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Tag: Negative

  • STRC Dividend Streak Hits 32 Years Amid Price Drop Below $90

    STRC Dividend Streak Hits 32 Years Amid Price Drop Below $90

    Strategy Claims 32 Years of Dividend Payments as STRC Sinks Below $90

    Strategy, the company whose treasury is heavily invested in Bitcoin, asserted on Thursday that it possesses sufficient reserves to cover its dividend obligations for the next 32 years. The company stated on X, formerly Twitter, that its Bitcoin holdings, currently valued at just under $55 billion, provide ample coverage for its $1.7 billion in dividend commitments.

    This latest claim follows a November assertion by Strategy that it had 71 years of dividend coverage, a projection that assumed a flat Bitcoin price, an assumption that has not held true. Strategy issues dividends on its Stretch product, STRC, which is designed to trade at $100 and offers an 11.5% yield.

    However, the price of STRC has recently fallen by more than 10%, a development that increases its effective yield and necessitates a greater cash outlay from the company to meet its dividend payments. On Wednesday, STRC dropped another 3%, nearing its record low and trading at $89, according to Google Finance data. BitcoinQuant reports the current effective yield for STRC stands at 12.9%.

    The company’s pronouncements have drawn scrutiny and concern from observers. Many have voiced worries on social media platforms about Strategy potentially needing to sell more Bitcoin to meet its payment obligations. This could lead to significant dilution of its common stock, MSTR, and carries the risk of accelerating the depletion of its Bitcoin reserves if further price declines occur.

    MSTR shares also experienced a downturn on Wednesday, falling an additional 5% to $116. The stock is now down 73% from its all-time high reached in July 2025.

    Skepticism Mounts Over Dividend Coverage Claims

    Prominent Bitcoin critic Peter Schiff has been particularly vocal in his opposition to Strategy and its CEO, Michael Saylor. Schiff commented on Strategy’s 32-year dividend coverage claim, outlining several critical assumptions. “That assumes you don’t raise the dividend on the preferreds, you don’t issue any more preferred shares, and the price of Bitcoin doesn’t fall,” Schiff stated. He added, “In fact, if you start selling Bitcoin to cover your obligations, the price will fall even faster, depleting your reserves much quicker.”

    This sentiment was echoed by others in the cryptocurrency community. User ‘Kaleo’ suggested, “the responsible thing you should do is cut your losses sooner rather than later and sell the Bitcoin now.” The underlying concern is that selling Bitcoin to meet obligations will inevitably depress its price. “The lower the price that you’re forced to sell, the more BTC you’ll be forced to sell to raise the same amount of cash,” one user explained. CryptoQuant analyst ‘Darkfost’ urged Strategy to “Do the math again without thinking your sales will never drag BTC price down.”

    Strategy’s recent activity has also contributed to market uncertainty. The company sold 32 BTC in late May, coinciding with a broader Bitcoin selloff. However, it has also been acquiring Bitcoin, purchasing 1,587 BTC for approximately $100 million last week and another 1,550 BTC for a similar sum in early June.

    While selling Bitcoin to cover dividend payments appears to be the company’s primary recourse, this strategy risks creating a negative feedback loop, often termed a “death spiral,” as such sales could further depress the price of Bitcoin.

    Despite these concerns, Joe Burnett, vice president at Strive, offered a different perspective. He suggested that if Strategy were to allow the market to test lower price levels and then actively buy back Bitcoin to push the price back into its target range, it could potentially bolster market confidence. “It would train the market that temporary breaks below the target range can be buying opportunities, especially if dividends continue getting paid and the price returns to the range quickly,” Burnett commented.

  • Illinois Enacts Nation’s Toughest Crypto Law

    Illinois Enacts Nation’s Toughest Crypto Law

    Crypto Executive Slams Illinois’ New Digital Asset Tax as “Most Anti-Crypto Law in the US”

    Andreessen Horowitz crypto executive Miles Jennings has sharply criticized Illinois’ newly enacted Digital Asset Privilege Tax Act, labeling it “one of the most anti-crypto laws in the US” on June 17. The legislation imposes a 0.2% tax on the exchange, transfer, and custody of digital assets, with virtually no exemptions for common self-custody activities.

    According to Jennings, no other U.S. state has implemented a transaction-based tax specifically on cryptocurrency. He further noted that comparable levies do not exist for traditional assets like stocks, bonds, or derivatives anywhere in the country. “That means crypto is being singled out in violation of several federal laws,” he stated.

    Jennings’ remarks echoed concerns raised in a June 16 letter from the Crypto Council for Innovation (CCI) to Illinois Governor J.B. Pritzker, urging him to veto the legislation. The CCI argued that the law places unique and disproportionate burdens on individuals simply for holding digital assets, potentially driving users and entrepreneurs out of the state.

    The organization expressed the view that the measure taxes blockchain-based activity based on the underlying technology rather than the nature of the transaction itself. The CCI also raised concerns about the legislative process, highlighting that affected stakeholders were not afforded an opportunity to provide input.

    Jennings also criticized Governor Pritzker’s timing, pointing out that Illinois had recently adopted the Digital Asset and Consumer Protection Act, which he described as a “constructive approach to blockchain technology.”

    “So, rather than embracing innovation and the cost efficiencies blockchain can deliver for ordinary people in Illinois, the state is poised to punish its entrepreneurs and citizens that want to use crypto,” Jennings argued.

    The Illinois law emerges as the U.S. Congress is actively working toward establishing a national framework for crypto taxation. The CCI’s letter had advised Governor Pritzker to defer his state-level approach until federal standards were in place. The group warned that Illinois’ decision could contribute to a fragmented landscape of crypto tax laws across the remaining 49 jurisdictions, further complicating matters.

    This concern is not without precedent. Earlier this month, Coinbase vice president of tax, Lawrence Zlatkin, testified before the House Ways and Means Committee, advocating for simplified federal crypto tax rules. His proposals included treating federally regulated stablecoins as equivalent to cash and establishing de minimis exemptions for small transactions.

    The congressional hearing addressed six standalone bills aimed at updating the U.S. tax code’s treatment of digital assets. Jennings’ post on X underscored the broader implications: “When states adopt discriminatory, asset-specific taxes that drive builders and users elsewhere, we all lose.”

  • India Bans Telegram; Crypto Markets Tumble

    India Bans Telegram; Crypto Markets Tumble

    India Orders Telegram Delisting, Sparking Crypto Market Concerns

    India’s directive for Google and Apple to remove Telegram from their app stores has sent ripples through the cryptocurrency market, with the native token GRAM experiencing a notable decline. The move, affecting an estimated 104 to 150 million users, effectively cuts off Telegram’s largest national user base.

    Temporary Ban Tied to Exam Re-examination

    The delisting order, enacted under Section 69A of India’s Information Technology Act, is explicitly temporary. It is linked to the NEET-UG medical entrance re-examination, scheduled for June 21. The Internet Freedom Foundation has criticized the decision, labeling the shutdown of Telegram a “band-aid solution” and a “disproportionate answer to exam fraud.”

    TON Blockchain’s Distribution Moat Under Threat

    The investment thesis for the TON blockchain and its native token, GRAM, hinges on Telegram’s vast user base as a distribution channel. The Indian government’s order has highlighted a vulnerability, demonstrating that this “moat” can be compromised.

    Broader Crypto Market Implications

    The decision is expected to impact the broader cryptocurrency market, given India’s significant number of active crypto holders. Telegram, alongside platforms like X, serves as a hub for many of these crypto communities.

    Government Action Driven by Exam Leak Allegations

    India’s Ministry of Electronics and Information Technology, acting on a request from the National Testing Agency (NTA), invoked Section 69A of the IT Act. The NTA had previously canceled the original May 3 exam due to allegations of a paper leak, with Telegram channels reportedly involved in the distribution and fabrication of leaked materials.

    Message Editing Feature Disabled

    In a separate directive, Telegram has been ordered to disable its message-editing feature for Indian users until June 30. This measure targets a specific function investigators believe cheating networks exploited to create fabricated evidence of exam leaks. The current delisting order is set to expire on June 22, 2026, the day after the re-examination.

    Telegram CEO Alleges BGP Hijacking

    Telegram CEO Pavel Durov has vehemently opposed the ban, accusing Indian telecom provider Reliance of employing BGP hijacking. Durov claims Reliance is manipulating the Border Gateway Protocol via autonomous system number AS18101 to disrupt Telegram access for users outside India, including in the United Arab Emirates. He further alleged that Reliance and WhatsApp collaborated to lobby for the ban, citing Reliance’s partial ownership by Meta as a potential motive.

    Telecom Industry Source Disputes Claims

    A senior source within the Indian telecom industry has refuted Durov’s allegations, suggesting a conflation of two distinct entities: Reliance Communications, which manages subsea cables and holds AS18101, and Reliance Industries Ltd, the parent company of Jio, where Meta holds a minority stake without operational control. The source characterized Durov’s claims as either a misunderstanding or deliberate misinformation. At the time of publication, Telegram, Jio, Meta, and Reliance Communications had not responded to media inquiries.

    Investment Calculus Affected by Ban’s Nature

    The disruption to Telegram’s crypto-related services in India, including tap-to-earn games, quiz apps, and Web3 mini-apps, has immediate consequences for users. The long-term implications for the TON blockchain and GRAM depend on the nature of the ban. If it is purely regulatory, driven by exam integrity concerns, it may be temporary. However, if Durov’s allegations of competitive warfare and lobbying hold true, the ban could be an instrument of market suppression, with potentially more complex and lasting effects. The BGP hijacking claim, if substantiated, would independently raise alarms about manufactured disruptions to internet traffic beyond government directives.

  • Binance Faces EU License Rejection

    Binance Faces EU License Rejection

    Binance Confident in EU Compliance Amidst Report of Potential Service Loss

    Leading cryptocurrency exchange Binance stated Tuesday that it believes it is operating in compliance with the European Union’s Markets in Crypto Assets (MiCA) regulatory framework. This assertion comes in the wake of a Reuters report suggesting the firm is likely to lose its ability to offer services to EU residents.

    Reuters, citing two sources familiar with the matter, reported that Greece’s markets regulator is expected to deny Binance’s application ahead of the June 30 license deadline.

    “We have been pursuing a MiCA licence and have worked constructively with regulators over the past 18 months, including through a comprehensive application process with the HCMC in Greece,” a spokesperson for the exchange told Decrypt. “Our understanding is that the HCMC completed its review of the application and considered it compliant with MiCA requirements.”

    The firm established a holding company in Greece in December and formally applied for a MiCA license in January through the Hellenic Capital Market Commission (HCMC). Approval would have allowed Binance, the world’s largest crypto exchange by daily trading volume, to extend its services to other EU nations, including France, Spain, and Germany.

    However, if the application is denied, Binance would be required to cease operations across the European Union, a scenario Reuters indicated is likely imminent.

    “Our priority is to minimize disruption and keep users informed. We will provide further details directly as additional information becomes available, including in relation to next steps and available options,” the firm posted on X.

    In a blog post, Binance emphasized that Europe remains “central to [its] long-term plans” and that it “remains willing and ready to operate under a truly harmonized MiCA regime.”

    Earlier this year, French regulators indicated that approximately 90 crypto firms were operating in the region without MiCA compliance, although about 30% had applied for the license at that time. Last year, French regulators had threatened to disallow the “passporting” – the transference of compliance allowed by MiCA licenses throughout EU nations – as they sought to elevate oversight to the European Securities and Markets Authority (ESMA).

    A spokesperson for Binance told Decrypt that the exchange’s understanding is that its MiCA application was also reviewed at the ESMA level.

  • Robinhood Cuts 10% of Staff as Crypto Revenue Falls

    Robinhood Cuts 10% of Staff as Crypto Revenue Falls

    Robinhood Cuts 10% of Workforce Amid Crypto Revenue Slump

    Robinhood announced Tuesday it is laying off 10% of its employees as it seeks to streamline operations amid a significant decline in cryptocurrency-related revenue.

    The reduction in headcount is part of an effort to flatten the company’s organizational structure and foster a “lean, hyper-focused team,” CEO Vlad Tenev informed employees in an internal message shared on X. “We cannot default to operating as a heavily-layered organization,” Tenev stated. “Our execution is strong today, but our ambitions require us to continuously raise our own bar.”

    The move comes after Robinhood reported its smallest quarterly profit in a year during the first quarter earnings release in April. At that time, the company also disclosed that revenue from crypto transactions had fallen 34% sequentially, dropping to $134 million from $221 million. This performance underscored the brokerage’s continued exposure to crypto traders, whose engagement has waned amid subdued market conditions. Despite the cuts, Tenev characterized the layoffs as proactive, asserting, “Robinhood’s business has never been stronger.”

    Robinhood’s stock price saw a 1% dip to $97 on Tuesday, according to Yahoo Finance. While shares had reached an all-time high of $153 last year, coinciding with Bitcoin’s peak above $126,000 in October, they have since declined approximately 12% year-to-date.

    In an SEC filing accompanying its 2025 annual report, Robinhood stated it employed around 2,900 full-time staff, emphasizing its “lean organizational structure.” The impact of these layoffs on Robinhood’s development of crypto-focused products, including stock tokens available to European customers and its Arbitrum-based Ethereum layer-2 scaling network, Robinhood Chain, remains unclear. A Robinhood spokesperson directed inquiries to Tenev’s statement.

    In a separate filing on Tuesday, the company indicated it anticipates incurring $28 million in restructuring costs, which will cover employee severance packages, benefits, and share-based compensation. “The company is taking this action from a position of business strength,” Robinhood added, noting that “June month-to-date average daily trading volumes [were] at record levels across equities, options, and prediction markets.”

    This year has seen several cryptocurrency firms reduce their workforces amid a prolonged downturn in crypto prices, often termed a “crypto winter.” In March, Crypto.com laid off 280 employees, or 12% of its staff, signaling a pivot toward AI-driven operations. The previous month, Jack Dorsey’s Block announced it would cut over 4,000 jobs, representing more than 40% of its workforce.

  • Europe Crypto Firms Face MiCA Deadline Crunch

    Europe Crypto Firms Face MiCA Deadline Crunch

    Europe’s Crypto Landscape Faces Reckoning as MiCA Deadline Looms

    Brussels, Belgium – A significant portion of the cryptocurrency industry operating in Europe faces a stark choice: comply with the European Union’s new Markets in Crypto-Assets (MiCA) regulation or cease operations within the bloc. With the transitional period set to expire on July 1, 2026, a mere 17% of crypto firms previously registered under national frameworks have successfully obtained full licensing under MiCA.

    Of the more than 1,200 crypto firms that held national Virtual Asset Service Provider (VASP) registrations across the EU, only approximately 210 have converted to the new Crypto-Asset Service Provider (CASP) licenses. This leaves a substantial 83% of these entities in a precarious position, having either missed the application window, are currently navigating a process without legal standing to continue operations, or have quietly exited the market.

    The European Securities and Markets Authority (ESMA) has been unequivocal: there will be no intermediate status after July 1. Companies will either be authorized under MiCA or will be in breach of EU law. The concept of “pending authorization” does not grant the right to continue serving EU clients; this is the operative legal reality as the deadline approaches.

    MiCA establishes a unified licensing regime for crypto exchanges, custodians, brokers, portfolio managers, and lending platforms that serve EU clients. Prior to MiCA, these firms had to contend with a fragmented landscape of national registration standards, where rules varied significantly from one member state to another. MiCA consolidates this into a single framework, with one authorization granting EU-wide passporting rights.

    The application deadline in December 2024 initiated an 18-month grandfathering period under Article 143 of the regulation, which concludes on July 1. Firms that have secured CASP licenses from national competent authorities in countries such as France, Germany, Luxembourg, Ireland, or the Netherlands can now offer their services across all 27 EU member states. Those that have not completed this process are legally obligated to halt their operations.

    The comprehensive MiCA framework mandates adherence to stringent rules covering governance, custody standards, conflicts of interest, prudential safeguards, client asset protection, disclosure obligations, market abuse, and complaint handling.

    For stablecoin issuers, MiCA’s earlier phase in June 2024 already significantly altered the European market. Reserve requirements and redemption rules were first applied to asset-referenced tokens and e-money tokens. The ongoing pressure on the distribution of Tether’s USDT within the EU is a direct consequence of this earlier regulatory phase.

    The 17% conversion rate is a critical indicator, highlighting the narrowness of the currently licensed market. Industry snapshots suggest an even more concentrated landscape, with reports indicating around 14 exchanges holding trading approval and 183 entities with full authorization across 20 EEA states. This licensed market is geographically concentrated in jurisdictions that were early movers in crypto regulation, such as Luxembourg, France, and Ireland, which had established licensing pipelines and processed a higher volume of applications.

    While the passporting advantage offers a strong economic incentive to secure authorization in any single member state, the application process itself demands significant legal, compliance, governance, and capital resources, which many smaller firms lack. Smaller exchanges and non-EU platforms catering to EU retail clients are identified as the most vulnerable categories. Global exchanges based outside the EU that have not established authorized EU subsidiaries will face the same operational halt as unlicensed domestic operators, as MiCA’s scope is determined by client location, not the firm’s headquarters.

    Major licensed players include Kraken, Coinbase, Bitstamp, OKX, Crypto.com, and Bitpanda. The regulation’s impact is also evident in the market for stablecoins like USDC and EURC.

  • Crypto Giants Face Setback Amid Trump’s Condemnation of Israel’s Actions

    Crypto Giants Face Setback Amid Trump’s Condemnation of Israel’s Actions

    Trump Criticizes Israeli Attacks, Citing Iran Deal Hopes

    U.S. President Donald Trump issued sharp criticism of Israel’s latest actions, which occurred on the same day he had anticipated the announcement of a permanent deal with Iran.

    The Israeli government, led by Benjamin Netanyahu, conducted a new series of strikes on Beirut’s southern suburbs earlier today. These actions could potentially jeopardize the Iran deal, which was already considered precarious.

    “This morning’s attack on Beirut should not have happened, particularly on a special day when we are so close to a Peace Deal with Iran,” Trump stated in a message on Truth Social. “Israel has the right to defend itself against threats, but the attack it was responding to was very small and meaningless, nobody was hurt, injured, or killed, and should not disrupt this important process.”

    Lebanon’s civil defense reported at least three fatalities and seven injuries resulting from the attacks, according to Al Jazeera.

    Trump reiterated his previous day’s assertion that the United States and Iran were expected to announce a deal later today, a prospect that had already been met with skepticism by some Iranian authorities.

    In his latest post, he also called for de-escalation from all parties, including Israel and Hezbollah, suggesting this could usher in “the beginning of a long and beautiful peace.”

    Cryptocurrency Markets React to Geopolitical Developments

    Major cryptocurrencies experienced modest gains over the preceding day, potentially fueled by optimism surrounding the anticipated permanent peace deal and the expected opening of the Strait of Hormuz. However, the recent Israeli attacks and Trump’s subsequent condemnation have stalled this progress.

    Bitcoin (BTC) fell below $64,000 in recent minutes, after reaching a high of $64,800 earlier today. Ethereum (ETH) is down more than 1%, while XRP has declined by 2% to $1.13, following another rejection at the $1.15 mark.

    With the trading day not yet concluded, further volatility is anticipated later today or, more likely, tomorrow morning with the opening of futures and traditional markets. President Trump is also scheduled to travel to France for a G7 meeting.

  • Crypto Token Sales Slump Towards 5-Year Lows in Q2 2026

    Crypto Token Sales Slump Towards 5-Year Lows in Q2 2026

    Public Token Sales Plummet to Five-Year Lows

    Public cryptocurrency token sales have generated a mere $58 million in the second quarter of 2026, marking an 85% decrease from the preceding quarter, according to data released by CryptoRank on June 10. This downturn positions the current period to become the weakest fundraising quarter for Initial Coin Offerings (ICOs), Initial DEX Offerings (IDOs), and Initial Exchange Offerings (IEOs) in half a decade.

    CryptoRank’s figures reveal that while the first quarter of 2026 already showed signs of weakness with approximately $390 million raised across 105 sales, the situation has significantly worsened in the subsequent quarter.

    The severity of the decline is starkly illustrated in a month-by-month breakdown. April saw just $15 million raised from 20 sales, followed by May, which brought in around $41 million from only 13 sales. This represents the lowest monthly sales volume since December 2020. June, still in progress, has so far recorded a meager $2 million from just four sales.

    For context, January 2025 alone witnessed $654 million in fundraising, with that entire quarter serving as a cycle peak, amassing just under $850 million across 429 sales. Since that high point, the market has seen its quarterly fundraising volume, in dollar terms, shrink by over 93%.

    Despite this contraction, CryptoRank’s dashboard indicates that public token sales collectively raised more than $4 billion between the first quarter of 2024 and the second quarter of 2026.

    During this period, IDOs consistently dominated the fundraising landscape, accounting for nearly 75% of all public sales. IEOs and ICOs represented 18% and 7% of activities, respectively. However, all three formats have experienced a sharp contraction this quarter.

    Among the leading launchpads, Coinlist stands out as the largest by capital raised, having facilitated $1.37 billion. Fjord Foundry follows with $975 million, and Echo with $201 million. Gate Launchpad and DAO Maker complete the top five.

    Venture Capital Activity Also Slows

    The slowdown extends to crypto venture capital activity, which also saw a decline in the first quarter of 2026, according to a May report by Galaxy Digital. During that period, private investors contributed approximately $4 billion across 355 deals, a 50% drop from the previous quarter.

    Galaxy Digital attributed this decline primarily to a scarcity of substantial late-stage funding rounds, which had been prevalent in late 2025. Nevertheless, some significant raises have occurred recently, including Digital Asset Holdings’ $355 million round led by Andreessen Horowitz, which followed a $300 million raise just a month prior.

    CryptoRank’s data suggests that while capital remains available within the crypto space, it is increasingly being channeled into a smaller number of companies and private funding rounds, rather than public token launches. These public launches reached their zenith when market sentiment was at its strongest and appear to have since mirrored the broader market’s downturn.

    This trend is further evidenced by a previous CryptoRank report, which showed that many projects funded between April and June 2025, during a crypto market rebound, ended the year trading significantly below their initial fundraising valuations. This may explain the current lack of retail investor appetite for new launches in 2026.

  • Rug Pulls Fuel Crypto Scams, Making Up 54% of Threats

    Rug Pulls Fuel Crypto Scams, Making Up 54% of Threats

    Rug Pulls Dominate Crypto Scams, Accounting for Over Half of Threats

    Rug pulls constituted more than 54% of all newly detected cryptocurrency scams, according to the latest data from on-chain security analysis platform Web3 Antivirus. The findings indicate that while scam tactics continue to evolve, many malicious actors still rely on token projects that initially appear legitimate, only to later exploit contract controls to trap investors or drain liquidity.

    Scam Tactics and Mechanics

    In a June 9 breakdown shared on X, Web3 Antivirus reported that honeypots, a distinct but related scam, ranked second at approximately 22%. Fake tokens followed at roughly 12%, with scam airdrops accounting for just under 12%.

    The effectiveness of rug pulls stems from their underlying mechanics. As the security firm explained, these schemes are designed to mimic normal market activity in their early stages, featuring rising prices, increased trading volumes, and high engagement in online forums. The risk only becomes apparent when contract owners activate hidden permissions, preventing users from selling, removing liquidity, or otherwise locking their funds.

    “A token can look alive with the chart moving up and the community getting louder, but one owner-side action can change everything in secs,” Web3 Antivirus stated. “The same contract controls that were invisible during the pump can suddenly become the reason users cannot exit, liquidity disappears and the chart collapses.”

    Honeypots operate on a similar principle. Bad actors create a fraudulent token and promote it with convincing marketing as a lucrative investment opportunity. They may even artificially inflate the token’s value through self-executed transactions to create an illusion of high demand, luring unsuspecting investors. Once individuals purchase the token, often at inflated prices, the underlying contract prevents any sales, allowing scammers to abscond with the profits.

    Scale of Detected Scams

    Web3 Antivirus’s latest Scam Pulse data reveals the detection of over 425,000 rug pulls, alongside 172,000 honeypots and more than 94,000 scam airdrops. Of the more than 100 million contracts analyzed by the platform, nearly 4 million have been flagged as scams, with at least 3.1 million identified within the last 30 days alone.

    Impersonation and AI’s Role

    The platform has also observed an increase in the impersonation of token contracts. Web3 Antivirus’s weekly leaderboard shows Ethereum leading with 291 fake token detections, followed closely by Tether with 270 and USDC with 225. Activity has risen across nearly all tracked assets compared to the previous week.

    Beyond on-chain mechanics, Web3 Antivirus highlighted that artificial intelligence is transforming how scams reach potential victims. The technology now enables phishing emails, fake support chats, and fraudulent social media posts to appear polished enough to pass initial visual scrutiny.

    According to their data, emails remain the most common delivery channel at 53%, followed by SMS at 10%, social media at 9%, and online advertisements at 8%. Notable incidents include a fake Uniswap website in May that drained at least $400,000 from users before being identified. In the same month, Ripple CTO Emeritus David Schwartz warned XRP investors about a fake airdrop and giveaway campaign targeting XRPL users. More recently, Web3 Antivirus identified a phishing account impersonating the Canton Network, complete with the project’s branding, which used a seemingly official announcement to redirect users to a fraudulent URL.

  • Google Sues Chinese Group Over AI-Powered Phishing

    Google Sues Chinese Group Over AI-Powered Phishing

    Google filed a lawsuit Friday against an alleged Chinese cybercrime network, Outsider Enterprise, accusing the group of using the company’s Gemini AI to automate fraudulent text messaging campaigns. These campaigns reportedly targeted hundreds of thousands of U.S. victims with phishing sites designed to steal financial credentials.

    AI-Powered Phishing Operation

    Court documents reveal that the defendants allegedly employed Gemini AI to generate code and templates for fake websites. These sites were designed to impersonate legitimate telecom portals. The FBI stated that the operation deployed over 8,000 phishing websites across numerous countries.

    In the two weeks leading up to June 1, Google received approximately 55,000 reports of suspicious messages on Google Messages, many of which were allegedly linked to Outsider Enterprise. The same court documents indicate that the network has stolen an estimated 3.87 million credit card numbers, contributing to roughly $1.9 billion in losses since July 2023.

    Google announced the lawsuit on its official news account, stating, “Today, we filed a lawsuit to permanently dismantle a group of organized cybercriminals accused of using AI tools — including Gemini — to scam Americans via fake text campaigns.”

    Targeting Digital Assets

    The phishing sites allegedly focused on various financial accounts, including cryptocurrency wallets and exchange credentials. This trend reflects a growing focus by scammers on digital asset holders, who may have fewer avenues for recourse compared to traditional banking customers.

    Surge in AI-Driven Scams

    The lawsuit comes amid a surge in AI-powered financial scams across the United States. In 2025, the FBI received a total of 1,008,597 internet crime complaints. Of these, crypto-related complaints accounted for 181,565 reports, resulting in $11 billion in losses, the highest of any category.

    For the first time in its nearly 25-year history, the FBI’s Internet Crime Complaint Center (IC3) dedicated a section to artificial intelligence scams. These scams generated 22,364 complaints and cost Americans nearly $893 million. The bureau’s Operation Level Up, launched in 2024, has notified over 8,000 cryptocurrency fraud victims and prevented more than $500 million in potential losses.

    Research has indicated that even leading AI models can facilitate harmful behavior, raising concerns as companies like Apple integrate AI capabilities into consumer products. The Google lawsuit is seen as a significant development in efforts to hold malicious actors accountable for weaponizing AI tools against financial systems.