This Week In Crypto News | 12th May 2023

by | May 12, 2023 | News | 0 comments

Hey guys, here are the headlines of crypto news for this week:

Keep reading for more details or simply click on the headline that picks your interest.


Crypto exchange Bittrex files for bankruptcy after SEC complaint

Bittrex Inc, a prominent cryptocurrency exchange, recently filed for bankruptcy protection following allegations from the U.S. Securities and Exchange Commission (SEC) regarding its operation as an unregistered securities exchange.

The Seattle-based exchange halted its operations within the United States on April 30.

Also, it emphasised that the bankruptcy filing would not impact Bittrex Global, which caters to customers outside the country.

Bittrex Global operates primarily from Liechtenstein.

In its bankruptcy petition submitted to the Wilmington court in Delaware, Bittrex disclosed assets and liabilities within the range of $500 million to $1 billion.

Notably, the exchange confirmed the retention of cryptocurrency assets belonging to U.S. customers who had not withdrawn their funds prior to the specified date.

Bittrex assured the public that these assets remain secure.

It has plans to seek a limited re-opening of customer accounts through the bankruptcy court, allowing for the distribution of crypto holdings back to the customers.

Earlier, the SEC filed a lawsuit against the exchange, alleging that its former CEO, William Shihara, encouraged crypto asset issuers to remove public statements that could trigger regulatory investigations regarding the classification of their token offerings as securities.

Bittrex has steadfastly refuted the SEC’s allegations, firmly stating that the crypto assets traded on its platform do not fall under the category of securities or investment contracts.

Despite the ongoing lawsuit, Bittrex had previously agreed to pay fines amounting to $29 million to the U.S. Treasury Department for apparent violations of sanctions on specific countries and anti-money laundering regulations.

In terms of creditors, the Office of Foreign Asset Control under the Treasury Department emerged as Bittrex’s largest unsecured creditor, with an outstanding debt of over $24 million.

The exchange’s remaining major creditors primarily consist of its customers.

Nigerian national blockchain policy gets government approval

Nigeria’s Federal Ministry of Communications and Digital Economy (FMCDE) endorsed the policy in response to a report from PricewaterhouseCoopers (PwC).

This report estimated that widespread blockchain adoption could contribute $1.76 trillion to the global GDP by 2030.

The policy was developed through consultations with public and private stakeholders.

It aims to create a blockchain-based economy that facilitates secure transactions among individuals, businesses, and the government.

Also, the National Information Technology Development Agency (NITDA) will coordinate the policy initiatives under the supervision of the FMCDE.

Additionally, a multisectoral steering committee has been established to oversee its implementation.

Regulatory bodies such as NITDA, the CBN, and the SEC have been instructed to create regulatory frameworks for blockchain technology in various sectors.

The strategy for blockchain adoption includes initiatives such as

  • establishing a blockchain consortium,
  • strengthening regulatory frameworks,
  • promoting digital identity, creating business incentive programs,
  • fostering digital literacy and awareness, and
  • establishing a national blockchain sandbox for testing and piloting.

However, it’s important to note that despite the new policy, cryptocurrency transactions remain illegal in Nigeria.

Ukraine Now Tracking Russia’s Crypto Moves Thanks to IRS Training

In light of the Russian invasion of Ukraine, the United States, along with its private sector collaborators, is extending support to Ukrainian authorities in their efforts to counter the use of cryptocurrencies by Russian entities to evade sanctions.

This is a matter that European authorities have already been tackling.

To address this pressing issue, the Internal Revenue Service’s Criminal Investigations (IRS-CI) unit, along with blockchain analytics firm Chainalysis, has initiated an advanced in-person training program on blockchain analysis.

The training will take place in Frankfurt, Germany.

Ukrainian law enforcement agencies will be equipped with the necessary skills and expertise to effectively analyze blockchain data, trace cryptocurrency transactions, and develop operational leads.

IRS-CI Chief Jim Lee and Michael Gronager, the co-founder and CEO of Chainalysis emphasized the significance of partnerships between private and public entities in dealing with complex financial transactions.

Overall, this training program solidifies the role played by blockchain analytics in combating illicit activities within the cryptocurrency space.

Also, it underscores the importance of partnerships and knowledge sharing to effectively navigate the complexities of the financial landscape and ensure the integrity of the global financial system.

Coinbase Says it ‘Screwed Up’ in Describing Pepe Meme’s Alt-Right Connections

Coinbase issued an apology to the PepeCoin (PEPE) community after a contentious 24-hour period filled with backlash from the meme coin’s fan base.

The controversy arose when Coinbase described the original Pepe the Frog meme, which serves as the inspiration for the popular coin, as being “co-opted as a hate symbol by alt-right groups” in a newsletter.

Coinbase’s Chief Legal Officer, Paul Grewal, took to Twitter on Thursday to express remorse and offer an apology.

He acknowledged that their previous overview of the PEPE meme coin didn’t provide the complete historical context of the meme. Grewal apologized to the community for the oversight.

This response from Coinbase’s leadership came after the hashtag “#DeleteCoinbase” trended on Twitter.

Influential figures in the crypto industry condemned the newsletter’s characterization of Pepe the Frog’s association with the alt-right as deceptive and manipulative.

Despite its controversial history, Pepe has experienced a significant resurgence within the cryptocurrency community. Thanks to the creation of a viral meme coin.

The apology from Coinbase highlights the challenges faced by exchanges in navigating the complex cultural contexts surrounding memes.

Also, it reveals the importance of understanding the implications of such symbols when discussing them within the cryptocurrency space.

Ordinals Rise Divides Bitcoin Developers, But Miners Are Cashing In

Despite the recent surge in Bitcoin fees and concerns raised by developers regarding Ordinals, there is one segment of the community that is thriving: miners.

According to data from Glassnode, daily revenue for Bitcoin miners by market cap has reached an impressive $40 million.

This surge in revenue can be attributed to the growing demand for Ordinals, which is causing congestion on the Bitcoin network.

Similar to transaction processing, miners need to validate Ordinals assets.

As the network becomes busier, users need to pay higher fees to ensure their transactions are prioritized and validated by miners.

In essence, miners are earning more because there is an increased workload.

CleanSpark, a Las Vegas-based company, reported a 61% surge in mining output on Monday alone compared to the average day prior to the recent spike in transaction fees.

Interestingly, there was a point when miners were earning more from processing transactions on the blockchain than from mining new Bitcoin, a rarity in the industry.

Meanwhile, the Ordinals trend has raised concerns about network congestion and the impact on Bitcoin’s usability for everyday transactions.

However, Scott Norris, co-founder of LSJ Ops, believes that the hype around Ordinals will eventually subside.

He predicts that “Ordinal traffic will run out of money to burn, so it will regulate itself.”

Norris also highlights that, despite any backlog, Bitcoin still outperforms traditional banks when it comes to transaction settlement speed.

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