The founder of cryptocurrency firm MyTrade, Liu Zhou, pleaded guilty in Boston federal court on Wednesday to charges of market manipulation and wire fraud. Zhou, who described himself as the ‘mastermind’ behind the company, entered the plea just weeks after being indicted along with 14 others as part of a groundbreaking FBI investigation dubbed ‘Operation Token Mirrors.’ This operation was notable for involving the creation of a digital token by the FBI itself to uncover fraud in the crypto sector.
Prosecutors revealed that MyTrade was one of three market makers involved in providing illicit trading services to cryptocurrency firms. During the investigation, Zhou agreed to manipulate the market for a token backed by the FBI, known as NexFundAI, which operates on the Ethereum blockchain. As part of a plea agreement, Zhou faces a maximum prison sentence of 1.5 years and must refrain from appealing if sentenced within that timeframe. Additionally, MyTrade must stop facilitating fraudulent trades that had previously manipulated the trading volumes of about 60 cryptocurrencies.
Zhou founded MyTrade in 2021, a British Virgin Islands-registered company that offered services like ‘volume support,’ where automated bots were used to inflate trading volumes. Prosecutors characterised this practice as ‘wash trading,’ which artificially boosts an asset’s trading activity. Zhou’s discussions with NexFundAI promoters included plans for market manipulation and ‘pump and dump’ schemes. Following a meeting on 23 September, Zhou quickly agreed to plead guilty after the FBI approached him. Four others involved in the investigation have also pleaded guilty.
Interest in cryptocurrency has seen new applications for Bitcoin, including its recent adoption in life insurance by Meanwhile, which claims to be the first company to denominate policies in Bitcoin. Rather than using dollars, Meanwhile’s life insurance policies operate entirely in Bitcoin, covering everything from premium payments to policy loans and payouts.
Meanwhile offers whole life insurance, so holders are covered for life. Director of Wealth and Asset Management, Danny Baer, highlights unique tax advantages, particularly thetax-free policy loan option. This allows policyholders to borrow Bitcoin against the policy’s value. As Bitcoin increases in price, the value of the policy and the amount that can be borrowed also rise, and the loaned Bitcoin’s cost basis adjusts to the current rate.
Baer suggests that if Bitcoin’s price skyrockets over time, the ability to borrow against the policy without incurring capital gains tax could be highly beneficial for long-term holders. Meanwhile’s Bitcoin-denominated approach appeals to those looking to invest in an asset with a low time preference, which complements the long-term nature of whole life insurance.
Coinbase users in the UK and US can now fund their accounts instantly using eligible Visa debit cards, following a recent partnership with Visa. This integration, announced on 29 October, allows customers to deposit funds in real-time through the Visa Direct network, providing flexibility for those looking to quickly respond to crypto market changes.
The new feature is set to simplify access to trading funds by reducing traditional wait times associated with crypto funding. With Visa Direct, Coinbase users can now top up their accounts or make crypto purchases almost instantly, while also benefiting from instant cash-outs to bank accounts, minimising delays on major transactions.
The partnership further underscores Visa’s growing involvement in the crypto sector. Earlier in October, Visa also launched its Tokenized Asset Platform, enabling banks to manage fiat-backed tokens, including stablecoins. BBVA, a major Spanish bank, is set to trial this platform on the Ethereum blockchain in 2025, marking a significant step in Visa’s broader blockchain strategy.
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.
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.
South Korea has unveiled plans to regulate cross-border cryptocurrency transactions, set to take effect in the latter half of 2025. The forthcoming regulations will mandate that businesses engaged in virtual asset trading across international borders register with relevant authorities and provide monthly transaction reports to the Bank of Korea. This initiative aims to enhance transparency and oversight in a rapidly evolving market that has seen explosive growth in recent years.
The move comes in response to alarming statistics from the customs agency, which revealed that since 2020, foreign exchange-related crimes have amounted to 11 trillion won (approximately $7.97 billion). Notably, over 80% of these crimes have involved virtual assets, highlighting the need for stricter controls. The South Korean government is prioritising legislative measures to ensure the successful implementation of these regulations within the next 18 months, reflecting its commitment to combating financial crime and protecting investors.
By introducing these regulations, South Korea aims to create a safer environment for cryptocurrency transactions, aligning with global efforts to establish clearer frameworks for digital asset trading. As countries worldwide grapple with the implications of cryptocurrency, South Korea’s proactive stance may serve as a model for other nations looking to regulate the digital asset space effectively.
Japan’s financial regulators remain cautious about approving spot crypto exchange-traded funds (ETFs), even as other markets like the US and Hong Kong move forward with similar products. Oki Shiozawa, investment director at Sumitomo Mitsui Trust Asset Management, explained that Japan’s Financial Services Agency (FSA) is conservative and not yet ready to allow such ETFs, despite global advancements.
While Japan aims to position itself as a crypto-friendly hub, strict regulations and high tax rates have limited the growth of digital assets. Crypto gains in Japan are taxed as high as 55%, compared to the 20% tax rate for traditional assets like ETFs. Keisuke Kimura, from the Japan Cryptoasset Business Association, noted that past scandals, like Mt. Gox, have made both regulators and the public wary of crypto investments.
Despite the challenges, companies like Franklin Templeton and SBI Holdings are preparing for potential regulatory shifts, while others, like Nomura, have already launched crypto-related products for institutional investors. As global markets embrace crypto ETFs, Japan faces increasing pressure to adapt.
Elon Musk, CEO of Tesla and SpaceX, addressed the potential of cryptocurrency during a town hall in Pittsburgh, emphasising its role in safeguarding individual freedom. Although he stopped short of directly endorsing XRP, Musk highlighted how cryptocurrencies like it could be crucial in resisting centralised control. His comments were met with enthusiasm from XRP supporters, with Ripple’s ongoing legal battle against the SEC remaining a hot topic.
The legal dispute over whether XRP is a security continues, as Ripple defends its position that XRP is a cryptocurrency. Ripple’s CEO, Brad Garlinghouse, agreed with Musk’s view, stressing that crypto and XRP are no longer niche concerns but essential issues for voters who want policies that foster innovation.
Musk’s involvement in the crypto space remains significant, with Tesla recently transferring $765 million worth of Bitcoin to new wallets. While Tesla stopped accepting Bitcoin for payments over environmental concerns in 2021, the company continues to engage with the crypto market, also accepting Dogecoin for some merchandise.
