Elon Musk’s DOGE Lawsuit, Silvergate Bank Liquidation, and CBN’s Crypto Ban: A Tumultuous Week in Crypto

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Elon Musk is facing a proposed class action lawsuit, filed by investors who allege the CEO manipulated the Dogecoin (DOGE) cryptocurrency, causing them to lose billions of dollars. According to The Guardian, the investors claim Musk used Twitter posts, paid online influencers, his 2021 appearance on NBC’s Saturday Night Live, and other “publicity stunts” to trade profitably through various DOGE wallets.

Venture capital firm Digital Currency Group (DCG) and its CEO Barry Silbert have requested the consolidation of two class-action lawsuits involving alleged losses during the crypto winter. They argue that both cases present overlapping legal issues, making consolidation necessary to prevent conflicting decisions and promote judicial efficiency.

In banking news, licensed private bank Xapo has integrated with the single euro payments area (SEPA) network, allowing members to seamlessly move funds in euros (EUR). The SEPA feature in Xapo Bank’s mobile app enables members to send funds or settle invoices with individuals and businesses within the SEPA network. Although the bank accepts euro deposits, they are automatically converted to USD.

Silvergate Bank, a crypto-friendly institution, is preparing to file a self-liquidation plan with California financial regulators following a US Federal Reserve (Fed) order. The bank has been instructed to conserve cash and other resources to repay depositors without dissipating assets through executive compensation or severance payments.

On the regulatory front, the US Commodity Futures Trading Commission (CFTC) has issued a proposal inviting comments on potential changes to their risk management program (RMP). Areas of high risk, such as digital assets, artificial intelligence, and cloud services, may necessitate the commission to reconsider its risk management requirements. CFTC Commissioner Christy Goldsmith Romero expressed these concerns in a statement.

The Central Bank of Nigeria (CBN) clarified that its decision to ban cryptocurrency in 2021 stemmed from concerns over private sector interference and the transparency of digital currencies. Kinsley Obiora, the Deputy Governor of Economic Policy at the CBN, cited the “lingering threat posed by the opacity of the cryptocurrency system to financial stability” as the reasoning behind the ban.

In security news, the Twitter account of Mira Murati from artificial intelligence firm OpenAI was reportedly hacked to promote a “scam” cryptocurrency airdrop. The post highlighting the phishing link has since disappeared.

Rounding out the news, the Uniswap community rejected a proposal to charge fees from liquidity providers (LPs) on the protocol. In a close vote, 45% of the community voted against the fee, while varying percentages voted for charging LPs different portions of the fees generated by Uniswap V3 pools.

Source: Cryptonews

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