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The U.S. Securities and Exchange Commission (SEC), the New York Department of Financial Services (NYDFS) and the Attorney General of the State of New York have objected to Binance.US’s amended plan to acquire crypto lender Voyager.

The objections were filed as part of Voyager’s bankruptcy proceedings in the Southern District of New York on Feb. 22.

Binance.US entered into a good faith agreement with Voyager to acquire the crypto lender’s assets in December 2022. The exchange’s winning bid of $1 billion beat other industry players such as CrossTower and Wave Financial. The acquisition is still subject to regulatory approval, however.

Securities law violations

The SEC objects to the debtor’s plans to sell crypto assets as part of its rebalancing plan and has concerns about the security of assets on Binance.US’s platform.

“Here, the transactions in crypto assets necessary to effectuate the rebalancing, the re-distribution of such assets to account holders, may violate the prohibition in Section 5 of the Securities Act of 1933 against the unregistered offer, sale, or delivery after sale of securities,” said Therese Scheuer, senior trial counsel at the SEC, in the filing.

The regulator also raised concerns over whether Voyager could demonstrate that it complies with federal laws with this plan, questioned whether the acquisition is “just a $20 million sale of Voyager’s customer list to Binance.US” and also said the plan did not include adequate detail on the impact of potential regulatory action on the purchaser, Binance.US. 

“Regulatory actions, whether involving Voyager, Binance.US or both, could render the transactions in the plan impossible to consummate, thus making the plan unfeasible,” said Scheuer in the filing.

Discrimination against New Yorkers

Meanwhile, the NYDFS alleges the current plan “unfairly discriminates” against New Yorkers by delaying their recovery of assets compared to other creditors within the same class and criticized Voyager for illegally operating in the state of New York.

“Even putting aside for the moment the debtors’ past violations of law, the debtors’ plan as proposed unfairly discriminates against these New Yorkers by materially delaying their recovery compared to creditors in the same class and by not allowing them the option to recover cryptocurrency instead of liquidated assets,” said Kevin Puvalowski, acting executive deputy superintendent for NYDFS, in the filing.

This isn’t the first time the regulators have pushed back on the deal. Federal and state agencies previously objected to the sale, citing the possibility that assets could be moved offshore and more challenging to recover on behalf of consumers. 

The ad hoc committee of equity holders has also submitted an objection to the amended acquisition plan.

Several regulatory actions have been taken against crypto companies as of late. Crypto exchange Kraken settled with the SEC over the failing to register the offer and sale of its “crypto asset staking-as-a-service program” last week, paying a $30 million fine. Lender Nexo is set to close down its earn program in the U.S. following a settlement with the SEC.

© 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.

“Hello there, I am Rummer. from theblock.co where I work as a Article Writer. Our team is intrigued by your NFT project and we would like to request permission to write an article about your project.”

That’s the Discord message that greeted Elton Penguin, a pseudonymous project lead for the Noundles NFT collection, on Sunday, purporting to come from, well, me.

Unfortunately for Elton, however, that beautifully crafted missive hadn’t been penned by me at all. Someone had set up a fake Discord server for The Block and fake profiles for several of our staff, including Frank Chaparro, Lucy Harley-McKeown and Editor-in-Chief Sarah Kopit.

Fake accounts

Elton wasn’t alone. Dozens of people had been contacted by fake accounts purporting to be employees of The Block.

Exactly what these imposters were after wasn’t immediately clear, though the consensus from those targeted was that the efforts at chumminess would result in an eventual phishing attempt.

“My take is they want to get me to feel good and tell them about the project. And then social engineer me for a bit to feel like it’s safe to click links. Then hack my stuff,” said Jake Baker, another victim, who runs the Twitter account behind the Shaq Gives Back NFT collection.

For the record: The Block has no official presence on Discord.

‘Malicious site’

“The attackers are likely attempting to compromise existing Discord accounts,” said Sacha Tememe, a security engineer at The Block. “The verification link to join their server leads to a malicious site which may try and steal a user’s authorization token, essentially granting the attackers full access to the user’s account.”

A Discord spokesperson said it “takes the safety of all users seriously” and the account impersonating me has now been deleted.

“Our community guidelines prohibit users from coordinating or participating in malicious impersonation of an individual or an organization, and our Trust & Safety team takes action when we become aware of this kind of behavior,” they added. 

Discord is a messaging and chat tool founded in 2015, where users can build communities — called servers — around a specific activity. After first finding an audience among video gamers, the app has more recently become one of crypto’s social networks of choice. It’s rare to find a DAO or NFT project that doesn’t have an affiliated Discord server.

There is an irony here, of course. In targeting projects like Noundles and Shaq Gives Back with the promise of coverage in The Block, the hackers have inadvertently given them coverage in The Block. In this article.

More irony

The second irony is that in attempting to report out this story, I found myself sending Twitter DMs that — on reflection — sounded distinctly scammy.

“How should I refer to you? Do you go by Elton Penguin or do you prefer to be called by your real name in the article?” I found myself typing, just an imagined step or two away from asking for his private keys.

Elton had some advice for me on that front.

“Just work on making your grammar worse, then you’ll have it nailed.”

© 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 collection of prized NFTs purchased by Three Arrows Capital (3AC), the failed crypto hedge fund, will soon be put up for sale.

3AC’s liquidators, Teneo, notified interested parties about the sale on Feb. 22, according to a filing.  

Christopher Farmer, a senior managing director at Teneo, wrote that the purpose of the sale “is to realize the value of the NFTs for the purposes of the liquidation,” adding that it is expected to commence within 28 days of the notice.

The NFTs on sale are separate from the Starry Night Capital portfolio, which was assembled by the pseudonymous collector VincentVanDough on behalf of 3AC, wrote Farmer. Teneo took possession of the wallet holding Starry Night’s NFTs in October last year, with the help of VincentVanDough. But the Starry Night portfolio is “presently subject to an application before the Eastern Caribbean Supreme Court in the High Court of Justice in the British Virgin Islands,” Farmer wrote in the filing.

The assortment of NFTs put up for sale nevertheless represents a potential treasure trove for collectors. There are a dozen CryptoPunks, 30 of Tyler Hobbs’ Fidenzas and 17 of Dmitri Cherniak’s Ringers — all blue-chip collections. Zerion suggests the value of the collection is roughly $6.4 million, though the estimate is based on floor prices, and therefore the figure may ultimately be higher.

3AC splashed 1,800 ETH (more than $5.6 million at the time) on Ringer #879 last year. The hedge fund’s co-founder and CEO Su Zhu said of the purchase at the time: “We like the Goose.” Cherniak tweeted today that the goose is now being liquidated.

Once vaunted as one of the top investors in the crypto market, 3AC imploded spectacularly last year, ultimately filing for bankruptcy in July. It owes creditors at least $3.5 billion.

© 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.

Kratos Studios, a web3 gaming startup based in India, reached a valuation of $150 million in a seed funding round of $20 million.

Accel led the round, and other investors included Prosus Ventures, Courtside Ventures, Nexus Venture Partners and Nazara Technologies, Kratos said Thursday. The gaming startup also acquired IndiGG, a sub-DAO of Yield Guild Games DAO via a token swap, meaning existing INDI token holders will be swapped to new Kratos tokens.

“The new token will be launched in 12 months,” Kratos co-founder Manish Agarwal told The Block in an interview. “The current INDI token holders will be swapped for the dollar value they initially invested so that they don’t have to mark down their investment,” he said. Agarwal is the former CEO of Nazara, India’s first publicly listed gaming company.

IndiGG raised $6 million in funding in January 2022 from investors including Sequoia Capital India, Lightspeed Venture Partners, Variant Fund, Jump Capital, Animoca Brands and Alan Howard. Kratos was founded last September, and as part of the IndiGG acquisition, will continue to build the IndiGG brand as a gaming DAO, said Agarwal.

Expansion plans

“We believe after Polygon, IndiGG could be the next multi-billion dollar company, bringing billions of ad revenue to the exchequer of India and getting millions of earners in India and South Asia,” Agarwal said. “We will then aim to take that playbook to Africa, Southeast Asia, and some countries in the Middle East as well.”

Kratos’s business model brings game developers and gamers onto its platform, earning revenue from both sides. “We create on-chain profiles of gamers in the form of cohorts, and we let game developers design quests for gamers,” Ishank Gupta, another co-founder of Kratos, said in the interview. “Game developers pay us for listing their quests and gamers pay us for validation of their quests.”

Kratos also helps gamers with the off-ramping process that converts on-chain assets into fiat currency in their bank accounts, said Gupta.

Kratos launched the IndiGG app earlier this week and it aims to increase the number of participants on both sides with more games and more gamers, Gupta said.

Argarwal and Gupta said they will work closely with Polygon co-founder Sandeep Nailwal and YGG co-founder Gabby Dizon toward the mission of “building the largest gaming DAO in the world.”

© 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 founders of Forsage, a decentralized finance crypto investment platform, were indicted for their alleged roles in a $340 million “global Ponzi and pyramid scheme.” 

A federal grand jury returned an indictment charging four Russian nationals for their role at the platform: Vladimir Okhotnikov, Olena Oblamska, Mikhail Sergeev and Sergey Maslakov. 

All four were charged with conspiracy to commit wire fraud and could face 20 years in jail if convicted. 

“The defendants aggressively promoted Forsage to the public through social media as a legitimate and lucrative business opportunity, but in reality, the defendants operated Forsage as a Ponzi and pyramid investment scheme that took in approximately $340 million from victim-investors around the world,” the Justice Department said in a press release. 

The indictment comes months after the Securities and Exchange Commission charged nearly a dozen people for their alleged roles at Forsage.

The defendants are accused of coding and deploying smart contracts that “systemized their combined Ponzi-pyramid scheme” on the Ethereum blockchain, the Binance Smart Chain and the Tron blockchain. Court documents say that when an investor put their funds into Forsage, the smart contract automatically diverted them to another investor.

More than 80% of Forsage investors received fewer ETH than they invested, and more than 50% never received a payout, according to the Justice Department.

© 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.

New York Attorney General Letitia James is suing cryptocurrency exchange CoinEx for allegedly failing to register with the state.  

“CoinEx offered, sold, purchased and effected transactions in cryptocurrencies that are commodities and securities, without having been registered as a commodity broker dealer and a securities broker or dealer in New York,” according to a petition filed in the Supreme Court of the State of New York on Wednesday.  

New York has been an active player in the crypto space with lawsuits against others, including Alex Mashinsky, the former CEO of crypto lender Celsius and in the past, actions against Bitfinex and Tether. The petition alleged that CoinEx “represented itself as an exchange” while not being registered with the state.

The exchange also failed to comply with a subpoena served in January, according to the petition.  

The attorney general said some of the crypto offered by CoinEx counted as commodities and securities under the Martin Act, a New York securities law, because “they represent investments of money in common enterprises with profits to be derived primarily from the efforts of others”.

The attorney general’s office listed four tokens that included AMP, the LBRY token (“LBC”), LUNA and the Rally (“$RLY”). The petition seeks to stop CoinEx from engaging in unauthorized activities in state and wants to have New York IP addresses blocked from using exchange.

 James is also seeking  “a full accounting of New York accounts and all fees received from New York customers.”

CoinEx did not immediately respond to a request for comment.  

© 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.

“Hello there, I am Rummer. from theblock.co where I work as a Article Writer. Our team is intrigued by your NFT project and we would like to request permission to write an article about your project.”

That’s the Discord message that greeted Elton Penguin, a pseudonymous project lead for the Noundles NFT collection, on Sunday, purporting to come from, well, me.

Unfortunately for Elton, however, that beautifully crafted missive hadn’t been penned by me at all. Someone had set up a fake Discord server for The Block and fake profiles for several of our staff, including Frank Chaparro, Lucy Harley-McKeown and Editor-in-Chief Sarah Kopit.

Fake accounts

Elton wasn’t alone. Dozens of people had been contacted by fake accounts purporting to be employees of The Block.

Exactly what these imposters were after wasn’t immediately clear, though the consensus from those targeted was that the efforts at chumminess would result in an eventual phishing attempt.

“My take is they want to get me to feel good and tell them about the project. And then social engineer me for a bit to feel like it’s safe to click links. Then hack my stuff,” said Jake Baker, another victim, who runs the Twitter account behind the Shaq Gives Back NFT collection.

For the record: The Block has no official presence on Discord.

Discord didn’t immediately respond to a request for comment on the apparent scam. 

‘Malicious site’

“The attackers are likely attempting to compromise existing Discord accounts,” said Sacha Tememe, a security engineer at The Block. “The verification link to join their server leads to a malicious site which may try and steal a user’s authorization token, essentially granting the attackers full access to the user’s account.”

Discord is a messaging and chat tool founded in 2015, where users can build communities — called servers — around a specific activity. After first finding an audience among video gamers, the app has more recently become one of crypto’s social networks of choice. It’s rare to find a DAO or NFT project that doesn’t have an affiliated Discord server.

There is an irony here, of course. In targeting projects like Noundles and Shaq Gives Back with the promise of coverage in The Block, the hackers have inadvertently given them coverage in The Block. In this article.

More irony

The second irony is that in attempting to report out this story, I found myself sending Twitter DMs that — on reflection — sounded distinctly scammy.

“How should I refer to you? Do you go by Elton Penguin or do you prefer to be called by your real name in the article?” I found myself typing, just an imagined step or two away from asking for his private keys.

Elton had some advice for me on that front.

“Just work on making your grammar worse, then you’ll have it nailed.”

© 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.

“Hello there, I am Rummer. from theblock.co where I work as a Article Writer. Our team is intrigued by your NFT project and we would like to request permission to write an article about your project.”

That’s the Discord message that greeted Elton Penguin, a pseudonymous project lead for the Noundles NFT collection, on Sunday, purporting to come from, well, me.

Unfortunately for Elton, however, that beautifully crafted missive hadn’t been penned by me at all. Someone had set up a fake Discord server for The Block and fake profiles for several of our staff, including Frank Chaparro, Lucy Harley-McKeown and Editor-in-Chief Sarah Kopit.

Fake accounts

Elton wasn’t alone. Dozens of people had been contacted by fake accounts purporting to be employees of The Block.

Exactly what these imposters were after wasn’t immediately clear, though the consensus from those targeted was that the efforts at chumminess would result in an eventual phishing attempt.

“My take is they want to get me to feel good and tell them about the project. And then social engineer me for a bit to feel like it’s safe to click links. Then hack my stuff,” said Jake Baker, another victim, who runs the Twitter account behind the Shaq Gives Back NFT collection.

For the record: The Block has no official presence on Discord.

‘Malicious site’

“The attackers are likely attempting to compromise existing Discord accounts,” said Sacha Tememe, a security engineer at The Block. “The verification link to join their server leads to a malicious site which may try and steal a user’s authorization token, essentially granting the attackers full access to the user’s account.”

A Discord spokesperson said it “takes the safety of all users seriously” and the account impersonating me has now been deleted.

“Our community guidelines prohibit users from coordinating or participating in malicious impersonation of an individual or an organization, and our Trust & Safety team takes action when we become aware of this kind of behavior,” they added. 

Discord is a messaging and chat tool founded in 2015, where users can build communities — called servers — around a specific activity. After first finding an audience among video gamers, the app has more recently become one of crypto’s social networks of choice. It’s rare to find a DAO or NFT project that doesn’t have an affiliated Discord server.

There is an irony here, of course. In targeting projects like Noundles and Shaq Gives Back with the promise of coverage in The Block, the hackers have inadvertently given them coverage in The Block. In this article.

More irony

The second irony is that in attempting to report out this story, I found myself sending Twitter DMs that — on reflection — sounded distinctly scammy.

“How should I refer to you? Do you go by Elton Penguin or do you prefer to be called by your real name in the article?” I found myself typing, just an imagined step or two away from asking for his private keys.

Elton had some advice for me on that front.

“Just work on making your grammar worse, then you’ll have it nailed.”

© 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.

Bitcoin mining stocks were mostly lower on Wednesday.

Bitcoin mining stocks tracked by The Block were mostly lower on Wednesday, with three gaining and 15 declining in share price.

Bitcoin fell 2.8% to $23,801 by market close.

© 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.

Pacman, the formerly pseudonymous CEO of the fast-growing NFT marketplace Blur, beat the engagement farmers to it.  

“Web2 me vs. web3 me,” he posted on Twitter late last night, revealing his previously unknown identity in a thread. 

The move came in a world where online personas are the shopfront of valuable brands and multi-billion-dollar tokens, and outing someone’s true identity still can be a controversial topic. Previous identity revelations, such as that of the Bored Ape Yacht Club founders, have sparked rage in the crypto community. The identity of other founders, such as Chef Nomi of Sushiswap and, most famously, Bitcoin’s Satoshi Nakamoto, remain a mystery.  

The 24-year-old entrepreneur, whose legal name is Tieshun Roquerre, had been working under the retro game-inspired pseudonym for 401 days, while he and a team set out to build an NFT marketplace for pro traders, fit to challenge industry heavyweight OpenSea. 

He had previously asked if he could be interviewed pseudonymously. But now, he is stepping into the light. 

Web2 me vs Web3 me

A thread ???? pic.twitter.com/9BKyNdan3x

— Pacman | Blur.io (@PacmanBlur) February 22, 2023

“It’s not like I’m hard core anonymous or anything like that,” Pacman said in an interview with The Block hours before the identity reveal. “Since we started Blur, I’ve just liked having that choice.” 

“I like how having Pacman as a character can only represent the brand, so it doesn’t really exist outside of Blur, from a branding perspective,” he added, conceding that it was only a “matter of time” before someone wrote a thread about his identity to a captive audience on Twitter.  

Blur has captured the imagination of the NFT community since its launch in October 2022. A schedule of airdropped tokens to frequent traders and loyal users kept people returning. It finally launched its long-awaited token last week, with a fully diluted market cap sitting at around $3 billion, according to CoinMarketCap data. The company recently completed a second fundraise after its $11 million seed, which earned it a billion-dollar valuation. 

The person behind the curtain 

Tieshun Roquerre dropped out of high school in 2016 at the age of 17 to join Y Combinator’s accelerator program. This led him down the path to MIT where he studied math and computer science. He was awarded the Thiel Fellowship – a prize created by billionaire Peter Thiel, which grants gifted students $100,000 to drop out and pursue things such as research or building a business. Roguerre founded Namebase in 2018, a decentralized domain name tracker that was later sold to Namecheap in 2021.  

It was around this time he started trading NFTs. “As we sold the business, I minted a Blitmap and held it up to its all-time high, which was around 30 ETH, and sold it. I was completely hooked afterwards,” he said. Blitmaps are an NFT collection featuring 8-bit drawings of a “sci-fi fantasy universe” which launched in 2021. 

Fast forward to October 2022, and he — alongside his co-founder — launched the first iteration of Blur. 

Blur’s Binance plan 

Since then, Blur has snatched market share of trading volume from bigger players, overtaking OpenSea in December 2022 and extending its lead each month since then. This is partially due to its play for the fastest growing segment of the market — which is pro trading.  

Further growth will come from using the Binance playbook, says Pacman. 

“We focus on the NFT natives first and from there we can expand, similar to how Binance expanded downmarket and broadened the offering,” he said.  

Along with this, Pacman expects growth to come from products which spring out of the community as more contributors build on the protocol. The eventual aim would be to mirror what MakerDAO did with targeted sub-communities, which build out specific parts of the larger project. 

“I think a model like that would be very beautiful, because the goal is to build infrastructure that can be controlled by the community,” he added. 

What remains to be seen is whether the token will stick, and if Blur’s play for the hearts and minds of the NFT community through decentralization will pan out. Pacman thinks that to own a stake and decision-making power in the future of the business will be a big enough differentiator to challenge incumbent, and crucially tokenless, heavyweight OpenSea long-term.  

For now, what worries him most is not moving fast enough.  

“You know that if you don’t build something you want to ship, someone else will,” he said. “We have a lot of ideas and a high level of confidence that those will be well-received.” 

© 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.