Tag: Regulation & Policy

South Korean Police Target Crypto Laundering for Cambodia-Based Phishing Ring

South Korean authorities have apprehended dozens of individuals accused of laundering funds for a Cambodia-based phishing operation through cryptocurrency transactions. The crackdown comes as an expert from Chainalysis warns that the ecosystem of scam compounds in Southeast Asia continues to pose a “persistent concern” despite years of efforts to dismantle criminal networks.

The Seoul Metropolitan Police Agency’s crime investigation division reported that 23 suspects have been referred for charges including violations of the Foreign Exchange Transactions Act and the Specific Financial Information Act. Two individuals, identified only as A and B, have been detained, according to local media.

In addition to these arrests, 33 other suspects were apprehended for allegedly engaging in the illegal exchange of $4.1 million (6.3 billion won) in cryptocurrency. The alleged ringleader, known only as C, remains at large and is now the subject of an Interpol Red Notice.

Investigators also secured approximately $431,000 (650 million won) in illicit proceeds through pre-indictment confiscation.

Police stated that the group, acting under C’s directives, moved around $11.1 million (16.8 billion won) between February 2024 and April 2025. Their method involved purchasing the USDT stablecoin, transferring it between domestic and overseas exchanges, and then cashing out into foreign currency or South Korean won for a fee.

A review of over 11,300 linked accounts revealed 265 instances of phishing-related harm, encompassing voice phishing and investment fraud, with a total value of $17 million (25.7 billion won).

Authorities urged the public to exercise caution, emphasizing that “acting as an agent for another person’s virtual asset trading or exchanging virtual assets for Korean Won can also be subject to punishment.”

Persistent Threat in Southeast Asia

Xue Yin Peh, head of investigative strategy and collections for APAC at Chainalysis, told Decrypt that increased international scrutiny has yielded concrete results against the “persistent problem” of scam compounds and their associated illicit networks. She highlighted significant actions from the past year, including the recovery of 61,000 Bitcoin by UK authorities and a $15 billion forfeiture linked to the Prince Group, noting these cases signify “a meaningful shift toward dismantling the global financial infrastructure that supports crypto fraud.”

However, Peh observed that transnational criminal networks have “demonstrated significant flexibility and resilience,” relocating within and beyond Southeast Asia and adapting their operational models as enforcement tightens. These networks rely on a broad illicit ecosystem comprising laundering networks, infrastructure, and trafficked labor, which she described as “remarkably resilient,” with new service providers “quickly filling gaps left by enforcement takedowns.”

Stablecoins like USDT remain the preferred tool for illicit fund flows because, as Peh explained, criminals utilize them “for largely the same reasons legitimate users do”: liquidity, portability, and relative price stability. She added that on-chain transactions are “transparent and traceable,” and issuers can freeze funds once illicit activity is detected.

Peh believes that cases like this “certainly can, and already have” bolstered the argument for enhanced global oversight of stablecoins. She suggested that stablecoin issuers should be integral to the “fraud-prevention front line” and that clearer legal frameworks are necessary to facilitate coordination among issuers, exchanges, banks, and authorities when victim funds are at risk.

In November, Interpol designated scam-compound networks as a global transnational threat. The same month, U.S. agencies established a multi-agency Scam Center Strike Force to track illicit funds. The Strike Force has since frozen, seized, and forfeited over $580 million in cryptocurrency linked to networks operating out of Burma, Cambodia, and Laos.

Around the same period, Taiwanese prosecutors charged 62 individuals in connection with the network of Cambodian tycoon Chen Zhi, chairman of Prince Group. Chen Zhi was extradited to China earlier this year amid allegations linking his business empire to cyber scam networks.

In April, Cambodia enacted its most stringent anti-scam legislation to date via royal decree, imposing potential life sentences on compound operators. However, analysts have cautioned that such measures might merely shift the illicit trade across borders rather than eradicate it.

Judge Dismisses xAI’s Trade Secret Lawsuit Against OpenAI

A federal judge has dismissed xAI’s trade secret lawsuit against OpenAI, ruling that Elon Musk’s artificial intelligence company failed to demonstrate that the ChatGPT maker improperly obtained confidential information related to its Grok chatbot.

In an order issued Monday, U.S. District Judge Rita Lin granted OpenAI’s motion to dismiss the case without leave to amend. The judge concluded that xAI did not provide sufficient evidence that OpenAI encouraged a former xAI engineer to disclose trade secrets during the recruitment process.

“xAI insufficiently pled inducement in the prior complaint because it offered no nonconclusory allegations allowing a reasonable inference ‘that OpenAI told or encouraged’ xAI’s former employees to exfiltrate its confidential information,” the order stated.

This ruling marks the second legal setback for Musk, who co-founded OpenAI before leaving in 2018, in his ongoing dispute with OpenAI and its CEO, Sam Altman.

Last month, a federal jury rejected Musk’s $150 billion lawsuit, which alleged that OpenAI, Altman, and co-founder Greg Brockman had abandoned the organization’s original nonprofit mission by transitioning to a commercial structure and strengthening its ties with Microsoft.

The most recent lawsuit focused on a presentation given by Xuechen Li, a former xAI engineer, during his recruitment by OpenAI. xAI claimed that OpenAI targeted Li specifically because of his work on Grok 4’s reinforcement learning and post-training systems, and accused the ChatGPT developer of knowingly seeking confidential information about these efforts.

Judge Lin rejected this argument, writing that “merely asking Li to discuss his previous work—a routine part of the hiring process—does not allow a plausible inference that OpenAI induced Li to reveal anything confidential or secret about that work.” She added that accepting xAI’s theory could “potentially expose employers to liability any time they inquire about a candidate’s past work.”

The judge also found that xAI failed to prove that OpenAI knew or should have known Li disclosed trade secrets during the presentation.

“These allegations are insufficient to support a reasonable inference that OpenAI knew or should have known that Li disclosed xAI trade secrets during his presentation,” Lin wrote. “It is not clear how much detail Li shared about xAI’s reinforcement learning techniques. Similarly, while xAI does not allege that Li actually displayed the slide deck during his presentation, even assuming he did, the level of detail contained in the slides remains unclear.”

The decision comes as Musk recently became the world’s first trillionaire, following SpaceX’s record-breaking initial public offering, which valued the company at approximately $1.77 trillion and solidified its status as one of the globe’s most valuable corporations.

SpaceX (SPCX) shares continued to climb on Monday amid a broader market surge, influenced by the announcement of a ceasefire between the U.S. and Iran. The company’s stock rose nearly 20% by the close of trading, finishing the day at $192.50, which brings its valuation to over $2.5 trillion.

iGaming Sector Faces Dual Pressures of Intensifying Regulation and Global Expansion

Norwich, United Kingdom – June 15, 2026 – The iGaming industry is navigating a complex landscape defined by heightened regulatory scrutiny and persistent global market expansion, according to a new industry overview released by NyesteCasino.com, a prominent iGaming analysis resource. Operators are grappling with a delicate balance between risk management and aggressive growth strategies, a challenge underscored by U.S. Senate hearings, evolving legal interpretations, the localization of crypto casinos, and a surge in World Cup betting activity.

Across the United States, Europe, Southeast Asia, and South America, regulators have been tightening rules concerning prediction markets, sweepstakes casinos, and the use of credit cards for deposits. Simultaneously, online gambling platforms, content providers, and policy advisors have accelerated product innovation and launched targeted, region-specific sports marketing campaigns.

NyesteCasino.com’s analysis suggests these developments signal a significant structural shift within the industry, where agility in compliance is rapidly becoming as crucial for success as product quality. Despite increasing regulatory headwinds, the pace of innovation and sustained market demand indicate continued sector growth.

Prediction Markets: A Battlefield of Courts, Congress, and Cross-Border Bans

The week commenced with a highly anticipated hearing before the U.S. Senate Commerce Subcommittee, titled “No Sure Bets.” Held on May 20 under the chairmanship of Senator Marsha Blackburn, the session signaled further deliberations to come. A central point of contention emerged between American Gaming Association CEO Bill Miller and former Congressman Patrick McHenry regarding the future of prediction markets. Miller argued that sports event contracts function as clandestine betting operations, circumventing state licensing, tax regulations, and integrity safeguards. McHenry, representing the Coalition for Prediction Markets, countered that existing Commodity Futures Trading Commission (CFTC) oversight is effective.

Adding to the legal complexities, on May 22, a panel from the Ninth Circuit Court of Appeals rejected stay requests from both Kalshi and Polymarket, refusing to halt state enforcement proceedings in Nevada and Washington. The court ruled that a federal preemption defense under the Commodity Exchange Act alone does not establish federal jurisdiction. This decision strengthens the ongoing dispute in the New Jersey appeals court, which had previously upheld an injunction against Kalshi, and further accelerates the process towards a potential Supreme Court review of state jurisdiction over event contracts.

In Indonesia, the Ministry of Communication and Digital Affairs classified Polymarket as an online gambling site, disregarding its crypto-based structure, and requested a national ban on the platform on May 25. This action was prompted by a viral contract concerning whether President Prabowo Subianto would resign before the end of his term in October 2029, which generated approximately $46,000 in trading volume. Polymarket is now inaccessible in over 33 jurisdictions worldwide, including India, Brazil, and Singapore, with more countries implementing bans.

State-Level Regulations: Tennessee Enacts Anti-Sweepstakes Bill

State-level restrictions on online gambling law have also emerged in Tennessee. Governor Bill Lee signed two significant bills into law during the week. Senate Bill 2136 designates Tennessee as the ninth U.S. state to completely ban sweepstakes casinos and dual-currency systems, empowering the attorney general to enforce the ban. Senate Bill 1992, the second bill signed by the governor, classifies anyone who deliberately influences the outcome of an event while holding a prediction market contract with a Class E felony. These legislative actions are expected to influence other state legislatures considering similar regulations.

Europe and Brazil: Tax Proposals, Ad Restrictions, and Credit Bans

The European Parliament held a plenary debate on May 20 concerning a proposed EU-level gambling levy. Budget Commissioner Piotr Serafin confirmed that the Commission is actively evaluating this option, alongside levies on digital services and crypto-assets, as part of the next Multiannual Financial Framework. Proponent Member of the European Parliament Victor Negrescu estimated the levy could generate between €2 and €4 billion annually for education, youth, and addiction prevention programs. However, opponents from the EPP and ECR blocs voiced concerns regarding subsidiarity, competitiveness, and national tax sovereignty, with any operational package anticipated for January 2028.

In anticipation of the FIFA World Cup tournament, scheduled from June 11 to July 19, Belgium’s Kansspelcommissie and the Netherlands Gambling Authority issued formal advertising warnings to licensed operators. France’s ANJ reported a year-on-year increase of over 25% in operator marketing budgets as the tournament approaches. Meanwhile, Brazil formalized rules on May 25 to prohibit Pix Crédito as a deposit method on regulated betting platforms. This move was partly influenced by a Folha de São Paulo audit that revealed major banks, including Bradesco and Banco do Brasil, were still processing credit transfers into betting accounts as recently as mid-May.

Editorial Perspective

“This week clearly illustrates that the iGaming sector is entering a phase where regulatory acumen is as strategically vital as product development,” stated the editorial team at NyesteCasino.com. “The debate surrounding prediction markets alone spans courtrooms, congressional hearings, and international bans, and it remains far from resolved. Operators adept at tracking and adapting to this multi-jurisdictional complexity, while simultaneously executing World Cup campaigns and localization strategies, will be best positioned for the latter half of 2026.”

Philippines Tightens Crypto Regulations with New Listing Rules

The Philippines is reinforcing its oversight of cryptocurrency markets with new guidelines for digital asset listings. The Bangko Sentral ng Pilipinas (BSP), the nation’s central bank, has mandated that all licensed Virtual Asset Service Providers (VASPs) must implement stringent due diligence and accreditation procedures before making digital assets available to consumers.

Promoting Financial Stability and Consumer Protection

According to a memorandum signed by Deputy Governor Lyn Javier, these new rules are designed to “promote financial stability and protect the financial welfare of customers by ensuring that VA services are provided in a safe, sound, and consumer-centric manner.”

Ban on Privacy Coins

In a significant move, the central bank has also prohibited the listing or support of anonymity-enhancing cryptocurrencies, commonly known as privacy coins, by VASPs.

Enhanced Monitoring and Delisting Thresholds

The latest directive requires exchanges to continuously monitor their listed assets and establish specific thresholds that would trigger suspensions or delistings. These triggers include the loss of liquidity, issuer insolvency, involvement in scandals or scams, de-pegging from a stable value, material security breaches, or misleading disclosures.

Alden Yburan, head of crypto at GCash, described the new listing standards as “long overdue” and a “minimum bar any responsible platform should already be applying.” He believes that stronger listing requirements will ultimately lead to “better products.”

However, Yburan expressed mixed feelings about the ban on privacy coins. He acknowledged that assets like Monero and Zcash “exist for legitimate reasons,” as privacy is a “foundational value in crypto, the ability to transact without surveillance.” Yet, he also noted the Philippines’ significant remittance market, stating, “PH is remittance-heavy, we can’t be positioning the ecosystem as a trusted financial infra while simultaneously allowing anonymity-enhancing assets to flow freely.”

Compliance with Securities Regulations

The memorandum also highlights that platforms may need to comply with securities regulators. If a token is offered as a security, VASPs will be required to adhere to “the SEC’s CASP Rules and Guidance.”

A Dual Regulatory Landscape

The Philippines ranks ninth globally on Chainalysis’s 2025 Global Crypto Adoption Index, reflecting strong grassroots adoption in the Asia-Pacific region. The new listing rules fit into a regulatory framework where crypto firms are accountable to two distinct authorities: the Securities and Exchange Commission (SEC) for crypto-asset service providers on the securities side, and the BSP for licensing VASPs involved in payment and transaction services. Firms must meet the requirements of both bodies independently.

Last June, the SEC introduced Memorandum Circular No. 5, which mandated crypto-asset service providers (CASPs) to register locally, maintain $1.8 million (₱100 million) in paid-up capital, store customer data within the Philippines, and report to both the SEC and the Anti-Money Laundering Council. By August, the SEC had blocked access to 10 offshore platforms, including OKX, Bybit, Kraken, and KuCoin.

Luis Buenaventura, President at the Blockchain Council of the Philippines, previously commented that the SEC’s rules created “a competitive advantage for licensed players” and that the broader crackdown would steer users toward compliant services.

Legislative Efforts and Binance’s Return Bid

Lawmakers are also exploring separate initiatives, including Senate Bill 1330, which proposes to place the national budget on-chain, following public outcry over approximately $9.2 billion in flagged public works spending.

Meanwhile, global crypto exchange Binance is seeking to re-enter the Philippine market through a local partner, BlockShoals Technologies Inc. BlockShoals received initial clearance from the SEC in November under the StratBox regulatory sandbox, according to local media reports. However, the BSP has clarified that neither Binance nor BlockShoals currently holds a VASP license, and participation in the sandbox “doesn’t substitute for central bank licensing.”

The SEC has since refined its stance, reclassifying Binance as a “global crypto-asset service provider” rather than a global VASP. The commission now requires BlockShoals to integrate with a licensed domestic VASP within 90 days before it can onboard any users through Binance’s infrastructure.

U.S. Government Orders AI Firm Anthropic to Halt Access to Advanced Models Over Security Concerns

The U.S. government has issued an emergency directive ordering AI company Anthropic to immediately suspend access to its two most powerful artificial intelligence models, Claude Fable 5 and Claude Mythos 5, for all foreign nationals. The order, citing national security concerns, was issued on Friday, just days after the models were released.

The directive prohibits any foreign national, whether inside or outside the United States, from accessing the models. To ensure compliance with the sweeping order, Anthropic was compelled to disable the models for its entire customer base.

While the government’s directive did not specify the exact nature of the national security concern, it is understood that officials believe a method for bypassing or “jailbreaking” the publicly available Fable 5 model has been discovered. Mythos 5, which has fewer safeguards and is particularly adept at identifying cybersecurity vulnerabilities, was only accessible to a select group of partners.

Anthropic has disputed the severity of the government’s findings. The company stated that it reviewed a demonstration of the alleged bypass technique and concluded that the identified vulnerabilities appear relatively simple. Furthermore, Anthropic asserted that other publicly available AI models can achieve similar results without requiring any bypass.

The company also indicated that the government has so far provided only verbal evidence of a potential, narrowly defined, and non-universal jailbreak. This bypass reportedly involves instructing the model to read a specific codebase and identify software flaws. Anthropic claims to have verified that the capabilities demonstrated are already widely available from competing models, including OpenAI’s GPT-5.5.

While complying with the directive, Anthropic expressed concerns that the action sets a dangerous precedent. “If this standard was applied across the industry,” the company stated, “we believe it would essentially halt all new model deployments for all frontier model providers.” Access to all other Anthropic models remains unaffected, and the company is working to restore access to the restricted models as soon as possible.

Key Figure Claims Refusal to Cooperate Led to Export Control

David Sacks, co-chair of the President’s Council of Advisers on Science and Technology, posted on X on Saturday that a “highly credible, trusted partner” of both Anthropic and the U.S. government, while testing Fable, discovered a jailbreak of its safeguards. According to Sacks, the administration requested that Anthropic CEO Dario Amodei fix the vulnerability or deactivate the model, but Amodei allegedly refused.

Sacks further claimed that Anthropic’s response contradicted its public statements on AI safety and regulation, a stance recently reiterated by Amodei in a blog post. “Anthropic prioritized the continued offering of the consumer model over safety,” Sacks wrote. He added that the administration issued the export control reluctantly, expressing surprise at Anthropic’s lack of cooperation with a “reasonable safety request.” Sacks characterized Anthropic’s reaction as being “very much at odds with their branding and ethos as a safe AI research community.”

The administration, Sacks noted, hopes Anthropic will resolve the issue, allowing Fable 5 to be re-released. He stated that the administration values Anthropic’s technical capabilities and believes the issue is resolvable, concluding, “The ball is in Anthropic’s court.”

This development follows earlier friction between Anthropic and the U.S. government this year. The AI firm reportedly refused to sign an expanded agreement that would have permitted mass domestic surveillance and the use of fully autonomous lethal weapons systems. Following the breakdown of those talks, President Donald Trump criticized the company, and the Department of Defense designated Anthropic as a “supply chain risk,” a label the firm has challenged legally. More recently, reports suggested a cooling of tensions as the government sought to utilize Claude Mythos and other models.

Ripple CEO Criticizes JPMorgan’s Dimon Over CLARITY Act Remarks

Ripple CEO Brad Garlinghouse has publicly criticized JPMorgan Chase CEO Jamie Dimon for his recent statements attacking the CLARITY Act, a proposed piece of legislation concerning cryptocurrency regulation. Garlinghouse accused Dimon of consistently dismissing the crypto industry for years while misrepresenting the bill’s actual purpose.

During an interview with Fox Business host Maria Bartiromo, Garlinghouse directly addressed comments Dimon made earlier this month. In those remarks, the banking executive alleged that Coinbase CEO Brian Armstrong was lobbying for the bill in Washington and claimed the proposed legislation would weaken protections against money laundering and violations of the Bank Secrecy Act.

Garlinghouse suggested that Dimon was either intentionally attempting to undermine support for the CLARITY Act or fundamentally misunderstanding its provisions.

“As much as we can talk about whether or not Brian Armstrong is representing the industry, he is not; he is representing Coinbase, and in certain ways he is going to look out for Coinbase’s best interest,” Garlinghouse stated. “But at the end of the day, I think what Jamie Dimon did was a disservice. He’s representing that this reduces compliance concerns, that it makes it easier to do bad things. That’s just not true. It’s either intentional misrepresentation or even negligent to try to make support for the Clarity Act go away.”

Dimon’s criticism of the bill and Armstrong was also evident at the Reagan National Economic Forum last month. At the event, Dimon stated that banks would not accept the bill in its current form and made disparaging remarks about Armstrong, reportedly saying, “He’s the only one, and he’s spending hundreds of millions of dollars in Washington on this thing. He’s full of shit.”

Economist Peter Schiff has also weighed in, criticizing Dimon’s comments and arguing that stablecoin issuers should not be subjected to the same banking regulations as traditional lenders. Schiff, a known critic of the crypto industry, differentiated stablecoins, which he noted are typically fully backed and invested in U.S. Treasuries, from banks that operate with FDIC insurance and engage in riskier lending practices. He asserted that stablecoins serve a legitimate purpose.

The CLARITY Act is currently progressing through Congress but is encountering increasing opposition from major financial institutions. The bill’s primary objective is to delineate regulatory oversight for different types of cryptocurrencies, assigning responsibilities between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) in an effort to reduce regulatory ambiguity in the United States.

After passing the House in 2025, the legislation moved through the Senate Banking Committee last month. However, it still requires further debate in the full Senate. A significant point of contention involves provisions related to stablecoin yields, which banks contend could permit crypto firms to offer interest-like returns without adhering to the same regulatory requirements imposed on traditional financial institutions.

Americans may have contributed as much as $34 billion to offshore prediction market trading volumes in the 12 months leading up to April 2026, according to a new study commissioned by the Coalition for Prediction Markets. This industry group includes regulated operators such as Kalshi, Crypto.com, and Coinbase.

The research, conducted by Rutgers professor Harry Crane, a member of the CFTC Innovation Advisory Committee, compared data from offshore platforms—those that do not permit U.S. users and are not regulated by the Commodity Futures Trading Commission (CFTC)—with platforms exclusively serving U.S. users or non-U.S. users.

“As a share of all U.S. prediction market activity (including regulated and offshore platforms), we estimate 12.5–31.5% of U.S. prediction market volume occurs on offshore platforms,” the study stated.

“Based on current third-party estimates of industry growth, U.S.-based activity on offshore prediction markets could grow to an estimated $133 billion in annual volume by 2030, assuming constant relative market shares of regulated and offshore markets,” the study added.

Offshore Market Activity

Harry Crane analyzed the largest offshore prediction market exchanges, which are prohibited from serving U.S. users. His findings indicate that between $11 billion and $34 billion in offshore prediction market activity originates from U.S. users, a figure described as a conservative estimate.

Polymarket’s Role

The study highlighted Polymarket, the largest offshore platform, estimating that approximately $10.6 billion to $26.7 billion of its $55.6 billion in trailing 12-month trading volume was attributable to U.S. users, despite their technical prohibition on the platform. Polymarket, which was compelled to move offshore by the CFTC in 2022, announced last fall that it had received regulatory approval to operate in the U.S. Since then, it has gradually launched its regulated Polymarket U.S. platform, though the study’s data did not separate volumes from this new entity due to reliability concerns. Data from a Dune dashboard indicates that the regulated U.S. version of Polymarket has posted approximately $5 billion in notional volumes to date.

A representative for Polymarket did not immediately respond to a request for comment.

Broader Concerns

While Polymarket was the largest offshore market examined, the study also analyzed data from other unregulated markets, including Opinion, Predict, Limitless, and Myriad. (Myriad is a product of Decrypt’s parent company, Dastan).

The Coalition for Prediction Markets, comprised of regulated operators, views this trend as a significant concern, arguing that offshore markets do not adhere to the same standards as those operating under U.S. regulations.

“Americans are using VPNs to access unregulated, offshore prediction market platforms that offer contracts on death and war,” the Coalition posted on X. “Now, we finally know how big this market is.”

The Coalition further stated, “These platforms are not subject to the same customer verification requirements, anti-money laundering controls, or market integrity oversight that protect American traders.”

Regulatory Scrutiny

The findings emerge as the CFTC faces increasing pressure and scrutiny. On Wednesday, the agency proposed new rules that would ban market outcomes dependent on war or assassination. However, states and lawmakers have been pushing back against the CFTC’s regulatory approach and the expanding scope of prediction markets under its purview.

CFTC Chairman Mike Selig has maintained a firm stance on the agency’s jurisdiction over these platforms, stating in February, “see you in court,” as states began challenging the regulator’s authority. Earlier this week, Democratic Senator Elizabeth Warren sought clarification on the regulator’s oversight capabilities, questioning its effectiveness in regulating prediction markets, particularly in light of significant workforce reductions.