On July 17, during a session at the Georgetown Psaros Center for Financial Markets and Policy, the United States Commodity Futures Trading Commission (CFTC) revealed its vigilant oversight of Polymarket and other offshore cryptocurrency betting platforms. CFTC Chair Rostin Behnam emphasized that the commission is actively monitoring any offshore activities that might extend services to U.S. customers.
Behnam highlighted the necessity of ensuring that platforms like Polymarket operate “legally and within the bounds of the law.” He further noted that if any entity’s presence in the U.S. is substantial and fails to register the derivatives contracts it offers, enforcement actions will follow.
In a separate development, on September 17, the U.S. Securities and Exchange Commission (SEC) announced its inaugural move against crypto “pig butchering” scams. The agency filed lawsuits against five entities and three individuals associated with purportedly fraudulent exchanges CoinW6 and NanoBit, accusing them of misappropriating nearly $3.2 million. The SEC’s allegations indicated that these exchanges built trust with investors and fostered relationships through social media platforms.
The SEC claimed that CoinW6 and NanoBit had constructed deceptive crypto ecosystems that presented investors with misleading information.
In another significant move, on September 19, the German government shut down 47 cryptocurrency exchanges, alleging their involvement in facilitating an “underground economy” for cybercriminals. Authorities stated that these exchanges had “deliberately” obscured the origins of “criminally obtained funds on a large scale.” The government accused them of failing to adequately implement legal measures aimed at combating money laundering.
Reportedly, users of these exchanges included botnet operators, ransomware attackers, and black market traders, who utilized the platforms to convert illicitly obtained funds into legitimate currency.
On the same day, U.S. federal agents apprehended and charged two men in connection with a $230 million Bitcoin (BTC) scam targeting a Washington, D.C. resident, believed to be the creator of Genesis. The U.S. Attorney’s Office for the District of Columbia announced that Jeandiel Serrano and Malone Lam were indicted for conspiracy to steal and subsequently launder over 4,100 BTC.
Employing various online aliases and intricate methods, Serrano and Lam accessed the victim’s accounts, transferred the funds, and laundered the proceeds since at least August. The stolen funds were reportedly used to fund an extravagant lifestyle that included nightclub outings, international travel, luxurious jewelry, high-end vehicles, and more.