United States: DOJ Actions Cite Crypto Use, Turkey Bans Crypto, DeFi Hacked For $80 Million
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Last Thursday, the U.S. Department of Justice (DOJ) announced
that two men were charged with producing false identity documents
and aggravated identity theft in connection with operating an
illegal e-commerce business known as “SecondEye.” From at
least 2011, the individuals, through various versions of its
website, electronically produced, sold and transferred digital
versions of false government-issued identity and other documents.
As part of the operation, the defendants accepted more than $1.5
million in bitcoin transfers from customers.
This week, the DOJ announced that another individual, Sheng-Wen
Cheng, pled guilty to various fraud charges for engaging in a
scheme to fraudulently obtain more than $7 million in
government-guaranteed loans designed to provide relief to small
businesses during the COVID-19 pandemic. Part of Cheng’s fraud
involved lying to investors in his blockchain-based peer-to-peer
lending platform.
The Central Bank of the Republic of Turkey recently introduced
legislation banning the use of cryptocurrency for payments
throughout the country. The payments ban is set to go into effect
on April 30; the trading of cryptocurrencies appears to be
unaffected by the regulation. In related news, following the
announcement of the new regulation, hundreds of thousands of users
of a Turkish cryptocurrency exchange, Thodex, were allegedly left
unable to access their digital assets after the trading platform
abruptly halted trading Wednesday, spurring fraud allegations and
criminal complaints. The CEO of the exchange is reportedly
missing.
Earlier this week, a decentralized finance (DeFi) Polygon
Network-powered protocol, EasyFi, reported it suffered a hack in
which $80 million of assets were stolen. The hacker reportedly
transferred out 2.98 EAST tokens and $6 million from liquidity
pools in U.S. dollars, Dai and USDT. Amounts were then allegedly
transferred to an unknown wallet on the Ethereum network. A $1
million reward has been offered by the company’s CEO and
founder to the hacker for returning the funds in full.
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