UpGate

Tag: Regulation & Policy

  • ESMA Highlights Inside Trading Risks and Regulatory Complexity in Prediction Markets

    ESMA Highlights Inside Trading Risks and Regulatory Complexity in Prediction Markets

    The European Securities and Markets Authority (ESMA) has identified prediction markets as a sector prone to inside trading and facing significant regulatory complexity. In its risk monitor, ESMA dedicated a chapter to these platforms, highlighting concerns that could lead to their classification as financial instruments or gambling, and noting that platform responses to issues are largely reactive.

    ESMA pointed to three specific episodes of alleged inside trading or manipulation. Notably, new wallets reportedly made $1.2 million in the hours preceding a February strike on Iran. By May, analysis by Bubblemaps traced nine linked accounts to $2.4 million in Iran-related bets that were successful 98% of the time. In another instance, a U.S. Army master sergeant was charged over $400,000 in profits from Polymarket, related to bets on the capture of Venezuelan president Nicolás Maduro. Furthermore, suspected tampering with weather sensors used to settle Polymarket contracts prompted Météo-France to file a police complaint in April.

    Regulatory Classification Ambiguity

    The regulator emphasized the ambiguity surrounding the classification of event contracts. ESMA stated these contracts can qualify as financial instruments under MiFID II, fall under MiCA, or be considered gambling under national law. When classified as financial instruments, they are treated as derivatives. National rules, mirroring ESMA’s intervention on binary options, prohibit their sale to retail investors. Uncertainty remains regarding why platforms like Kalshi and Polymarket restrict users in some EU countries but not all, despite both banning VPNs. Malta, however, is reportedly drafting a framework for prediction markets.

    Market Volume Growth and User Dynamics

    Volumes in these markets have surged considerably. ESMA’s data collection periods for Kalshi ended in November 2025 with quarterly volumes of $8.8 billion, and for Polymarket in January 2026 with quarterly volumes of $12 billion. By June, The Block reported their combined monthly volume at $44.8 billion, with Kalshi alone accounting for $31.5 billion. ESMA reported that sports constitute 73% of Kalshi’s volume, while Polymarket divides its volume across politics, sports, and crypto.

    Further analysis cited by ESMA indicates a concentration of gains among a small number of users. A Wall Street Journal finding suggested that 67% of Polymarket gains went to just 0.1% of accounts. A Bloomberg analysis indicated that most users lose money on these platforms. The practical effectiveness of VPN bans by these platforms remains uncertain.

    Divergent US Regulatory Stance

    In contrast to the EU’s cautious approach, Washington has taken a different course. The Commodity Futures Trading Commission (CFTC) has defended its jurisdiction and proposed barring war and assassination contracts. Both the CFTC and the Securities and Exchange Commission (SEC) are reportedly taking action against individuals involved in the crypto space.

    Key uncertainties persist regarding the practical effectiveness of VPN bans and the reasons behind the selective application of user restrictions across EU member states. The exact nature and outcome of the CFTC and SEC’s actions concerning crypto persons also remain unclear.

    Why This Matters

    The materials describe a narrow update: ESMA has identified prediction markets as being prone to inside trading and has highlighted regulatory challenges, including potential classification as financial instruments or gambling. The practical effectiveness of VPN bans by Kalshi and Polymarket.

    Broader Context

    Source materials place the factual news in this context: ESMA’s risk monitor gives the prediction market sector its own chapter.

  • Albuquerque Bans Bitcoin ATMs, Operators Must Remove Within 45 Days

    Albuquerque Bans Bitcoin ATMs, Operators Must Remove Within 45 Days

    Albuquerque Bans Cryptocurrency ATMs Amid Fraud Concerns

    Albuquerque has outlawed cryptocurrency ATMs within its city limits, enacting an ordinance on Wednesday that also extends to virtual currency transactions facilitated by cashiers.

    Known operators and the retailers hosting these machines will be notified by the city and given 45 days to remove them.

    Councilor Stephanie Telles of District 1, who co-sponsored the measure with Councilor Tammy Fiebelkorn of District 7, stated that 90% of crypto ATM transactions in Albuquerque are linked to fraudulent activity. “No one who legitimately exchanges or transmits virtual currency uses these kiosks, because the high fees make them a ripoff,” Telles said in a press release. She argued that they are primarily utilized by “scammers, organized crime, and human traffickers” due to the instant, anonymous, and irreversible nature of the transactions.

    “We cannot wait for federal regulators to solve this crisis while our residents are actively being targeted and harmed in our own neighborhoods,” Fiebelkorn added.

    Residents will still be permitted to own, mine, and transfer cryptocurrency through online exchanges and personal wallets, according to the council.

    The city’s ban follows a trend of statewide prohibitions. Indiana initiated such a ban in March, Tennessee followed in July, and Minnesota’s ban, proposed in the spring, took effect in August. Delaware has advanced a similar bill, New Jersey is considering one, and Texas lawmakers are weighing a ban after kiosk scams cost residents $57 million.

    Bitcoin Depot, formerly the largest operator in North America, filed for Chapter 11 bankruptcy in May and removed approximately 9,700 kiosks offline. Chief Executive Alex Holmes cited transaction limits and “in some jurisdictions, outright restrictions or bans” as contributing factors.

    While Telles’s 90% figure is substantial, it is not an isolated statistic. Washington, D.C.’s attorney general sued Athena Bitcoin last year after discovering that 93% of deposits into its seven kiosks in the city over a five-month period were the result of fraud, with the median victim age being 71. Athena stated at the time that it strongly disagreed with the findings. The FBI logged nearly 11,000 kiosk fraud complaints in 2024, totaling more than $246 million.

  • CLARITY Act Revisions for DeFi and Credit Unions Face Ethics Hurdle Ahead of Vote

    CLARITY Act Revisions for DeFi and Credit Unions Face Ethics Hurdle Ahead of Vote

    Senate Republicans have released updated text for the CLARITY Act, introducing new regulations for non-decentralized decentralized finance (DeFi) protocols and clarifying crypto dealings for credit unions. These revisions are scheduled for consideration ahead of a procedural vote on September 15. However, the bill’s advancement remains uncertain as key ethics provisions, a significant point of contention for Democratic support, have not been altered.

    The revised legislation requires non-decentralized DeFi protocols—platforms that market themselves as decentralized but do not fully operate as such—to register with the Commodity Futures Trading Commission (CFTC). According to Senate Republicans, these new rules apply specifically to spot or cash digital commodity transactions, a modification intended to address prior concerns regarding blockchain-based prediction markets. Concurrently, the updated language provides credit unions with clearer authority to conduct cryptocurrency transactions.

    These revisions are the result of negotiations during the August recess. Senator Cynthia Lummis, a key sponsor, stated that the updated text includes over 100 changes suggested by Democrats. Despite these adjustments, the core ethics provisions, which Democrats have pushed for, remain unchanged. These provisions typically involve requirements for elected officials to divest their cryptocurrency holdings or place them in blind trusts.

    The CLARITY Act requires 60 senators to invoke cloture, underscoring the necessity of bipartisan backing for its advancement. The persistent disagreement over ethics provisions casts doubt on whether the bill will secure the requisite Democratic votes. Senator Lummis has contended that any failure to pass the bill would stem from Democrats’ refusal to accept a bipartisan compromise, rather than the ethics stipulations themselves. Treasury Secretary Scott Bessent has also encouraged senators to persist with negotiations and advance the legislation.

    Questions have been raised regarding the definition of ‘non-decentralized’ DeFi, with Roman Storm notably questioning the terminology on X. In contrast, Coinbase CEO Brian Armstrong has expressed support for a ‘yes’ vote on the bill. The upcoming procedural vote on September 15 will indicate whether the compromises embedded in the revised CLARITY Act are sufficient to move the legislation forward, notwithstanding the ongoing debate surrounding ethics.

    Significant uncertainty persists regarding the CLARITY Act’s path forward, specifically whether the recent compromises will be enough to garner the necessary Democratic support for the September 15 vote. The bill’s progression is fundamentally tied to achieving bipartisan consensus, with ethics remaining the primary obstacle.

    Why This Matters

    The materials describe a narrow update: Senate Republicans released an updated version of the CLARITY Act, introducing new regulations for non-decentralized DeFi protocols requiring registration with the CFTC and clarifying crypto dealings for credit unions. Whether the compromises made in the revised CLARITY Act will be enough to secure the necessary Democratic support for the September 15 vote.

    Broader Context

    Source materials place the factual news in this context: The CLARITY Act is a piece of legislation being considered in the US Senate.

  • Senate Test Vote on CLARITY Act: Procedural Step Amidst Regulatory Uncertainties

    Senate Test Vote on CLARITY Act: Procedural Step Amidst Regulatory Uncertainties

    The U.S. Senate is scheduled for a procedural test vote on September 15th regarding the Digital Asset Market CLARITY Act, a legislative proposal aimed at establishing a federal regulatory framework for the cryptocurrency market. This vote, which requires 60 senators to proceed with debate (cloture), represents a procedural step that could influence the momentum for federal digital asset regulation, according to the FactSheet.

    The CLARITY Act has navigated substantial legislative milestones, including passage in the House by a vote of 294-134 in July 2025 and advancement within the Senate Banking Committee with a 15-9 vote in May 2026. Its primary objective, as detailed in the FactSheet, is to address ambiguities surrounding regulatory authority between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). The proposed framework aims to maintain the SEC’s oversight of securities and specific fundraising transactions while concurrently broadening the CFTC’s jurisdiction over spot digital-commodity markets and related intermediaries.

    Key Provisions Under Consideration

    The legislation introduces several key provisions targeting distinct aspects of the digital asset ecosystem. Notably, it defines “ancillary assets” as network tokens whose value may be contingent on entrepreneurial or managerial efforts. These assets would be classified as commodities, necessitating specific disclosures, with obligations potentially concluding once relevant managerial efforts cease. This distinction seeks to separate the securities-law treatment of initial fundraising activities from the subsequent regulatory status of the token itself, addressing a long-standing uncertainty within the industry.

    Furthermore, the CLARITY Act addresses the evolving fields of decentralized finance (DeFi) and self-custody. Recent revisions focus on non-decentralized DeFi protocols—those that present as decentralized but where identifiable parties retain significant control. Such protocols may be subject to CFTC registration requirements for spot digital-commodity activities. The bill’s broader framework evaluates discretion, control, and censorship capabilities to determine a protocol’s decentralization status. Crucially, it also provides protections for software developers and network participants whose roles are confined to software development or transaction validation. Additionally, the act stipulates that federal agencies generally cannot prohibit individuals from utilizing self-hosted wallets.

    Federal Registration and Compliance

    The proposed legislation also outlines a defined federal registration and supervision regime for digital-commodity exchanges, brokers, and dealers. This initiative aims to replace the current fragmented system of state regulations, enforcement actions, and overlapping federal authorities with a cohesive national structure. In line with this, the latest Senate proposal mandates that cryptocurrency intermediaries comply with Bank Secrecy Act obligations. This integration includes anti-money-laundering programs, customer identification, suspicious activity reporting, and sanction compliance within the federal framework. The bill further incorporates additional disclosures and protections designed to mitigate insider abuse, fraud, and ensure proper handling of customer assets.

    Legislative Path and Future Uncertainties

    The CLARITY Act’s journey began with the House passing H.R. 3633 by a vote of 294-134 in July 2025. The Senate Banking Committee followed by advancing its version with a 15-9 vote in May 2026. Prior to the August recess, Senate Majority Leader John Thune filed for cloture, setting the September 15th test vote as the next significant procedural step. Reports indicate that Senate Republicans have introduced further revisions, asserting that the bill incorporates over 115 Democratic “wins,” such as new fraud measures and changes for DeFi platforms.

    Despite this legislative progress, considerable uncertainties persist. The outcome of the September 15th vote is not assured, and failing to secure the 60-vote threshold for cloture could substantially diminish the momentum behind this comprehensive regulatory effort. The CLARITY Act represents a critical step in defining the operational rules for the entire crypto market, extending beyond the mere classification of individual tokens. The result of this vote will offer insight into the immediate trajectory of federal digital asset regulation.

    Why This Matters

    The FactSheet indicates that the CLARITY Act, a comprehensive crypto market-structure framework, is set for a crucial Senate test vote on September 15th. A key uncertainty is whether the Senate will reach the 60 votes required for cloture on September 15th.

    Broader Context

    Source materials place the factual news in this context: The Digital Asset Market CLARITY Act is going to go through a very important Senate test on September 15th after more than a year of legislative work on the bill.

  • Craig Lund Appointed CEO of Tag Markets, Emphasizing Operational Discipline and Client Experience

    Craig Lund Appointed CEO of Tag Markets, Emphasizing Operational Discipline and Client Experience

    Tag Markets has appointed Craig Lund as its new Chief Executive Officer, signaling a strategic shift for the online trading services provider towards enhanced operational discipline and client experience. The announcement, made on September 10th, 2026, positions Lund to lead the company’s executive team and its next phase of development.

    Lund brings over fifteen years of experience in financial services, regulated digital assets, operations, and governance to his new role. His career includes senior leadership positions at prominent firms such as Merrill Lynch, M2, MidChains, BitOasis, and Property Finder. This extensive background in regulated financial businesses and operational scaling suggests a strategic focus on compliance and robust infrastructure for Tag Markets.

    According to the announcement, Lund’s mandate at Tag Markets may concentrate on operational discipline, execution resilience, and client service. This emphasis indicates a deliberate shift from a primary focus on growth to solidifying the foundational elements that support sustainable business operations and foster client trust. Lund stated, “The next chapter for Tag Markets is defined less by how fast it grows than by how well it runs. My focus is on the operating discipline, the governance and the client experience that let a firm grow across markets without losing the confidence of the people it serves.”

    Tag Markets, the trading name for T.M. Financials Ltd, is incorporated in Mauritius and regulated by the Financial Services Commission of Mauritius as an Investment Dealer. The company offers online trading services providing access to foreign exchange, commodities, indices, and other markets through various trading platforms. Lund’s appointment comes as the company turns its attention to the aspects of a brokerage that clients experience most directly, such as withdrawal processing speed and support response times.

    Lund’s previous roles have involved significant operational achievements. At MidChains, he was instrumental in building an over-the-counter desk that achieved multi-billion-dollar volume within its first year. At M2, he led the group operational structure that facilitated the launch of a globally regulated exchange and custody platform within months, operating under multiple regulatory frameworks. His experience also includes contributing to securing one of the first in-principle approvals from Abu Dhabi Global Market for a digital asset exchange and custodian while at BitOasis.

    The strategic priorities under Lund’s leadership are centered on three key areas: operating discipline, defined by clear standards and escalation thresholds; execution resilience, ensuring the reliability of order routing, pricing, and system changes; and client service, treated as critical management information with feedback systematically recorded and reviewed. This approach aims to ensure that as Tag Markets expands across markets, its internal systems, governance, and regulatory engagement grow in parallel.

    This leadership transition and strategic refocus are expected to shape Tag Markets’ future trajectory, prioritizing stability and client confidence in a competitive financial services landscape.

    Why This Matters

    The materials describe a narrow update: Tag Markets announced the appointment of Craig Lund as its new Chief Executive Officer. Lund’s appointment signifies a shift in Tag Markets’ focus from growth to foundational sustainability.

    Broader Context

    Source materials place the announcement in this context: The appointment brings a veteran of regulated digital-asset and brokerage businesses to a firm turning its focus from growth alone to the foundations that sustain it.

  • Coinbase CEO Brian Armstrong Endorses CLARITY Act Ahead of Senate Vote

    Coinbase CEO Brian Armstrong Endorses CLARITY Act Ahead of Senate Vote

    Coinbase CEO Brian Armstrong has publicly backed the CLARITY Act, urging a “yes” vote ahead of its September 15 Senate vote. Armstrong believes the legislation is key to establishing a clear regulatory framework for U.S. cryptocurrency markets, which he anticipates will attract institutional capital and facilitate the integration of tokenized assets.

    In an interview on CNBC’s “Squawk Box Asia” on September 10, Armstrong stated that Coinbase’s previous concerns about the bill have been resolved. He indicated that a broad spectrum of stakeholders, including law enforcement, banks, and representatives from both Republican and Democratic parties, now support the legislation. “All of those must-have issues that we raised our hands on last time have now been sorted,” Armstrong said, referencing input from extensive discussions.

    Armstrong highlighted the potential link between regulatory clarity and institutional adoption, citing the GENIUS Act as a precedent. He noted that over 150 large companies integrated stablecoins within three months of its passage. He suggested that the CLARITY Act could serve as a regulatory “checkbox” for institutional investors and help bring tokenized equities and perpetual contracts to the U.S.

    The CLARITY Act is scheduled for a procedural vote in the Senate on September 15. Senate Majority Leader John Thune filed cloture before the lawmakers’ recess, setting the date for this vote. The measure requires 60 votes to pass, necessitating support from at least seven Democrats or independents in addition to Republican backing.

    Armstrong characterized the political negotiations surrounding the bill as nearing a resolution, particularly concerning ethics provisions related to digital-asset holdings. He acknowledged that while the White House proposal includes “very strong” ethics provisions, Democrats have sought additional measures, such as divestiture, but expressed optimism that these discussions are close to resolution.

    Beyond regulatory matters, Armstrong commented on broader financial conditions, suggesting that excessive government spending could drive investors toward Bitcoin, drawing a parallel to gold. He also pointed to regulated stablecoins as significant buyers of U.S. government debt, potentially creating demand for Treasury bills and influencing interest rates.

    Regarding Bitcoin’s future, Armstrong reiterated his price target of $400,000 by 2030. He believes the cryptocurrency’s one-year downturn may have reached its bottom. With the next Bitcoin halving approximately a year and a half away, Armstrong noted that previous market run-ups have often preceded these events, leading him to predict that “the next year or two is going to be good for Bitcoin.”

    Armstrong also indicated that regulatory clarity for the crypto market is likely to emerge through actions by agencies such as the SEC and CFTC, even if the CLARITY Act does not pass. He framed the September 15 vote as a critical decision point, rather than the sole pathway to new rules, suggesting that regulatory clarity is inevitable through either congressional action or agency rulemaking.

    Why This Matters

    The materials describe a narrow update: Coinbase CEO Brian Armstrong has publicly endorsed the CLARITY Act, urging for a ‘yes’ vote on September 15. Whether the CLARITY Act will pass the Senate on September 15.

    Broader Context

    Source materials place the factual news in this context: Coinbase CEO Brian Armstrong has backed the CLARITY Act once again ahead of its September 15 Senate vote.

  • XRP Eyes $1.50 Breakout Amid Clarity Act Vote

    XRP Eyes $1.50 Breakout Amid Clarity Act Vote

    XRP trades at $1.38, a level significantly below the $1.50 mark that traders now consider a critical threshold. This price point holds particular importance this week, as a procedural vote in Washington could determine whether XRP embarks on a breakout or continues a gradual decline toward the mid-$1.30s.

    Senate Majority Leader John Thune has scheduled a cloture vote for September 15 on the CLARITY Act. This vote requires a 60-vote majority, with all 53 Senate Republicans reportedly in favor, leaving a seven-vote gap that Democrats must bridge. Recent reports on the bill’s progress highlight the tight margin for its passage.

    CLARITY Act’s Potential Impact on XRP

    The CLARITY Act is poised to bolster XRP’s integration into mainstream U.S. finance. The proposed framework aims to clarify responsibilities for the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) across digital asset markets, offering clearer rules for market participants.

    Historically, the bill’s passage through the Senate Banking Committee saw XRP surge 4.51% to $1.49 within hours, underscoring the asset’s sensitivity to legislative developments.

    Adding to the market’s volatility, the week also includes an Federal Open Market Committee (FOMC) meeting and fresh inflation data releases. These events could significantly influence risk appetite across cryptocurrency markets. XRP’s current chart already reflects some degree of optimism.

    Technical Outlook for XRP

    At $1.38, XRP is trading within a support band identified by analysts between $1.35 and $1.38. A more substantial support level lies between $1.31 and $1.33 should selling pressure intensify. While momentum indicators suggest a cautiously bullish outlook, derivatives data indicates waning conviction. Open interest has not kept pace with the recent price rebound, a pattern that often precedes consolidation rather than sustained upward trends.

    The bullish scenario anticipates a decisive reclaim of the $1.48–$1.51 range, potentially paving the way for $1.60–$1.68. Technical analyst Ali Charts points to $1.70 as the next significant price magnet, while Dark Defender’s model suggests a target of $1.8815 en route to $2. Continued whale accumulation would further support this optimistic outlook.

    The base case scenario involves sideways consolidation around current levels until the Senate vote resolves the prevailing uncertainty.

    Conversely, the bearish outlook suggests that a failed cloture vote or a hawkish surprise from the FOMC could send XRP back toward $1.31, invalidating the near-term bullish structure.

    The procedural risk associated with the vote remains the most significant wildcard factor influencing trader sentiment.

    Alternative Investment Opportunities

    For XRP holders who acquired positions around the $1.50 level, the market has seen gains reversed twice this month. Even a clean breakout to $1.70 would represent a notable swing, but not a transformative one given XRP’s substantial market capitalization.

    This dynamic is prompting traders with smaller portfolios to explore early-stage projects with higher potential upside ceilings, unconstrained by multi-billion-dollar market caps.

    Maxi Doge ($MAXI) is one such project, positioning itself with a meme-driven identity focused on leverage trading. It features a large canine mascot and marketing that appeals to a demographic seeking significant returns, reminiscent of early Dogecoin days.

    The presale has raised $4.8 million, with the current token price at $0.0002838. The project offers dynamic APY staking, holder-exclusive trading competitions with leaderboard rewards, and a dedicated Maxi Fund for liquidity. Investors are encouraged to explore Maxi Doge before the presale concludes.

  • Secret Service Seizes $52.8M in Crypto Linked to Global Scam Bazaar

    Secret Service Seizes $52.8M in Crypto Linked to Global Scam Bazaar

    U.

    S. Freezes $52.8 Million in Crypto Linked to Global Scam Marketplace

    The U.S. Secret Service has frozen $52.8 million in cryptocurrency connected to Xinbi Guarantee, a Chinese-language marketplace operating on Telegram that facilitates global fraud by selling tools to scammers.

    The operation, conducted in collaboration with blockchain analytics firm Elliptic, successfully identified and froze the illicit funds. Elliptic stated in a release that it had been monitoring Xinbi and its associated wallet infrastructure for several years, and its intelligence was instrumental in enabling both the asset freeze and the sanctions imposed by the U.S. government.

    The freeze, initiated at 8 a.m. UTC on September 8, targeted 52 wallets holding USDT, Tether’s dollar-pegged stablecoin. Under a warrant unsealed by the Department of Justice, two of these wallets, containing approximately $12 million, were seized outright. The remaining funds are frozen pending further legal action.

    Xinbi operates as a guarantee marketplace, essentially an escrow system designed to foster trust among criminals. Vendors deposit cryptocurrency as collateral, assuring operators that they will receive their purchased goods, which can range from stolen personal data to money-laundering services. Buyers who feel defrauded can be reimbursed from these deposits, a mechanism that incentivizes criminals to use the platform rather than relying solely on mutual trust.

    According to Elliptic, Xinbi and its merchants have processed at least $24 billion in transactions since 2022, making it the second-largest illicit online marketplace ever tracked. It surpassed Huione Guarantee, which processed $31 billion before being shut down by Telegram in May 2025 following years of exposure by Elliptic. This action followed a Treasury finding that Huione’s parent group was a primary money laundering concern, and Xinbi subsequently absorbed much of the displaced traffic.

    A significant portion of the funds flowing through such platforms originates from “pig butchering” scams. In these schemes, perpetrators cultivate fake online relationships over extended periods before convincing victims to invest in fraudulent applications that display fabricated profits, ultimately leading to the draining of savings.

    On September 9, the Treasury’s Office of Foreign Assets Control (OFAC) designated Xinbi as a transnational criminal organization, placing it in the same category as drug cartels. Two supporting firms, Singapore-based SafeW Technology and Cambodia-based Anwen Technology, were also sanctioned for their role in facilitating Xinbi’s operations. The United Kingdom had previously sanctioned Xinbi in March.

    Xinbi has publicly condemned the asset freeze, calling it “arbitrary” and vowing to compensate its customers. The marketplace appears to be shifting its focus from USDT to USDD, a stablecoin launched by Tron founder Justin Sun, which claims to lack a central issuer capable of freezing wallets. Xinbi has reportedly already converted approximately $2.8 million of its remaining USDT into USDD via a decentralized exchange.

    However, a potential complication arises from USDD’s reserves, which are partially backed by USDT. This means that the very asset Xinbi is attempting to evade could still pose a risk to its holdings.

    Wednesday’s action was part of a broader effort by the DOJ’s Scam Center Strike Force. In a separate operation, agents were deployed to Madagascar to assist local authorities in dismantling 13 Chinese-run scam compounds. This operation resulted in the processing of evidence from nearly 400 arrestees and the seizure of over 3,200 devices. Since its inception in November 2025, the Scam Center Strike Force has seized approximately $938 million in cryptocurrency linked to scams, with Xinbi’s outstanding balance still under scrutiny.

  • UK’s NECC Developing Proactive Crypto Crime Capability Amid Evolving Criminal Tactics

    UK’s NECC Developing Proactive Crypto Crime Capability Amid Evolving Criminal Tactics

    The UK’s National Economic Crime Centre (NECC) is in the process of developing a more proactive and intelligence-led crypto capability to counter the increasingly sophisticated ways criminals are using digital assets for illicit finance. This strategic shift is highlighted in the agency’s latest report, which also notes that cryptoassets have been elevated to a top priority in the nation’s economic crime strategy.

    Criminals are demonstrating “innovative use of crypto asset products to evade detection and move illicit value at scale,” according to the NECC. These illicit networks are proliferating across borders and combining “novel and traditional” methods to launder money. A notable trend is the outsourcing of money laundering activities, with many organized crime groups now paying dedicated networks for these services. Furthermore, criminals are leveraging advanced techniques such as artificial intelligence, synthetic identities, and process automation against financial institutions.

    In response to these evolving threats, the NECC is developing “a more proactive and intelligence-led crypto capability to inform our response to cross-cutting priorities.” This indicates a move away from relying solely on referrals and towards generating its own targets. The agency plans to expand its successful Operation Destabilise approach to other “high harm money laundering networks which pose the greatest illicit finance risk to the UK.”

    Cryptoassets as a Top Priority

    Cryptoassets have been elevated to a significant position within the UK’s economic crime priorities. As of July 2025, they rank third among nine key areas agreed upon by the NECC, the Financial Conduct Authority, the Home Office, and the Treasury. This ranking places crypto above other significant threats like criminal cash and money mules, directing regulatory compliance efforts within firms.

    Enforcement Operations Yield Results

    The NECC’s efforts are already yielding results through targeted operations. Operation Atlantic, a joint initiative with the U.S. Secret Service, Coinbase, Binance, Kraken, and Tether, identified 20,000 approval-phishing victims in March and resulted in the freezing of $12 million. Operation Destabilise, focused on Russian-speaking networks converting street cash into crypto, has coincided with 129 arrests and the seizure of over £25 million in the UK.

    Debate on Privacy Tools

    Amidst these enforcement actions, a nuanced discussion is emerging around the use of privacy-enhancing technologies (PETs) in crypto. A report by the Royal United Services Institute (RUSI), drawing from a July 2025 roundtable hosted by the NECC, suggests that outright bans on privacy tools could be counterproductive. Participants argued that prohibition would push illicit actors onto unregulated services, reducing transparency and making it harder for investigators to gather information. They posited that building trust through compliance features would ultimately expand the legitimate use of the technology.

    However, uncertainties remain regarding the full scope of the NECC’s new crypto capability and the precise nature of the “novel and traditional” laundering methods being employed. The agency’s report signals a determined and evolving strategy to confront the complex challenges posed by crypto-enabled financial crime.

    Why This Matters

    The NECC’s annual report underscores the growing threat of crypto-enabled financial crime, with criminals increasingly using digital assets for illicit purposes. The agency’s strategic shift towards a more proactive capability and the prioritization of cryptoassets reflect the evolving landscape of economic crime and the need for adaptive law enforcement responses.

    Broader Context

    The NECC is a National Crime Agency unit coordinating the country’s response to economic crime. This report highlights the agency’s efforts to adapt its strategy to address the specific challenges posed by the innovative use of crypto assets in money laundering and other illicit activities.

  • XRP Faces Crucial Test on September 15 Amid CLARITY Act Scrutiny

    XRP Faces Crucial Test on September 15 Amid CLARITY Act Scrutiny

    XRP and the CLARITY Act: A Crucial Test Looms

    All eyes in the cryptocurrency world are fixed on a pivotal week ahead, marked by two major events and the release of crucial inflation data. While some are keenly awaiting the Federal Open Market Committee (FOMC) meeting, others are placing greater emphasis on the CLARITY Act vote scheduled for September 15.

    The XRP community appears to lean towards the latter, with the countdown to this vote dominating discussions across platforms like X and Reddit. One prominent user, operating under the X handle RippleXity, recently highlighted the CLARITY Act’s potential significance for XRP, suggesting it could place the token “at the center” of regulatory attention.

    This highly anticipated legislation aims to establish a comprehensive framework that clearly delineates regulatory responsibilities for digital assets between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). For Ripple’s native token, a significant aspect of this regulatory uncertainty was already addressed through a protracted legal battle.

    In March, the SEC officially classified XRP as a digital commodity, a designation it shares with Bitcoin (BTC), Ethereum (ETH), Solana (SOL), Cardano (ADA), and several other cryptocurrencies. The watchdog explained that digital commodities derive their value primarily from the operational integrity of their underlying networks and market supply-and-demand forces, rather than from the expectation of profits generated by the essential managerial efforts of others.

    Consequently, the CLARITY Act could offer something far more valuable in the long term: stability. While current interpretations by the SEC and CFTC are subject to change by future administrations, federal legislation provides a considerably more robust and enduring foundation.

    The bill would also formalize a regulatory regime for digital commodity exchanges, brokers, and dealers, while expanding the CFTC’s oversight role in spot digital commodity markets.

    In a recent interview, Ripple’s Chief Legal Officer described September 15 as a “bellwether” for the continued progress of comprehensive cryptocurrency legislation through Congress. He further argued that the bill offers a more permanent structure than agency rulemaking alone.

    Despite the XRP community’s considerable hopes pinned on September 15, it is important to clarify that the Senate will not be voting on the passage of the CLARITY Act on that specific day. Instead, lawmakers will vote on cloture for the motion to proceed to H.R. 3633. This procedural step requires 60 votes and would allow the legislation to advance toward formal Senate consideration.

    A failure to achieve cloture could significantly jeopardize the bill’s prospects for success this year. The odds of its passage have already diminished considerably, reportedly falling from over 70% to approximately 30% in recent months.

    A notable hurdle was cleared last week when the National Sheriffs’ Association withdrew its opposition, shifting to a neutral stance. However, a report released on Monday suggested that an unresolved ethics dispute might pose an even more serious challenge.

    Semafor reported that several Republican senators now believe the legislation is likely to fail next week, particularly if the White House does not intervene to help resolve disagreements over restrictions on government officials profiting from the industry.

    Ultimately, XRP would likely see a modest benefit from a successful cloture vote. The most substantial impact is anticipated once the bill becomes law. However, if the vote on September 15 falters, XRP, along with the broader market, could experience a significant downturn. This situation could be exacerbated a day later if the Federal Reserve implements an interest rate hike and adopts a more hawkish monetary policy stance.