South Korean regulator the Financial Services Commission (FSC) said it would inspect three domestic banks servicing cryptocurrency exchanges to check compliance April 9.

A statement confirms the banks will undergo inspections April 19 - 25, with regulators looking to ensure they are conforming to new anti-anonymity regulations introduced at the end of January this year.
Cointelegraph previously reported on the steps taken by Seoul to remove anonymity and multiple trading accounts on domestic cryptocurrency exchanges.
As part of the legislation, Koreans using exchanges to trade may only hold one account, the identity details of which must match their bank account.
The requirements put new pressure on both exchanges and banks to ensure trading remained legal, with smaller institutions reportedly struggling to get to grips with the FSC’s demands.
Now, Nonghyup Bank, Kookmin Bank and Hana Bank will face individual scrutiny, Nonghyup in particular standing out as the service partner of Coinone and Bithumb, two of Korea’s biggest exchanges.
Investigators will check adherence to various rules, including anti-money laundering as well as the providence of customer data.
Meanwhile, preparations continue on filling in the remaining legal gaps in the local cryptocurrency economy, with tax legislation due to be released by June.

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A new class action lawsuit has been filed in the United States District Court Eastern District of New York on behalf of investors in Nano (XRB, formerly Raiblocks), according to a class action complaint signed April 5.

The lawsuit is being filed by an American individual, Alex Brola, through Silver Miller law firm, and alleges that Nano’s core team both violated US securities laws by selling unregistered securities as well as negligently misrepresented the reliability of crypto exchange BitGrail, from which around 17 mln Nano ($187 mln at the time) were stolen in mid-February.
The lawsuit asks that Nano be ordered by court to “rescue fork” the investors’ missing NANO “into a new cryptocurrency in a manner that would fairly compensate the class of victims.”
In the aftermath of BitGrail’s Feb. 9 announcement on their website that the 17 mln Nano had been hacked from the exchange, Nano developers and BitGrail’s owner and operator Francesco “The Bomber” Firano reportedly entered into a conflict over whether or not Firano had asked for the ledger to be edited to “cover his losses.”
Nano then accused Firano of “misleading the Nano Core Team and the community” on their official blog.
Although Nano investor Alex Brola is the named plaintiff in the lawsuit, having reportedly bought $50,000 worth of Nano on Dec. 10, 2017, the complaint claims there are “at least hundreds if not thousands of putative Class members” that Silver Miller plans to contact during the discovery period.
Silver Miller writes in the class action notice that they are a “strong advocate for aggrieved investors harmed by the misrepresentations and illegal actions of cryptocurrency exchanges and issuers.” The law firm is currently working on class actions against crypto exchanges and services Coinbase, Kraken, BitConnect, Cryptsy, and Initial Coin Offering (ICO) promoters Monkey Capital, Giga Watt, and Tezos.
Tezos has been the subject of multiple lawsuits over the question of its compliance with SEC regulations. The Tezos class action lawsuit filed last fall by Silver Miller alleges that Tezos violated securities laws during their ICO,  which raised $232 mln, making it the world’s second largest ICO to date in terms of most funds raised.

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News is emerging of the seizure of €400 mln from an account that is reportedly affiliated with crypto exchange Bitfinex at the Cooperative Bank in Skierniewice, Poland. The investigation is allegedly tied to Colombian drug cartel operations, a local news outlet reported April 6. The report has not yet been officially confirmed or denied by Bitfinex.

The confiscated funds are said to correspond to the defrauding of €400,000 from The Belgian Ministry of Foreign Affairs during the construction of its embassy in the Democratic Republic of Congo.
Prosecutors are said to be investigating accounts linked to two companies. One is registered in the vicinity of Pruszków, and is said to be headed by someone of Canadian-Panamanian descent. The second company is allegedly presided over by a man with Colombian and Panamanian citizenships. Both companies are said to have over 1.27 bln PLN ($371 mln) deposited on their accounts.
It is this second account that is reported to be tied to Bitfinex. In late 2017, documents posted online appeared to show Bitfinex directing its customers to an account at the Cooperative Bank in Skierniewice, as Bloomberg reported.
On Polish forum Bitcoin.pl, one Bitfinex user has claimed he was interrogated by Polish police last week: “I testified as a witness regarding the case of Crypto sp z o.o because they sent me money from Bitfinex and their accounts were blocked.”
Today’s reports in Polish media raised the suspicion that there is a connection between Panama registered Crypto sp z o.o (and parent company Crypto Capital Corp.) and narcotics trafficking networks, suggesting that the criminals converted fiat into crypto to cover their tracks.
No charges have been filed yet, with Polish prosecutors awaiting Europol and Interpol cooperation.
There has been much controversy surrounding Bitfinex and sister company Tether, both receiving subpoenas from U.S. regulators in December for undisclosed reasons. In 2017, Wells Fargo & Co. allegedly refused to continue operating as a correspondent bank for Bitfinex and sister company Tether. Bitfinex then filed a lawsuit that was quickly dropped.
Blogger Bitfinex’ed repeatedly posted his concerns about the obscurity surrounding the exchange’s bank accounts, resulting in Bitfinex threatening to pursue legal action against him.
Speculation has also arisen that Tether has been operating a fractional reserve and is covering over its reserve deficit in complicity with Bitfinex. Suspicions mounted further when Tether allegedly dissolved its relationship with a third-party auditor.
As of press time, Bitfinex has not responded to Cointelegraph’s request for comment.

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Robert Hughes, Senior Vice President of Finance and Risk Management at Overstock is resigning from his position to join a Blockchain venture that also involves Overstock’s CEO and founder Patrick Byrne, The Wall Street Journal reported April 6.

According to a press release published on Market Exclusive, Hughes notified Overstock that he is leaving the company on April 2 and that he will take the post of chief financial officer (CFO) at the Overstock’s indirect 50% owned subsidiary DeSoto, starting April 16.
DeSoto was first announced by Overstock’s CEO Byrne in December 2017. The project aims to create a global property register based on Blockchain technology in order to protect the property owners’ rights. DeSoto is a joint venture between Overstock’s subsidiary Medici Ventures, responsible for the company’s Blockchain investments, and Peruvian economist Hernando de Soto.
Gregory J. Iverson, previously CFO at Apollo Education Group, is set to join Overstock.com as its new finance chief from April 16. Iverson, 42 years old, worked at Apollo from April 2007 till March of this year.
The CFO replacement at Overstock is taking place after the company has announced to cancel its secondary share offering of four million shares, citing “market volatility.” The company has started looking for ways to prevent further decline of its share prices after they started dropping in March following the release of the company’s “surprisingly weak” fourth quarter earnings report.

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The Texas State Securities Board has sent an Emergency 9Cease and Desist letter on April 5 to Mark J. Moncher, the Millionaire Mentor University, and several other connected players to stop selling unlicensed securities and defrauding investors in an allegedly fraudulent complex cryptocurrency trading and medical marijuana investment scheme.

Two of the other respondents named in the letter, Estrada Trucking and Capital Cash, as well as Moncher, are accused of offering promissory notes that are considered unlicensed securities for a California-licensed, unnamed marijuana growing operation. Moncher and the Millionaire Mentor University, or the Freedom Financial Club, have also been accused of purposefully suggesting that Texas residents defraud credit card companies.
Investments in the cryptocurrency trading program associated with Moncher apparently offered an 8 percent weekly returns on investments, with an investment minimum of $2000 and sign up fee of $150 that both had to be paid by either credit or debit card.
The crypto trading program would provide investors with an invoice stating that they bought a “gold Seiko watch which [they] will never get,” as “protection in the event somebody runs away.” In the case of a bad investments, investors were suggested to report to their credit or debit card company that the watch never arrived and receive their money back.
The cease and desist order notes that the respondents involved the crypto trading program purposely attempted to hide the cryptocurrency aspect of the investment, citing them as saying, “We really don’t want to portray this as an investment in crypto because then you’re opening yourself up to a can of worms.”
The respondents also failed to disclose that Moncher is a convicted felon who served 57 months for conspiracy to commit mail and wire fraud, as well as not disclosing the risks associated with cryptocurrency investments, like market volatility and potential for hacking.
Texas has had a run of cease and desist letters to crypto-related businesses since the beginning of this year, with alleged Ponzi scheme Bitconnect ordered to stop selling “unlicensed securities” in Texas in early January and asking an allegedly “scam” related cryptocurrency bank to leave the state. More recently in mid-February, Texas regulators sent a cease and desist letter to Leadinvest.com, citing the selling of unlicensed securities and overall “[threatening] immediate and irreparable harm.”
Moncher’s Millionaire Mentor University website is still active by press time.

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Open source software publisher Block.one pre-released its scalability-focused Blockchain platform EOSIO Dawn 3.0 on Github yesterday, April 6, according to an EOSIO Medium post.

Dawn 2.0 had been released in December of last year, and the most current pre-release of Dawn 3.0 this April 6 is noted as a “major milestone on the road to EOSIO 1.0,” which reportedly will be released in June.
Earlier this month, Block.one and German fintech incubator FinLab AG announced a partnership for developing EOS software with $100 mln of funding.
EOSIO’s Medium post writes that that “we think we have achieved” the goal for inter-Blockchain communication, which they describe as the “the ultimate scalability feature — the holy grail — that the industry has been searching for,” to be “as secure as intra-chain communication between smart contracts.”
Dawn 3.0 contains many new features that “were not even contemplated in the original EOSIO White Paper,” most notably the capability to “accelerate throughput without hard forking changes” through parallel computation, the “ability to implement a light client as a smart contract,” the implementation of context free actions whose validation computation can be “pruned from replay,” and the addition of a new resource rate liming system.
The Medium post continues by reporting one of Dawn 3.0’s “most significant features,” which is a user-configurable delay for various actions that will allow a user to know they have been hacked before a hacker’s transaction goes through, because the delay broadcasts the transaction to the Blockchain for whatever amount of time chosen before it can be applied.
EOSIO can be used without tokens in private and permissioned Blockchains, has a .5 second block interval, and uses a “hello world” contract development that contains only “a few simple lines of code.”
The Medium post ends with encouragement to EOSIO public network to “operate as many chains as necessary to meet user demand,” in order to create the “maximum possible network effect around a single token and leverage the trust and security of economic incentives created by high-market capitalization tokens.”
Other Blockchain scalability projects in the crypto ecosystem include PHANTOM, a scalable BlockDAG - an alternative structure to Blockchain protocol - which was introduced in an academic paper in early February.

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A bill allowing corporations to hold and share data on a distributed ledger was officially signed into Arizona state law by Governor Doug Ducey, according to a legislation tracker April 3. 

The Arizona House of Representatives passed HB 2603 with 56 in favor, 3 against, and 1 abstention. The Arizona Senate proceeded to pass the bill unanimously.
The bill was first introduced as an amendment to the Arizona Revised Statutes by Rep. Jeff Weninger in February, one of three bills aiming “to open the door for emerging technologies in Arizona.”
HB 2602 and HB 2601 are both awaiting a third reading in the Arizona Senate. The former would prohibit towns from restricting cryptocurrency mining in residences, while the latter aims to address securities and crowdfunding, recognize a “virtual coin” as “a digital representation of value”, and authorize its function as a medium of exchange in digital trading.
Weninger’s measures emerge amid a backdrop of robust regulatory moves by the state to recognize and delimit applications of Blockchain technology. As Cointelegraph reported in March, the Arizona Senate passed SB 1091, which would allow state residents to pay their taxes in Bitcoin.
In April last year, HB 2417 legalized Blockchain signatures and recognized the enforceability of smart contracts. Arizona’s Revised Statutes now stipulate that data “written” and stored on Blockchain technology is “immutable and auditable and provides an uncensored truth.”
Across the US, state governments are passing liberal legislation on cryptocurrencies and Blockchain technology. New Hampshire exempted crypto traders from money transmission regulations in March 2017, while this year Wyoming exempted virtual currencies from state property taxation, as well freeing certain Blockchain tokens from securities regulations.

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A panel discussion dedicated to Bitcoin (BTC) scaling between Bitcoin.com CEO Roger Ver and Blockstream Chief Strategy Officer Samson Mow turned into a battle of visions at the Distributed Economy’s (Deconomy 2018) first annual Blockchain forum in Seoul, South Korea, April 3rd.

The two-day event, which took place from April 3rd to 4th, brought together Blockchain enthusiasts, entrepreneurs, and leaders in the field aiming to cover the hottest topics in the industry.
The issue of Bitcoin scalability has always been a persistent and painful problem of the first cryptocurrency due to the constant increase in the number of transactions on the chain and the inability to validate them fast enough.
Giving the floor to Ver to express his opinion about Bitcoin scaling, the attendees witnessed his ardent conviction that the scaling of Bitcoin is a ‘natural’ part of the cryptocurrency’s Blockchain, and that there’s no reason to avoid block size increasing if the growing adoption requires it. Ver’s position is that Bitcoin has failed to become digital cash for everyday payments, such as paying for a coffee. That vision, according to Ver, now lives in the ideology of Bitcoin Cash (BCH).
Samson Mow, to the contrary, said that an over the edge increase of blocks is not an ultimate solution as it could lead to increasing the chain weight. Mow believes that there should be a second layer technology integrated, where everything is cryptographically bound to the main chain. According to Mow, this would enable keeping the Bitcoin Blockchain compact enough to synchronize transactions with nodes for a relatively small period of time. He also sees a solution in the usage of Bitcoin coupled with Lightning. Mow said:
“I think scaling Bitcoin, we have to take into consideration the computer science aspect of it. We can’t just make things up. We actually have to look at the code and we have to follow the consensus rule, so if you look at what Bitcoin Core has been doing, is they’ve been scaling all along so that everything is backwards compatible.”
Ver parried with an argument that the intention behind Bitcoin Core might be positive, however the empirical evidence shows that the “effects were negative and incredibly damaging to Bitcoin” and cause a “negative merchant adoption around the world.” Ver claimed that it’s easier for merchants to migrate to Altcoins rather than to add Lightning support to the existing Bitcoin payment option because it would be expensive and unreliable. Ver stated:

“Bitcoin Core is having negative merchant adoption around the world. Bitcoin Cash is having positive merchant adoption around the world. So even if Samson and Blockstream and Bitcoin Core supporters have the absolute best intentions in their heart, we have the empirical evidence to show that the effects were negative and incredibly damaging to Bitcoin. Let’s judge things by their effect and their results, not the intent of the people that were putting it together.”

Ver’s tone towards Mow’s Bitcoin Core team became accusatory, saying, “they’ve shattered the Bitcoin ecosystem into a thousand and one different altcoins and delayed the adoption of cryptocurrencies around the world by years.”
Mow stated that Bitcoin can be used by everybody, but technology takes time to mature, including Lightning. This will result, according to Mow, in the ability to make transactions with Bitcoin by anyone, even on low-grade devices. With a wider implementation of Lightning, transaction fees will inevitably change “like the weather, it can be hot one day, cooler the next day and windy and rainy.”
The passionate debates gave rise to a sarcastic reaction from the community, which has been absorbedly discussing the way Roger and Samson behaved on stage, rather than addressing the topic of Bitcoin scalability.
Youtube user Jonathan Mogg said:

“Does Bitcoin core have any spokesperson who can articulate the BTC value proposition anymore? You may not like Roger but he can speak to the commercial and economic aspects of Bitcoin far better than anyone I've seen from the Blockstream crew.”

Youtube user sssidhu7788 said:

“Samson didn’t answer anything, he didn’t clarify anything. Just sitting there like he’s some cool guy with an ace up his sleeve but nothing.”

Youtube user Slowly GoingBroke said:

“Roger Ver sounds like a BCH commercial.  He is just embarrassing himself now…”

mango_drive said on Reddit:

“Roger appears so agitated and angry all the time. I don't mind listening to differing opinions but he makes it rather unpleasant to do so.”

Bananananbread said on Reddit:

“Did you see Mow’s body language? The constant finger tapping and playing with the water bottle. He looked so nervous like he was about to visit the dentist for root canal surgery...”

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