A Canadian exchange, ezBTC, was exposed for embezzling $10 million in customer funds for personal use and gambling—just like the FTX scandal.
During the week, a FOIA request revealed that the FBI may have information about the identity of Satoshi Nakamoto, Bitcoin's mysterious creator.
Binance reentered the Indian market after a seven-month ban, which shows an increase in regulatory acceptance.
Sahil Arora, the mastermind of the recent celebrity memecoin scams, was exposed, with a likely profit of around $3 million.
Not much happened last week in terms of price action, with the market’s major cryptocurrencies showing few signs of growth.
However, the crypto ecosystem had its fair share of events, including the case of a Canadian exchange that gambled away nearly $10 million in user funds, just like Sam Bankman-Fried did with FTX.
We also had an interesting report which suggested that the FBI might know who Satoshi Nakamoto is (or was), Binance’s return to India after a 7- Month ban, as well as another report in which the mastermind of the 2024 celebrity memecoin craze earned around $3 million from these scams.
Here are all of the major events from last week, compiled into bite-sized sections:
According to reports from the British Columbia Securities Commission (BCSC) last week, a Canadian crypto exchange known as ezBTC and its founder followed in the footsteps of FTX and Bankman-Fried.
According to reports, David Smillie, the exchange's founder, defrauded customers by diverting around 13 million Canadian dollars in crypto before gambling it all away.
Keep in mind that ezBTC shut down permanently between 2016 and 2019 before being dissolved in 2022.
Within this time, it claimed that all customer funds were stored safely "in cold storage" to the tune of 2,300 Bitcoin and over 600 ETH.
According to the BCSC, Smillie and ezBTC siphoned off 935.46 BTC and 159 ETH through the founder’s exchange accounts before squandering it all on online bets.
Fortunately, ezBTC was nowhere near as big as FTX, or we might have skipped the incoming bull run and gone straight towards a full bear market.
In recent times, there have been more mentions of Satoshi Nakamoto (Bitcoin’s mysterious creator) in the news.
Earlier in the year, Craig Wright's claims of being Nakamoto were all the rage and dominated news headlines for weeks.
Eventually, a UK judge ruled against Wright, stating that he “repeatedly lied” and “falsified documents” to support his claim.
Soon after, Wright was forced to post disclaimers on his website, Twitter, and Slack, detailing how he "falsely claimed" to be Bitcoin's creator.
This time around, there might be convincing signs that the US Federal Bureau of Investigation (FBI) knows who Nakamoto is.
FBI Claim
The agency responded to a FOIA request from journalist Dave Troy last week, in which it stated that Satoshi Nakamoto was a "third-party individual" and that it could "neither confirm nor deny" possession of any records.
In summary, even if the FBI doesn’t know exactly who Nakamoto is, it likely knows a lot more than the entire Bitcoin community combined.
Last week, the Binance app appeared again in the Google and Apple app stores on the mobile phones of Indian citizens after being banned for seven months for regulatory non-compliance.
According to Chainalysis, India currently ranks among the top five countries in terms of crypto transaction volume across the market, alongside Nigeria, Vietnam and the United States.
In view of this, Binance announced its return to the country as its "19th global regulatory milestone" and will implement anti-money laundering (AML) policies and a framework against terrorism financing in the Indian market.
Binance announcement
Despite the massive regulatory scrutiny that Worldcoin has endured in countries like Germany, India, Singapore, Hong Kong, and many others, the Worldcoin Foundation signed a memorandum of understanding with MIMOS Berhad last week.
MIMOS Berhad is the Malaysian government's research and development department. This collaboration aims to integrate Worldcoin's iris scanning technology into Malaysia's digital infrastructure.
This means that Worldcoin and Malaysia are now collaborating to manufacture iris scanners (orbs) that allow citizens to verify their identities or "humanness."
This most recent launch in Malaysia is part of a broader expansion in Europe and Latin America.
Sahil Arora, the alleged mastermind of the celebrity memecoin craze between June and July, allegedly made millions from scamming celebrities and their fans.
Celebrities like Caitlyn Jenner, Rich the Kid and Jason Derulo were recruited to promote memecoins that Arora had created.
However, according to insights from blockchain data tracker BubbleMaps, on 14 August, Arora held around 30 - 40% of the supply of these tokens himself and dumped it all as soon as these celebs took the bait and urged fans to invest.
BubbleMaps reported that Arora made around $30 million from these scams between January and August 2024.
However, blockchain sleuth Zach XBT eventually weighed in, stating that Arora made less than $5 million and likely $2 - $3 million.
It turned out that the error came from the data platform incorrectly flagging a Poloniex wallet address as one of Arora's personal wallets.
Despite the ban, Arora is believed to still be at large, operating multiple accounts on X and Telegram.
Disclaimer: Voice of Crypto aims to deliver accurate and up-to-date information but will not be responsible for any missing facts or inaccurate information. Cryptocurrencies are highly volatile financial assets, so research and make your own financial decisions.