A group of US Senate Democrats has called on the nation’s largest Bitcoin ATM operators to step up efforts in preventing fraud targeting elderly Americans. The Senators, led by Senate Judiciary Committee Chair Dick Durbin, addressed the growing number of scams using Bitcoin ATMs, urging companies to take immediate action to protect vulnerable populations.
Data from the Federal Trade Commission reveals that in the first half of this year alone, Bitcoin ATM-linked fraud amounted to $65 million. Older adults, particularly those aged 60 and over, were disproportionately affected, being three times more likely to report financial losses than younger users. Senators, including Elizabeth Warren, pointed to recent reports showing scammers coercing elderly individuals into sending funds through Bitcoin ATMs.
The Senators have asked major Bitcoin ATM firms to respond by early October, detailing their measures to combat fraud. This comes amid broader concerns over the rise in crypto scams, with the FBI reporting a significant increase in overall crypto-related fraud this year.
Circle, the company behind the USDC stablecoin, is confident that stablecoins will become a mainstream form of money. With increasing competition in the market, Circle’s chief strategy officer Dante Disparte emphasises the need for global regulatory harmony to ensure proper compliance for all stablecoin issuers, particularly in areas like financial crime prevention and conservative reserving practices.
Circle is also preparing to relocate its global headquarters to New York by 2025, as it continues to advocate for federal stablecoin regulations in the US. Disparte argues that the lack of a clear framework poses a risk to American interests, potentially allowing foreign entities to exploit trust in the US dollar without proper oversight.
Meanwhile, Europe’s new MiCA regulation has provided much-needed clarity for stablecoins, with Circle achieving compliance under this framework. As competition heats up with entrants like PayPal and Ripple, Circle remains at the forefront of regulatory discussions, pushing for clearer rules that foster innovation while safeguarding consumers.
On Friday, US spot Bitcoin ETFs experienced a significant rise in inflows, totalling $263 million as Bitcoin’s price surged over $60,000. Fidelity’s Bitcoin ETF led the pack, pulling in $102 million, while ARK Invest and 21Shares followed closely with $99 million in net inflows. This marks a shift in sentiment after weeks of outflows, signalling renewed investor optimism in the crypto market.
Despite the positive inflows for most ETFs, BlackRock’s iShares Bitcoin Trust and WisdomTree’s Bitcoin Fund recorded no new investments. However, US spot Bitcoin ETFs collectively closed the week with more than $400 million in net inflows. This, combined with Bitcoin’s 12% price increase, reflects growing confidence in the market.
The wider cryptocurrency market also benefited, with Ethereum rising by 8% and altcoins like Toncoin, Chainlink, and Avalanche performing strongly. Investors remain hopeful as expectations build for a potential interest rate cut by the US Federal Reserve, which could further boost the crypto market.
Former US President Donald Trump has announced the launch of his cryptocurrency project, World Liberty Financial, set to go live on 16 September. In a video posted on X, Trump described the project as a move towards decentralised finance (DeFi) to move away from traditional banking systems. Trump’s sons, Donald Trump Jr. and Eric Trump, will be in charge of the project, which promises to offer services such as digital wallets, lending, and investing in crypto assets.
World Liberty Financial is also exploring the use of US dollar-pegged stablecoins and has hinted at a collaboration with the DeFi platform Aave, suggesting it may operate on the Ethereum blockchain. Despite Trump’s support for the crypto sector, some in the industry have expressed concerns about the launch timing, which comes just 50 days before the US presidential election, where Trump is a candidate.
The project has faced significant challenges, including attempts by hackers and scammers to exploit its hype. Accounts linked to Trump’s family were recently compromised, and false advertisements and giveaways have been circulating online. Despite these issues, Trump’s crypto venture continues to generate a mix of excitement and scepticism within the crypto community.
The UK government has introduced a new Property Bill aimed at clarifying the legal status of digital assets such as cryptocurrencies, non-fungible tokens (NFTs), and carbon credits. The proposed legislation would create an additional property category under UK law, recognising digital assets as ‘things’ and providing a clear legal framework for handling them in cases like divorce settlements. It is seen as essential to ensure the law keeps pace with evolving technologies, according to Labour MP and Minister of State Heidi Alexander.
The bill also seeks to protect digital asset owners and businesses from fraud and scams, while giving judges clearer guidance in complex property disputes involving digital holdings. The proposal stems from a 2023 report commissioned by the Ministry of Justice, which highlighted the unique nature of digital assets and their need for distinct legal recognition under personal property law.
This legislation forms part of the Labour government’s broader efforts to address blockchain and digital asset regulation, following their recent victory in the July election. It reflects a growing trend of governments worldwide reassessing their stance on digital assets, with similar discussions taking place in the United States ahead of the 2024 election.
Nigeria’s Economic and Financial Crimes Commission (EFCC) has frozen bank accounts totalling over $330,000, accusing cryptocurrency traders of manipulating the naira. Traders using global platforms like Kucoin and Bybit are suspected of contributing to the local currency’s depreciation through illegal foreign exchange trading. EFCC claims these platforms have failed to comply with anti-money laundering regulations, worsening the situation.
EFCC investigator Okoro Philip directly blamed these traders for the naira’s sharp decline, which has dropped by around 70% since the start of the year. He criticised Kucoin and Bybit for allowing USDT, a digital dollar, to be exchanged for naira at rates that artificially lower the currency’s value. The EFCC has expressed concerns that such platforms are being used to trade proceeds from criminal activities.
These actions follow recent intervention by the Central Bank of Nigeria, which sold US dollars at a lower rate to bureaux de change in a bid to stabilise the naira. Despite these efforts, the currency continues to struggle, and experts warn that further depreciation is likely unless demand for US dollars is curbed.
Australia’s Federal Court has ruled that Bit Trade Pty, the operator of the Kraken cryptocurrency exchange in Australia, failed to meet design and distribution obligations for its margin trading product. The case, initiated by the Australian Securities and Investments Commission (ASIC) in September 2023, centred on Bit Trade’s failure to determine an appropriate target market before offering the product, despite prior warnings.
The court’s ruling highlights the legal requirement for financial products to be appropriately distributed to consumers. ASIC argued that the obligation to repay digital assets or national currency classified the margin trading product as a credit facility, which required stricter compliance. ASIC’s Deputy Chair, Sarah Court, emphasised the significance of this outcome as a reminder to the crypto industry about the importance of adhering to regulations.
Bit Trade, a subsidiary of US company Payward Incorporated, expressed disappointment with the decision but stated its readiness to comply with the court’s ruling. The company has seven days to negotiate declarations and injunctions with ASIC, which plans to pursue financial penalties against Bit Trade at a later date.
In addition to this case, Kraken’s parent company is also under scrutiny in the US, where the Securities and Exchange Commission filed a lawsuit in November 2023, accusing Kraken of operating as a securities exchange without proper registration.
US-based State Street Corporation, a global financial and banking service provider and Swiss crypto company Taurus have announced their partnership to expand their offerings of digital assets through new services. As per the joint statement, under the partnership, Taurus will provide State Street with crypto custody and asset tokenisation services to institutional clients like banks and asset management firms.
State Street’s chief product officer and head of digital asset solutions, Donna Milrod, stated, ‘We need to provide our clients the ability to deal with both traditional finance as well as (digital assets) side by side.’ The following move will help the company meet the market demand for safe banking partners that protect investors’ crypto assets, offering an alternative to exchanges and wallet providers with weaker security measures. Milord added that plans to offer crypto custody for customers are contingent upon the US Securities and Exchange Commission updating its 2022 accounting guidelines, making it highly costly for publicly traded banks to hold crypto.
Why does this matter?
There has been an increase in the spread of cryptocurrencies in the traditional financial system through regulated products like futures and exchange-traded funds. As financial institutions look for ways to hedge inflation and diversify their portfolios, they turn to crypto. Thus, with the significant rise of digital asset’s impact on traditional finance, there’s a gradual blurring of the distinction between these two previously distinct financial systems.
Apart from the cryptocurrency-focused media, not many US news outlets have been providing this newsworthy coverage. The United States is home to more than 100 top cryptocurrency companies. In particular, the USA is home to the world’s second largest cryptocurrency exchange, Coinbase, which is a publicly traded company. Coinbase reported a USD 273 million profit in the fourth quarter of 2023. For the full year of 2023, it earned USD 95 million on USD 3.1 billion in revenue, while in 2022, it posted a loss of USD 2.6 billion. Apart from Coinbase, Marathon Mining, the largest US cryptocurrency mining operation, reported a staggering revenue increase of 229% to a record USD 387.5 million in 2023 from USD 117.8 million in 2022. Several policy proposals are before policymakers in the USA, trying to tackle issues related to the industry.
In late July 2024, Nashville, Tennessee (USA) was the stage of the largest annual bitcoin gathering. The Bitcoin Conference 2024 had one speaker that everyone awaited with anticipation. Republican Party candidate and the former US President Donald J Trump is the first high-end political figure in the USA who agreed to address the bitcoin crowd. Trump’s appearance was announced a couple of weeks before, and at that very moment the issue of cryptocurrency and the surrounding industry slipped into the main discussion among the candidates for the November US elections.
Back on the green
So, the industry is back on the green, regulation is discussed in the US Senate and Congress and the mining industry is growing. How come that industry is not discussed that much on the main political stage?
In Nashville, everything was ready for Trump’s appearance. The former president’s campaign trail advertised his appearance as one of the highlights of his July campaign. Anyhow, the crowd gathered at the Bitcoin Conference is not politically homogeneous. There are people on the complete opposite side of Trump’s proposed political spectrum. In the past, US cryptocurrency companies were one of the top contributors to the US Democratic Party (most prominently, Sam Bankman-Fried, now convicted, former CEO of the failed cryptocurrency exchange FTX).
Crypto vs bitcoin
Before I continue, let me give you a brief explanation. It is important, trust me.
In short, the cryptocurrency industry is divided into two strongly opinionated teams standing on opposite sides. Bitcoin adopters would almost never call themselves crypto enthusiasts. They consider other cryptocurrencies, cryptocurrency exchanges, and the entire idea of ‘blockchain technology changing the world’ to be false. For (true) bitcoiners, NFTs, meme coins, microtransactions, enormous overnight profits, and other ‘miraculous’ stories were considered nothing more than elaborate schemes for tricksters and scammers willing to sell innocent investors a story of the world-changing technology. And to be fair, that narrative kind of proved to be true. For years, US financial regulators have been waging war on cryptocurrencies and online cryptocurrency exchanges as ‘unregulated securities’ businesses. The US SEC has already won many cryptocurrency-related court cases for scam and fraud charges. On the other hand, the same regulatory agency has made a clear distinction between bitcoin and others. The SEC has officially stated that bitcoin cannot be considered a security but rather a commodity and that they will not pursue any bitcoin holders or bitcoin-only companies (in a court case back in 2019). This is thought to be due the decentralised nature of bitcoin. Unlike other cryptocurrencies, bitcoin does not have a CEO, headquarters, or hire anyone to work on its update. Bitcoin is simply an open-source protocol that handles digital value as unique information. Therefore, it cannot be defined as ‘a promise of profits’ to investors, which is the main argument of the famous Howey Test, a metric that has been used by the SEC to determine the scope of its work since the 1946 Supreme Court case.
This is the first point of difference recognised by regulators and one of the main arguments for Bitcoin as digital gold. Bitcoin can be used at a settlement level to create a future ‘digital gold standard’ mimicking the now abandoned ‘gold standard’ for the global economy. Bitcoiners argue that other cryptocurrencies and the industry as a whole have achieved a huge value transfer but fail to see any value creation (thus far). Court decisions worldwide have confirmed quite similar things.
Energy consumption in cryptocurrency
The second point of major disagreement between the two sides (crypto and bitcoin) is the way the industry is spending energy. Energy is the most frequently mentioned issue in the media coverage of cryptocurrency developments. You have heard and read numerous reports on the massive amount of energy used to mine (create) cryptocurrency and 99.5% of that energy is spent in bitcoin mining. The proof-of-work (PoW) algorithm, used in the bitcoin network for security reasons, requires miners to spend energy creating new bitcoins. Specialised mining equipment is often located near big power plants, and the pursuit of cheap electricity is the major driver of the industry. In contrast, the crypto industry, apart from bitcoin, has created a solution for such energy demand with the non-energy consuming Proof-of-Stake (PoS) algorithm for network security. Therefore, the crypto industry is now pointing to bitcoin as the sole reason why regulators are thinking about cryptocurrencies, as the green agenda worldwide becomes dominant. A couple of US legislators from the Democratic Party have filed several motions for a statewide ban on bitcoin mining as an energy demanding industry. As a counter-argument, bitcoiners say that the actual amount of energy spent for bitcoin creation gives it its power. In other words, energy spent in creation gives bitcoin an intrinsic value similar to physical gold.
It is important that these distinctions have been clarified in order to understand the scope of Trump’s address. With that, back to Nashville.
One of my friends who was in the audience told me that people who normally are not interested in politics were ecstatic and wanted to hear the first address of the US president to the bitcoin crowd. President Trump took the stage at the Bitcoin Conference 2024 and gave the crowd all they wanted to hear, and a bit more. He said that the AI and bitcoin industries are similar as they need the same thing: electricity. He made a promise to the United States to ramp up electricity production by a couple of folds, clearly setting his agenda on the opposite side of Democrat’s calls for mining bans. We want all bitcoins in the world to be created in the USA, he said. ‘We will be creating so much electricity that you’ll be saying: Please, please president, we don’t want any more electricity…’
He immediately followed with the promise to relieve Mr Gary Gensler, the current chairman of the US SEC. Actually, he would do it on his first day in the office. He promised that the bitcoin and crypto industry would stay in the USA. But one of the most dazzling promises for all bitcoiners attending was his announcement that the USA might start accumulating bitcoins as for future global trade. The crowd was overwhelmed, as he confirmed that the idea of bitcoin as digital gold had finally received approval from the top policymaker, let alone the former (and possibly future) president of the United States. Later during the conference, plans were elaborated on how such a thing can be done. If true, this could indeed play a significant role in the worldwide adoption of bitcoin as a global store of digital value. Having in mind that the future global economy will certainly be digital, such a thing is actually quite possible and logical. Ultimately, it is a matter of political will to create such a strong global independent currency not related to the reigning central banking system. ‘Bitcoin will probably overtake gold (market), there was never anything like it… it’s not only a marvel of technology but the miracle of (human) corporation.’ To back that up, Trump reiterated that he would halt the development of the US Central Bank Digital Currency (CBDC).
Trump finished with the best wishes for all: ‘We will make America and bitcoin bigger, better, stronger, richer, freer, and greater than ever before… Have a good time with your bitcoin and your crypto and everything else you’re playing with.’
The moment he said it, the crowd suddenly became colder. They realised that he was not aware of the distinction between bitcoin and crypto. Actually, he might just populistically say what crowds want to hear, and the moment the script was taken off the teleprompter, he could not tell the difference between the two.
This was for sure the event that launched issues surrounding bitcoin and cryptocurrency in the US elections race, as more and more young voters are getting to the polling stations and the idea of the independent global currency becomes not so utopian and high-end tech issue. In any case, we will have to wait and see which of those promises are actual future policies and which part plays the role of enchanting the masses. Open-source software, energy consumption, and consumer protection will be discussed in detail in the future.
The next US administration is expected to adopt a ‘constructive’ stance on cryptocurrency regardless of the election outcome, according to Brian Armstrong. The CEO of Coinbase has highlighted the industry’s growing political influence as the November election approaches. Both Republican and Democratic parties have acknowledged the increasing significance of the crypto sector, with major political action committees raising over $230 million to support pro-crypto candidates.
Coinbase, the largest United States crypto exchange, is currently engaged in a legal battle with the SEC over allegations of failing to register as an exchange. The support from Wall Street and corporate figures like Elon Musk has boosted the sector’s mainstream appeal. Recently, Republican candidate Donald Trump pledged to create a ‘stockpile’ of bitcoin, while advisors to Democratic Vice President Kamala Harris have engaged with top crypto companies to improve relations.
A recent Supreme Court ruling overturning the ‘Chevron deference’ doctrine, which limited judicial interpretation of laws, is seen as a positive development for the crypto industry. Coinbase has strengthened its board by adding former US Solicitor General Paul Clement, a key figure in the Chevron ruling case. The shifting political landscape and favourable court rulings are expected to attract new institutional capital to the crypto market. Coinbase’s recent surpassing of Q2 revenue expectations and strategic board expansions further highlight its proactive stance amid these changes.
