On Monday, the U.S. Securities and Exchange Commission issued a press release announcing charges against Jonathan C. Lucas for fraudulently raising approximately $63,000 from more than 100 investors during an initial coin offering (ICO) for Fantasy Market, an online adult entertainment marketplace that Lucas founded and controlled. According to the announcement, Lucas has returned the investors' money and consented to a final judgment that orders him to pay a civil penalty of $15,000 and prohibits him from participating in certain securities offerings.
In California, the United States attorney's office indicted Elliot Gunton and Anthony Tyler Nashatka for hacking EtherDelta, a cryptocurrency exchange, in December 2017. According to the indictment, which was filed in August, the defendants changed the settings of EtherDelta's domain name system, misleading users in order to access their cryptocurrency addresses and private keys, allowing them to steal users' funds. The federal government is increasingly focused on these types of crimes. In the September 2019 edition of the United States Department of Justice's Journal of Federal Law and Practice, an entire section is devoted to addressing the challenges inherent in tracing, forfeiting and seizing cryptocurrencies.
The Korea Times recently reported that the International Financial Reporting Interpretations Committee (IFRIC) considers cryptocurrency to be an "intangible asset," as opposed to cash or another financial asset. The IFRIC's conclusion is unofficial, and no actual rule has been issued, but its assessment (which was reportedly reached in a meeting in London last June) can be significant, as the IFRIC's determinations are the bases for many nations' accounting rules and standards. And Global Legal Insights recently issued a report summarizing the blockchain and cryptocurrency regulatory landscape in Bermuda, British Virgin Islands, Cayman Islands, Guernsey and Jersey. Topics include government receptivity to cryptocurrency-related businesses, and regulatory issues related to licensing, mining and ICOs.
For more information, please refer to the following links:
- SEC Charges Founder and CEO of Purported Online Adult Entertainment Marketplace with Fraudulent ICO Scheme
- Two suspects in EtherDelta hack indicted by U.S. authorities
- DOJ Report: Asset Forfeiture and Money Laundering
- Global Legal Insights: Blockchain and cryptocurrency regulation 2019, first edition
- Crypto is an Intangible Asset, Global Accounting Standards Body Argues
- Holdings of Cryptocurrencies—June 2019
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