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Total crypto market-cap hits $850M as Bitcoin and altcoins recover from FTX’s collapse

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The total crypto market recovers some lost ground as the contagion risks associated with FTX’s collapse begin to look resolvable.

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Europol helps dismantle $23M ‘mafia crypto bank’

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European law enforcement in January arrested 17 suspects of a “mafia crypto bank” who are said to have laundered over 21 million euros ($23.5 million) in crypto for criminal entities in China and the Middle East.

The money laundering services were allegedly carried out on behalf of other criminal networks engaged in migrant smuggling and drug trafficking, Europol said in a May 14 statement.

Spanish authorities said the criminal organization ran a secret informal money transfer system called hawala and was often compensated in crypto.

A total of 17 individuals were arrested — 15 in Spain, one in Austria and one in Belgium — while 4.5 million euros ($5 million) worth of items were seized, including cash, crypto, 18 vehicles, four shotguns and several electronic devices.

Of the 4.5 million euros, 183,000 euros ($205,000) came as crypto. Another 421,000 euros ($471,000) in cash was seized from 77 bank accounts tied to the criminal organization, which one Spanish news outlet described as a “mafia crypto bank.”

Luxury bags, watches and even cigars worth 876,000 euros ($980,000) were also seized, Spanish officials said.

Scenes of European law enforcement efforts and assets seized from the criminal organization. Source: Europol

The arrests and asset seizures took place in January 2025, across Spain, Austria and Belgium, Europol said. More than 250 officers were involved, Spanish authorities added.

Most of those arrested have already been detained

Of the 17 arrested, 15 have already been imprisoned as alleged perpetrators of the crimes linked to the organization. 

Most of those arrested were of Chinese and Syrian nationality, targeting clients in China and the Arabic-speaking criminal world.

Related: Crypto exchange CEO’s daughter fights off brazen kidnappers in Paris

The criminal organization tried to cover up its money laundering activities by operating a remittance business, and even advertised those services on social media.

The investigation was led by a court in Almería, Spain, which supported Europol’s efforts to coordinate Spanish and Belgian officials to dismantle the criminal organization.

Blockchain forensics firm Chainalysis estimates that illicit crypto transactions totaled $51.3 billion in 2024, marking an 11.3% year-on-year increase.

Magazine: Japanese porn star’s coin red flags, Alibaba-linked L2 runs at 100K TPS

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Dems seek suspicious activity reports linked to Trump crypto ventures

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US Democrat lawmakers have sent a letter to the US Treasury demanding access to suspicious activity reports (SARs) on several Trump-backed crypto projects as part of the latest probe into the president’s digital ventures. 

Penned by representatives Gerald Connolly, Joseph Morelle, and Jamie Raskin, the May 14 letter asks Treasury Secretary Scott Bessent for all SARS filed since 2023 related to World Liberty Financial (WLF) and the Official Trump (TRUMP) token. 

Financial institutions in the US must file SARs with the Financial Crimes Enforcement Network, a bureau within the Department of the Treasury, when they detect suspicious activity, including potential money laundering or fraud. 

Source: Oversight Committee Democrats

The sweeping probe asks for any SARs mentioning WinRed, America PAC, Elon Musk, political action committee, PAC, Trump, World Liberty Financial, WLF, TRUMP, MELANIA and Justin Sun, no later than May 30. 

The Democratic lawmakers say their probe is to “determine whether legislation is necessary to prevent violations of campaign finance, consumer protection, bribery, securities fraud, and other anti-corruption laws” and to guard against “financial misconduct connected to prospective or current federal officials.” 

Democrats argue WLF and Trump coin could be misused

As part of the letter, the lawmakers argue WLF could be misused as a “vehicle for foreign influence peddling” because it served part of its token sale for foreign investors, who are “generally subject to less stringent regulation than US investors.” 

Justin Sun’s investment in WLF and the subsequent pause of the SEC’s lawsuit that alleged the crypto entrepreneur broke securities laws has also been flagged as a concern. 

Trump’s token has come under fire as well because the lawmakers argue in their letter that the identities of the coin purchasers are not publicly disclosed, which could open the door for bad actors to “curry favor with Trump” by purchasing the coin. 

At the same time, SARS related to Republican digital fundraising WinRed, Elon Musk’s super PAC, which poured $250 million into Trump’s election campaign, and two other PACs are being sought. 

Related: Trump-owned Truth Social denies it is launching a memecoin

This effort is the latest Democrat-led salvo against Trump’s crypto ventures.  

A group of Democratic senators reportedly sent a letter to leadership at the US Department of Justice and the Treasury Department expressing concerns about Trump’s ties to crypto exchange Binance and potential conflicts of interest in regulating the industry, according to a May 9 Bloomberg report. 

US Democratic lawmakers also launched a multi-angle attack on May 6, targeting Trump’s ability to profit from his crypto initiatives with two bills and a subcommittee inquiry. 

Magazine: Trump’s crypto ventures raise conflict of interest, insider trading questions

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Crypto startups scaring away VCs with 80x valuations: 10T Holdings

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Too many crypto startups are pricing themselves out of venture capital funding by chasing valuations far exceeding their revenues, according to Dan Tapeiro, the CEO of crypto-focused venture capital firm 10T Holdings.

“For some reason, founders and CEOs think that they should be raising capital at 50 to 80 times revenue. So that makes it very hard for us to make a return for our liquidity providers,” Tapeiro said while speaking in a panel discussion at the Consensus conference in Toronto on May 14.

“So a lot of those deals we just pass almost automatically, even businesses that we really like, we won’t invest in if the price isn’t reasonable in the beginning.”

10T Holdings has passed on over 200 companies for similar reasons, including the now-bankrupt FTX, BlockFi and Celsius, Tapeiro said. 

Tapeiro said 10T Holdings looks for crypto projects that have valuations above the $400 million to $500 million range with a valuation-to-revenue ratio of 10x or less.

Host of Crypto In America Eleanor Terrett (left) moderating a discussion with Pantera Capital CEO Dan Morehead (middle) and Dan Tapeiro (right) at the Consensus conference. Source: Cointelegraph

VCs often prefer lower valuations because they offer more upside potential with less risk.

Realistic valuations often make follow-on funding rounds more attractive to investors while also simplifying the exit process.

“Valuation is very important,” Tapeiro said.

Despite Tapeiro’s comments, it appears that crypto startups have had no problem attracting VC funds, as PitchBook reported on May 13 that the total value of crypto venture capital deals rose over 100% quarter-on-quarter to $6 billion in Q1 2025, while the number of deals only increased by 8.8%.

VCs should diversify their bags

Also speaking alongside Tapeiro was Pantera Capital CEO Dan Morehead, who said more VCs should opt to receive a mix of private equity and tokens when investing in crypto startups.

“Each one has their pros and cons, and then they go in these wild pendulum swings where sometimes tokens are really expensive and ventures cheap. Sometimes it’s the opposite.”

Related: Crypto VC deals drop in Q1, but funding more than doubles: PitchBook

“So as an investor, I always advocate people investing in a wide spectrum of tokens and ventures.”

Morehead’s Pantera has taken a more aggressive approach than 10T Holdings over the years and seen considerable success, making a return on 86% of the startups it invested in, with 22 of those reaching unicorn status (companies reaching $1 billion valuations).

Magazine: Danger signs for Bitcoin as retail abandons it to institutions: Sky Wee

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