Bitcoin

Man Who Hijacked SEC's X Account To Pump Bitcoin Faces Up To 5 Years In Prison (gizmodo.com) 49

Eric Council Jr. pleaded guilty to identity theft and access device fraud after hijacking the SEC's X account to falsely announce Bitcoin ETF approval. He was compensated in Bitcoin by co-conspirators, and while the Justice Department continues its investigation, Council faces up to five years in prison. Gizmodo reports: According to the Justice Department, Council accessed the SEC's account using an attack called SIM swapping, in which a perpetrator uses social engineering to trick a phone carrier's customer service representatives into transferring an individual's phone number to a new device. Basically, they call into a support line and use pieces of personal information about a victim they have gathered online to convince the representative they are the person they are targeting. Once perpetrators take the number and can begin receiving text messages, they are able to reset the passwords of accounts on services like X. It is not really a "hack" in the traditional sense that they are not finding flaws in software but rather exploiting human trust.

Unfortunately for individuals like Council, all Bitcoin transactions are logged on a blockchain for anyone to see, leaving a trail of breadcrumbs for investigators to find. If he did make out with a lot of crypto, it would be hard to keep it hidden forever. Council allegedly did not post the message himself to the SEC's X account, but conducted the SIM swap and left the rest of the work to his co-conspirators who compensated Council in the form of, of course, Bitcoin. The price of the cryptocurrency rose by $1,000 after the fake announcement, according to the Justice Department, and fell by $2,000 after the SEC issued a correction. That could have led to a big windfall depending on how much Bitcoin the perpetrators held at the time.

Bitcoin

Man Who Lost Bitcoin Fortune In Welsh Tip Explores Purchase of Entire Landfill (theguardian.com) 151

AmiMoJo writes: A computer expert who has battled for a decade to recover a $743 million bitcoin fortune he believes is buried in a council dump in south Wales is considering buying the site so he can hunt for the missing fortune. James Howells lost a high court case last month to force Newport city council to allow him to search the tip to retrieve a hard drive he says contains the bitcoins.

The council has since announced plans to close and cap the site, which would almost certainly spell the end of any lingering hopes of reaching the bitcoins. The authority has secured planning permission for a solar farm on part of the land. Howells, 39, said on Monday it had been "quite a surprise" to hear of the closure plan. He said: "It [the council] claimed at the high court that closing the landfill to allow me to search would have a huge detrimental impact on the people of Newport, whilst at the same time they were planning to close the landfill anyway. I expected it would be closed in the coming years because it's 80/90% full -- but didn't expect its closure so soon. If Newport city council would be willing, I would potentially be interested in purchasing the landfill site -- as is -- and have discussed this option with investment partners and it is something that is very much on the table."

Bitcoin

El Salvador Congress Votes to Revoke Bitcoin's 'Legal Currency' Status (reason.com) 58

After finalizing loan terms with the IMF, El Salvador's Legislative Assembly approved changes to the country's Bitcoin Law last week by a 55-2 vote, "effectively removing bitcoin's status as legal currency," reports Reason. Under the new rules, bitcoin is no longer considered "currency," though it remains "legal tender." Another change makes using bitcoin entirely voluntary. (Previously, the law mandated that businesses accept bitcoin for any goods or services they provided.) Additionally, bitcoin can no longer be used to pay taxes or settle government debts. The government is also stepping back from its involvement in Chivo Wallet, the state-backed digital wallet...

The reforms come as part of a broader financial agreement between Bukele and the International Monetary Fund (IMF). One of the conditions for a proposed $1.4 billion Extended Fund Facility loan was that El Salvador mitigate "potential risks of the Bitcoin project." The IMF has been critical of the country's crypto policies since Bukele made bitcoin legal tender in 2021. "There are large risks associated with using Bitcoin as legal tender, especially given the high volatility of its price. We don't recommend it," the organization said in 2022.

Despite these changes, the administration insists it remains committed to bitcoin. Milena Mayorga, El Salvador's ambassador to the United States, has said that El Salvador is still a "bitcoin country" and will maintain — and even expand — its bitcoin reserves. "You have to adapt to the current situation and this is the decision that was taken in the Assembly, but that does not mean that the country will stop having a bitcoin reserve," she explained.

Government data suggests El Salvador now holds 6,072 Bitcoin worth $586,888,000.
Power

Will Cryptomining Facilities Change Into AI Data Centers? (yahoo.com) 36

To capitalize on the AI boom, many crypto miners "have begun to repurpose parts of their operations into data centers," reports Reuters, "given they already have most of the infrastructure" (including landing and "significant" power resources...) Toronto-based bitcoin miner Bitfarms has enlisted two consultants to explore how it can transform some of its facilities to meet the growing demand for artificial intelligence data centers, it said on Friday... Earlier this month, Riot Platforms launched a review of the potential AI and computing uses for parts of its facility in Navarro County, Texas.
Crime

Silk Road Creator Ross Ulbricht Pardoned (bbc.com) 339

Slashdot readers jkister and databasecowgirl share the news of President Donald Trump issuing a pardon to Silk Road creator Ross Ulbricht. An anonymous reader shares a report from the BBC: US President Donald Trump says he has signed a full and unconditional pardon for Ross Ulbricht, who operated Silk Road, the dark web marketplace where illegal drugs were sold. Ulbricht was convicted in 2015 in New York in a narcotics and money laundering conspiracy and sentenced to life in prison. Trump posted on his Truth Social platform that he had called Ulbricht's mother to inform her that he had granted a pardon to her son. Silk Road, which was shut down in 2013 after police arrested Ulbricht, sold illegal drugs using Bitcoin, as well as hacking equipment and stolen passports.

"The scum that worked to convict him were some of the same lunatics who were involved in the modern day weaponization of government against me," Trump said in his post online on Tuesday evening. "He was given two life sentences, plus 40 years. Ridiculous!" Ulbricht was found guilty of charges including conspiracy to commit drug trafficking, money laundering and computer hacking. During his trial, prosecutors said Ulbricht's website, hosted on the hidden "dark web", sold more than $200 million worth of drugs anonymously.

Bitcoin

Donald and Melania Trump Launch a Pair of Meme Coins (cnn.com) 214

Donald and Melania Trump have launched a pair of meme coins just before President Trump was sworn into office. The coins are already worth billions of dollars, raising "serious ethical questions and conflicts of interest," said Richard Painter, a law professor at the University of Minnesota. CNN reports: Melania Trump launched her cryptocurrency $MELANIA in a social media post Sunday, sending her husband's cryptocurrency $TRUMP, announced two days earlier, plummeting. "The Official Melania Meme is live! You can buy $MELANIA now. https://melaniameme.com," the future first lady wrote on X Sunday. Meme coins are a type of highly volatile cryptocurrency inspired by popular internet or cultural trends. They carry no intrinsic value but can soar, or plummet, in price. "My NEW Official Trump Meme is HERE!" Trump wrote on X Friday. "It's time to celebrate everything we stand for: WINNING! Join my very special Trump Community. GET YOUR $TRUMP NOW. Go to http://gettrumpmemes.com -- Have Fun!" Both coins are trading on the Solana blockchain. [...]

$TRUMP is the first cryptocurrency endorsed by the incoming president, who once trashed bitcoin as "based on thin air." [...] While executive branch employees must follow conflict of interest criminal statutes that prevent them from participating in matters that impact their own financial interests, the law does not apply to the president or the vice president. [...] The Trump coin's market capitalization, which is based on the 200 million coins circulating, is capped at $13 billion, according to CoinMarketCap. The meme coin's website said there will be 1 billion Trump coins over the next three years. Both $MELANIA and $TRUMP's websites contain disclaimers saying the coins are "intended to function as a support for, and engagement with" the values of their respective brands and "are not intended to be, or to be the subject of, an investment opportunity, investment contract, or security of any type."

The website says the meme coin is not politically affiliated. But 80% of the coin's supply is held by Trump Organization-affiliate CIC Digital and Fight Fight Fight LLC, which are both subject to a three-year unlocking schedule -- so they cannot sell all of their holdings at once. Trump coin's fully diluted value (which reflects the eventual total supply of Trump coins) stood at around $54 billion as of Monday morning, according to CoinMarketCap. At that value, the 80% linked to Trump is worth a staggering $43 billion, at least on paper. The $TRUMP coin's website says it is "the only official Trump meme. Now, you can get your piece of history. This Trump Meme celebrates a leader who doesn't back down, no matter the odds," the website reads.
"Trump owning 80% and timing launch hours before inauguration is predatory and many will likely get hurt by it," Nick Tomaino, a former Coinbase executive, said in a post on X. "Trump should be airdropping to the people rather than enriching himself or his team on this."
Encryption

Ransomware Crew Abuses AWS Native Encryption, Sets Data-Destruct Timer for 7 Days (theregister.com) 18

A new ransomware group called Codefinger targets AWS S3 buckets by exploiting compromised or publicly exposed AWS keys to encrypt victims' data using AWS's own SSE-C encryption, rendering it inaccessible without the attacker-generated AES-256 keys. While other security researchers have documented techniques for encrypting S3 buckets, "this is the first instance we know of leveraging AWS's native secure encryption infrastructure via SSE-C in the wild," Tim West, VP of services with the Halcyon RISE Team, told The Register. "Historically AWS Identity IAM keys are leaked and used for data theft but if this approach gains widespread adoption, it could represent a significant systemic risk to organizations relying on AWS S3 for the storage of critical data," he warned. From the report: ... in addition to encrypting the data, Codefinder marks the compromised files for deletion within seven days using the S3 Object Lifecycle Management API â" the criminals themselves do not threaten to leak or sell the data, we're told. "This is unique in that most ransomware operators and affiliate attackers do not engage in straight up data destruction as part of a double extortion scheme or to otherwise put pressure on the victim to pay the ransom demand," West said. "Data destruction represents an additional risk to targeted organizations."

Codefinger also leaves a ransom note in each affected directory that includes the attacker's Bitcoin address and a client ID associated with the encrypted data. "The note warns that changes to account permissions or files will end negotiations," the Halcyon researchers said in a report about S3 bucket attacks shared with The Register. While West declined to name or provide any additional details about the two Codefinger victims -- including if they paid the ransom demands -- he suggests that AWS customers restrict the use of SSE-C.

"This can be achieved by leveraging the Condition element in IAM policies to prevent unauthorized applications of SSE-C on S3 buckets, ensuring that only approved data and users can utilize this feature," he explained. Plus, it's important to monitor and regularly audit AWS keys, as these make very attractive targets for all types of criminals looking to break into companies' cloud environments and steal data. "Permissions should be reviewed frequently to confirm they align with the principle of least privilege, while unused keys should be disabled, and active ones rotated regularly to minimize exposure," West said.
An AWS spokesperson said it notifies affected customers of exposed keys and "quickly takes any necessary actions, such as applying quarantine policies to minimize risks for customers without disrupting their IT environment."

They also directed users to this post about what to do upon noticing unauthorized activity.
Bitcoin

DOJ Cleared To Sell $6.5 Billion In Bitcoin Seized From Silk Road (cryptobriefing.com) 71

An anonymous reader quotes a report from Crypto Briefing: The US Department of Justice (DOJ) has been authorized to sell approximately 69,370 Bitcoin seized in connection with the Silk Road darknet marketplace, a haul currently valued at around $6.5 billion, DB News reported Wednesday. The decision is set to end a years-long legal dispute over the BTC stash's ownership. On December 30, a federal judge ruled in favor of the DOJ's request to liquidate the crypto assets, the report said. Battle Born Investments, which had asserted a claim to the Bitcoin stash through a bankruptcy estate, ultimately failed in its bid to delay the sale.

As noted, the group had pursued a Freedom of Information Act (FOIA) request seeking the identity of "Individual X," who initially surrendered Bitcoin, but the effort also proved unsuccessful. Battle Born's legal counsel criticized the DOJ's handling of the case, alleging the department employed "procedural trickery" in its use of civil asset forfeiture to avoid scrutiny. The DOJ, in its arguments before the court, cited Bitcoin's price volatility as motivation for seeking a quick sale of the seized assets. A DOJ spokesperson, when contacted, stated, "The Government will proceed further consistent with the judgment in this case."

The update comes after the US Supreme Court refused to hear an appeal challenging the seizure of the Bitcoin stash, which was brought by Battle Born last October. The decision likely paved the way for the US government to sell Bitcoin, which was valued at $4.4 billion at the time. The US Marshals Service is expected to manage the liquidation process, which, if confirmed, will be one of the largest sales of seized crypto in history.
Further reading: Judge Rejects Man From Retrieving $750 Million of Bitcoin From Landfill
Bitcoin

Judge Rejects Man From Retrieving $750 Million of Bitcoin From Landfill (crypto.news) 127

An IT engineer from Wales lost a decade-long legal battle to recover a hard drive containing 8,000 Bitcoins from a Newport landfill. The hard drive, accidentally thrown away in 2013, is now valued between $700-750 million. crypto.news reports: However, Judge Keyser KC ruled there were no "reasonable grounds" for the claim, citing environmental concerns and the council's ownership of the landfill contents. The landfill reportedly holds 1.4 million tonnes of waste, but Howells claims to have pinpointed the hard drive's location to a 100,000-ton section. Reacting to the ruling, Howells expressed frustration, calling it a "kick in the teeth," according to the BBC.
The Almighty Buck

A Tour Through History's Most Entertaining Price Anomalies (msn.com) 29

MicroStrategy's bitcoin holdings and a tech investment fund are commanding extraordinary premiums in U.S. markets, highlighting unusual price anomalies reminiscent of past market distortions. MicroStrategy shares are trading at more than double the market value of their main asset -- bitcoin holdings -- while closed-end fund Destiny Tech100 recently traded at 11 times its net asset value, down from 21 times earlier in 2024.

Similar market irregularities have emerged throughout history. In 1923, investor Benjamin Graham profited from a disconnect between DuPont and General Motors shares. During the 1929 bull market, closed-end fund Capital Administration Co. traded at a 1,235% premium to its net asset value. WSJ adds: The PalmPilot during the 1990s and early 2000s was a hand-held device and personal assistant that came with a touch-screen display and a stylus. Palm was the biggest maker of hand-held computer devices, with 70% market share, and it held its initial public offering in March 2000, about a week before the Nasdaq Composite Index's peak during the dot-com bubble.

Palm's shares jumped 150% on their first day of trading, giving Palm a stock-market value of about $53 billion. Palm was still 94%-owned by parent 3Com at the time. Yet on Palm's first day of trading, 3Com's shares fell 21%.

The funny part: According to the stock market, 3Com was worth about $23 billion less than the value of the Palm shares that 3Com owned. This made no sense, yet the valuations remained out of whack for months. In time, both stocks came down to earth, sanity prevailed and the world eventually moved on to smartphones.

Bitcoin

MicroStrategy's Big Bet On Bitcoin Went Stratospheric (theguardian.com) 33

MicroStrategy has transformed into a "bitcoin treasury company," investing billions in bitcoin through debt and equity issuance, driving its stock price up nearly 400% in 2024 despite declining software revenues and heightened financial risks. The Guardian reports: In the summer of 2020, as the Covid-19 pandemic upended economies around the world, an obscure U.S. software firm decided to diversify. MicroStrategy, whose head office is situated next to a shopping mall and metro station in Tysons Corner, Virginia, had decided the steady business of "software as a service" was not racy enough. Instead, it would branch out by investing up to $250 million in alternative assets -- "stocks, bonds, commodities such as gold, digital assets such as bitcoin or other asset types." Less than five years later, that bitcoin side hustle has gone stratospheric. MicroStrategy's share price has swollen twentyfold, lifting its market capitalization to almost $75 billion and catapulting the stock into the Nasdaq 100 index of top technology shares.
Bitcoin

North Korean Hackers Stole $1.3 Billion Worth of Crypto This Year 22

In 2024, North Korean state-sponsored hackers stole $1.34 billion in cryptocurrency across 47 attacks, marking a 102.88% increase from 2023 and accounting for 61% of global crypto theft. BleepingComputer reports: Although the total number of incidents in 2024 reached a record-breaking 303, the total losses figure isn't unprecedented, as 2022 remains the most damaging year with $3.7 billion. Chainalysis says most of the incidents this year occurred between January and July, during which 72% of the total amount for 2024 was stolen. The report highlights the DMM Bitcoin hack from May, where over $305 million was lost, and the WazirX cyberheist from July, which resulted in the loss of $235 million.

As for what types of platforms suffered the most damage, DeFi platforms were followed by centralized services. Regarding the means, the analysts report that private key compromises accounted for 44% of the losses, while exploitation of security flaws corresponded to just 6.3% of stolen cryptocurrency. This is a sign that security audits have a significant effect on reducing exploitable flaws on the platforms. However, stricter security practices in the handling of private keys need to be implemented.
Bitcoin

El Salvador Strikes $1.4 Billion IMF Deal After Scaling Back Bitcoin Policies (bbc.com) 15

El Salvador secured a $1.4 billion loan deal with the IMF after agreeing to scale back its bitcoin policies, making cryptocurrency acceptance voluntary for businesses and limiting public sector involvement. The deal aims to stabilize the country's economy, with bitcoin's recent rally boosting the value of El Salvador's holdings. The BBC reports: In 2021, El Salvador became the first country in the world to make bitcoin legal tender. This week, the cryptocurrency briefly hit a fresh record high of more than $108,000.

"The potential risks of the Bitcoin project will be diminished significantly in line with Fund policies," the IMF announcement said. "Legal reforms will make acceptance of Bitcoin by the private sector voluntary. For the public sector, engagement in Bitcoin-related economic activities and transactions in and purchases of Bitcoin will be confined."
Last Friday, El Salvdaor purchased more than 11 BTC worth $1.07 million and executed another 11 BTC purchase on Sunday, according to crypto data platform Arkham. El Salvador's President, Nayib Bukele, is ramping up buys "with an interim goal of acquiring 20,000 more Bitcoin," reports the Daily Hodl.
The Courts

Craig Wright Convicted For Repeatedly Lying About Inventing Bitcoin 37

Craig Wright, an Australian computer scientist living in the UK, has been found guilty of contempt of court for persistently and falsely claiming to be Bitcoin's creator, Satoshi Nakamoto, despite a High Court ruling against his claim. He has been sentenced to 12 months in prison, suspended for two years, and faces jail if he continues his assertions. The BBC reports: [...] Wright, who appeared via videolink, refused to disclose where he was, saying only he was in Asia. It means an international arrest warrant would have to be issued if the UK authorities wanted to detain him.

Wright's actions were described in court as "legal terrorism" that "put people through personal hell" in his campaign to be recognised as Bitcoin's inventor. The judge, Mr Justice Mellor, said Wright arguments were "legal nonsense" but acknowledged that he was not in the UK and "appears to be well aware of countries with which the UK does not have extradition arrangements".
Bitcoin

Texas House Introduces Bill To Establish a Strategic Bitcoin Reserve 166

An anonymous reader quotes a report from CNBC: Legislation was introduced in the Texas House of Representatives on Thursday to establish a strategic bitcoin reserve, which could serve as a proving ground for the U.S. Treasury. The proposed bill would enable the state to start building a strategic bitcoin reserve by accepting taxes, fees and donations in bitcoin that would be held for a minimum of five years, Republican state Rep. Giovanni Capriglione announced on an X Spaces event Thursday.

The Texas bill aims to provide a way to strengthen the state's fiscal stability and establish it as a leader in bitcoin innovation, according to the Satoshi Action Fund, a nonprofit bitcoin advocacy group that worked with Capriglione on the bill. "Probably the biggest enemy of our investments is inflation," Capriglione said. "A strategic bitcoin reserve, investing in bitcoin, would be a win-win for the state." "I just filed the bill ... entitled 'An act relating to the establishment of a bitcoin reserve within the state treasury of Texas and the management of cryptocurrencies by governmental entities,'" he said later.
"My goal is to make this bill as big and as broad as possible," Capriglione said. "This initial step is to allow some optionality and flexibility on it, but if I am able to get support from other legislators, we will make it even stronger."

It's "unlikely" a U.S. strategic bitcoin reserve will be established, "but it helps get animal spirits back into the market," Needham's John Todaro told CNBC. He said it's also "unlikely to drive material price gains, as we do not expect the U.S. government will purchase bitcoin in any meaningful capacity, but it's an item that drives excitement and optimism."
United States

Bitcoin Miner Purchases 112-Megawatt Texas Wind Farm, Takes it Off the Grid (chron.com) 104

This week a Florida-based Bitcoin-tech company named MARA Holdings announced it had bought a 114-megawatt Texas wind farm, reports Chron.com, "and will subsequently take it off the power grid and use it to energize its mining operations."

MARA's CEO tells the site they're "leveraging renewable resources that would have otherwise been curtailed" while "reducing our bitcoin production costs through vertical integration, and demonstrating MARA's commitment to environmental stewardship." The wind farms were not a part of the Electric Reliability Council of Texas (ERCOT) grid, but instead they were located within the Southwest Power Pool, which manages the market for the central U.S., including but not limited to most or parts of Oklahoma, Kansas, Nebraska, South Dakota and North Dakota... A 114-MW facility could power somewhere between 20,000 and 100,000 homes, depending on who you ask...

Historically, the facilities use up a lot of power and have generated backlash from neighbors who have complained about the noise of the machines inside. Texas has been a haven for cryptocurrency tech companies, primarily because of the state's space, deregulated power market and friendly business climate. Two weeks ago, the Public Utilities Commission adopted a rule requiring crypto and other virtual currency miners within the ERCOT grid to register their locations, ownership information and electricity demands, to further ensure that they could be watchful of this emerging source of energy consumption.

"Crypto mining operations currently consume around 2.3 percent of US electricity, and it requires roughly 155,000kWh to mine one Bitcoin," notes the site Data Centre Dynamics. This is the second off-grid power deal MARA has signed over the last few months. In October, it launched a 25MW micro data center operation across oil wellheads in Texas and North Dakota. The data center will be powered exclusively by excess natural gas from oilfield production that would have otherwise been flared. The operation will be distributed across wellheads in Texas and North Dakota, with operational status expected by January 2025.
Some context from Bloomberg: A few years ago Bitcoin miners took part in a global scramble for electricity to power their specialized computers... But the rise of AI, with its insatiable demand for electricity, dwarfed the needs of crypto and upended energy markets worldwide. Miners must now compete with much-larger tech firms for connections to electrical grids and power contracts. "Bitcoin miners are being forced to go look at marginal generation," said [MARA CEO Fred] Thiel. "The AI guys can afford to pay a much higher amount for energy than a Bitcoin miner"... MARA's plan to mine only when the wind is blowing makes economic sense because its mine will house last-generation computers that would otherwise have been retired, Thiel said.
"Thiel said he'd be interested to potentially buy more wind farms over time."
Bitcoin

Hard Drive Tossed in Landfill With Bitcoin Now Worth $800 Million. Lawsuits Continue (theguardian.com) 205

11 years ago his hard drive ended up in a U.K. landfill — with 8,000 bitcoin. It's now worth $800 million... and James Howell wants it back.

The Guardian reports that his "bid to become extremely rich reached a judge on Tuesday with a team of lawyers arguing that it was still possible to launch a hunt for his missing hard drive containing the bitcoin." They claimed that rather than searching for a "needle in a haystack", the position of the bitcoin hoard had been narrowed down to a small area and there was a "finely tuned" plan to retrieve it... [Howells] has been asking Newport city council for help in getting the hard drive back, and even said he would share the money with the authority, to no avail... James Goudie KC, representing the council, said Howells had no legal claim to the hard drive. He said: "Anything that goes into the landfill goes into the council's ownership."

Goudie said Howells' offer to share some of the bitcoin with Newport council amounted to a bribe. He said: "He is trying to buy something the council is not in a position to sell...." Before the hearing, a spokesperson for Newport council said: "The council has told Mr Howells multiple times that excavation is not possible under our environmental permit and that work of that nature would have a huge negative environmental impact on the surrounding area. "Responding to Mr Howells' baseless claims are costing the council and Newport taxpayers time and money which could be better spent on delivering services."

Howells was 28 when he lost the hard drive, and has said he may as well keep trying to recover it — because he'll always know that it's out there. Howells' legal teams are "working pro bono," the article notes, "on the basis that they get a share of the bitcoin profits if successful..." And TechSpot points out that "There's also the question of whether the data on the drive would still be accessible after more than a decade of sitting under a pile of rotting garbage.

"Howells has a team of data recovery engineers who are also working pro bono..."

Thanks to Slashdot reader jjslash for sharing the news.
Crime

Founder of Cryptocurrency Lender 'Celsius Network' Pleads Guilty to Fraud (reuters.com) 16

59-year-old Alex Mashinsky, the founder/former CEO of cryptocurrency lender Celsius Network, "pleaded guilty on Tuesday to two counts of fraud," reports Reuters.

He'd been indicted in July on seven counts of fraud, conspiracy and market manipulation charges, according to the article, and federal prosecutors in Manhattan "said he misled customers of Celsius to persuade them to invest, and artificially inflated the value of his company's proprietary crypto token." On Tuesday, during a hearing before U.S. District Judge John Koeltl, Mashinsky said he pleaded guilty to two out of the seven counts he was initially charged with: commodities fraud, and a fraudulent scheme to manipulate the price of CEL, Celsius' in-house token. In court, Mashinsky admitted to giving Celsius customers "false comfort" by giving an interview in 2021 in which he said Celsius had received approval from regulators for its "Earn" program, which it had not. That program offered to deploy customers' cryptocurrency assets to yield investment returns. He said he also failed to disclose that he had been selling his holdings of CEL, the platform's in-house token.

"I know what I did was wrong, and I want to try to do whatever I can to make it right," Mashinsky said. As part of his plea deal with prosecutors, Mashinsky agreed not to appeal any sentence of 30 years or less — the maximum he faces for the two counts. Koeltl is set to sentence him on April 8, 2025.

Federal prosecutors in Manhattan have said Mashinsky also personally reaped approximately $42 million in proceeds from selling his holdings of the Cel token. "Mashinsky made tens of millions of dollars selling his own CEL at artificially high prices, while his customers were left holding the bag when the company went bankrupt," Damian Williams, the U.S. Attorney in Manhattan, said in a statement on Tuesday... Founded in 2017, Celsius filed for Chapter 11 bankruptcy protection in July 2022 after customers rushed to withdraw deposits as crypto prices fell. Many were initially unable to access their funds... Celsius' former chief revenue officer, Roni Cohen-Pavon, pleaded guilty in September 2023 and agreed to cooperate with prosecutors' investigation.

"The company exited bankruptcy on Jan. 31, and has pivoted to Bitcoin mining..."
Bitcoin

Coinbase Expands Crypto Buying Reach With Apple Pay Integration (techcrunch.com) 23

Major cryptocurrency exchange Coinbase has integrated Apple Pay into its Onramp service, enabling third-party apps to offer direct cryptocurrency purchases through Apple's payment system.

The move significantly streamlines the traditionally complex process of converting traditional currencies to cryptocurrencies, eliminating multiple steps and extra fees previously required. It also marks a notable shift in Apple's historically cautious stance toward cryptocurrency, following years of restricting crypto-related features and removing major exchanges from its App Store in certain markets.

Slashdot Top Deals