Money Laundering

Feb 25 2021

Philippines based Moneybees, an OTC Cryptocurrency Service, Launches New Outlets to Support Local Bitcoin, Ethereum Transactions

Moneybees, which claims to be the very first over-the-counter (OTC) cryptocurrency service in the Philippines, has announced that it’s launching three new outlets this month.

The outlets are being opened to accommodate the growing demand for OTC transactions among Filipino cryptocurrency traders and investors, according to a release shared with Crowdfund Insider.

The update revealed that the large volume of crypto transactions has come at a time when the Bitcoin (BTC) and larger digital asset market continues to set all-time highs.

Bitcoin (BTC) is trading at around $50,000 at the time of writing, after briefly surging as high as $58,000. Meanwhile, Ethereum (ETH), the second-largest cryptocurrency by market cap and in terms of adoption, is currently trading at just over $1,600 after briefly crossing the $2,000 mark.

The present crypto market bull run has seen hundreds of billions of dollars in capital entering the market within weeks. The BTC market cap had managed to exceed $1 trillion but has now retraced to around $936 billion (at time of writing). Ethereum market cap presently stands at around $186 billion (and had surpassed $200 billion recently).

BSP Governor Benjamin Diokno had noted late last year that the institution had recorded 59 billion worth of digital currency transactions during H1 2020 (in the Philippines).

Moneybees is focused on banking the crypto industry by teaming with money changers such as Tivoli Money Exchange, an institutional money changer service that was founded in 1983.

Moneybees is now able to serve more clients who need to purchase and sell cryptocurrencies via Tivoli’s Trinoma, Glorietta, and Okada branches.

As mentioned in the update:

“This partnership with Tivoli brings a total of 7 outlets for Moneybees where their customers can cash out their trading gains from exchanges that don’t have peso cashouts like Binance, Bittrex, Bitstamp, etc. Users can transact as high as P5,000,000 in one day.”

Paulo Del Puerto, CEO of Moneybees, noted that “the partnership with Tivoli is a great step for us to fulfill our mission of making crypto more accessible in the Philippines by providing a familiar and secure way of buying and selling crypto via OTC.”

Launched in 2017, Moneybees is now an established cryptocurrency over-the-counter service in the Philippines. The company aims to make the exchange between fiat currencies and cryptocurrencies a lot more accessible. It offers the technology to local money changer businesses with physical outlets so they are able to carry out digital currency transactions at their shops, without having to deal with the risk of excessive market volatility.

Moneybees reportedly supports nearly all crypto users who are using Binance, Bitmex and other exchange services.

Paulo Del Puerto added:

“With the rising demand for cryptocurrency trading and investment, we aim to facilitate 2 Billion pesos worth of transaction volume in 2021. To serve more customers, we’re also looking at opening more outlets in malls around the Philippines and partner with major market players in the remittance and money exchange industry. We target to open 100 outlets by the end of the year.”

Moneybees is “duly registered” with the Banko Sentral ng Pilipinas and with the Anti Money Laundering Council (AMLC) as “a Remittance Agent with Virtual Currency Exchange (VCE) service.”

Moneybees confirmed that it only works with government-licensed or approved remittance centers and money changers in order to facilitate financial transactions. The company plans to further expand its services nationwide by working with even more outlets in major cities in the country.

(Note: to view the list of locations of Moneybees outlets, you can check here.)

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Feb 08 2021

Malaysia’s Kenanga Buys Stake in Crypto Exchange Tokenize

Malaysia’s largest independent financial services company, Kenanga Investment Bank Berhad, wants to add cryptocurrencies to its investment portfolio. To do this, the firm is going through the acquisition route.

Purchasing Stock in Licensed DAX

In a Feb 8 media release, Kenanga confirmed that it has reached agreements with Tokenize Technology to purchase a 19% equity share in its exchange arm, Tokenize Exchange. The funding round was completed through Kenanga’s private equity firm, Kenanga Private Equity Sdn Bhd.

Tokenize Xchange is one of the three licensed Digital Assets Exchanges (DAX) by the Securities Commission (SC) Malaysia. Tokenize Xchange is the second-largest DAX in Malaysia by traded market share. It is an online exchange that lets customers trade on popular digital assets like Bitcoin (BTC) and Ethereum (ETH) predominantly.

Speaking on the auspicious occasion, Datuk Chai Wai Leong, group managing director of Kenanga Investment Bank said:

“Our curiosity in digital property goes past Bitcoin and different generally traded cryptocurrencies. We consider that the know-how behind digital property may be very highly effective and the emergence of digital property sooner or later is inevitable.”

His counterpart Hong Qi Yu and CEO of Tokenize Malaysia also spoke concerning the merger, praising the experience of Kenanga and how it could help them grow their operations in Malaysia.

Before the recent dabble in cryptocurrencies with Tokenize Technology, Kenanga Investment Bank went into partnership with Japan’s e-commerce company Rakuten in 2017. The joint-venture birthed Rakuten Trade, which is an online stock trading platform operating in Malaysia. It also went into a partnership with Merchantrade Asia which saw it launch Kenanga Money; Malaysia’s first stockbroker e-wallet.

No further details were released concerning the partnership.

SC Malaysia Toughens Regulatory Framework

Following the recent boom in crypto-focused businesses, a lot of financial institutions are paying closer attention to the crypto space. With its increased popularity, it has drawn the focus of governments and their respective financial regulatory agencies to the nascent market which is what the Securities Commission of Malaysia set out to do with a revisit of its crypto framework.

The SC Malaysia released revised guidelines on digital asset custodians and initial exchange offerings (IEOs) in October 2020 saying the amended framework is looking to encourage “responsible innovation in the digital asset space.” The new framework aims to address the issues of money laundering and terrorist financing of which crypto assets have been associated with recently by world governments.

Malaysia’s Kenanga Buys Stake in Crypto Exchange Tokenize

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Feb 05 2021

Estonia Introduces Stricter Licensing Laws for Crypto Companies

Estonia used to be known as one of the most crypto-friendly nations in the world, embracing the assets in their early stages. However, a series of unfortunate events appears to have soured the government’s relationship with the industry.

Switching Regulators

This week, local news source ERR News reported that the Estonian Ministry of Finance is looking to implement more stringent crypto licensing regulations. The news source explained that the Finance Ministry had issued draft legislation to tighten rules on the crypto industry back in January.

As part of the new rules, the Finantsinspektsioon — Estonia’s Financial Supervisory Authority – will take the country’s crypto industry’s reins and oversee all companies in the space. The agency will be taking over the responsibility from the Financial Intelligence Unit, the hitherto regulator.

Henceforth, all crypto firms looking to operate in the Eastern European country will need to pay licensing fees to the Finantsinspektsioon. The country already has 381 licensed companies, all of whom will need to reply for the new regulator’s permits.

Erki Peegel, a spokesperson for the finance ministry, explained to ERR News that the government policy does not have anti-crypto undertones. However, given that regulatory rule changes have recently been passed, there is a significant chance that several existing companies will be forced to close their doors soon.

A Messy Divorce

The Estonian government has already been on a trend of implementing some harmful regulatory policies. Following a $220 billion money-laundering scandal in the country, the government revoked 500 crypto companies’ licenses last June.

At the time, Bloomberg reported that the government had cause to believe that licensed crypto firms had assisted the Estonian unit of Danske Bank A/S – Denmark’s largest lender – to facilitate its money-laundering operation.

Madis Reimand, Head of the FIU, explained that regulators were incredibly skeptical about the crypto space. As such, 500 companies – about a third of the country’s total crypto firm count – that had failed to start operating in the country within six months of getting their licenses would be banished.

“This is a first step in tidying up the market, allowing us to take care of the most urgent issues by permitting operations only for companies that can be subjected to Estonian supervision and coercive measures.”

Reinard had indicated that stricter regulations would come in Estonia’s crypto space. The government kept its word, revoking the licenses of another 1,000 firms in the country in December. Per a report from news source Postimees, the FIU conducted the purge in response to the “significant risks” that it had seen in the industry.

Veiko Tali, the Deputy Secretary-General of the Government Committee for the Prevention of Money Laundering and Terrorist Financing, explained that the government was committing to monitoring new technologies in the country and managing money laundering risks. By engaging in the mass license revocation, it was essentially tidying up its crypto market.

Estonia Introduces Stricter Licensing Laws for Crypto Companies

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Jan 21 2021

Ignoring Bitcoin, Hedera Hashgraph, Reef and Perpetual Protocol rally higher

Bitcoin (BTC) price tumbled more than 10% today to hit a low near $31,000 and at the time of writing it looks like the sell-off has a bit further to go. In a weekly report from crypto fund provider, CoinShares, some institutional investors seem to be booking profits and the analysts also cited the strengthening (trade-weighted) U.S. dollar.

Another indicator that points to professionals selling Bitcoin is the drop in “Coinbase Premium.” As markets continue lower, an increasing number of investors may dump their positions with the intent to buy again at lower levels.

*Crypto market data daily view. Source:* *Coin360*

Guggenheim Partners chief investment officer Scott Minerd has turned bearish on Bitcoin for the year. In an interview with CNBC, Minerd said that Bitcoin may have topped out and could “see a full retracement back toward the 20,000 level.”

If Bitcoin plunges, altcoins are also likely to witness selling pressure. Although this may be the case, during sell-offs, tokens backed by strong fundamentals may outperform.

Let’s have a look at three tokens which have held steady during the current market correction.

HBAR/USD

Hedera Hashgraph (HBAR), the enterprise-grade distributed ledger, has been entering into various partnerships to leverage blockchain technology in real-world use cases in several sectors. If these initial projects are successful, it will open a plethora of future possibilities around the globe. Some of the recent collaborations are highlighted below.

Hedera and content services provider Hyland recently presented a proof of concept to the Texas Secretary of State to secure and verify government-issued records using electronic Apostilles, which will be recognized universally.

Fighting against money laundering and combating terrorism financing are critical regulatory requirements for every financial institution and these obligations are closely monitored by governments. TRM Labs has integrated with the Hedera public ledger to provide robust compliance and risk management solutions to the developers building on Hedera.

The team also has partnered with Everyware to monitor the cold storage equipment used to store COVID-19 and other vaccines at Stratford Upon Avon and Warwick hospitals.

Along similar lines, AVC Global and its Subsidiary MVC’s Track-and-Trace Platform have chosen to collaborate with Hedera to develop intelligent supply chains to reduce risk and fraud and enable the right product to reach the right place at the right time.

Hedera’s strength can be found in its diversified enterprises and the organizations that are part of the Hedera Governing Council. As the number of use cases for the protocol increase, it’s possible that HBAR will also continue to perform well.

HBAR has risen from an intraday low of $0.04151 on Jan. 12 to an intraday high at $0.12467 today, a 200% rally within a short span. The sharp rally on Jan. 20 cleared the overhead hurdle at $0.083.

*HBAR/USDT daily chart. Source:* *TradingView*

However, the sharp rally of the past few days has pushed the relative strength index (RSI) deep into the overbought territory, which may have attracted profit booking from traders. This has resulted in the formation of a Doji candlestick pattern today, suggesting indecision among the bulls and the bears about the next directional move.

The HBAR/USD pair could retest the recent breakout level at $0.083. If the price rebounds off this support, the bulls will again try to resume the uptrend. A breakout and close above $0.12467 could resume the uptrend, with the next target objective at $0.16616.

This bullish view will invalidate if the bears sink the price below the $0.083 support. Such a move could drag the pair to the 20-day exponential moving average ($0.06) as a deep fall tends to delay the resumption of the uptrend.

REEF/USD

The growing popularity of the DeFi space shows no signs of slowing down. Several new platforms promising innovative products pop up every other day and this makes it increasingly difficult to keep track of all new developments.

Reef’s (REEF) AI and Machine Learning powered algorithms attempt to address this problem by aggregating liquidity from various sources in order to offer users the most profitable option.

To achieve this objective, Reef has entered several partnerships in the past few weeks. The platform added support to Avalanche, enabling Reef’s clients to directly access the products available on Avalanche without leaving Reef’s platform.

Similarly, a partnership with bZx Protocol offers clients several trading and lending opportunities. The addition of a bZx farming pool to Reef’s AI and Machine Learning powered analytics engine will further widen the options available to Reef’s clients.

Reef’s collaboration with OpenDeFi allows users to invest in synthetic versions of real-world assets that are held by a custodian. Traders can invest in physical assets such as gold, silver, or even real estate and they can stake them to receive loans.

Reef finance was recently listed on Binance Launchpool, increasing its accessibility and a recent code audit by Halborn is likely to increase investors’ confidence in the project.

REEF rallied from an intraday low at $0.006516 on Jan. 13 to an intraday high at $0.023 today, a 252% rally within a short period. Due to the short trading history, a 4-hour chart has been used for the analysis.

*REEF/USDT 4-hour chart. Source:* *TradingView*

The REEF/USD pair is currently trading inside an ascending channel, with both moving averages sloping up and the RSI in the positive territory. This suggests that the bulls have the upper hand.

If the pair rebounds off the 20-EMA, the uptrend could resume its up-move inside the channel. A breakout and close above the channel will suggest a pick up in momentum. The critical level to watch on the upside is $0.031 and then $0.042.

Contrary to this assumption, if the bears sink the price below the support line of the channel, the pair could drop to the 50-simple moving average. A break below this support could signal that bears have taken control.

PERP/USD

Perpetual Protocol (PERP) is a relatively new entrant in the DeFi space, listing on the Ethereum mainnet on Dec 14. The recent crypto bull run could have accelerated its adoption as traders have been using perpetual contracts to profit from the speeding market.

Even though the platform supports only three trading pairs, Perpetual said their 7-day volume puts them in the top 10 on the DEX Metrics highlighted by Dune analytics.

After its initial success, Perpetual plans to add a fourth trading pair and then follow it up with more additions in due course. The staking pool may launch in February, which will allow PERP token holders to stake and earn rewards on fees generated by trading on the platform. The team is currently working to integrate limit orders sell options to the platform and the feature is expected to go live before the end of Q1.

PERP rallied from $1.844 on Jan. 12 to an intraday high at $6.055 on Jan. 17, a 228% rally within a week. After a three-day correction, the bulls are currently attempting to resume the uptrend.

*PERP/USD daily chart. Source:* *Beta.Dex Vision*

The shallow correction of the past three days suggests that the bulls are not closing their positions in a hurry. If the buyers can push the price above $6.055, the next leg of the up-move could begin. The next target objective on the upside is $9.41.

On the contrary, if the price turns down from $6.055, the PERP/USD pair may correct to $4.275 and remain range-bound between these two levels for a few days.

A break below $4.275 may intensify selling with the next support at the 50% Fibonacci retracement level. A breakdown and close below the 20-day EMA ($3.19) will signal a possible trend change.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk, you should conduct your own research when making a decision.

Ignoring Bitcoin, Hedera Hashgraph, Reef and Perpetual Protocol rally higher

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Jan 03 2021

IRS to transition from ‘education to enforcement’, says former division chief

A former top investigator is warning that “a high-stakes game of chicken” between the Internal Revenue Service (IRS) and cryptocurrency holders who fail to properly report their earnings will be entering a new phase in 2021 as the tax collection agency begins to focus on pursuing “civil and, potentially, criminal penalties.”

In an article co-authored by Don Fort today, the former chief of the Internal Revenue Service’s (IRS) criminal investigation division said that while the agency until now has focused its resources on informing the public of proper reporting guidelines, it will now be turning to more stringent “enforcement.”

“The IRS has been not-so-quietly positioning itself for a smooth transition from education to enforcement in 2021 and beyond.”

The article notes that the trail starts with Coinbase, who answered a “John Doe” summons in 2018 and handed over account information on nearly 13,000 users — information which could soon lead to crackdowns. For instance, the article mentions the request the IRS made to Luxembourg-based exchange Bitstamp for information on one American user.

The focus on crypto holders is in part due to a widening “tax gap” — the rift between the total income from taxes that should be paid to the Treasury verses what it actually receives — a disconnect in which Fort and his co-author Lawrence Sannicandro believe crypto holders could be playing a major part.

“As of Dec. 10, with Bitcoin fresh off new record highs, the market capitalization of cryptocurrencies was $524 billion,” the article reads. “Assuming cryptocurrency-related tax liabilities of $25 billion and a 50% compliance rate, unreported cryptocurrency tax liabilities again account for around 3.2% of the $381 billion tax gap. Thus, it is likely that unreported taxable cryptocurrency transactions are contributing significantly to the tax gap.”

Ultimately, the article concludes that major trends — such as the addition of a question about cryptocurrency now prominently placed at the top of form 1040 — indicate that the IRS is gearing up for widespread efforts to root out underpayment.

“Even though the IRS has not yet announced many mainstream tax evasion or money laundering cases involving virtual currency, that trend should change in 2021.”

Moreover, crypto holders shouldn’t try to get cute when the tax man comes calling.

“History has shown that underestimating the government is a fool’s game.”

IRS to transition from ‘education to enforcement’, says former division chief

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