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Russia’s financial monitoring agency, Rosfinmonitoring, said it is upgrading its ability to track cryptocurrency transactions as Moscow looks to regulate the industry, possibly later this year, Reuters reported on Friday.

Russia has already identified some criminal cases involving crypto, Rosfinmonitoring’s head Yuri Chikhanchin told Reuters. Going forward, the agency intends to discover transactions and blockchains that are currently hidden.

Chikhanchin said it is not possible to cover everything, partly because some countries are not working toward regulating the crypto industry. “It is very difficult when cryptocurrency accounts go into the unregulated zone and we don’t understand who is on the other end,” he said. “But I think we will still solve this task.”

Blockchain technology records transactions, but not the identity of wallet-owners, the report said.

Anatoly Aksakov, head of the financial committee in Russia’s lower house of parliament, said recently that draft legislation on regulating cryptocurrencies would be submitted in the autumn.

Aksakov also recently voiced support for a crypto market within the Moscow Stock Exchange, or MOEX.

© 2022 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 virtual reality market is currently small, and there’s some uncertainty about how large it could eventually get.

But recent data from the IDC shows that global shipments for VR headsets jumped 241.6% during the first quarter of 2022, compared to Q1 of last year. 

Meta accounts for 90% of the VR headset market with Quest 2. Meta’s dominance is followed by ByteDance’s Pico, which operates within China. Pico captures 4.5% of the overall VR headset market, according to the report. 

“Meta continues to pour dollars into developing the metaverse but the strategy of promoting low-cost hardware at the expense of profitability isn’t sustainable in the long run,” said Jitesh Ubrani, research manager at IDC’s mobility and consumer device trackers, in the report.  

In June, Meta’s chief executive Mark Zuckerberg showcased VR prototypes during a demonstration, all of which are not yet available for sale. Meta, which has made a $10 billion bet on virtual and augmented reality, is developing technology so realistic that users feel like they’re in the same room as other virtual people, said Zuckerberg in the presentation. At present, VR headsets are clunky, costly, and have low resolution. 

Shipments of VR headsets are forecasted to grow in 2022, expected to reach 13.9 million, up 26.6% from last year.

Still, it’s uncertain if Meta will hold its dominant position long-term, as Apple is expected to launch its own VR headset. 

“All eyes will be on Apple as it launches its first headset next year, and while it is tempting to imagine the company shipping high volumes, keep in mind that this is its first headset that will appeal primarily to a small audience of early adopters and Apple fans,” noted Ramon Llamas, research director with IDC’s Augmented and Virtual Reality team. 

© 2022 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.

Wintermute, a market maker in the crypto space, has paid back hundreds of millions to its lending counter-parties—a signal of the extent to which leverage is being sucked out of the crypto market.  

In an interview with the Wall Street Journal, the firm’s chief operating officer Marina Gurevich said the firm has paid “hundreds of millions in obligations to various lenders over the past couple of weeks.”

The interview was in reference to the collapse of crypto broker Voyager Digital, which filed for Chapter 11 bankruptcy on July 6, days after it halted trading, deposits and withdrawals. Gurevich added that Voyager has recalled most of its loans to Wintermute. Voyager lent $27.3 million to Wintermute at a rate of 4% to 13.5%, according to the Journal. 

Voyager was known for delivering juicy yields on deposits. On the backend, the company lent out those deposits to large trading firms including market makers like Wintermute and Jump Trading. Since the meltdown of hedge fund Three Arrows Capital, lenders have grown more conservative, hiking the cost to borrow and calling back loans. 

Wintermute CEO Evgency Gaevoy commented on this dynamic in a recent episode of The Scoop. 

“Everyone kind of assumed those guys just made billions over the years… but now it seems like we were just all horribly wrong,” said Gaevoy in the episode of The Scoop. 

“[Wintermute] basically got recalled pretty much on all open loans that we had with all the lenders,” Gaevoy added. “Our balance sheet decreased more than half basically.”

© 2022 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.

Crypto exchange CoinFLEX has begun arbitration proceedings in Hong Kong to recover $84 million in losses from a client, it said in a blog post today.

The company paused withdrawals last month after CoinFLEX CEO Mark Lamb said that investor Roger Ver had defaulted on a loan agreement worth $47 million in USDC. Lamb said on Twitter at the time that the contract required Ver to “guarantee any negative equity” and that he had been served a notice of default.

Seemingly in response, Ver wrote on Twitter that rumors that he had defaulted on a loan were false.

According to CoinFlex, the deficit was larger than anticipated because of the associated slippage cost of liquidating the counterparties’ collateral, which was tied up in the firm’s thinly traded native token.

CoinFLEX co-founders Lamb and Sudhu Arumugam said in today’s blog post that after liquidating collateral, “there still remains a significant deficit of about US$84 million so we have commenced action to recover this debt.” The original “estimate of $47m which we communicated did not include the significant loss in liquidating his significant FLEX coin positions,” the post said, without identifying the client by name.

“The individual first asked us to liquidate his account, but then continued to tell us for some considerable time afterwards that he wanted to send significant funds to the exchange to take physical delivery of the futures positions. It is clear to us now that he was wasting time and hoping for a bounce in the market that never materialized,” the blog post said.

The two said in the post that they estimated it would take about 12 months to get a judgement in Hong Kong that could then be enforced against the client’s worldwide assets.

Meanwhile, the company is looking to raise capital from new investors and eventually to resume withdrawals, the post said, adding that CoinFLEX is looking to make 10% of its clients’ balances available for withdrawal within a week.

In 2019, CoinFLEX emerged as a platform for physically delivered futures. It overhauled its strategy in 2020 to focus on building a repo market for crypto. Its backers include Polychain Capital and Digital Currency Group.

© 2022 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.

MoonXBT, a Cayman Islands-based crypto social trading platform, is implementing a zero-fee policy on multiple trading pairs for the spot market until further notice, it said today in a news release. 

The zero-fee approach follows that of some major exchanges, including Binance. 

The move is necessary to lessen the burden on retail investors amid a bear market, MoonXBT said, adding that it is one of the few mid-sized crypto exchanges to institute a zero-fee policy in sync with major players. 

MoonXBT has eliminated transaction fees for some bitcoin trading pairs, as well as for ETH/USDT, BNB/USDT, ADA/USDT and XRP/USDT, it said. 

It may add more trading pairs to the no-fee list in the future, based on how its users react. 

Users will have zero fees for both maker and taker orders, without trading volume requirements or other pre-conditions, the company said. 

© 2022 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.

Sberbank, the largest bank in Russia and majority-owned by the government, has conducted the first digital financial asset transaction on its own blockchain-based platform.

Announcing the news today, Sberbank said it had launched the smart contract-based blockchain platform and carried out the first transaction with its subsidiary, SberFactoring, executing a 1 billion rouble (about $15 million) issue with a three-month maturity.

“The launch of the platform and our obtaining the status of an operator is the result of the teamwork of many divisions of our bank in close cooperation with the Bank of Russia,” Anatoly Popov, deputy chairman of the board of Sberbank, said in the announcement.

Popov went on to say that the research conducted by Sberbank’s blockchain laboratory, which was initially launched in 2018, is now being translated into industrial business solutions. “We believe that our platform has good prospects, since the digital format significantly speeds up and simplifies the process of issuing financial instruments and lowers the threshold for entering the market,” he said.

Sberbank’s blockchain platform is operating in pilot mode for a limited number of users, but soon all corporate clients of the bank will be able to connect to it.

Looking forward, the bank also plans to launch more types of financial assets on its platform.

Last month, Russia’s second-biggest bank, VTB’s subsidiary VTB Factoring, executed its first cash-backed digital financial asset transaction in partnership with the fintech company Lighthouse.

© 2022 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.

Thalex, a Gibraltar-based trading platform offering stablecoin-settled crypto options and futures, said it has closed a Series A funding round of 7.5 million euro ($7.64 million).

Among the participants were Bitfinex, Bitstamp, Flow Traders, IMC, QCP and Wintermute.

These strategic investors will support the company’s effort to enable on-exchange trading of crypto derivatives at scale by removing friction, ensuring platform reliability and partnering with liquidity providers and major exchanges, Thalex said in a news release on Thursday.

The trading platform is available for public testing at www.thalex.com and will go live soon, the company said.

Thalex is in the process of being authorized as a regulated DLT provider by the Gibraltar Financial Services Commission.

© 2022 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.

Securities regulators in Texas and Alabama are expanding their investigations into troubled crypto lending firms Celsius and Voyager, according to a Bloomberg report on Friday.

The two states are said to be examining whether Voyager and Celsius fully disclosed information on their loans and the creditworthiness of borrowers.

Joe Rotunda, director of enforcement at the Texas State Securities Board, told Bloomberg that the regulator is finding a lot of firms may not have adequately disclosed what they were doing with investors’ funds, including the amount of risk they were taking and the type of transactions they were conducting.

Amanda Senn, chief deputy director at the Alabama Securities Commission, told the outlet that the regulator was investigating these companies and “trying to figure out what happened and why.”

Senn added that the investigations were still in the initial stages, “but we have a responsibility on behalf of our investors in our states.”

Last September, both the Texas and Alabama regulators claimed that Celsius’s interest-bearing crypto deposit offerings were unregistered securities.

Celsius and Voyager are both struggling financially, as The Block has previously reported:

Celsius halted withdrawals on June 12 and since then clients’ funds have remained stuck. The firm has hired legal and financial advisers to explore possible restructuring options.

Voyager filed for Chapter 11 bankruptcy protection earlier this week. Funds of Voyager’s clients also remain stuck, since the firm halted withdrawals last week after its counterparty and troubled hedge fund Three Arrows Capital failed to repay a $650 million loan.

© 2022 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.

Brazil’s federal police raided a group they say used crypto tokens to launder money from illegal gold mining, Reuters reported on Friday. 

Five people were arrested in the operation on Thursday, which was aimed at health-care companies that had laundered money from illegal gold mining in the northern state of Rondonia, the report said, citing federal police. 

 The group used its own crypto token to move billions of dollars, the police said. 

The token, created by one of the group’s shell companies, was used to “justify the amounts arising from the illegal extraction of gold … as if they were investments of third parties interested in receiving dividends,” Reuters quoted the federal police as saying. 

A banking analysis performed by the federal police found that between 2019 and 2021, more than $3 billion moved through the group’s bank accounts, according to the report. 

© 2022 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 US asked Japan to increase pressure on its cryptocurrency exchanges and miners to sever ties with Russia amid the Ukraine conflict, the Financial Times reported on Friday, citing people familiar with the matter. 

The US asked Tokyo specifically to stop its companies’ cryptocurrency mining operations in the Irkutsk region in Siberia, two people familiar told the FT.  

The area is favored for crypto mining operations because of its low temperatures and cheap hydroelectric power.  

Japan’s Financial Services Agency renewed its demands that the Japanese exchanges they oversee cease any such relationships, people close to three exchanges told the FT. 

Some Japanese exchanges and crypto mining businesses have developed complex networks of subsidiaries to continue their Russian operations, people close to the situation said. 

© 2022 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.