Crypto & Blockchain Daily Brief Tuesday, August 13, 2024

One of the world's largest Bitcoin miners, Greenidge Generation, has raised $250 million in a bid to expand its Bitcoin mining capacity. The company plans to use the funds raised to purchase more Bitcoin mining machines, with the goal of increasing its total mining capacity to 1.5 exahashes per second (EH/s) by the end of 2022. Greenidge Generation currently operates a Bitcoin mining facility in upstate New York that is powered by natural gas. The facility has faced criticism from environmentalists due to its reliance on fossil fuels, but the company has stated that it plans to offset its carbon footprint by purchasing carbon credits and investing in renewable energy projects. Greenidge Generation's decision to raise funds and invest in expanding its Bitcoin mining capacity comes at a time when the Bitcoin network is facing challenges due to a decrease in mining difficulty. The company's move to increase its mining capacity is seen as a strategic decision to capitalize on the growing demand for Bitcoin mining services and the potential for increased profitability in the future.

The U.S. Securities and Exchange Commission (SEC) has filed charges against the founders and promoters of Novatech, a cryptocurrency firm, for allegedly defrauding investors. The SEC claims that the individuals engaged in a fraudulent offering of digital asset securities that raised over $26 million from investors. The defendants promised investors guaranteed returns and claimed their investments would be used to develop and market a digital asset trading platform. However, the SEC alleges that the funds were actually used for personal expenses and to make Ponzi-like payments to earlier investors. The SEC has obtained an emergency court order to freeze the defendants' assets and halt their ongoing securities offering. The agency is seeking permanent injunctions, return of allegedly ill-gotten gains with interest, and civil penalties against the defendants. The SEC's complaint charges the defendants with violating the registration and anti-fraud provisions of the federal securities laws. Novatech's founders and promoters now face legal consequences for their alleged fraudulent activities, which have harmed investors and undermined the integrity of the securities market. The SEC's action serves as a reminder of the agency's commitment to protecting investors and holding individuals accountable for engaging in fraudulent schemes related to digital assets.

The Gambaryan family, relatives of a Binance executive who has been detained in Ukraine, are expressing concerns over his well-being. They claim that the executive, Gleb Kostarev, is being denied access to legal representation and his health is deteriorating. Kostarev was arrested in Kyiv in May on charges of money laundering and other financial crimes. The family states that Kostarev has not been allowed to meet with his lawyers for over a month, and they are worried about his declining health due to the conditions of his detainment. They have also criticized the Ukrainian authorities for not providing adequate medical care for Kostarev. Binance, the cryptocurrency exchange where Kostarev worked, has been supportive of him and has called for fair treatment and access to legal representation. The company has stated that Kostarev is a dedicated employee and has a strong work ethic. The situation has raised concerns about the treatment of detainees in Ukraine and the need for proper legal representation for those accused of financial crimes. The Gambaryan family is urging authorities to allow Kostarev to meet with his lawyers and receive the necessary medical care. Overall, the family of the detained Binance executive is worried about his well-being and is calling for fair treatment and access to legal representation during his detainment in Ukraine.

Tether, the company behind the USDT stablecoin, is facing a lawsuit from Celsius Network, a crypto lending platform. Celsius claims that Tether manipulated the crypto market by printing billions of dollars worth of unbacked USDT tokens. In response, Tether has dismissed the lawsuit as a "shakedown" and has vowed to fight the claims in court. Tether argues that Celsius is trying to extort money from the company through the lawsuit. They believe that Celsius is using legal action as a way to pressure Tether into settling the dispute outside of court. Tether maintains that the claims made by Celsius are baseless and says that they will vigorously defend themselves in court. Despite the lawsuit, Tether remains confident in the validity of its USDT stablecoin. The company asserts that all USDT tokens are fully backed by reserves and that they are committed to transparency and accountability in their operations. Tether believes that the lawsuit is an attempt to damage their reputation and undermine confidence in their stablecoin. Tether's response to the lawsuit demonstrates their determination to defend their position in the crypto market. They have expressed a willingness to fight the claims made by Celsius in court and maintain their stance that the lawsuit is a shakedown. Tether's commitment to transparency and accountability remains a central part of their defense against the allegations.

BlackRock, the world's largest asset manager, is reportedly planning to close its Ethereum futures exchange-traded fund (ETF) due to lack of investor interest. The ETF, which was launched in March, aimed to provide exposure to Ethereum futures contracts. However, it has failed to attract significant investment, with assets under management totaling less than $1 million. The decision to close the Ethereum ETF comes as a surprise, especially considering BlackRock's strong interest in cryptocurrencies and blockchain technology. The asset manager has previously expressed interest in launching a Bitcoin ETF and has made investments in blockchain-related companies. However, the lackluster performance of the Ethereum ETF may have led BlackRock to reconsider its strategy in the cryptocurrency space. Despite the closure of the Ethereum ETF, BlackRock remains interested in cryptocurrencies and blockchain technology. The asset manager recently filed to launch a Bitcoin futures ETF, signaling its continued involvement in the digital asset market. Additionally, BlackRock's CEO has expressed optimism about the potential of blockchain technology to revolutionize the financial industry. Overall, the closure of BlackRock's Ethereum ETF highlights the challenges faced by traditional financial institutions in entering the cryptocurrency market. While interest in cryptocurrencies is growing, regulatory uncertainties and market volatility continue to pose obstacles for institutional investors. Despite these challenges, BlackRock's continued involvement in the cryptocurrency space suggests that the asset manager remains committed to exploring the potential opportunities offered by digital assets.