{"id":27092,"date":"2025-03-25T21:09:30","date_gmt":"2025-03-25T21:09:30","guid":{"rendered":"https:\/\/davidgerard.co.uk\/blockchain\/?p=27092"},"modified":"2025-03-25T23:35:43","modified_gmt":"2025-03-25T23:35:43","slug":"crypto-update-lol-who-cares-crime-is-legal","status":"publish","type":"post","link":"https:\/\/davidgerard.co.uk\/blockchain\/2025\/03\/25\/crypto-update-lol-who-cares-crime-is-legal\/","title":{"rendered":"Crypto update: LOL who cares, crime is legal"},"content":{"rendered":"<ul>\n<li>Hey, I still have <a href=\"https:\/\/davidgerard.co.uk\/blockchain\/wp-content\/uploads\/2021\/05\/bitcoin-it-cant-be-that-stupid.png\">&#8220;Bitcoin: It can&#8217;t be that stupid&#8221;<\/a> stickers free for <a href=\"https:\/\/www.patreon.com\/c\/davidgerard\">patrons<\/a>. Just message me on Patreon!<\/li>\n<li>Also, you can still buy <a href=\"https:\/\/davidgerard.co.uk\/blockchain\/2020\/11\/26\/get-signed-copies-of-libra-shrugged-and-attack-of-the-50-foot-blockchain\/\"> signed author copies<\/a> of the books from me. (Stickers included!)<\/li>\n<li>If you like this post, please <b><i>tell at least one other person<\/i><\/b>. It really helps!<\/li>\n<\/ul>\n<blockquote><p>im sorry but every time i see a stupid comment on here the person has crypto or bitcoin in their bio<\/p>\n<p style=\"text-align: right;\">\u2014 <a href=\"https:\/\/x.com\/dieworkwear\/status\/1817641497996771366\">Derek Guy<\/a><\/p>\n<\/blockquote>\n<p>&nbsp;<\/p>\n<p><a href=\"https:\/\/davidgerard.co.uk\/blockchain\/2025\/03\/25\/crypto-update-lol-who-cares-crime-is-legal\/disaster-girl\/\" rel=\"attachment wp-att-27093\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-27093\" src=\"https:\/\/davidgerard.co.uk\/blockchain\/wp-content\/uploads\/2025\/03\/disaster-girl.webp\" alt=\"\" width=\"510\" height=\"315\" srcset=\"https:\/\/davidgerard.co.uk\/blockchain\/wp-content\/uploads\/2025\/03\/disaster-girl.webp 680w, https:\/\/davidgerard.co.uk\/blockchain\/wp-content\/uploads\/2025\/03\/disaster-girl-300x185.webp 300w, https:\/\/davidgerard.co.uk\/blockchain\/wp-content\/uploads\/2025\/03\/disaster-girl-348x215.webp 348w\" sizes=\"auto, (max-width: 510px) 100vw, 510px\" \/><\/a><\/p>\n<p style=\"text-align: center;\"><i><small>Amy preparing for a full and frank discussion in the marketplace of ideas<\/small><\/i><\/p>\n<p>Amy Castor has declared herself <a href=\"https:\/\/pivot-to-ai.com\/2025\/02\/06\/amy-is-retiring-probably\/\">retired from writing<\/a>. I can confirm that Amy is <i>definitely not<\/i> leading a guerilla resistance group high in the mountains of Massachusetts with occasional terrorist sorties to blow up Tesla Superchargers.<\/p>\n<p>For the minutiae of crypto news, we heartily recommend signing up for Molly White\u2019s newsletter. [<a href=\"https:\/\/www.citationneeded.news\/\"><i>Citation Needed<\/i><\/a>]<\/p>\n<p><a href=\"https:\/\/pivot-to-ai.com\/\">Pivot to AI<\/a> is still going strong, and it has a YouTube channel now. Hear me rant about AI bubble nonsense for a few minutes every day! [<a href=\"https:\/\/www.youtube.com\/@PivotToAI\"><i>YouTube<\/i><\/a>]<\/p>\n<h3>Crypto trading is still fake<\/h3>\n<p>Hello, crypto fans! I haven\u2019t forgotten you! I\u2019ve just spent the past nine months or so writing <a href=\"https:\/\/davidgerard.co.uk\/blockchain\/2024\/11\/22\/i-hear-bitcoin-is-supposed-to-be-good-now-is-it-a-new-bubble-yet\/\">the same article about bitcoin<\/a> repeatedly:<\/p>\n<ul>\n<li aria-level=\"1\">Trading is thin;<\/li>\n<li aria-level=\"1\">The price is set on unregulated offshore casinos;<\/li>\n<li aria-level=\"1\">Bitcoin is pumped with stablecoins printed out of thin air as loans;<\/li>\n<li aria-level=\"1\">This isn\u2019t a bubble, it\u2019s a balloon being inflated with hot air.<\/li>\n<\/ul>\n<p>A retail bubble doesn&#8217;t really seem to have restarted? Volumes are up on mid-2024, but are still nothing like November 2021. The actual dollars remain scarce.<\/p>\n<p>For the barrage of headlines about the price of bitcoin, the public still don&#8217;t seem to be falling for it again as yet. I&#8217;m slightly surprised.<\/p>\n<p>A new preprint, \u201cTracing the Masterminds Behind Cryptocurrency Pump-and-Dump Schemes,\u201d says that just 438 people are the &#8220;masterminds&#8221; behind \u201c$3.24 trillion\u201d of crypto market pumping. I put that in quotes because we\u2019re talking about memecoins and garbage, and not anything that touches an actual dollar. [<a href=\"https:\/\/arxiv.org\/abs\/2503.01686\"><i>arXiv<\/i><\/a><i>, PDF<\/i>]<\/p>\n<p>These 438 traders are defi bottom feeders. Our good friend Bitfinex\u2019ed puts the number of those netting the dollars from the <a href=\"https:\/\/davidgerard.co.uk\/blockchain\/2020\/09\/06\/the-crypto-market-as-a-single-unified-scam\/\">single unified crypto casino<\/a> at less than 20. For all its headline footprint, crypto is <i>small<\/i>.<\/p>\n<h3>Anti-money-laundering just hampers innovation<\/h3>\n<p>The Trump administration is not enforcing the anti-money-laundering law that requires businesses to declare their actual beneficial owners. It just &#8230; doesn&#8217;t matter! [<a href=\"https:\/\/www.reuters.com\/world\/us\/us-treasury-department-says-it-will-not-enforce-anti-money-laundering-law-2025-03-03\/\"><i>Reuters<\/i><\/a>]<\/p>\n<p>(\u201cThe extensive use of intermediaries to conceal control interests is because they know they\u2019re doing nothing wrong.\u201d \u2014 <a href=\"https:\/\/x.com\/ybchri_\/status\/1838623366485278722\">Chris Slaughter<\/a> on the Ethereum Foundation)<\/p>\n<p><a href=\"https:\/\/davidgerard.co.uk\/blockchain\/2022\/08\/09\/us-sanctions-tornado-cash-and-crypto-shrieks-in-horror\/\">Tornado Cash<\/a> has been removed from the US sanctions list. This has long been on the crypto industry wish list, so of course it\u2019s fine. The Justice Department will continue to pursue cybercrime for sanctions-busting by North Korea, just not in ways that might do much. [<a href=\"https:\/\/home.treasury.gov\/news\/press-releases\/sb0057\"><i>DoJ<\/i><\/a>]<\/p>\n<p>The AML regime is <a href=\"https:\/\/davidgerard.co.uk\/blockchain\/2021\/11\/24\/regulatory-clarity-extreme-edition-anti-money-laundering-and-crypto-fatf-ofac-fincen\/\">stupid and broken<\/a> in many ways. But it also does useful things. So the useful things are the first ones they break.<\/p>\n<h3>Fifty more Silvergates!<\/h3>\n<p>Of the four US bank collapses in 2023, <a href=\"https:\/\/amycastor.com\/2023\/03\/09\/crypto-collapse-good-night-silvergate-bank-unbanking-crypto-exchanges-voyager-sale-to-binance-proceeding\/\">Silvergate<\/a> and <a href=\"https:\/\/amycastor.com\/2023\/03\/14\/crypto-collapse-signature-bank-blows-up-us-crypto-frantically-looks-for-banking\/\">Signature<\/a> were directly because they got into crypto, and <a href=\"https:\/\/davidgerard.co.uk\/blockchain\/2023\/11\/02\/crypto-collapse-bankman-fried-trial-draws-to-a-close-safemoon-arrested-fourth-us-bank-failure-was-crypto\/\">Heartland<\/a> was the CEO falling for a crypto pig-butchering scam.<\/p>\n<p>But nobody cares, so the Office of the Comptroller of the Currency has told banks to go as crypto as they like, and provide the world with more worked examples of why regulation exists. [<a href=\"https:\/\/www.reuters.com\/business\/finance\/us-bank-regulator-reaffirms-banks-can-engage-some-crypto-activities-2025-03-07\/\"><i>Reuters<\/i><\/a>]<\/p>\n<p>It\u2019s a good thing bankers have historically shown appropriate restraint when regulators tell them \u201cALL THE FREE MONEY IN THE WORLD, DIVE IN BOYS.\u201d<\/p>\n<h3>Nanostrategy<\/h3>\n<p>Michael Saylor has gone full corporate Ponzi with his bitcoin sales. MicroStrategy has changed its name to Strategy B \u2014 the \u201cB\u201d is for bitcoin! It\u2019s a large pile of bitcoins with a stock exchange ticker.<\/p>\n<p>The plan is to kite cheques as far as possible and borrow actual dollars against a pile of bitcoins that could never be sold for a thousandth of its book value, while insiders sell company stock as long as number is up.<\/p>\n<p>Saylor is setting up various new stock offerings and a second stock market ticker, STRK, as well as the existing MSTR. The details are deliberately confusing \u2014 they\u2019re in the linked FT articles if you care \u2014 but the main trick is that Saylor promises dividends funded by &#8230; just diluting the stock and issuing more to sell! He\u2019s taking a page out of <a href=\"https:\/\/davidgerard.co.uk\/blockchain\/2024\/07\/14\/tether-and-northern-data-part-1-the-miners-tale\/\">Northern Data\u2019s<\/a> book. [<a href=\"https:\/\/www.ft.com\/content\/685c764b-3eb6-41a1-855d-54cb3bc85a16\"><i>FT<\/i><\/a><i>, <\/i><a href=\"https:\/\/archive.is\/5Rbkn\"><i>archive<\/i><\/a><i>; <\/i><a href=\"https:\/\/www.ft.com\/content\/20984de7-4a63-4919-979f-04245de33592\"><i>FT<\/i><\/a><i>, <\/i><a href=\"https:\/\/archive.is\/TeAwC\"><i>archive<\/i><\/a>]<\/p>\n<p>I told Decrypt about how this looks very like the scam <a href=\"https:\/\/amycastor.com\/2022\/08\/04\/bitcoin-mining-in-the-crypto-crash-the-mining-companies-creative-accounting\/\">bitcoin miners ran in the last crypto bubble<\/a> \u2014 say a lot of bitcoin words while the cash flows to insiders. The exit is the company going Chapter 11. [<a href=\"https:\/\/decrypt.co\/307214\/strategy-michael-saylor-us-20-percent-bitcoin-supply\"><i>Decrypt<\/i><\/a>]<\/p>\n<h3>Pivot to Quantum<\/h3>\n<p>Quantum computing company D-Wave is so far down the quantum grift rabbit hole they had to prop up the quantum talk with blockchains. [<a href=\"https:\/\/www.dwavequantum.com\/company\/newsroom\/press-release\/d-wave-introduces-quantum-blockchain-architecture-featuring-enhanced-security-and-efficiency-over-classical-computing\/\"><i>press release<\/i><\/a><i>, <\/i><a href=\"https:\/\/archive.is\/MrKXl\"><i>archive<\/i><\/a><i>; <\/i><a href=\"https:\/\/arxiv.org\/abs\/2503.14462\"><i>arXiv<\/i><\/a><i>, PDF<\/i>]<\/p>\n<p>This preprint claims you <i>could<\/i> make a proof of work blockchain that uses quantum computing! Probably. If \u2014 unlike anyone else in crypto \u2014 you still gave a hoot about new proof of work mechanisms.<\/p>\n<p>They&#8217;ll be introducing a token soon, betcha.<\/p>\n<p>D-Wave sells actual quantum computers! They do <a href=\"https:\/\/en.wikipedia.org\/wiki\/Quantum_annealing\">quantum annealing<\/a> rather than the vastly-hyped quantum computation that will destroy a lot of cryptography in two or three decades and that venture capitalists <a href=\"https:\/\/pivot-to-ai.com\/2024\/11\/03\/pivot-to-ai-get-in-loser-were-going-quantum\/\">desperately hope will be a new tech bubble<\/a>.<\/p>\n<p>But venture capital will hype anything with whatever this month&#8217;s magical jargon word is \u2014 because the particular technology involved doesn\u2019t matter to the bubble economics. Look at <a href=\"https:\/\/pivot-to-ai.com\/2024\/12\/01\/does-ai-startup-extropic-actually-do-anything\/\">our e\/acc friends at Extropic.<\/a> I fully expect D-Wave to pivot to &#8220;quantum electronic,&#8221; selling ordinary computers on the basis that transistors are quantum.<\/p>\n<h3>Return of the Kraken<\/h3>\n<p>I wrote in December 2019 about how a whistleblower at the Kraken crypto exchange, Nathan Runyon, <a href=\"https:\/\/davidgerard.co.uk\/blockchain\/2019\/12\/17\/kraken-exchange-sued-by-whistleblowing-ex-employee-allegations\/\">sued the exchange for unfair dismissal.<\/a> The complaint included allegations of fake addresses for company officers, and sloppy compliance and sanctions enforcement. [<a href=\"https:\/\/trellis.law\/case\/cgc19581099\/nathan-peter-runyon-vs-payward-inc-a-california-corporation-et-al\"><i>Case docket<\/i><\/a>]<\/p>\n<p>I\u2019m pretty sure the complaint caused Kraken a ton of trouble in obtaining their <a href=\"https:\/\/davidgerard.co.uk\/blockchain\/2023\/04\/09\/so-much-for-wyoming-blockchain-regulatory-capture-the-fed-blocks-custodia-bank\/\">Wyoming bank charter<\/a> application \u2014 <a href=\"https:\/\/amycastor.com\/2023\/03\/09\/crypto-collapse-good-night-silvergate-bank-unbanking-crypto-exchanges-voyager-sale-to-binance-proceeding\/\">a charter that Kraken still doesn\u2019t have<\/a> \u2014 and problems regarding possible sanctions sloppiness. [<a href=\"https:\/\/www.nytimes.com\/2022\/07\/26\/technology\/kraken-crypto-iran.html\"><i>New York Times<\/i><\/a><i>, 2022, <a href=\"https:\/\/archive.is\/AOG6T\">archive<\/a><\/i>]<\/p>\n<p>Anyway, it looks like Runyon got his desired settlement. Kraken brought a countersuit accusing Runyon of misappropriating trade secrets \u2014 specifically, that he revealed Kraken\u2019s address. Kraken didn\u2019t claim any actual losses from this, so the claim was dismissed in September 2020 for failure to state a claim. [<a href=\"https:\/\/www.reuters.com\/article\/kraken-ruling-idUSL2N2GK2EV\"><i>Reuters<\/i><\/a><i>, 2020; <\/i><a href=\"https:\/\/law.justia.com\/cases\/federal\/district-courts\/california\/candce\/3:2020cv02130\/357308\/33\/\"><i>Justia<\/i><\/a><i>, PDF, 2020<\/i>]<\/p>\n<p>An amended complaint by Kraken was partially dismissed in January 2021. After much back and forth, Runyon and Kraken finally seem to have come to a settlement on his original complaint in October 2021.<\/p>\n<p>Kaiser Ng, Runyon\u2019s boss at Kraken at the time he was fired, was next spotted in Singapore working for Binance. [<a href=\"https:\/\/www.irishtimes.com\/business\/2023\/04\/06\/binance-chief-steps-down-from-irish-firms-at-centre-of-us-lawsuit\/\"><i>Irish Times<\/i><\/a><i>, 2023<\/i>]<\/p>\n<p>Kraken remains one of less than ten companies worldwide to have <a href=\"https:\/\/davidgerard.co.uk\/blockchain\/2020\/04\/14\/news-cooking-mama-and-blockchain-the-halvening-and-bitcoin-cash-simple-assurance-of-future-litigation-kraken-craig-wright\/\">a warning on its GlassDoor page<\/a> that it\u2019s taken legal action over employee reviews of the company.<\/p>\n<h3>Yelling into the void<\/h3>\n<p>Here\u2019s a new Foreign Policy piece on Trump&#8217;s bitcoin reserve plan! It\u2019s not by me, but it quotes me extensively. \u201cThis is just naked kleptocracy. This is corruption. It\u2019s what it looks like.\u201d [<a href=\"https:\/\/foreignpolicy.com\/2025\/03\/07\/trump-crypto-bitcoin-david-sacks-ai-summit\/\"><i>Foreign Policy<\/i><\/a>]<\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n<br><br><div align=\"center\"><p><a href=\"https:\/\/www.patreon.com\/bePatron?u=8420236\"><img src=\"https:\/\/davidgerard.co.uk\/blockchain\/wp-content\/uploads\/2021\/10\/become_a_patron_button.svg\" alt=\"Become a Patron!\" title=\"Become a Patron!\" width=217 height=51><\/a><br><p style=\"align:center;\" class=\"patreon-badge\"><i>Your subscriptions keep this site going. <a href=\"https:\/\/www.patreon.com\/bePatron?u=8420236\">Sign up today!<\/a><\/i><\/p><\/div>","protected":false},"excerpt":{"rendered":"<p>Fifty more Silvergates!<\/p>\n","protected":false},"author":1,"featured_media":27093,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"inline_featured_image":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[1],"tags":[21,74,3874,391,1929,1928,1577,1829,978,2626,3873,1796,745],"class_list":["post-27092","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uncategorised","tag-bitcoin","tag-blockchain","tag-d-wave","tag-kraken","tag-michael-saylor","tag-microstrategy","tag-nathan-runyon","tag-occ","tag-proof-of-work","tag-quantum-computing","tag-strategy-b","tag-tornadocash","tag-united-states"],"jetpack_featured_media_url":"https:\/\/davidgerard.co.uk\/blockchain\/wp-content\/uploads\/2025\/03\/disaster-girl.webp","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/davidgerard.co.uk\/blockchain\/wp-json\/wp\/v2\/posts\/27092","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/davidgerard.co.uk\/blockchain\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/davidgerard.co.uk\/blockchain\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/davidgerard.co.uk\/blockchain\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/davidgerard.co.uk\/blockchain\/wp-json\/wp\/v2\/comments?post=27092"}],"version-history":[{"count":42,"href":"https:\/\/davidgerard.co.uk\/blockchain\/wp-json\/wp\/v2\/posts\/27092\/revisions"}],"predecessor-version":[{"id":27136,"href":"https:\/\/davidgerard.co.uk\/blockchain\/wp-json\/wp\/v2\/posts\/27092\/revisions\/27136"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/davidgerard.co.uk\/blockchain\/wp-json\/wp\/v2\/media\/27093"}],"wp:attachment":[{"href":"https:\/\/davidgerard.co.uk\/blockchain\/wp-json\/wp\/v2\/media?parent=27092"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/davidgerard.co.uk\/blockchain\/wp-json\/wp\/v2\/categories?post=27092"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/davidgerard.co.uk\/blockchain\/wp-json\/wp\/v2\/tags?post=27092"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}