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Today's Top Crypto Headlines:
Crypto Lawsuit Settlements 2024 | Appchains Criticized | ZachXBT Warns Crypto Traders | Scroll Lists on Binance and more...
King Fatrick Gil Añasco
October 14, 2024
Good Morning Crypto Enthusiasts!
Glad to have you back for another edition of the UseTheBitcoin.com newsletter.
Crypto Lawsuit Settlements 2024: Crypto companies have paid a staggering $19 billion in lawsuit settlements to U.S. regulators in 2024. This marks an 8,327% increase in settlement values compared to 2022.
Appchains Criticized: Andre Cronje, co-founder of Sonic Labs, raised concerns about the practicality of Layer-2 appchains, citing high infrastructure costs and liquidity fragmentation.
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ZachXBT Warns Crypto Traders: Blockchain investigator ZachXBT has warned of a rise in physical crypto thefts, particularly in Western Europe, where armed robbers target traders' homes.
💡Feature of the Day - Scroll Lists on Binance: Scroll, an Ethereum Layer-2 project, recently listed on Binance, sparking a debate about decentralization within the crypto community.
All this and more in today’s headlines!
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📰 News Highlights:
Crypto companies have paid a staggering $19 billion in lawsuit settlements to U.S. regulators so far in 2024, accounting for nearly two-thirds of all settlements since 2019.
What are the top crypto enforcement actions in the US? ⚖️
The US regulators' largest crypto enforcement action was against @FTX_Official & its affiliate, @AlamedaResearch, led by the CFTC. The $12.7B settlement was announced in Aug 2024.
Read the study: gcko.io/dtkzbdb
— CoinGecko (@coingecko)
1:36 PM • Oct 10, 2024
A CoinGecko report on Oct. 9 revealed that bankrupt crypto exchange FTX and trading firm Alameda were responsible for most of the payments, with $12.7 billion going to the CFTC in an August settlement.
Notably, 2024 saw an 8,327% increase in settlement values compared to 2022, marking a significant year for regulatory scrutiny in the crypto industry.
2/ US regulators’ next largest crypto enforcement actions are settlements against @CelsiusNetwork ($4.7B) & @terra_money ($4.5B).
Their collapses in mid-2022 marked the shift from bull run to bear market, culminating in FTX’s fall & prompting increased US regulatory scrutiny.
— CoinGecko (@coingecko)
1:36 PM • Oct 10, 2024
Genesis also made headlines with a $2 billion settlement in August, further highlighting the aggressive approach of U.S. regulators.
3/ Binance's $4.3B settlement is the only billion-dollar settlement given to an operating crypto company so far.
@binance pleaded guilty in Nov 2023 to resolve lawsuits with multiple US regulators, including the DOJ, the Treasury Department & the CFTC – marking a landmark win.
— CoinGecko (@coingecko)
1:36 PM • Oct 10, 2024
Interestingly, Binance's November 2023 settlement stands out as the only billion-dollar agreement reached with an operating crypto company.
4/ There are now 25 crypto enforcement actions from US regulators that resulted in settlements of over $10M. In total, US regulators have cumulatively reached $31.92 billion in their top settlements against crypto companies.
Read the study:
— CoinGecko (@coingecko)
1:36 PM • Oct 10, 2024
The total amount collected since 2019 now stands at $31.92 billion.
Andre Cronje, co-founder of Sonic Labs, has raised concerns about the practicality of layer-2 (L2) appchains, criticizing them for their high infrastructure costs, fragmented liquidity, and limited developer support.
Why L2s as appchains are not logical for builders:
- Barely any infra when deploying (stable coins, oracles, institutional custody, etc)
- No foundation/labs to help support
- Centralised and open to attack
- Fragmenting liquidity and forcing it onto bridges
- No community of… x.com/i/web/status/1…— Andre Cronje (@AndreCronjeTech)
12:30 AM • Oct 13, 2024
In an Oct. 13 post, Cronje shared that his team had already spent $14 million this year on appchain infrastructure, making it difficult to focus on core applications.
disagree.
- Barely any infra when deploying (stable coins, oracles, institutional custody, etc)
=> you get most of those one-click on Gelato RaaS
- No foundation/labs to help support
=> actually you get a lot of support by RaaS providers and framework teams
- Centralised… x.com/i/web/status/1…
— Hilmar | ser.eth (@hilmarxo)
5:03 AM • Oct 13, 2024
However, not everyone agrees with Cronje’s bleak assessment. Hilmar Orth of Gelato Network argued that infrastructure challenges are now mitigated by rollup-as-a-service (RaaS) providers, which offer developers easier access to necessary tools.
Most of these things can be solved:
- Create an interop solution that includes native infra for all connecting chains (as will be the case with the AggLayer).
- Create a culture around an interop solution of helping others so the tide lifts all boats. Polygon Labs is the first… x.com/i/web/status/1…— Marc Boiron (@0xMarcB)
3:03 AM • Oct 13, 2024
Additionally, Marc Boiron, CEO of Polygon Labs, suggested that solutions like AggLayer could solve liquidity fragmentation by creating an interoperable network of appchains.
ZachXBT Warns Crypto Traders [Source]
Blockchain investigator ZachXBT has observed an alarming rise in the number of crypto traders being targeted in offline thefts, particularly in Western Europe.
1/ An investigation into Faris Ali (Zay/Tommy) from the UK and his alleged involvement in robbing an X user out of $4.3M in June 2024 during a home invasion as the result of a crypto data breach.
— ZachXBT (@zachxbt)
1:30 PM • Oct 10, 2024
In an Oct. 10 post, ZachXBT revealed that several individuals had been victims of home invasions, where armed robbers forced them to transfer their crypto holdings to the attackers.
2/ On June 18th a victim posted to X post he had been victim of a robbery earlier that day forcing him to send $4.3M to two addresses.
At the time of this post the majority of funds still remain dormant.
Theft address
0x7d1ecbf05b7fdbaf338e0179af2ee8e2ca786d99… x.com/i/web/status/1…— ZachXBT (@zachxbt)
1:30 PM • Oct 10, 2024
He cited one case where thieves, disguised as delivery personnel, broke into a victim’s home and stole $4.3 million worth of crypto.
4/ Faris/Tommy discussed with an accomplice how they planned to pretend to deliver a package to the victims home and shared an image of their door.
— ZachXBT (@zachxbt)
1:30 PM • Oct 10, 2024
This increase in physical crypto theft is not a new phenomenon. GitHub lists at least 15 incidents of in-person crypto robbery in the past year, with 17 cases in 2023 and 32 in 2021.
7/ While this is a cautionary tale and hopefully this will help lead to arrests here are some measures you can take to protect yourself.
>Avoid sharing personal information or details about your crypto holdings to “friends” or to flex on social media
>Monitor your personal… x.com/i/web/status/1…
— ZachXBT (@zachxbt)
1:30 PM • Oct 10, 2024
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💡 Feature of the Day:
Scroll’s recent listing on Binance has ignited a heated debate within the crypto community over the project's commitment to decentralization.
For us, Binance is more than just a listing, it's the best channel to reach global distribution, it will open the on-ramp and off-ramp channels and help us grow to the next stage, especially in emerging markets.
ETH deposits and withdrawals on Scroll are now live on Binance,… x.com/i/web/status/1…
— Sandy | Scroll 📜 | 🦇🔊 (@sandyzkp)
7:31 AM • Oct 11, 2024
Announced on Oct. 11, the listing was seen as a major step forward for Scroll, an Ethereum layer-2 project, but critics argue that partnering with a centralized exchange like Binance undermines its decentralization ethos.
It’s a tough decision to make. I strongly doubt that it’s a good decision long term.
Imagine @VitalikButerin paying 5.5% to @okx when @star_okx refused to list $ETH.
I like everyone in the scroll team, but kneeling to CEX is really disappointing.
— zjj.eth 曾嘉俊 (@zengjiajun_eth)
2:37 PM • Oct 11, 2024
Some community members, like X user Zeng Jiajun, described the decision as "kneeling" to centralized entities, questioning the long-term effects on Scroll’s values.
@VitalikButerin@okx@star_okx I don’t think partnering with Binance is "kneeling to a CEX for listing" - it's way more than that, it's a strategic decision to build a partnership for growth and broader support. However, it is indeed a tough decision. Here are some of my thoughts:
1) Binance on-ramp and… x.com/i/web/status/1…
— Ye Zhang 📜 (@yezhang1998)
11:59 PM • Oct 11, 2024
In response, Scroll co-founder Ye Zhang defended the move, explaining that the Binance partnership was part of a broader strategy to expand the project's ecosystem, especially in emerging markets.
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