Brazil’s net imports of crypto assets have surged by over 60% in the first nine months of 2024 compared to the same period last year, according to the country’s central bank. Total imports reached $12.9 billion through September, already exceeding the $11.7 billion recorded for all of 2023. Fernando Rocha, head of the central bank’s statistics department, noted a slight month-to-month decline from August to September but stressed that year-on-year growth remains strong.
Demand for stablecoins, digital assets pegged to real-world assets such as the United States dollar, has been the primary driver behind this increase, making up nearly 70% of all crypto transactions in Brazil this year, according to tax revenue data. Central bank chief Roberto Campos Neto recently announced plans to regulate stablecoins in 2025, citing concerns about their links to tax evasion and illicit activities.
As the world’s tenth-largest crypto market, according to blockchain analytics firm Chainalysis, Brazil continues to see stablecoins grow in popularity, largely due to their price stability and ease of international transfer. Unlike cryptocurrencies with fluctuating values, stablecoins such as Tether (USDT) and USDC offer Brazilians a reliable way to move funds quickly and securely.
JP Morgan Chase has initiated lawsuits against customers accused of exploiting a glitch to withdraw large sums from its ATMs. The viral ‘infinite money glitch’ trend on TikTok involved users writing large cheques to themselves, depositing them, and withdrawing the money before the cheques were returned as invalid.
The lawsuits target two individuals and two businesses, demanding the return of funds with interest, reimbursement of overdraft fees, and coverage of legal expenses. In a court filing, JP Morgan revealed that one incident involved a $335,000 cheque deposited on 29 August, with over $290,000 still owed after the cheque was deemed counterfeit.
Bank officials stressed their commitment to fraud prevention, describing bank fraud as a serious crime in court documents. The total amount linked to the defendants in the lawsuits exceeds $660,000. Typically, banks permit customers to withdraw only part of a cheque’s value until it clears.
The Wall Street Journal recently reported that the bank closed the loophole shortly after the glitch went viral. An ongoing investigation by JP Morgan is reviewing thousands of potential fraud cases tied to the incident.
The surge in AI exchange-traded funds (ETFs) reflects the growing investor enthusiasm for AI as fund managers launch new options to capture market interest. According to Morningstar, over a third of the AI-focused ETFs on the market were introduced in 2024, raising total assets in this category to $4.5 billion—close to the $5.5 billion held by nuclear-themed ETFs and far outpacing the $1.37 billion in cannabis funds. This growth is partially driven by high-profile gains, like chipmaker Nvidia’s stock surge of over 200% in the last year, which underscores AI’s profit potential, said Morningstar senior analyst Daniel Sotiroff.
BlackRock has added two new actively managed AI ETFs to its lineup, aiming to capture emerging opportunities in AI as the technology evolves. “The AI market is going to change dramatically,” noted Tony Kim of BlackRock, highlighting that what AI represents today will continue to shift. Bank of America analysts agree, describing the competition in AI among tech giants like Microsoft and Amazon as an “arms race.” This year, capital spending on AI by these firms is expected to total $206 billion, marking a 40% increase over last year, while venture capital funding for AI startups is projected to rise 27%, reaching $79.2 billion.
Despite the enthusiasm, AI-focused funds haven’t consistently outperformed the broader market; for instance, the Global X Artificial Intelligence & Technology ETF has gained about 20% in 2024, trailing the S&P 500’s 22% rise. Amplify ETFs recently shifted an existing cloud-computing ETF to focus on AI opportunities, illustrating the industry’s shift toward differentiating AI investment strategies. Nathan Miller of Amplify said that capturing the potential of AI-related capital spending remains a priority for long-term growth.
A coalition of major Japanese financial institutions has called on the government to prioritise top cryptocurrencies like Bitcoin and Ethereum if it decides to approve exchange-traded funds (ETFs) for digital assets. The group, which includes financial heavyweights such as Mitsubishi UFJ Trust and Banking Corp. and Nomura Securities, submitted recommendations on 25 October for creating crypto-focused ETFs, highlighting the importance of well-established tokens with significant market value.
In their proposal, the group also urged Japanese regulators to review the country’s taxation system, suggesting a distinct tax on crypto-derived earnings. This request reflects the institutions’ belief that Bitcoin and Ethereum’s established presence and stability could appeal to investors interested in building long-term wealth.
Despite these proposals, Japanese regulators remain cautious, with officials citing regulatory concerns and public scepticism following past issues, including the Mt. Gox collapse. Nevertheless, several firms remain optimistic about crypto’s future in Japan, as seen by partnerships like that of SBI Holdings and Franklin Templeton, aimed at expanding crypto offerings. Whilst Japan debates, nations such as the US, Hong Kong, and Australia have already approved spot crypto ETFs, creating a trend Japan may soon follow.
Chief executive of Tether has denied any signs of the company being under investigation by US authorities. His remarks follow a Wall Street Journal report suggesting federal investigators are looking into possible violations of sanctions and anti-money laundering rules.
The report stated that the US Attorney’s Office in Manhattan is examining whether Tether was involved in activities like funding drug trafficking, terrorism, or hacking, either directly or through third parties. Concerns have been raised over whether the cryptocurrency has facilitated the laundering of illicit funds.
Tether, the world’s largest stablecoin, aims to maintain a stable value over time. CEO Paolo Ardoino dismissed the claims on X, asserting that no investigation is underway. The Treasury Department is reportedly considering sanctions, though no official comments have been provided by the US Attorney’s Office or other relevant agencies.
In response, Tether criticised the Wall Street Journal for allegedly overlooking the firm’s cooperation with law enforcement to combat illegal activities involving cryptocurrencies. Officials from the Treasury’s Financial Crimes Enforcement Network did not immediately respond to media inquiries.
India’s Central Bank Governor, Shaktikanta Das, has voiced strong concerns about the impact of cryptocurrencies on financial stability, reiterating his cautious stance during a recent talk at the Peterson Institute for International Economics’ Macro Week 2024. Das highlighted that cryptocurrencies were originally designed to sidestep traditional financial systems, posing questions about whether governments are prepared to accept privately issued digital currencies with monetary attributes.
Das argued that issuing currency has always been a sovereign role, warning that allowing cryptocurrencies to operate could lead to sections of the economy moving beyond central bank oversight. This shift could destabilise monetary policy, as it would hinder the central bank’s control over money supply, a critical tool for managing inflation and economic cycles.
He further stressed that widespread crypto use could disrupt the existing financial system, potentially leading to chaos as banks lose their control over liquidity. Das’s comments underline India’s scepticism towards cryptocurrency, advocating for careful consideration of the long-term implications on economic stability.
Microsoft shareholders will vote on 10 December on whether the tech company should assess adding Bitcoin to its balance books, following a proposal filed with the US securities regulator. While the National Centre for Public Policy Research (NCPPR) urged Microsoft to consider Bitcoin investments, highlighting MicroStrategy’s profitable strategy and rising corporate adoption, Microsoft’s board advised against it.
The board argued that they already reviewed various assets, including Bitcoin, as part of their investment evaluations. The NCPPR, however, stated that Bitcoin could act as an inflation hedge, suggesting that even a small investment—around 1% of assets—might offer long-term benefits.
Despite interest from some shareholders, Microsoft’s current focus remains on artificial intelligence rather than blockchain or cryptocurrency investments. Though it once accepted Bitcoin payments for its Xbox store, this practice was discontinued in 2018, and Bitcoin investment is viewed as unlikely at present.
The United States and Nigeria have launched the Bilateral Liaison Group on Illicit Finance and Cryptocurrencies to counter cybercrime and misuse of digital assets. Led by the US Department of Justice and Nigerian authorities, this new initiative aims to strengthen both countries’ capabilities in investigating and prosecuting cyber and crypto-related financial crimes as digital finance expands globally.
The group’s formation comes soon after the release of Tigran Gambaryan, Binance’s head of financial crime compliance, who was detained in Nigeria since February on money laundering charges. His release due to health concerns follows rising tensions, and this new collaboration may help ease strained relations as both nations work toward secure cyberspace operations.
Aligned with US goals for global cyber enforcement, this liaison group aims to streamline coordination between the two countries’ enforcement bodies. This joint effort underscores the importance of cross-border cooperation to address the unique challenges posed by digital assets in the fight against financial crime.
At Fintech Week 2024, Dr Eric Yip of Hong Kong’s Securities and Futures Commission (SFC) announced key steps to streamline licencing for virtual asset trading platforms (VATPs). With fourteen platforms currently operating under ‘deemed-to-be-licensed’ status, the SFC plans to expedite full licencing by the end of this year through on-site inspections and close cooperation with platform leaders to maintain transparency and compliance.
The SFC will also establish a consultative panel in early 2025 to boost regulatory cooperation. This panel will include representatives from each licensed VATP and aim to foster dialogue between industry stakeholders and the SFC, with insights contributing to a white paper on upcoming regulatory priorities.
Alongside licencing efforts, the SFC will work with the Hong Kong Government and other agencies to establish frameworks for trading services and token custody. The SFC is also backing Project Ensemble, a tokenisation initiative by the Hong Kong Monetary Authority, aiming to set standards for tokenised asset settlement in the finance sector. Dr Yip highlighted the regulator’s commitment to investor protection and market growth through a ‘pragmatic and proactive approach.’
Kraken, a prominent cryptocurrency exchange, is set to unveil its new blockchain platform, Ink, in early 2025. The initiative marks a strategic shift towards decentralised finance (DeFi), empowering users to trade, borrow, and lend assets without intermediaries, a departure from Kraken’s traditional centralised operations. Ink aims to streamline DeFi access, making it more user-friendly and cost-effective.
The blockchain, inspired by similar efforts like Binance’s BNB Smart Chain and Coinbase’s Base, will launch without a native token but will include DeFi tools such as decentralised exchanges (DEXs) and yield-generating platforms, all accessible through the Kraken Wallet app. Kraken also plans to serve as Ink’s primary sequencer, managing network transactions and generating revenue, a model that has proven profitable for competitors.
Kraken introduced a derivatives trading platform in Bermuda on 3 October, following the receipt of a Class F Digital Business Licence from the Bermuda Monetary Authority in July. This expansion allows Kraken to provide digital asset wallet services, as well as futures and derivatives trading, aiming to capitalise on the growing market demand for these offerings.
