CFTC case against Digitex futures exchange and CEO results in $16M court order

Russian companies have been using cryptocurrencies like Bitcoin and USDt to facilitate trade with China and India amid international sanctions, according to a Reuters report.Russian oil companies have used crypto assets including Bitcoin (BTC) and Tether’s USDt (USDT) for international trade, Reuters reported on March 14, citing four sources with direct knowledge of the matter.One Russian oil trader reportedly conducts tens of millions of dollars worth of monthly transactions using digital assets, according to a source who spoke on condition of anonymity due to a non-disclosure agreement.While the Russian finance minister publicly declared in late 2024 that Russia is free to use assets like Bitcoin in foreign trade, the use of crypto in oil transactions with China and India had not been previously reported.Russia’s oil trade in crypto: How does it work?According to Reuters, Russia’s foreign oil trade in crypto involves intermediaries who manage offshore accounts and facilitate transactions in the buyer’s local currency. One example includes a Chinese buyer of Russian oil that pays a trading company acting as a middleman in yuan into an offshore account.The middleman then converts payments into crypto assets and transfers it to another account, which then sends it to a third account in Russia and converts it to Russian rubles, sources said.Crypto will be used no matter of sanctionsAccording to one of Reuters’ sources, crypto will likely continue to be used in Russia’s foreign oil trading regardless of whether any sanctions are in place and even if the sanctions are lifted and Russia is free to use the dollar.“It is a convenient tool and helps run operations faster,” the report said, citing the source.The news comes amid the Bank of Russia officially proposing to legalize cryptocurrency investments for high-net-worth individuals who have at least $1.1 million in securities and deposits.Bitcoin remains highly restricted in mainland ChinaWhile Russia has been increasingly open to Bitcoin, including its use in foreign trade, mainland China has maintained a cautious and restrictive approach toward cryptocurrency.Since banning virtually all crypto transactions in 2021, authorities in mainland China have maintained a restrictive agenda on crypto, while neighboring jurisdiction Hong Kong has emerged as a global crypto hub.Related: Indian authorities arrest alleged Garantex founder for US extraditionDespite the restrictions, mainland China has remained one of the global leaders in Bitcoin mining, raising controversy over the application of its crypto ban.Source: Jan3As the United States moves forward with its strategic Bitcoin reserve initiative, some industry observers believe China will not ignore Bitcoin’s growing role in the global financial landscape.According to data from the Bitcoin technology company Jan3, the Chinese government may be holding at least 193,000 BTC.Magazine: Ridiculous ‘Chinese Mint’ crypto scam, Japan dives into stablecoins: Asia Express

A Texas federal judge has entered a default judgment against Bancor DAO, which operated the decentralized finance platform Bancor, after it failed to respond to an online summons. Judge Robert Pitman issued the judgment after Bancor DAO did not appear to defend itself following a summons that was posted on the DAO’s forum in January 2024.“Defendant Bancor DAO has failed to answer or otherwise defend itself within the time allowed, and that plaintiffs have demonstrated that failure,” wrote district court clerk Philip Delvin on March 13.The class action involves investors who claim they lost tens of millions of dollars due to the exchange’s failure to warn about liquidity issues during a 2022 withdrawal spike.Clerk’s entry of default against Bancor. Source: Law360According to the plaintiffs, who filed the suit in May 2023, Bancor deceived investors about its impermanent loss protection mechanism for liquidity providers and also claimed its token was an unregistered security. They said Bancor’s ILP operated at a deficit and tried to cover by launching a new product, v3, which promised “some of the most competitive returns anywhere without asking users to take on any risk.”Impermanent losses occur within DeFi automated market maker models when liquidity providers deposit assets into a pool, and one of the tokens loses value against another in the pool. Bancor paused impermanent loss protection, citing “hostile” market conditions in June 2022.The plaintiffs also argued that Bancor DAO is an “unincorporated general partnership” consisting of vBNT tokenholders and could be sued in that capacity, according to Law360.The case was previously dismissed entirely because the protocol developers were not based in the United States, but was reopened in December.The plaintiffs said that the DeFi platform “does not appear to be registered in any jurisdiction and has no physical office location, mailing address, officers, directors, or appointed agents.”Bancor is an onchain liquidity protocol that enables automated, decentralized exchange across blockchains. It has $38 million in total value locked, a figure that is down 98% since its peak in May 2021, according to DeFillama.Related: Lawsuits could be catastrophic for DAOs if denied ‘limited liability’The ruling follows precedent from a similar case where the Commodity Futures Trading Commission won a default judgment against Ooki DAO.A California federal judge also ruled in November that DAOs and their governing members can be sued in cases involving unregistered securities.Magazine: Mystery celeb memecoin scam factory, HK firm dumps Bitcoin: Asia Express

US state Vermont has dropped its “show cause order” against crypto exchange Coinbase for allegedly offering unregistered securities to users through a staking service.Vermont’s Department of Financial Regulation said in a March 13 order that in light of the US Securities and Exchange Commission tossing out its case on Feb. 28, it would follow suit and rescind its action against Coinbase without prejudice.“The SEC has announced the formation of a new task force to, among other things, provide guidance for the promulgation of rules regarding the regulation of cryptocurrency products and services,” the department said.Vermont’s financial regulator has decided to drop its legal action against Coinbase. Source: Vermont’s Department of Financial Regulation“In light of the dismissal of the Federal Action and likelihood of new federal regulatory guidance, the Division believes it would be most efficient and in the best interests of justice to rescind the pending Show Cause Order, without prejudice.”On the same day the SEC filed its lawsuit in June 2023, the US states of Alabama, California, Illinois, Kentucky, Maryland, New Jersey, South Carolina, Vermont, Washington and Wisconsin said they were launching legal proceedings against Coinbase.The show cause order asserted that Coinbase was violating securities laws by offering staking to its users without a license and demanded the exchange provide a reason why the courts shouldn’t hit them with an order directing them to halt the service. Now that Vermont has opted out, Coinbase chief legal officer Paul Grewal said in a March 13 statement to X that the other states with staking actions should take a “page from Vermont’s playbook.”Source: Paul Grewal“As we have always said: staking services are not securities. We applaud Vermont for embracing progress and providing clarity for its citizens who own digital assets,” he said.“Our work isn’t over. Congress must seize the bipartisan momentum we’re seeing across the House and Senate to pass comprehensive legislation that takes into account the novel features of digital assets, such as staking,” he added.Related: YouTuber says SEC will recommend dropping lawsuit over 2018 token ICOA growing number of firms facing legal action from the SEC have had their cases dismissed in the wake of former SEC Chair Gary Gensler, who took a hardline stance toward crypto, resigning on Jan. 20.Crypto trading firm Cumberland DRW was among the latest to have its case dropped on March 4, while the regulator is reportedly wrapping up its enforcement action against Ripple Labs after more than four years.Grewal has also launched a request under the Freedom of Information Act to find out how many enforcement actions were brought against crypto firms under Gensler’s tenure between April 17, 2021, and Jan. 20, 2025, and the cost to the taxpayer. Magazine: Elon Musk’s plan to run government on blockchain faces uphill battle