Crypto Crackdown just getting started
By Lionel Laurent
There was much mirth online when the US Justice Department announced the arrest of crypto exchange Bitzlato's founder last week. Unpronounceable, unknown and unlike any of the far bigger fish (like Binance) getting headlines, Bitzlato looked like a small-fry, a nothingburger. The fact that Bitcoin resumed its march past $21,000 seemed to confirm it.
But this ignores the bigger picture. In the first few weeks of 2023, watchdogs have done a lot. On Jan. 3, a joint statement by US bank regulators warned the industry of crypto risks creeping into the banking system. Then came a $100 million settlement with Coinbase Global Inc. over weak internal controls, a lawsuit against the Winklevoss twins' Gemini and broker Genesis for allegedly selling unregistered securities, and a $45 million settlement with lending platform Nexo (which has ceased US operations). Subpoenas are flying.
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