29 December

China is launching its first state-backed non-fungible token (NFT) marketplace, the latest sign of embrace for a technology that’s occupied a legal gray area within the country’s notoriously strict regulations on cryptocurrency.

The marketplace, whose name translates to “China Digital Asset Trading Platform,” will also be used to trade digital copyrights and property rights along with collectibles. The platform will be run by a trio of state-owned and private entities. The platform’s underlying blockchain is called “China Cultural Protection Chain.”

NFTs have been popular amongst Chinese traders for much of the past two years, but not in the same ways as the rest of the world. NFTs in China cannot be purchased with cryptocurrency, according to the country’s laws, and they aren’t referred to as NFTs, but as digital collectibles. Digital artwork is also traded on closed, highly regulated platforms as opposed to open ones.”

See Also: NFTs Are Securities and It’s Great

“Avraham Eisenberg, the crypto investor whose “highly profitable trading strategy” drained DeFi trading platform Mango Markets of crypto worth $110 million, was arrested Monday in Puerto Rico. The self-described game theorist admitted his role in draining Mango Markets’ treasury shortly after the incident in mid-October, and may now be the first U.S. resident to face charges for his role in manipulating a decentralized-finance trading platform.

Eisenberg faces charges of commodities fraud and commodities manipulation. A deposition signed by FBI Special Agent Brandon Racz alleges Eisenberg “willfully and knowingly” manipulated the sale of a commodity – namely futures contracts on Mango Markets.

Eisenberg sold massive amounts of MNGO perpetuals contracts to himself, thus pumping the price of those contracts 1,300% in less than an hour. Up big time, Eisenberg then borrowed against the value of his position and ‘withdrew essentially all of the cryptocurrency deposits on the Mango Markets platform.’ The platform became “insolvent” as a result.

Eisenberg engaged in a scheme involving the intentional and artificial manipulation of the price of perpetual futures contracts on a cryptocurrency exchange called Mango Markets, and other manipulative and deceptive devices and contrivances.”

See Also: Anonymous Twitter User Leaks 3Commas API Database

“Several wallets associated with Sam Bankman-Fried’s trading firm Alameda Research came to life in the late hours on Tuesday evening, with various Ethereum-based tokens consolidated into two main wallets, which were later swapped for Ethereum (ETH) and Tether (USDT).

Research firm OXT noted that the way the funds have been swapped “rings some major alarm bells.” Commenting on suggestions that the transfers could have been initiated by FTX liquidators, ZachXBT sounded skeptical, saying it is unlikely that they would use services such as FixedFloat or ChangeNow.

Transactions seem odd to me. Consolidation makes sense, but after it’s being consolidated, the funds get sent to fresh wallets before it gets sent to ChangeNow /FixedFloat.

Though it’s unclear at the moment who is responsible for the transactions, the timing comes just a few days after FTX founder Bankman-Fried—also known as SBF— was released on bail under a $250 million bond agreement.”

See Also: Bankman-Fried may enter plea in NY federal court next week before Judge Lewis Kaplan

Crypto exchange Gemini is being sued by investors over the sale of its interest-earning crypto products. Picha and Hastings say Gemini’s Earn program – which offered interest of up to 7.4% to customers for lending their crypto assets – didn’t register those assets as securities in accordance with U.S. securities law.

The filing says Gemini abruptly halted the program around Nov. 16 after crypto exchange FTX filed for bankruptcy and contagion from its fall caused a liquidity crisis at Genesis Trading, which functioned as Gemini’s borrower.”

See Also: Crypto Exchange Kraken to End Japan Operations