50,000 Bitcoin worth $1 billion United States dollars were moved from multiple wallets related to U.S. Government law enforcement seizures and were transferred to new addresses, and a few were moved to Coinbase on March 8.
According to data shared by on-chain analytics firm PackShield, there were three transfers made from the U.S. law enforcement agencies' wallets. These wallets held nearly 51,000 BTC seized by U.S. agencies from the Silk Road marketplace in November 2021. The confiscated BTC was consolidated in two wallet addresses: bc1q5s…0ch and bc1q2ra…cx7.
Out of these three transfers, the majority appear to be internal transfers. However, approximately 9,861 BTC was sent to Coinbase. The other two transfers include a 30,000 BTC transfer to an address starting with bc1q... and a 9,000 BTC transfer to an address starting with bc1qe7....
Silk Road was an online black market and the first modern darknet market. It was launched in 2011 by its American founder Ross Ulbricht under the pseudonym "Dread Pirate Roberts." The marketplace was one of the first to accept Bitcoin payments and even popularised crypto use at its time. The U.S. law enforcement agencies confiscated multiple items from its founder, including hoards of BTC which have been auctioned from time to time and as early as 2014.
Popular Bitcoin proponent Tim Draper bought nearly 30,000 BTC in 2014 from one of these auctions. Another auction for 50,000 BTC was held in October 2015, where the U.S. Marshall Services auctioned 21 blocks of 2,000 BTC and one block of 2,341 in an online auction.
While only a small portion of the 50,000 BTC was sent to Coinbase, The movement of billions worth of BTC from U.S enforcement agency-linked wallets evoked wild reactions and even wilder theories. A user pointed out that if the U.S. agencies decided to sell their Silk Road Bitcoin, it would put significant selling pressure on the market. At the same time, a few others questioned the timing of the sale.
While there’s nothing new in imposing anti-money laundering (AML) standards on crypto, it is only now that the Indian government has decided to notify all interested parties of the obligation to comply with the national AML law.
On March 7, The Gazette of India published a notification from the Ministry of Finance, subjecting a range of transactions with crypto to the Prevention of Money-Laundering Act (PLMA) 2002 — namely the exchange, transfers, safekeeping and administration of virtual assets. Financial services related to an issuer’s offer and sale of virtual assets also fall under the PMLA.
The notification doesn’t provide many details, but the PML Act obliges financial institutions to maintain a record of all transactions for the last ten years, furnish these records to the officials if demanded, and verify the identity of all the clients.
Written right on time when regulators all over the globe are tightening the AML standards for crypto, the notification will nevertheless complicate the life of crypto companies in India. And it already has not been too comfortable in recent years. From March 2022, according to amended tax rules, digital assets holdings and transfers are subject to a 30% tax.
Trading volume on major cryptocurrency exchanges across India dropped by 70% within 10 days of the new tax policy and almost 90% in the next three months. The rigid tax policy drove crypto traders to offshore exchanges and forced budding crypto projects to move outside India.
In February 2023, Indian authorities once again demonstrated their tough stance on cryptocurrencies with a preemptive ban on crypto advertising and sponsorships in the local women’s cricket league. This followed a previous ban for the men’s cricket Premier League, introduced back in 2022.
In 2023, while celebrating India’s first presidency at G20, the country’s Finance Minister, Nirmala Sitharaman, urged international efforts to regulate crypto. She called for a coordinated effort “for building and understanding the macro-financial implications,” which could be used to reform crypto regulation globally.
Considering the regulatory struggle to keep up with ever-evolving innovations, Margrethe Vestager, the executive vice president of the European Commission for a Europe fit for the digital age, and commissioner for competition since 2014, recommended a headstart into brainstorming implications of technologies such as the metaverse and ChatGPT.
While speaking about competition policy at the Keystone Conference, Vestager highlighted how the digital transition and the shift to a digital economy had brought risks and opportunities for everyone. She believes that legislation lags behind technological advancements, adding:
“We have certainly not been too quick to act — and this can be an important lesson for us in the future.”
While the enforcement and legislative process will continue to stay a step behind tech innovations, Vestager stressed the need to anticipate and plan for such changes. She stated:
“For example, it is already time for us to start asking what healthy competition should look like in the metaverse or how something like ChatGPT may change the equation.”
The commissioner also revealed that the European Commission would enforce antitrust investigations from May 2023 aimed at the Facebook marketplace and how Meta uses ads-related data from rivals.
Feb. 15 marked the launch of the European Blockchain Regulatory Sandbox, which provides a space for regulatory dialog for 20 projects per year through to2026.
On the other end of the spectrum, European Union lawmakers are in talks about using zero-knowledge proofs for digital IDs. Cointelegraph’s report on the matter highlighted:
“The new eID would allow citizens to identify and authenticate themselves online (via a European digital identity wallet) without having to resort to commercial providers, as is the case today - a practice that raised trust, security and privacy concerns.”
Zero-knowledge proofs have recently been at the center of researchers’ attention as a way to ensure regulatory compliance and privacy in digital currencies.
This Daily Dose was brought to you by Cointelegraph.