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Prosecutors dropped criminal campaign finance charges against FTX owner Sam Bankman-Fried, due to a complication related to the U.S.’s extradition treaty with the Bahamas.

According to a Wednesday court filing by U.S. Attorney for the Southern District of New York Damian Williams, the Bahamian government notified the U.S. that it did not intend to extradite Bankman-Fried on a charge of conspiracy to make unlawful campaign contributions, an accusation levied by U.S. prosecutors.

The charge was not included when American law enforcement had notified Bahamian authorities of their intention to prosecute Bankman-Fried in order to facilitate his arrest late last year, but was later included in indictments of the FTX co-founder and former CEO. The Bahamian government told U.S. authorities on Wednesday that it did not intend to extradite Bankman-Fried on the campaign finance charge, effectively telling prosecutors that going forward with that part of the indictment would violate the extradition treaty between the two countries. Under terms of the treaty U.S. authorities are obligated to communicate what they intend to charge in advance.

“Accordingly, in keeping with its treaty obligations to The Bahamas, the government does not intend to proceed to trial on the campaign contributions count,” Williams wrote the federal judge presiding over Bankman-Fried’s criminal proceeding.

Bankman-Fried’s lawyers previously asked for a dismissal of most charges against him, including the campaign finance charge, over technicalities. Judge Lewis Kaplan, of the U.S. District Court of the Southern District of New York, declined to do so, but asked prosecutors to check if the Bahamas government agreed to the campaign finance allegation under terms of its extradition treaty with the U.S.

Prosecutors move forward with majority of charges

Prosecutors still plan to move forward with a majority of charges against Bankman-Fried, mainly centered around alleged fraud within FTX and the rest of the former billionaire’s failed crypto empire. If found guilty on all remaining charges the FTX and Alameda Research co-founder still faces possible decades in prison.

Bankman-Fried was one of the most prolific political donors in the U.S. during the 2020 and 2022 election cycles.

Earlier Wednesday Kaplan placed a temporary gag order on Bankman-Fried and his attorneys, barring them from discussing the case with media until an early August decision over whether the indicted crypto mogul will spend the rest of his time before an October criminal trial in jail due to possible violations of his bail terms.

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

The House Financial Services Committee advanced a set of crypto bills after a landmark markup on Wednesday.

zkSync Era launched only in March but has more daily active addresses than Arbitrum and Optimism, the two largest scaling solutions by total value locked, underscoring the rising interest in its potential airdrop.

Episode 70 of Season 5 of The Scoop was recorded with The Block’s Frank Chaparro, and cLabs CTO Marek Olszewski.

Listen below, and subscribe to The Scoop on Youtube, Apple, Spotify, Google Podcasts, Stitcher, or wherever you listen to podcasts. Please send feedback and revision requests to podcast@theblock.co.

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This episode of The Scoop was recorded with Marek Olszewski, Chief Technology officer for cLabs — the core development team behind the Celo platform — live from the Ethereum Community Conference in Paris.

In this episode, Olszewski unpacks cLabs recent proposal to transition Celo to an Eth Layer 2, and explains why he thinks one day “hundreds if not thousands of chains will all be rolling up to Ethereum.”

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

A few more Fed rate hikes are likely, but “the hardest work is done,” one expert said.

Storied auction house Sotheby’s sold 500 pieces of generative art in less than an hour for $1.2 million.

Created by the artist Vera Molnár and christened Themes and Variations, each piece of digital art was “minted immediately upon purchase,” Sotheby’s said in a statement, adding that trading volume on the secondary market had totaled 400 ether (about $754,000) in the hours following the auction.

Sotheby’s announced the launch of its generative art program last month. Despite a downturn in NFT sales, the auction house has recently been reasonably successful when auctioning off digital works, including a collection that once belonged to the failed hedge fund Three Arrows Capital.

The auction house said that the sale of Themes and Variations “opened with a ceiling price of 20 ether” ($37,600).

 

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

CoinsPaid is once again processing transactions after halting service in response to an attack on July 22. The company said it suspects North Korea’s Lazarus Group orchestrated the attack.

“We believe Lazarus expected the attack on CoinsPaid to be much more successful,” the company said in a statement. “In response to the attack, the company’s dedicated team of experts has worked tirelessly to fortify our systems and minimize the impact … our security measures and procedures allowed CoinsPaid to prevent higher loss of funds.”

CoinsPaid said client funds were not impacted, although revenues were. The company pointed out that Lazarus Group had allegedly hacked other crypto organizations like Sky Mavis’ play-to-earn game Axie Infinity,  Atomic Wallet and Alphapo.

Lazarus Group victims

Last month, blockchain forensics outfit Elliptic said Atomic Wallet had been hacked by Lazarus Group, with losses surpassing $100 million. The on-chain sleuth ZachXBT said yesterday that the Alphapo hack probably resulted in a loss of $60 million.

“Within a few weeks, CoinsPaid will organize a round table with all the Lazarus victims to announce a new initiative aimed at minimizing and preventing such attacks in the future,” the company said.

 

 

 

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Hector Network will take six to 12 months to hold a liquidation. Token holders want their money back sooner.

A federal judge issued a gag order on former FTX CEO Sam Bankman Fried, limiting him from speaking publicly about his case to the media.

“The parties in this case, their attorneys, and their agents are prohibited from publicly disseminating or discussing with any public communications media anything about the case,” New York United States District Judge Lewis Kaplan ordered on Wednesday.

Kaplan added that the order did not apply to “assertions of innocence.”

The U.S. Department of Justice accused Bankman-Fried last week of leaking the private diary of a former colleague, Caroline Ellison, to the media. Ellison ran FTX’s sister trading company Alameda Research and pleaded guilty to multiple charges last year. 

Counsel for Bankman-Fried had agreed that he would not talk publicly about the case but said it should be applied to “all parties and witnesses” including FTX, Alameda Research and current FTX CEO John Ray, according to a letter filed in the U.S. District Court for the Southern District of New York over the weekend. 

Jail time sought 

Prosecutor Danielle Sassoon told the court on Wednesday that Bankman-Fried, who’s currently under house arrest, should be detained, adding that  “no set of release conditions can ensure the safety of the community,” according to Reuters. 

The judge gave both sides until Aug. 3 to argue their positions on whether or not Bankman-Fried should be detained. His counsel said the former FTX CEO was trying to protect his reputation through communication with journalists and added that it “really would be almost impossible” to prepare for the Oct. 2 trial if Bankman-Fried were jailed, Reuters reported. 

Bankman-Fried faces over 100 years in prison if he is convicted of a slew of charges, including fraud, over allegations that he and other FTX executives used billions of customer assets to make their own failed investments. FTX filed for bankruptcy late last year. 

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Decentralized cloud infrastructure network Aethir completed a Pre-A funding round, bringing the total raised to date to over $9 million at a valuation of $150 million.

Aethir’s latest funding was led by Sanctor Capital, Hashkey, Merit Circle and CitizenX, with participation from Arthur Hayes’ Maelstrom, Mirana Ventures and Animoca Brands, among others, according to a statement. Aethir did not disclose the specific amount raised from this round.

The investment will fund the Singapore-based project’s expansion into key markets like South East Asia, Latin America and North America, as well as building out its decentralized cloud infrastructure to a growing network of AI companies and gaming studios, Aethir said.

“The cloud sector has traditionally been a challenging industry to scale, plagued by high costs, particularly for customers requiring complex real-time rendering or streaming infrastructure — and that’s not taking into account the additional stress on the ecosystem as a result of the AI boom,” Aethir co-founder and CEO Mark Rydon said.

Aethir’s latest fundraising

Aethir’s latest fundraising follows a previous Seed round led by Framework Ventures and Infinity Ventures Crypto in January 2022.

“We’re backing projects that are using the blockchain to solve real-world issues. Aethir is meaningfully expanding the addressable market for gaming and other streaming content in the world’s highest-growth (but hardware-constrained) markets. Everybody wins as Aethir expands — gamers, publishers and globally distributed rendering node operators alike,” Maelstrom CIO and former BitMEX CEO Arthur Hayes said.

“For the metaverse to become a populated, engaging, virtual universe, the underlying infrastructure needs to support efficient, low-cost computation. Aethir is part of this next-generation infrastructure stack that unlocks the gaming and social communication possibilities we have been waiting for,” Sanctor Capital CEO Han Kao added.

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.