? Beyond the promise of buying into the lucrative NFT market, the home and all of the furniture in it can be built in real life by glass furniture-makers in Italy, as well as through MicroLED screen technology. Kim also has a strong visions the art being projected, as well. “Everyone should install an LED wall in their house for NFT art.” says the artist. “ This is the future, and Mars House demonstrates the beauty of that possibility.” The owner is in agreement to the following terms and conditions upon purchase of Mars House (hereby referred to as Mars House NFT): The collector agrees to own one copy of Mars House NFT on a single Metaverse platform. The collector is required to register Mars House NFT ownership with Krista Kim Studio Inc. Krista Kim Studio Inc. will provide technical support to upload and integrate Mars House NFT on a Metaverse platform. If/when Mars House is resold, the collector is required to delete all Mars House NFT 3D file(s) from his/her Metaverse, and provide verification of deletion to Krista Kim Studio Inc. before new 3D files are transferred to the new owner by the artist. The new owner is required to register Mars House NFT ownership with Krista Kim Studio Inc. Krista Kim Studio will send Mars House NFT 3D files directly to the new owner and provide support for Metaverse integration. This verified ownership transfer system will be appointed to Krista Kim Studio Inc. trusteeship, after 40 years of the date of the sale. Krista Kim Studio Inc. retains ownership of Mars House NFT copyright. All rights reserved. All reproductions of Mars House (NFT) in both digital and physical formats, are restricted. Mars House NFT physical furniture pieces, made of tempered printed glass in Italy, may be commissioned by the collector as NFT physical pieces.
CryptoPunk #9373
The CryptoPunks are 10,000 uniquely generated characters. No two are exactly alike, and each one of them can be officially owned by a single person on the Ethereum blockchain. Originally, they could be claimed for free by anybody with an Ethereum wallet, but all 10,000 were quickly claimed. Now they must be purchased from someone via the marketplace that's also embedded in the blockchain.