🔥🚀 Crypto Chaos Unleashed: The Scandals, Secrets, and Showdowns - Proof of Intel

Good morning, tech pioneers! Your dynamic duo Mochi & Kimchi are back with another invigorating Proof of Intel (PoI) edition. Buckle up for a sizzling update that's hotter than a Carolina Reaper in August! Whether you're a blockchain boogie-er or a digital asset aficionado, we've got some red-hot crypto news from Hong Kong that's bound to set your inbox on fire. Let's dive deep before it cools down! 🔥🔥🔥

SUMMARY 📓🖋️

🟧 Tornado Cash founders face charges for laundering over $1 billion; includes funds for North Korea.

🟧 Moshe Hogeg, crypto entrepreneur, reportedly recommended for prosecution in Israel for a $290M scam.

🟧 Binance allegedly uses five blacklisted Russian lenders for P2P transactions.

🟧 While many nations tighten their grip on crypto, Hong Kong embraces it with new regulatory frameworks and licenses for retail trading.

🌪️💸 Tornado Cash: A Whirlwind of Controversy

Hold on to your ice cream cones, folks, because this scoop might just give you a brain freeze! Tornado Cash, our favorite (or not-so-favorite?) Russian cryptocurrency mixer, is in hot water. Roman Storm and Roman Semenov, two of its co-founders, are now officially "Wanted Men" for allegedly helping some very naughty hackers and fraudsters. Remember the Lazarus Group, that North Korean-backed hacking sensation? Yep, they’re involved.

Roman Storm got a knock on his door in Washington and now has some shiny new bracelets (not the kind you'd want), while Roman Semenov is playing a high stakes game of hide-and-seek. And for our fellow Euro readers, co-founder numero three, Alexey Pertsev, is set for a rendezvous with justice in Amsterdam.

Let’s talk numbers because, in the crypto world, we're all about those digits! Tornado Cash got caught up in the whirlwind of controversy after being linked to several high-profile heists. Security buffs tied them to a staggering $615 million theft from Ronin and a $100 million raid on U.S. startup, Harmony. To sprinkle a tad more drama, blockchain firm Elliptic claims that Tornado Cash laundered a cool $1.5 billion from various naughty activities. U.S. Treasury's figures? An eye-watering $7 billion since 2019. Yikes.

🕵️‍♂️💰 Israel's Crypto Drama: Moshe Hogeg Under The Spotlight

Ah, the world of crypto - where the line between genius and trickster is as thin as a wafer cone. Our latest protagonist, Moshe Hogeg, is facing some rather chilly winds from the Israeli police force. Why? Well, they're pointing fingers (and not the fun, "you got the last scoop" kind) at him for defrauding users to the tune of $290 million via crypto schemes.

This saga has had its share of ups and downs. If you rewind to November 2021, Moshe was enjoying the cozy confines of his house – not by choice but due to an arrest. That's right; he had a month-long "staycation" courtesy of some pretty serious allegations. It's always more fun to connect the dots backward, isn't it?

This crypto caper has unfolded over a two-year investigation. Hogeg's name popped up when he jet-setted to Morocco, sprinkling some excitement with his new venture, Tomi – a blockchain project boasting an "alternative internet network". Is he just a misunderstood figure in the crypto realm? Hogeg seems to think so, hinting that he's a target. And while 180 people have been questioned and assets seized, Moshe's spokesperson says they're thrilled the investigation is over. In their eyes, the media might just be serving a bit of a cold dish against Hogeg, who vehemently denies any wrongdoing.

And what's a drama without some flashy spending? Apparently, $7 million of the controversial cash was funneled into buying the Beitar Jerusalem Football Club, which he later passed on to businessman Barak Abramov in 2022.

🍦🍒 Binance's Icy Russian Connection: Blacklisted Lenders Alert!

Ladies and Gentlemen, we're diving deep into a chilling episode of Binance, the colossal crypto exchange, and its cool ties with a handful of Russian lenders. I mean, who doesn't like a dash of drama sprinkled on their sundae, right?

So here's the brain-freeze moment: Binance, as per Wall Street Journal's frosty findings, seems to be giving a nod to transfers involving at least five Russian banks which have been, drum roll, BLACKLISTED post-Russia's escapades in Ukraine. Among the infamous five are the delightful Rosbank and the tantalizing Tinkoff Bank, being a part of this crypto waltz.

From October to March, Russians orchestrated peer-to-peer (P2P) trades worth a whopping $428 million. Just to remind y'all, P2P means you're trading directly, no middle-man or exchange pool involvement. No sprinkles. Pure, raw scoop-to-scoop action! Furthermore, our frosty investigators also discovered that Binance's guardian angels, aptly named “Binance Angels,” whispered over Telegram that no trading limits exist for their Russian clientele. A tad contrary to the restrictions they announced in April 2022, don't you think?

Now, Binance's spicy rebuttal is that they don’t shake hands with banks in Russia (or anywhere else) when it comes to their P2P operations. They're claiming to be the good guys, adhering to global sanctions and keeping the baddies off their platform. But this icy relationship with Russia is only the tip of the iceberg.

Enter the U.S., stage left, throwing lawsuits at Binance like snowballs, with claims that the platform has been a naughty child, assisting U.S. customers to dodge trading restrictions. Rumors even hint at a possible Justice Department indictment against Zhao and Binance for a sundae of charges. Oh, and did I mention over 1,000 Binance employees have been given the cold shoulder and shown the door?

🍦🌆 Hong Kong's Crypto Gleam: Dancing to a Different Blockchain Beat!

Hong Kong's taking us on a whirlwind crypto-tango amidst global uncertainties surrounding the virtual asset world. While cryptocurrencies face roller-coaster rides, HK's message is clear: "Shall we dance?" 🎶💃

Hong Kong, a bustling global financial hub, might have had its charm dimmed by the double whammy of stringent COVID measures and political challenges. However, the city is upping its game by bestowing a warm embrace to cryptocurrencies. This month, the city took a monumental leap by awarding licenses to HashKey Exchange and OSL, letting them groove to the beat of retail crypto trading.

Julia Leung, the bigwig of the Securities and Futures Commission (SFC) in Hong Kong, elegantly noted in June that while the city doesn't aim to be the crypto dance champion, it recognizes the rhythm of the crypto dance in the global finance dance floor. And a good dance requires trust, hence the emphasis on well-balanced regulations.

But here's the salsa twist: Why is Hong Kong grooving to this tune when mainland China, its big sibling, is firmly seated with a "no-dance" sign? Neil Tan, the chairman of the city's FinTech Association, hints at the city's autonomy under the “one country, two systems” arrangement, suggesting Hong Kong's dance card is its own to fill, with Beijing perhaps liking the view and the oversight it offers.

Now, amid this crypto dance gala, the world witnessed the somber departure of big names like FTX and Three Arrows Capital. Binance and Coinbase? They're locked in a fierce tango with the U.S. regulators, leading to declarations like “crypto’s dead in America” from tech investors like Chamath Palihapitiya. However, just like any great ballroom drama, crypto sees a revival with Bitcoin dancing its way up by over 50% this year.

Yet, there are naysayers. Professor Lu Fangzhou of the University of Hong Kong believes the city might be a tad late to the party, suggesting that while HK's got the moves, the crypto dance's prime time might have passed.

TL;DR: 🔻💯

🟧 Founders of Tornado Cash, a crypto mixing service, are facing charges for laundering a billion dollars. Tied to high-profile thefts, and massive amounts funneled through the service since 2019.

🟧 Israeli entrepreneur Moshe Hogeg accused of a $290 million crypto scam, following a two-year investigation. Hogeg, who once owned a football club, denies the charges.

🟧 Binance is under fire for allegedly facilitating P2P transactions via blacklisted Russian banks. This adds to their increasing legal battles in the U.S., with CEO Changpeng Zhao at the epicenter.

🟧 Hong Kong is dancing to the crypto tune with a new regulatory approach, even as global perspectives on cryptocurrencies fluctuate. Some say HK is late to the party, but the city believes it's right on beat.