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Elon Musk’s xAI Sues OpenAI Again, This Time Over Alleged Trade Secret Theft

by admin September 26, 2025



In brief

  • Elon Musk’s xAI has sued OpenAI, alleging it induced former employees to steal source code and data center deployment strategies.
  • The AI company alleges OpenAI targeted employees with knowledge of its “secret sauce” data center operations, with one executive refusing to sign confidentiality documents after leaving for OpenAI.
  • One engineer allegedly admitted in a “handwritten confession” to misappropriating code after encrypted communications with an OpenAI recruiter.

Elon Musk’s artificial intelligence company xAI filed a federal lawsuit on Wednesday against OpenAI, accusing its rival of orchestrating a “coordinated, unfair, and unlawful campaign” to steal proprietary technology through targeted employee poaching.

The complaint, filed in California, alleges OpenAI “by hook or by crook” induced former xAI employees to misappropriate the company’s entire source code, training methods, and data center deployment strategies.

Musk, a co-founder of OpenAI alongside Sam Altman, Greg Brockman, Illya Sutskever, and others in 2015, stepped down from the board in 2018, citing conflicts of interest with his company, Tesla, and its self-driving cars. Since then, the tech billionaire has assumed a combative stance against OpenAI, including filing a separate lawsuit last month.



OpenAI recruiter Tifa Chen simultaneously targeted multiple xAI employees, offering multi-million dollar packages to engineers who then stole source code and uploaded it to personal devices within hours of their communications, the lawsuit alleges.

Xuechen Li, an early xAI engineer, allegedly “uploaded the entire xAI source code base to a personal cloud account” in July 2025, and later “admitted in a handwritten confession” that he misappropriated xAI’s code and presentation materials on training techniques.

The lawsuit details timestamps showing Li’s code theft occurred within hours of encrypted Signal messages with Chen, who allegedly responded “no way!” after Li copied the files, before OpenAI extended its multi-million dollar offer.

Jimmy Fraiture, another early xAI engineer, allegedly “used the AirDrop feature to transfer” confidential source code “at least five times” after signing with OpenAI, stealing “the majority of xAI’s code” he oversaw, plus experimental folders from four co-founders.

An unnamed senior finance executive who left for OpenAI allegedly called these operations xAI’s “secret sauce,” saying, “The data center team. Their speed and precision blew me away. I would NEVER want to compete against them.”

The executive then took a lesser role at OpenAI, focused on data center spending strategy even though he had no prior AI experience, and when confronted about confidentiality obligations, allegedly “responded with crude sexual expletives” and refused to sign termination documents.

Navodaya Singh Rajpurohit, legal partner at Coinque Consulting, told Decrypt  the case “leans heavily on employee poaching,” noting that whether it crosses from aggressive recruiting to unlawful misappropriation “will depend on evidence not included in the filing,” and that “hiring alone is rarely enough to prove trade-secret misuse.”

Ishita Sharma, managing partner at Fathom Legal, told Decrypt that xAI must define its “secret sauce” broadly, grouping GPU racking, vendor contracts, pricing curves, and orchestration playbooks, which, she noted, can be described “by the results they deliver — like faster deployment or cheaper scaling,  without putting the exact technical diagrams or formulas on the record.”

Sharma said “the recruiter angle is trickier,” since liability depends on whether recruiters acted as agents of OpenAI with the company’s knowledge. 

For OpenAI’s defense, she explained, the strongest approach would be to show independent creation through “time-stamped records: internal Git commits, R&D notes, supplier invoices, and emails,” with earlier documentation providing the most credibility.

xAI seeks damages, restitution, and injunctions requiring OpenAI to purge xAI material from its systems and even destroy models built with it.

The lawsuit adds to Musk’s ongoing legal battle with OpenAI, as last month, his companies filed an antitrust suit against Apple and OpenAI, claiming their exclusive iPhone integration creates unfair market dominance.

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NFT Gaming

China Inaugurates Digital Yuan Operation Centre to Push CBDC Integration: Report

by admin September 26, 2025



China has quietly taken a bold step in its bid to expand the global footprint of its digital currency.

On Thursday, the People’s Bank of China (PBOC) inaugurated an international operations centre for its central bank digital currency, the digital yuan (e-CNY) in Shanghai, according to a report from the South China Morning Post.

PBOC Deputy Governor, Lu Lei, framed the move as part of a “historical inevitability” in payments innovation, with the aim of offering a more efficient, inclusive, and open global cross-border payment system.

The initiative is intended to enhance settlement efficiency, and serve as building blocks toward a broader framework for e-CNY integration.

China’s CBDC push comes in the wake of the country pulling the brakes on tokenization efforts. Earlier this week, China’s securities regulator warned some brokerages to pause their real-world asset (RWA) tokenization businesses in Hong Kong.

Read more: China Pumps the Brakes on RWA Businesses in Hong Kong: Reuters



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September 26, 2025 0 comments
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'Bitcoin Is Next': Peter Schiff Slams Ethereum into Bear Market Territory
NFT Gaming

‘Bitcoin Is Next’: Peter Schiff Slams Ethereum into Bear Market Territory

by admin September 26, 2025


Ethereum dipped below $4,000 on Thursday, kicking off a technical bear market and causing Peter Schiff to sound the alarm once again. The move took ETH more than 20% off its August peak, where the token briefly touched $4,850 and marked the sharpest correction since early summer.

The sell-off got worse once ETH hit $4,150. A heavy session dragged the major altcoin down to the $3,930 zone, canceling out weeks of gains and putting a damper on corporate treasury purchases that had been promoted as a stabilizing force. 

ETH/USD by TradingView

The latest breakdown means we are now looking at whether the second-biggest crypto can find a floor above the $3,800 support band, or if it is going to go even lower.

Peter Schiff strikes again

Schiff, who has always been cautious about crypto rallies, said that the Ethereum reversal was linked to Bitcoin. In his words, ETH’s decline is a sign that the crypto market has turned bearish, and BTC is poised to be the next asset to dip. 

Ethereum just tanked below $4,000. Despite all the Ethereum Treasury company buying, the #2 crypto is now in an official bear market, down 20% from its August record high. Bitcoin is next.

— Peter Schiff (@PeterSchiff) September 25, 2025

For traders, the report is about more than just Schiff’s criticism, though. It is also about the numbers on the chart. Ethereum is trading at the same levels it was at in early August, and it is clear that the momentum is broken right now . This means that the two biggest digital assets might have problems holding on until the end of 2025.

Ethereum’s fall gave Schiff another headline. The big question now is whether Bitcoin will follow suit.





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September 26, 2025 0 comments
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ARK Invest Forecast Highlights $25 Trillion Crypto Market Cap, Here’s How Much Ethereum And XRP Will Be

by admin September 26, 2025


Trusted Editorial content, reviewed by leading industry experts and seasoned editors. Ad Disclosure

Ark Invest, an American investment management firm, has recently shared a long-term forecast that envisions the Ethereum (ETH) price reaching the six-digit territory if the total crypto market capitalization surges to $25 trillion. Ark Invest also notes that Ethereum stands to be one of the biggest winners in this scenario, with XRP also set to capture significant value. 

Ethereum’s Share Of The Projected $25 Trillion Market

Lorenzo Valente, Director of Research at Ark Invest, explained in a video post on X social media that Ethereum currently accounts for approximately 13.5% of the total cryptocurrency market capitalization. He predicts that if the global crypto market cap climbs to $25 trillion within the next five years, Ethereum could command a market valuation of approximately $3.37 trillion. This translates into a price of about $28,000 per token—a level that would mark a historic moment for ETH.

The Ark Invest Director pointed to key drivers underpinning the cryptocurrency’s strength to reach such a valuation. These include the tokenization of Real-World Assets (RWA) on the Ethereum blockchain, the network’s rapid growth in DeFi, the growing presence of stablecoins, and ongoing innovations across Layer 2 solutions. 

Valente further notes that more than $120 billion in total value is already locked within Ethereum and its scaling networks, highlighting its liquidity dominance. For stablecoins, the blockchain accounts for over $100 billion of the sector’s $200 billion capitalisation, a commanding position that underscores its role as the backbone of the DeFi landscape. 

Notably, Valente emphasized ETH’s yield-bearing nature, with staking making the cryptocurrency one of the few revenue-generating digital assets. Beyond its ability to generate yield, the Ark Invest Director notes that Ethereum is also the number one collateral used on Layer 2s, a medium of exchange within NFT marketplaces, and the currency for paying network fees. 

He also believes that scaling improvements on Layer 1 and Layer 2 over the next five years could attract millions more users, reinforcing ETH’s dominance and positioning it as a unique asset unlike any other in the crypto market.  

XRP’s Growth Potential In A $25 Trillion Crypto Market

While Ethereum is positioned at the forefront of Ark Invest’s projection, XRP remains one of the most closely watched altcoins in the market. Currently valued at approximately $2.8 billion after a recent decline, the cryptocurrency has a total market capitalization of $170.6 billion. For reference, the entire crypto market also has a market cap of $3.93 trillion, as of the time of this report. 

Based on these figures, XRP’s current market share is about 4.3% of the entire industry. If this ratio is maintained during the broader market’s projected rise to a $25 trillion valuation, XRP could achieve a market cap of roughly $1.05 trillion. With its current circulating supply, this would imply a price of approximately $17 per token, representing a more than sixfold increase from current levels.

ETH trading at $4,028 on the 1D chart | Source: ETHUSDT on Tradingview.com

Featured image from Adobe Stock, chart from Tradingview.com

Editorial Process for bitcoinist is centered on delivering thoroughly researched, accurate, and unbiased content. We uphold strict sourcing standards, and each page undergoes diligent review by our team of top technology experts and seasoned editors. This process ensures the integrity, relevance, and value of our content for our readers.



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September 26, 2025 0 comments
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Kraken logo with digital finance background
NFT Gaming

Kraken secures $500M funding at $15B valuation ahead of IPO

by admin September 26, 2025



Kraken has secured fresh funding at a $15 billion valuation, boosting its war chest as it eyes a 2026 initial public offering.

Summary

  • Kraken raised $500M at a $15B valuation with Tribe Capital backing.
  • The exchange reported strong revenue growth in H1 2025, nearly double 2024.
  • IPO plans have been pushed to 2026 as Kraken expands into tokenized assets.

According to a Sept. 25 Fortune report, the round closed this month without a single lead investor, with Kraken itself setting the terms. Participants included investment managers, venture capitalists, and CEO Arjun Sethi’s Tribe Capital, as well as Sethi in a personal capacity.

The exchange, founded in 2011, has now raised over $527 million in total funding, following its initial $27 million investment.

Kraken’s strong financials amid IPO delay

The funding round comes as Kraken prepares for a public listing, now expected in 2026. Investors were drawn to the company’s steady profitability. It reported $411 million in revenue and nearly $80 million in post-EBITDA earnings in the second quarter.

Kraken’s valuation places it among the industry’s most valuable private exchanges, second only to Coinbase. The firm has been expanding through acquisitions, including the $1.5 billion purchase of NinjaTrader earlier this year, which added two million customers. It has also rolled out new products such as tokenized stocks, or “xStocks,” aimed at bridging crypto with traditional markets.

Leadership and strategy

Since cofounder Jesse Powell left his position as CEO of Kraken in 2022, Sethi has played a key role in leading the company. The co-founder of Tribe Capital and venture capitalist has stressed the importance of establishing Kraken as a center for tokenized assets and institutional trading.

Under his direction, Kraken has entered the retail market and increased the scope of its institutional offerings, such as advanced APIs and derivatives. But the shift has also been accompanied by executive turnover and internal restructuring, which have sparked worries about morale and management style.

Market backdrop

Kraken’s funding comes amid a resurgence of cryptocurrency IPOs, with Circle, Gemini, and Bullish having already listed this year. The company’s choice to hold off until 2026, however, raises questions because a change in the market cycle could reduce investor interest in cryptocurrency stocks.

Analysts note that Kraken’s established reputation and diversified revenue sources put it in a stronger position than many of its rivals to weather volatility. The $500 million round shows that investors remain confident as the exchange prepares for its next phase of growth.



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September 26, 2025 0 comments
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New Book on AI Says ‘Everyone Dies,’ Leading Chatbots Disagree

by admin September 26, 2025



In brief

  • Authors Yudkowsky and Soares warn that AI superintelligence will make humans extinct.
  • Critics say extinction talk overshadows real harms like bias, layoffs, and disinformation.
  • The AI debate is split between doomers and accelerationists pushing for faster growth.

It may sound like a Hollywood thriller, but in their new book “If Anyone Builds It, Everyone Dies,” authors Eliezer Yudkowsky and Nate Soares argue that if humanity creates an intelligence smarter than itself, survival wouldn’t just be unlikely—it would be impossible.

The authors argue that today’s systems aren’t engineered line by line but “grown” by training billions of parameters. That makes their behavior unpredictable.

As intelligence scales, drives such as self-preservation or power-seeking could emerge independently, the authors warn. If such a system ever outstrips human control, they say, extinction would follow by default.

They call the current race among tech giants and governments to build ever-larger models a “suicide race.” No villainy required, just incompetence.



Why it matters

The book lands with the AI community already fractured into camps.

AI doomers argue that extinction is the inevitable outcome unless humanity halts or drastically slows progress. Accelerationists counter that pushing forward could deliver breakthroughs in medicine, science, and economics, while slowing down poses a greater danger.

Nick Bostrom’s Superintelligence first made the existential case a decade ago. Yudkowsky and Soares sharpen it into a klaxon call.

But critics worry that fixation on extinction distracts from harms already here: bias, layoffs, surveillance, and disinformation.

What the AI models say

Since the book is talking about them, we asked leading AI models what they think of it.

As far as we know, none of the LLMs have actually read the book yet, so the following reviews are based on the platforms’ interpretations of the reviews they have interpolated.

ChatGPT

OpenAI’s ChatGPT framed the book as a useful provocation rather than a prophecy.

“The book is valuable as a perspective-shifting tool, even if you think it overshoots,” the chatbot responded. “It sharpens intuitions about alignment and unintended consequences. But treating its worst-case as inevitable ignores uncertainty around future architectures, regulations, and constraints.”

ChatGPT stated that the model of future AI developments is contingent on how architectures evolve and what regulatory, social, or technical guardrails emerge.

“That uncertainty means I wouldn’t treat their worst-case as inevitable,” ChatGPT sniffed.

Meta

Meta AI struck a middle note, saying the book’s dire warnings are exaggerated but still valuable for sparking debate.

“Its dire predictions may feel exaggerated, but the emphasis on caution and international cooperation is justified,” Meta AI responded. “Whether or not you agree with its conclusion, the book sparks needed debate about responsible AI development.”

Meta’s AI said the authors’ emphasis on the need for caution and international cooperation is well-justified, given the potentially catastrophic consequences of unaligned AI development.

Gemini

Google’s Gemini cast the book as a terrifying but clarifying read, even if its proposed solutions seem unrealistic.

“The book is essential for understanding the extreme end of AI risk,” Gemini said. “Its proposed solution—a total shutdown—is politically unachievable, but the warning can galvanize investment in safety and control techniques before we reach the point of no return.”

Gemini said the book defines the extreme stakes of superintelligence, which, in turn, helps justify robust (if less radical) safety measures today.

Claude

Anthropic’s Claude was even more skeptical, which was interesting since among the leading LLMs, Anthropic is generally considered to be the most safety-conscious. But Claude described the book’s tone as “overconfident” and its framing as too binary.

“The authors correctly identify real risks, but their certainty feels overconfident,” Claude said. “They dismiss progress in AI safety research and frame the issue as a binary between perfection and extinction. That makes their message less constructive.”

While their warnings highlight important risks that warrant substantial resources and caution, Claude said the “everyone dies” framing appears more designed to grab attention than accurately represent the complex uncertainties involved.

“The risks are serious enough to take seriously without needing to accept their claims of inevitable catastrophe,” the AI said.

Grok

Elon Musk’s AI platform also surprised, since he’s been promoting Grok as the anti-mainstream media AI of record.

But Grok was quick to cite “a scathing NYT review, [calling] its arguments weak or alarmist.”

“This book is a gut-punch reminder that intelligence without wisdom is a liability, and we’ve got none of the latter baked in yet,” Grok responded. “That said, it’s doomer porn for rationalists: thrilling in its fatalism, but it underplays human adaptability. xAI’s ethos—curiosity over conquest—suggests we can thread the needle: pursue bold AI for cosmic questions while embedding safeguards from day one.”

Beyond that call out, however, Grok said that “overall, it’s a provocative, efficient read for anyone grappling with AI’s future—compelling if you’re open to pessimism, but potentially overstated if you’re optimistic about tech progress.”

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A weekly AI journey narrated by Gen, a generative AI model.



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September 26, 2025 0 comments
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Circle Examines Ways to Reverse Transactions to Counter Fraud, Disputes: FT
NFT Gaming

Circle Examines Ways to Reverse Transactions to Counter Fraud, Disputes: FT

by admin September 26, 2025



Circle Internet, (CRCL) is examining ways of reversing transactions involving its stablecoin, USDC, the Financial Times (FT) reported on Thursday.

The issuer of the second-largest stablecoin is “thinking through … whether or not there’s the possibility of reversibility of transactions,” the company’s president, Heath Tarbert, said in an interview with the newspaper.

Stablecoins, tokens pegged to the value of a traditional financial (TradFi) asset such as a fiat currency, are an important cog in the cryptocurrency machine, offering users a hedge against the volatility than can hit tokens like BTC$109,694.70 and ETH$3,960.01. They’re also finding popularity as a method for international payments. The sector has a market cap of about $300 billion, according to data tracked by CoinGecko. USDC alone has a market cap of $74 billion; market leader Tether’s USDT has $173 billion.

Tarbert said that allowing transactions to be refunded in case of fraud or disputes, similar to what is possible in TradFi, would help push stablecoins into the mainstream.

Such a development may rub certain crypto purists up the wrong way, because they consider settlement finality to be non-negotiable. Introducing the possibility of reversing transactions could rely on the the arbitration of a central authority, which many believe is antithesis of the decentralization that lies at cryptocurrency’s core.

“At the same time, we want settlement finality,” Tarbert said. “So there’s an inherent tension there between being able to transfer something immediately, but having it be irrevocable.”

Circle has been at the forefront of growing adoption of stablecoins in the U.S. this year following its successful initial public offering (IPO) in June.

The company did not immediately respond to CoinDesk’s request for further comment.



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September 26, 2025 0 comments
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XRP
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Liquid Staking Debuts On XRP Ledger, What mXRP Means For Investors

by admin September 26, 2025


Trusted Editorial content, reviewed by leading industry experts and seasoned editors. Ad Disclosure

Midas, in partnership with Axelar, has launched the first XRP liquid staking token, mXRP. The token will provide investors with yields from the XRP DeFi ecosystem and further expand the altcoin’s utility. 

XRP Liquid Staking Token Launches

Midas revealed that the mXRP liquid staking token will be issued on the XRP Ledger EVM via the Axelar bridge, which also facilitates the transfer of the token to the Ledger. The tokenization platform noted that this is a first-of-its-kind tokenized exposure product, offering meaningful XRP-denominated yield strategies. The token is expected to provide an APY of up to 8% for holders, although Axelar indicated it could reach 10%.

In an X post, Panek Mekras, co-founder of Anodos Finance, which offers the token on the Ledger, broke down key details about the liquid staking token. He explained that token is a yield-bearing version of XRP that generates yields for its holders. As such, the price of mXRP should continuously grow against the XRP price and trade at a premium. 

Panek further stated that the yield comes from various strategies, including lending, market making, and depositing on DeFi protocols, among others. He noted that asset managers first lock XRP and then borrow against it in stablecoins, using the capital for various strategies to generate profits. 

The Anodos Finance co-founder also clarified that investors simply need to hold the staking token to claim their yields or redeem their XRP. He added that holders of the liquid staking token do not receive extra tokens. Instead, the yield and rewards are automatically added and embedded into mXRP’s value. 

Panek noted that token works similarly to other liquid staking tokens, such as stETH, jitoSOL, and sAVAX, meaning that those looking to get yields from it have to buy the asset and hold it. They can do this by selling XRP or adding new capital to buy the token. 

What mXRP Means For XRP

Panek indicated that the launch of mXRP is beneficial for XRP, as it will add constant buying pressure to the altcoin. He noted that Midas and Axelar said that the goal is to become a perpetual buyer of XRP. Meanwhile, every XRP used to mint mXRP is locked, thereby removing it from circulation. 

Flare Network also recently announced the launch of ‘FXRP’ to expand XRP’s DeFi. Panek noted that mXRP and FXRP are slightly different, but ultimately, both are beneficial for XRP and the XRP Ledger. mXRP’s capital is managed by asset managers who generate yield on behalf of investors. At the same time, FXRP is a trustless version of XRP on the Flare network, which doesn’t inherently generate yield but can be used in DeFi protocols to generate yields.

At the time of writing, the altcoin price is trading at around $2.84, down in the last 24 hours, according to data from CoinMarketCap.

XRP trading at $2.84 on the 1D chart | Source: XRPUSDT on Tradingview.com

Featured image from iStock, chart from Tradingview.com

Editorial Process for bitcoinist is centered on delivering thoroughly researched, accurate, and unbiased content. We uphold strict sourcing standards, and each page undergoes diligent review by our team of top technology experts and seasoned editors. This process ensures the integrity, relevance, and value of our content for our readers.



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September 26, 2025 0 comments
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Wormhole's W token enters 'value accrual' phase with strategic reserve
NFT Gaming

SharpLink to tokenize Nasdaq-listed SBET shares on Ethereum

by admin September 25, 2025



SharpLink is set to become the first public company to issue its Nasdaq-listed SBET shares natively on Ethereum, appointing Superstate as digital transfer agent to oversee compliant onchain issuance.

Summary

  • SharpLink plans to tokenize its Nasdaq-listed SBET shares directly on Ethereum.
  • Superstate’s Opening Bell platform will manage compliant onchain issuance.
  • The partnership extends beyond issuance, exploring AMM-based trading of tokenized equity.

In an announcement on Sept. 25, SharpLink Gaming, Inc. said it will tokenize its SEC-registered common stock directly on the Ethereum blockchain, appointing financial technology firm Superstate as its Digital Transfer Agent.

The partnership will utilize Superstate’s ‘Opening Bell’ platform for the issuance. The Minneapolis-based company, chaired by Ethereum co-founder Joseph Lubin, stated the move is intended to demonstrate how blockchain infrastructure can create shareholder value and improve market efficiency.

“Tokenizing SharpLink’s equity directly on Ethereum is far more than a technological achievement – it is a statement about where we believe the future of the global capital markets is headed. At SharpLink, our core mission is two-fold: to build the world’s most trusted digital asset treasury and to pursue initiatives that accelerate the global adoption of the Ethereum network.” Lubin said.

Beyond issuance: exploring AMMs and compliant secondary markets

The partnership’s ambitions extend far beyond a simple onchain issuance. SharpLink and Superstate intend to explore one of the most complex frontiers in digital finance: enabling compliant secondary trading of tokenized equity on automated market makers and other DeFi protocols.

This initiative aligns with the SEC’s Project Crypto, a regulatory framework designed to accommodate blockchain-based markets. The goal is to demonstrate how tokenized securities can unlock deeper liquidity and operate within a modernized capital market structure.

If realized, this effort could reposition SharpLink’s tokenized equity and future issuances via Superstate’s Opening Bell as instruments with broader utility than traditional book-entry stock. Trading on AMMs would represent a structural shift in how liquidity forms around public equities, potentially enabling real-time settlement, global investor access, and transparent price discovery in a way conventional exchanges cannot match.

Notably, the partnership with Superstate is a strategic extension of SharpLink’s deep commitment to Ethereum. With Lubin at the helm, the company has aggressively positioned itself as a corporate leader in the Ethereum ecosystem, having launched a significant ETH treasury strategy earlier this year.

Investors have so far met the news with caution. SharpLink’s SBET stock traded down 7.63% on Thursday, settling at $16.26 after opening the session at $16.33 and closing the previous day at $17.58. The drop mirrors a wider pullback across crypto markets but also underscores how experimental the path ahead remains.



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September 25, 2025 0 comments
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NFT Gaming

Crypto Exchange KuCoin Hit With Record Anti-Money Laundering Penalty in Canada

by admin September 25, 2025



In brief

  • KuCoin was assessed a penalty of $19.5 million CAD ($14M USD) for failing to comply with Canadian anti-money laundering policies.
  • The exchange has appealed the decision in Canadian Federal Court.
  • KuCoin pleaded guilty to operating an unlicensed money-transmitting business in the U.S. in January, paying $300 million in fines and forfeitures.

Peken Global Limited, which operates as crypto exchange KuCoin, is facing a $14 million—over $19.5 million CAD—anti-money laundering penalty from Canada’s Financial Transactions and Reports Analysis Centre (FINTRAC), the agency announced on Thursday. 

The Seychelles-based firm was hit with the penalty—the largest ever imposed by FINTRAC, according to Reuters—in July for failing to comply with Part 1 of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act, FINTRAC said. 

“Canada’s Anti-Money Laundering and Anti-Terrorist Financing Regime is in place to protect the safety of Canadians and the security of Canada’s economy,” said FINTRAC Director and CEO Sarah Paquet, in a statement.



“FINTRAC works with businesses to help them understand and comply with their obligations under the Act,” she added. “We are also firm in ensuring that businesses continue to do their part, and we will take appropriate actions when they are needed.”

According to the release, KuCoin failed to register as a foreign services money business, did not report large virtual currency transactions above $10,000 CAD, and failed to report suspicious transaction reports even when there was grounds to do so. 

KuCoin has always strived to work constructively with regulators worldwide. We disagree with this decision on both substantive and procedural grounds, and we have pursued legal avenues by submitting an appeal before the Federal Court of Canada to ensure a fair outcome for KuCoin.…

— BC Wong (@BC_KuCoin) September 25, 2025

“While KuCoin respects the decision-making process and remains committed to regulatory compliance and transparency, it disagrees with both the finding that KuCoin is a Foreign Money Services Business and the penalty imposed, which KuCoin maintains is excessive and punitive in nature,” the exchange said in a statement.

The firm submitted an appeal before Canada’s Federal Court on substantive and procedural grounds. 

In January, KuCoin pleaded guilty to operating an unlicensed money transmitting business in the U.S. and agreed to pay almost $300 million in fines and forfeitures in a settlement.  

Its co-founders Chun Gan and Ke Tang were ordered to forfeit $2.7 million in cash, as well, and each left the firm after the settlement. 

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