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Terraform Labs co-founder Do Kwon denies fraud allegations in US court

Do Kwon, the South Korean cryptocurrency entrepreneur responsible for the collapse of TerraUSD and Luna currencies, pleaded not guilty to US criminal fraud charges on Thursday. The plea followed his extradition from Montenegro earlier this week.

Kwon, co-founder of Terraform Labs, is accused of orchestrating a multi-billion-dollar fraud scheme that led to an estimated $40 billion loss in cryptocurrency value in 2022. Federal prosecutors in Manhattan unsealed a nine-count indictment against Kwon, charging him with securities fraud, wire fraud, commodities fraud, and conspiracy to commit money laundering.

The indictment claims Kwon deceived investors by falsely promoting TerraUSD as a stablecoin guaranteed to maintain its $1 value. Prosecutors allege that when TerraUSD’s value dropped in 2021, Kwon secretly enlisted a high-frequency trading firm to inflate the token’s price, misleading investors and artificially boosting its sister token, Luna.

These alleged misrepresentations drove substantial investment into Terraform Labs’ products, propelling Luna’s market value to $50 billion by early 2022. However, the scheme unravelled in May 2022 when TerraUSD and Luna crashed, causing turmoil in the broader cryptocurrency market.

Kwon, 33, remains in custody in Manhattan after declining to seek bail during his initial court appearance. His trial is set to begin on 8 January. Kwon has faced mounting legal troubles, including a $4.55 billion settlement with the US Securities and Exchange Commission and a federal jury finding him liable for defrauding investors earlier this year.

His case is part of a broader crackdown on cryptocurrency figures, including FTX’s Sam Bankman-Fried and Celsius Network’s Alex Mashinsky, as US authorities tighten scrutiny over the volatile industry.

US weighs new restrictions on Chinese drones amid security concerns

Due to national security concerns, the US Commerce Department announced plans to consider new rules restricting or banning Chinese-made drones. The proposed regulations, open for public comment until 4 March, aim to safeguard the drone supply chain against potential threats from China and Russia.

Officials warn that adversaries could exploit these devices to access sensitive US data remotely. China dominates the US commercial drone market, with DJI, the world’s largest drone manufacturer, accounting for more than half of all sales.

The Biden administration has already taken steps to curb Chinese drone activity. In December, President Joe Biden signed legislation requiring an investigation into whether drones from companies like DJI and Autel Robotics pose unacceptable security risks.

If unresolved within a year, these companies may be barred from launching new products in the US. Additionally, DJI has faced scrutiny over alleged ties to Beijing’s military and accusations of violating the Uyghur Forced Labor Prevention Act, claims the company denies.

US Commerce Secretary Gina Raimondo hinted at measures similar to those targeting Chinese vehicles, focusing on drones with Chinese or Russian components. While DJI disputes allegations of data transmission and surveillance risks, US lawmakers remain concerned.

The evolving landscape underscores Washington’s broader efforts to address perceived security vulnerabilities in Chinese technology.

Albania’s TikTok ban: Balancing youth protection with free speech and economic impact

In Tirana, Albania, Ergus Katiaj, a small business owner who relies on TikTok to market his nighttime delivery service for snacks, cigarettes, and alcohol, faces an uncertain future. The Albanian government has announced a year-long ban on the social media platform, a move aimed at curbing youth violence.

The ban follows a tragic incident in November where a 14-year-old boy was fatally stabbed, reportedly after an online clash with a peer. Prime Minister Edi Rama said the decision, announced on 21 December, is to protect young people, but critics argue it threatens free speech and commerce ahead of the May elections.

The ban aligns Albania with a growing list of countries imposing restrictions on TikTok due to concerns over harmful content and its ties to China-based parent company ByteDance. However, business owners like Katiaj fear significant financial losses, as TikTok has been a vital tool for free marketing.

Rights groups and opposition leaders, such as Arlind Qori of the Bashke party, worry the ban sets a troubling precedent for political censorship, particularly in a country where protests against the jailing of political opponents were met with harsh government responses last year.

TikTok has called for urgent clarification from the Albanian government, asserting that reports indicate the videos linked to the tragic incident were uploaded to another platform. Meanwhile, the debate continues, with some viewing the ban as a protective measure for youth and others as an overreach limiting commerce and dissent.

For many, like Katiaj, the ban underscores the broader challenges of balancing public safety with democratic freedoms in Albania.

Malaysia tightens social media oversight with new licensing law

Malaysia’s communications regulator has granted licenses to Tencent’s WeChat and ByteDance’s TikTok under a new social media law designed to combat rising cybercrime. The law, effective from 1 January, mandates that platforms and messaging services with over 8 million users in Malaysia must obtain a license or face legal consequences.

While messaging app Telegram is close to completing the licensing process, Meta Platforms, the owner of Facebook, Instagram, and WhatsApp, has just started compliance steps. Other major platforms face scrutiny under the law. X, formerly known as Twitter, claims its user base in Malaysia falls below the 8 million threshold, a claim currently under review by authorities.

Alphabet’s YouTube has not applied for a license, citing concerns about how the law applies to its video-sharing features. The regulator emphasised that non-compliance could lead to investigations and regulatory actions.

The move follows a surge in harmful online content earlier this year, prompting Malaysian authorities to urge tighter monitoring from social media companies. Content related to online scams, child exploitation, cyberbullying, and sensitive topics such as race, religion, and royalty is classified as harmful.

Platforms like TikTok, Facebook, and YouTube reportedly have millions of active users in Malaysia. TikTok has over 28 million users aged 18 and above, highlighting the region’s high stakes of regulatory compliance.

Bitcoin’s value surges past $100,000, Trump victory drives crypto optimism

Bitcoin surged past $100,000 in 2024, more than doubling its value, driven by pivotal regulatory and political developments. The US Securities and Exchange Commission’s approval of exchange-traded funds tied to Bitcoin’s spot price marked a significant milestone, attracting mainstream and institutional interest in the cryptocurrency sector.

A broader crypto rally saw Bitcoin gain over 120% and Ethereum rise nearly 50%, boosting the market’s total value to $3.5 trillion. Analysts predict Bitcoin could reach $200,000 by late 2025, solidifying its status as a premier store of value. Enthusiasm for the asset class has extended to corporate treasuries, with firms like MicroStrategy leading the charge.

MicroStrategy’s shares quintupled in 2024, reflecting its substantial Bitcoin holdings. Other companies, including major financial players, are incorporating Bitcoin into their portfolios. Meanwhile, Donald Trump’s victory in the US presidential election, coupled with his pro-crypto stance, further energised the market.

Despite the rally, challenges persist for smaller crypto miners. Rising energy and hardware costs have limited gains for firms like Riot Platforms and Marathon Digital, which struggled against the year’s bullish trends.

Terraform Labs co-founder Do Kwon extradited to US by Montenegro

Montenegro has extradited Terraform Labs co-founder Do Kwon to the US, where he faces charges related to investor deception and the collapse of the TerraUSD cryptocurrency. The Montenegrin interior ministry confirmed Kwon was handed over to US law enforcement at Podgorica airport.

Kwon, a South Korean national, was arrested in March 2023 while attempting to leave Montenegro. The Supreme Court recently ruled that legal conditions for extradition were met, prompting Justice Minister Bojan Bozovic to approve the US request. His legal team has appealed the decision at Montenegro’s Constitutional Court.

The former CEO of Terraform Labs is accused of misleading investors about TerraUSD’s stability. The cryptocurrency collapsed in May 2022, triggering an estimated $40 billion in market losses. Kwon and his company are also being sued by the US Securities and Exchange Commission over allegations of fraud involving TerraUSD and Luna.

Stablecoins are digital assets designed to maintain a fixed value, typically pegged to a fiat currency. TerraUSD’s failure undermined trust in their stability and shook the broader cryptocurrency market.

US Army soldier faces charges for selling phone records

A US Army soldier, Cameron John Wagenius, has been charged with selling and attempting to sell stolen confidential phone records. Arrested on 20 December, Wagenius faces two charges of unlawfully transferring confidential information in a Texas federal court. His rank and station have not been disclosed, though he is reportedly based at Fort Cavazos in Texas.

Authorities allege that Wagenius, known online as ‘Kiberphant0m’, claimed involvement in hacking activities, including phone records linked to high-profile figures. The case is connected to a broader investigation involving hackers accused of stealing sensitive personal and financial information. Prosecutors have revealed the involvement of a hacking group targeting data storage firm Snowflake’s customers.

Cybersecurity researchers identified Wagenius after members of the group issued threats against them. Law enforcement acted swiftly following the tip-off, according to Allison Nixon of Unit 221B. The prosecution is being handled in Seattle, where two co-defendants, Connor Moucka and John Binns, face related charges for extensive data breaches.

The Department of Justice and the FBI have yet to comment on the case. Wagenius has been ordered to appear in Seattle, where the investigation continues.

Russian gas flows to Europe through Ukraine stop permanently

Russian gas deliveries to Europe via Ukraine ceased on New Year’s Day, concluding decades of reliance on Moscow’s energy dominance. Gazprom confirmed the halt at 0500 GMT, following Ukraine’s refusal to renew a transit agreement. The stoppage, long anticipated, follows a dramatic shift in European energy dynamics spurred by the war in Ukraine.

Alternative supply arrangements by EU nations such as Slovakia and Austria have ensured that the end of Russian gas transit through Ukraine will not affect consumer prices. Hungary remains connected to Russian gas through the TurkStream pipeline, while Moldova’s pro-Russian Transdniestria region is already facing heating shortages due to the cutoff.

The European Union has significantly reduced its dependence on Russian energy, replacing supplies with liquefied natural gas from Qatar and the US, as well as piped gas from Norway. Ukrainian Energy Minister German Galushchenko hailed the decision as historic, stating that Russia would face substantial financial losses as a result.

Both sides are set to incur economic setbacks. Ukraine is losing $800 million annually in transit fees, while Gazprom faces a $5 billion drop in sales. Once dominant in Europe’s energy markets, Russia’s share has plummeted from 35% to near irrelevance, marking the end of an era shaped by Soviet-era pipeline projects.

US sanctions Iranian and Russian entities over election meddling

Sanctions have been imposed by the US on organisations in Iran and Russia accused of attempting to influence the 2024 presidential election. The Treasury Department stated these entities, linked to Iran’s Revolutionary Guard Corps (IRGC) and Russia’s military intelligence agency (GRU), aimed to exploit socio-political tensions among voters.

Russia’s accused group utilised AI tools to create disinformation, including manipulated videos targeting a vice-presidential candidate. A network of over 100 websites mimicking credible news outlets was reportedly used to disseminate false narratives. The GRU is alleged to have funded and supported these operations.

Iran’s affiliated entity allegedly planned influence campaigns since 2023, focused on inciting divisions within the US electorate. While Russia’s embassy denied interference claims as unfounded, Iran’s representatives did not respond to requests for comment.

A recent US threat assessment has underscored growing concerns about foreign attempts to disrupt American democracy, with AI emerging as a critical tool for misinformation. Officials reaffirmed their commitment to safeguarding the electoral process.

Koeberg nuclear plant upgrade bolsters South Africa’s power grid

Eskom has reconnected the second unit of the Koeberg nuclear power plant to South Africa’s grid following a significant refurbishment, providing a welcome boost to electricity supply. This achievement follows a decade marked by controlled power outages, which have finally given way to nine months of uninterrupted electricity, improving business confidence in the country.

Located near Cape Town, Koeberg remains Africa’s sole commercial nuclear power plant, generating approximately 1,860 megawatts, or 5% of the nation’s electricity. Eskom’s CEO, Dan Marokane, highlighted Koeberg’s role in aligning economic and environmental goals, promoting a sustainable energy future.

In a move to extend the plant’s longevity, the nuclear regulator approved a 20-year extension of Unit 1’s operating licence in July. A similar decision for Unit 2 is anticipated by 2025, underscoring South Africa’s commitment to maintaining and expanding its nuclear energy resources.

Looking ahead, South Africa plans to add 2,500 megawatts of nuclear capacity. Efforts to revive the development of the Pebble Bed Modular Reactor, abandoned over a decade ago, are also under consideration as the nation explores innovative energy solutions.