U.S. Digital Asset Companies Announce New Product Launches
By Robert A. Musiala Jr.
A major U.S. cryptocurrency exchange recently announced that certain customers can now trade “over 11,000 U.S.-listed stocks and ETFs, bringing equities and digital assets together in one accessible trading platform.” According to a blog post by the company, the new feature is currently available for U.S.-based clients in New Jersey, Connecticut, Wyoming, Oklahoma, Idaho, Iowa, Rhode Island, Kentucky, Alabama and the District of Columbia. The blog post notes that the new product offering allows clients to “seamlessly manage stocks, crypto, cash and stablecoins – all in one place.”
In another development, a Canadian investment company recently announced that it has debuted a Solana spot exchange-traded fund (ETF) that provides “direct physical exposure to Solana while delivering staking rewards accruing directly to the fund.” According to a press release, the staking rewards are generated by the company’s “proprietary in-house staking infrastructure.”
Another recent press release announced that “Centrifuge, the leading platform for bringing real-world assets onchain, has selected Wormhole as its official multichain infrastructure partner for Centrifuge V3.” According to the press release, the Centrifuge V3 platform provides “full chain abstraction and a unified interface for fund administration and investment across any blockchain network.” The release further notes that the new platform “removes the need to manage custody, transaction payments, blockchain endpoints, and more for the ever-growing network of L1s and L2s, thus simplifying the onramp for institutions.”
In a related item, tokenization platform Securitize recently announced that it has acquired a leading digital asset fund administration business. According to a press release, the acquisition will enhance Securitize’s offerings for “institutional grade real-world asset tokenization and fund administration.”
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BIS Report Addresses Advances in Tokenization
By Keith R. Murphy
The Bank for International Settlements’ (BIS) Consultative Group on Innovation and the Digital Economy (CGIDE) recently issued a report (Report) addressing advances in tokenization in the financial system. The CGIDE reportedly launched a task force for the purpose of exploring the potential of tokenized assets for safe and efficient transactions settled in central bank money, and the stated purpose of the Report is to provide insights into ongoing tokenization projects, as well as their potential to improve the financial system. Among other things, the Report addresses potential use cases of tokenization and ongoing applications in central banks.
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DeFi Broker Rule Overturned; SEC Dismisses Claims Against DePIN Provider
By Robert A. Musiala Jr. and Keith R. Murphy
According to reports, a bill was recently signed into law to overturn a final rule by the IRS that would have prescribed new reporting requirements for what the rule had described as “trading front-end service providers interacting directly with customers on digital asset transactions, often referred to as ‘DeFi brokers.’” The newly passed law follows previous actions by Congress to rescind the rule through the Congressional Review Act.
A decentralized public infrastructure network (DePIN) provider recently announced that the U.S. Securities and Exchange Commission (SEC) has agreed to dismiss with prejudice its claims that the DePIN provider sold unregistered securities. The announcement is the latest in a number of similar announcements by digital asset industry companies.
In a final development, according to a recent press release, following an announcement by the U.S. Department of Justice regarding the dismantling of the National Cryptocurrency Enforcement Team, New York Attorney General Letitia James has written to congressional leaders suggesting that they pass legislation to strengthen regulations on digital assets and cryptocurrencies. In the press release, the attorney general argues that federal regulation of cryptocurrencies is necessary to protect investors from a multitude of risks, including price manipulation and rigged markets, fraud that results in billions in losses to Americans, and national security risks from the use of digital assets to anonymously finance adversarial regimes and to fund criminal operations. The press release notes that cryptocurrency frauds have multiplied significantly, costing Americans an estimated $12 billion in 2024.
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DOJ Action Targets Defendant for Failing to Report NFT Sales
By John Robertson
In a recent press release, the U.S. Department of Justice (DOJ) announced Pennsylvania resident Waylon Wilcox pled guilty to two counts of filing false individual income tax returns. According to the release, Wilcox bought and sold 97 CryptoPunk NFTs throughout the 2021 and 2022 tax years. Despite these sales, Wilcox answered “no” to tax return questions about virtual currency and digital asset income. The release reports that, due to these false answers, Wilcox omitted more than $13 million in income. Wilcox faces a maximum penalty of six years’ imprisonment.
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Reports Provide Notice of Newly Discovered Crypto Malware
By Keith R. Murphy
According to a recent report, threat actors are loading malicious packages to the npm registry in an effort to tamper with existing legitimate libraries and inject malicious code. A newly discovered package named “pdf-to-office” presents as a utility to enable the conversion of PDF files to Microsoft Word documents; however, it instead injects malicious code into cryptocurrency wallet software associated with Atomic Wallet and Exodus, according to the report. The report notes that a victim sending crypto funds to another wallet would have the originally intended wallet destination “swapped out for the one belonging to the malicious actor.”
A related recent report from JFrog Security Research provides an analysis and warns of another malicious package, the ccxt-mexc-futures package, the goal of which is to leak cryptocurrency trading credentials. Reportedly, the malicious package claims to extend the capabilities of crypto trading through the CryptoCurrency eXchange Trading PyPI package (a legitimate commonly used crypto trading Python package) by falsely claiming to support “futures” trades on the MEXC exchange.
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