Federal District Court Issues Default Judgment Based on NFT Proceedings
A federal district court judge in Florida has entered a $2.2 million default judgment against a defendant who the judge had previously allowed service of process via a non-fungible token (NFT), according to a recent report. The defendant was allegedly accused of stealing $2.2 million worth of cryptocurrency in an investment scam, and this is the second such case in which the Florida judge has allowed service via NFT while the accused could not be located. A lawyer for the plaintiff in this case stated that “the important question here is whether an offender has been informed that he is being prosecuted and therefore must come to present his defense, or whether he defaults” and that an offender does not can’t hide. of justice when there is a way to warn them. In this case, the plaintiff served notice of his complaint by sending the NFT to the wallet addresses to which he traced his stolen cryptocurrency.
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Automakers Introduce Blockchain System to Monitor CO2 Emissions
According to recent press releases, two major international automobile manufacturers have introduced an artificial intelligence (AI)-based blockchain-based system called “Supplier CO2 Emissions Monitoring System” (SCEMS) to manage carbon dioxide emissions. carbon emissions from their cooperative trading partners. The companies note in press releases that through SCEMS, “it is possible to obtain reliable carbon emissions data across their suppliers’ entire business operations, including raw material sourcing, processes manufacturing and transportation of products. The system’s next-generation technology will allow regulators, stakeholders and investors to have complete confidence in the accuracy of the data. According to press releases, the integration of AI technology and high-performance blockchain will enable companies and their partners to set carbon dioxide reduction targets and accurately predict carbon dioxide emissions. of carbon in the future, thereby boosting climate change mitigation efforts.
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IRS Earnings Ruling Addresses Taxation of Cryptocurrencies Earned Through Staking Activities
The United States Internal Revenue Service (IRS) recently issued IRS Rev. Rul. 2023-14, which addresses the taxation of cryptocurrencies earned as staking rewards. Reverend Rul. 2023-14 addresses the following specific issue.
“If a taxpayer who uses a cash method of accounting (cash method taxpayer) stakes a native cryptocurrency of a proof-of-stake blockchain and receives additional units of cryptocurrency as rewards when of validation (validation rewards or rewards), must the taxpayer include the value of the rewards in the taxpayer’s gross income and, if so, in which tax year?
Among other things, Rev. Rul. 2023-14 includes an overview of the tax treatment of cryptocurrencies, describes proof-of-stake and staking consensus mechanisms, and provides an example factual model to illustrate the specific issue addressed. Reverend Rul. 2023-14 then provides for the following detention.
“If a cash taxpayer stakes a native cryptocurrency of a proof-of-stake blockchain and receives additional units of cryptocurrency as a reward upon validation, the fair market value of the validation rewards received is included in the taxpayer’s gross income during the tax year. in which the taxpayer gains dominance and control over validation rewards. Fair market value is determined as of the date and time the taxpayer acquires dominion and control over the validation awards. The same applies if a taxpayer stakes a native cryptocurrency of a proof-of-stake blockchain via a cryptocurrency exchange and the taxpayer receives additional units of cryptocurrency as a reward as a result. of validation.
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OFAC adds TRON public key to SDN list
A recent press release from the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) announced that OFAC had “designated top leaders and financial facilitators of the Islamic State of Iraq and Syria (ISIS) and ‘Al-Qaeda in the Maldives, including 20 members of ISIS, Islamic State-Khorasan (ISIS-K) and Al-Qaeda. For one of the sanctioned individuals, OFAC included a cryptocurrency public key associated with the TRON blockchain in the Special National Designated List (SDN) entry for the individual. Blockchain analytics firm Chainalysis has published a blog post analyzing cryptocurrency transaction activity tied to the public key.
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SEC Accuses Token Issuer of Fraud and Unregistered Securities Offering
A recent press release from the U.S. Securities and Exchange Commission (SEC) announced charges against an individual and three unincorporated entities he controls – Hex, PulseChain and PulseX – for “conducting unlicensed offerings.” registered crypto asset securities that have raised over $1 billion in crypto. investor assets. According to the press release, the SEC also charged the individual and PulseChain with “fraud for diverting at least $12 million of the offering proceeds to purchase luxury products, including sports cars, watches and a 555 carat black diamond known as “The Enigma”. » The press release further notes that marketing of Hex and Hex tokens began in 2018 with claims to “make people ‘rich'” and that between “July 2021 and March 2022, (the individual) orchestrated two additional unregistered crypto assets. security offerings” of PLS and PLSX tokens that “have each raised hundreds of millions of dollars in additional crypto assets.”
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Vulnerability in Ethereum Programming Language Exploited in DeFi Hack
On July 30, hackers exploited a vulnerability in Vyper, a popular smart contract-oriented Ethereum virtual machine (EVM) language, to attack multiple decentralized finance (DeFi) protocols, resulting in millions of dollars in losses. Curve Finance, whose multi-asset stablecoin pools would play a major role in Ethereum’s DeFi stack as a source of liquidity, was among the hardest hit, with initial losses estimated at more than $47 million. The attack also hit DeFi exchanges Ellipses, Alchemix, and Metronome, with initial loss estimates ranging from $1.6 million to around $15 million.
Vyper, the second most popular EVM language behind Solidity, relies on a feature known as reentry guard, which locks contracts to prevent multiple functions from running concurrently. According to reports, some versions of Vyper were not properly executing reentry guard, allowing attackers to repeatedly call smart contracts before the initial execution was completed. This exploit, called a reentry attack, can cause an attacker to drain a pool of all its funds. According to reports, the re-entry bug in Vyper has now been fixed.
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