In this week’s crypto news, several key developments have shaped the landscape. A Shanghai court affirmed the legal ownership of cryptocurrencies for individuals, though business-related activities remain banned. Meanwhile, the UK’s Financial Conduct Authority (FCA) reported a rise in crypto ownership, coupled with plans for tighter regulations to enhance market integrity and consumer protection. In the U.S., the SEC set a record with $8.2 billion in fines, driven largely by Terraform Labs’ $4.5 billion settlement. Additionally, Bitcoin saw a price dip below $93,000 amid increased liquidations, while the legal case against Tornado Cash developer Alexey Pertsev raises ongoing concerns around privacy protocols in the crypto space.
Read more about each of these stories below.
Shanghai court confirms cryptocurrency ownership as legal
A Shanghai court has affirmed that Chinese citizens can legally own cryptocurrencies, such as Bitcoin, classifying them as virtual commodities with property-like attributes. Judge Sun Jie of the Shanghai Songjiang People’s Court clarified this stance, noting that while personal ownership is lawful, business-related cryptocurrency activities remain prohibited. This includes investments, token offerings, and exchanges, which are considered illegal fundraising or destabilizing to the financial system.
The ruling emerged during a court case involving an initial coin offering (ICO), reinforcing China’s broader regulatory crackdown on crypto activities. Since 2021, the nation has banned ICOs, cryptocurrency exchanges, and Bitcoin mining to safeguard financial stability.
Despite the prohibition on enterprise involvement, Chinese courts have consistently recognized digital assets as property, allowing individuals to possess them. However, the regulatory environment remains complex, as shown by the removal of Yao Qian, a former People’s Bank of China official, amid allegations of corruption involving cryptocurrency.
This legal recognition highlights the delicate balance China seeks between enabling personal rights and ensuring financial stability amid evolving global cryptocurrency trends.
Read more on the South China Morning Post.
FCA reports growing crypto ownership and outlines regulatory roadmap
The UK Financial Conduct Authority (FCA) has found that cryptocurrency ownership among UK adults has risen to 12%, up from 10% in previous findings. Public awareness of crypto increased slightly from 91% to 93%, and the average value of crypto holdings grew from £1,595 to £1,842. However, many consumers remain under-informed, with only 1 in 10 conducting no research before purchasing crypto.
The FCA’s research revealed misconceptions about protections, with a third of respondents believing they could seek recourse from the FCA in case of issues. Currently, the crypto sector remains largely unregulated and high-risk, with no guarantee of financial protection.
In response, the FCA has launched its approach to regulating crypto, including a roadmap with consultations to develop the UK’s crypto framework. The goal is to create clear rules that foster innovation while maintaining market integrity and consumer trust.
Matthew Long, FCA’s director of payments and digital assets, emphasized the importance of collaboration with the Government, industry, and consumers to shape a secure, competitive, and sustainable crypto sector in the UK.
Find out more about this story on the FCA website.
SEC nets record $8.2B in enforcement, mostly from Terraform Labs
In fiscal year 2024, the U.S. Securities and Exchange Commission (SEC) set a record for penalties and fines, totaling $8.2 billion, primarily driven by a historic $4.5 billion settlement with Terraform Labs. This record amount marks a 65.5% increase from the previous year, despite a 26% drop in the number of enforcement cases, which totaled 583.
Over half of the total came from the SEC’s court win against Terraform and its founder, Do Kwon, following the 2022 collapse of their blockchain ecosystem, which caused massive financial losses. The settlement, totaling $4.47 billion, was the largest contributor, while without it, the SEC’s enforcement actions would have resulted in $3.72 billion—its lowest total since 2013.
This surge in fines reflects the SEC’s increasingly aggressive stance, especially in the crypto sector. While crypto-related cases dropped significantly to 11 in 2024, penalties related to these cases spiked by over 3,000%, largely due to Terraform’s settlement. The record year caps Gary Gensler’s tenure as SEC chair, with his resignation scheduled for January 2025.
Read more on Cointelegraph.
Court extends pre-trial detention of Tornado Cash developer, raising legal concerns
Alexey Pertsev, the developer behind Tornado Cash, a privacy-focused cryptocurrency mixing protocol, will remain in pre-trial detention following a court ruling. This decision has deepened fears among developers of privacy-preserving blockchain technologies regarding potential legal risks.
Pertsev, who has been in custody since August 2022, faces charges of money laundering for allegedly facilitating the laundering of $1.2 billion through Tornado Cash. Despite operating as a non-custodial protocol that does not control funds, Pertsev was convicted earlier this year in the Netherlands, with the court arguing that he and his co-founders should have implemented stronger security measures to prevent misuse by criminals.
The case has drawn attention amid rising scrutiny of cryptocurrency mixers. Lawmakers in the U.S. have questioned the Treasury about increased mixer usage, with Tornado Cash reportedly handling $1.8 billion in deposits in the first half of 2024, a sharp rise from 2023.
The legal battle highlights challenges for privacy-focused technologies, with experts like Matthew Niemerg of AlephZero emphasizing the need for privacy protocols to balance innovation with compliance to avoid similar risks.
Find out more on Cointelegraph.
Bitcoin drops below $93,000 as liquidations and profit-taking surge
Bitcoin’s price has fallen below $93,000, driven by a wave of liquidations and profit-taking among traders. The dip follows a strong rally that saw Bitcoin reach new highs earlier in the month, prompting many investors to cash in on gains.
Market analysts attribute the decline to increased volatility and leveraged positions being liquidated as prices retraced. The sell-off has also been fueled by a cautious sentiment, with some traders anticipating further corrections amid broader uncertainty in the cryptocurrency market.
Despite the pullback, Bitcoin remains significantly higher than its levels at the start of the year, underscoring its strong performance in 2024. Market watchers suggest the current dip may offer a buying opportunity for long-term investors, though short-term traders should prepare for continued fluctuations.
As Bitcoin’s price stabilizes around this new level, attention turns to macroeconomic factors and upcoming regulatory developments, which could influence the market’s direction in the coming weeks.
Learn more on the Economic Times.
