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Abra Kadabra! And it's gone.

Cryptocurrency investment company Abra has been issued an emergency cease and desist order by Texas securities regulators.

Authorities claim the cryptocurrency company, also known as Plutus Financial, and Chief Executive Officer Bill Barhydt have engaged in securities fraud. The enforcement order also states it offered investment products to unaccredited investors and that the company has been at least partially insolvent since March 31, 2023.

According to the Texas Securities State Board, on May 12, 2021, the Texas Enforcement Division issued a warning to Barhydt that Plutus Financials products appeared to constitute investment contracts or securities. The state set up a working group to further investigate the cryptocurrency company.

Abra has tried to argue against that characterization in its marketing.

Earn users take no investment-like risks when they deposit digital assets into Interest accounts, the company said last year. Rather, Earn users are simply moving or placing their existing assets into their Interest Accounts with the possibility of receiving interest, but notably, no risk of an investment-type loss.

Investigations reveal, however, that Plutus Financial has been touting their risk management strategy as compared to the now-defunct Voyager Digital and Celsius Network.

The order also states that despite a letter from CEO Bill Barhydt, claiming the company had no exposure to the FTX collapse, a subsidiary of Plutus Financial did have more than $12 million in assets on the platform run by Sam Bankman-Fried.

Abra also allegedly held or currently holds nearly $30 million on Babel Finance, $30 million (or more) on Genesis, and roughly $10 million on Three Arrows Capital (3AC). All three of those companies have been touched by bankruptcy in the past year.

Last, but certainly not least, Texas state authorities claim that Abra has been winding down their Earn product, and transferring assets to Trade accounts. The company has been secretly transferring these funds to Binance, according to authorities. As of February this year, balances for Abra on the platform are valued at roughly $118 million.

Despite the warning, the company continued to offer and sell investment productsthrough Abra Earn and Abra Boostuntil roughly October 3, 2022, regulators said.

Abra did not immediately reply to a request for comment from Decrypt.

Alongside offering and selling investment contracts that resemble securities, the working group also alleges that Abra made offers containing statements that are materially misleading or otherwise likely to deceive the public.

Abra states Prime Trust as their main custodian, which according to Texas authorities, does not operate with a money transmitter license in the state.

As of May 17, 2023, Abra claims $49 million in assets under management (AUM) on behalf of 229 Boost investors, of which 23 are Texas-based. The company also claims to hold $66 million on behalf of 9087 Earn investors, of which 827 reside in the lone star state.

This is not the first time federal charges have been brought against Abra. In July 2020, the SEC charged the company with selling security-based swaps without registration. Similarly, the CFTC charged the company with engaging in illegal off-exchange swaps with overseas customers, namely from the Philippines. The company paid $300,000 for these two penalties.

Texas state authorities have not set a date for an official hearing, but have allowed customers to withdraw funds from the platform, for the time being.

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Abra Cease-and-Desist Reveals Ties to Binance and Prime Trust - Decrypt

By Clive McKeef

Binance, SEC strike deal to move all U.S. customer funds, wallet keys back onshore

Binance.US and the Securities and Exchange Commission have reached an agreement that avoids a total asset freeze at the cryptocurrency exchange while the SEC's lawsuit against it proceeds.

Under the deal announced Saturday, Binance Holdings, BAM Management US, BAM Trading Services and founder Changpeng "CZ" Zhao will repatriate Binance.US customer assets to the U.S.

Binance.US customers are permitted to withdraw funds from the platform, according to the order filed by US judge Amy Berman Jackson in Washington federal court.

Read the court orderhere.

Read the SEC statement here.

In its June 5 lawsuit, the SEC had accused Binance and Zhao of mishandling customer funds, misleading investors and regulators, and breaking securities rules. It also asked for the repatriation of crypto belonging to US customers, a request made when there is a risk assets may be lost or concealed.

See: Bitcoin drops after SEC files 13 charges against Binance, founder Changpeng Zhao

The deal is in response to an SEC motion to freeze all of Binance.US's assets while the securities-related charges are being considered by the court. The SEC said it was concerned that funds could be moved offshore or records destroyed if it was not granted a temporary restraining order.

However, Judge Amy Berman Jackson, of the District Court for the District of Columbia, told the parties that it would be better for them to come to an agreement.

Binance, Binance.US and the SEC agreed to ensure that only Binance.US employees could access customer funds in the short term, according to the court documents. Under the agreement, which still needs a sign-off from the federal judge overseeing the case, Binance.US will take steps to make sure that no Binance Holdings officials have access to private keys for its various wallets, hardware wallets or root access to Binance.US's Amazon Web Services tools, the filings showed.

See also:Should you be worried if your crypto is in Binance.US or Coinbase?

Binance.US says customer assets are safe and argued that blocking the flow of all funds would cripple its business.

The U.S. affiliate of Binance halted dollar deposits last week and gave customers until June 13 to withdraw their dollar funds, after the SEC asked a court to freeze its assets.

Binance.US on Saturday said it was "pleased" that the disagreement over the SEC's request was resolved on mutually acceptable terms, though it maintains that the call for a freeze was "entirely unwarranted," Bloomberg reported

See also:BlackRock is applying for a spot bitcoin ETF. Here's why it matters to the crypto industry

-Clive McKeef

This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

06-17-23 1215ET

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Binance.US reaches agreement with SEC to avoid full asset freeze - Morningstar

Binance, one of the worlds largest cryptocurrency exchanges, has enabled further adoption for popular memecoin Floki through its inclusion in special categories. The exchange announched addition of $FLOKI to its Metaverse and Gaming categories, price action followed in last 24 hours.

Official Twitter account of memecoin Floki took to Twitter and shared:

#Binancehas added $FLOKI to the #Metaverse and #Gaming categories on its exchange!

Binance by including $FLOKI to its Metaverse and Gaming categories allowed millions of users to trade Floki alongside other prominent metaverse and gaming cryptocurrencies such as $SAND, $MANA, $AXS, $IMX, $GALA, and $ENJ. Added are screenshots from Binance categories:

The decision by Binance to include Floki in its Metaverse and Gaming categories is a significant validation for the meme coin. Binance is renowned for its rigorous listing process and careful selection of cryptocurrencies, ensuring the inclusion of reputable and promising projects.

CoinGape reported yesterday how Binance delisted PEPE from its Flexible Loans as it was no longer a reliable asset, adding to whale dumping of PEPE tokens.

Floki, the fourth-largest meme coin by market capitalization, has been gaining momentum in recent times. It got listed on Bitci, one of Turkeys top crypto exchanges with over 5 million registered users. Also in a strategic partnership unveiled two weeks ago, the Floki team aims to drive adoption through an extensive marketing campaign that leverages Binance Pay to incentivize users.

Binance exchange announced Floki listing on April 24 this year and it went live the next day to its millions of users.

Floki continues to demonstrate positive momentum in the market, showcasing gains over the past 24 hours and the past week. With a 3.09% increase within one hour, it gained 5.28% gain over 24 hours upon announcement. It has also surged over 10% as we write over the course of the past week, indicating a positive trend in the coins performance.

CoinGape comprises an experienced team of native content writers and editors working round the clock to cover news globally and present news as a fact rather than an opinion. CoinGape writers and reporters contributed to this article.

The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.

See the article here:

Floki Surges Over 10% as Binance Adds It in Metaverse Section - CoinGape

Binance announces support for the much-awaited Terra Classic v2.1.0 upgrade seeking to bring LUNC to parity with Luna 2.0 and Cosmos.

Binance recently disclosed that it will support the Terra Classic (LUNC) upgrade to v2.1.0. The highly-anticipated upgrade, which is set to go live today, represents one of the most important LUNC updates since the ecosystem implosion, as it aims to bring Terra Classic to parity with the Luna 2.0 and Cosmos blockchains.

Binance announced its support for the network upgrade in a press release today. The exchange noted that the upgrade is expected to occur at the Terra Classic block height of 13,215,800. The timing for this block height is approximately 14:00 (UTC) today, but this is liable to change.

As a result, Binance revealed that it would suspend deposits and withdrawals on the Terra Classic network at 13:00 (UTC) today. This suspension is necessary to ensure that market participants do not face issues pertaining to deposits or withdrawals as a result of the instability of the network during the upgrade.

The exchange further confirmed that the suspension will not affect internal trades for tokens on the Terra Classic network. Users can continue with their spot and futures positions as usual. Binance will lift the suspension on deposits and withdrawals once they have ascertained that the network is stable enough after the upgrade. They will announce this in another statement.

The v2.1.0 upgrade is an integral aspect of the ultimate Terra Classic revitalization plan. Its significance is due to the fact that it will eventually bring LUNC to parity with the Cosmos network and the Luna 2.0 blockchain. This development will introduce more utility to Terra Classic by allowing builders from those chains to bring their projects to LUNC.

The upgrade is coming up after the passing of Proposal 11561 which sought community consensus on implementing it. LuncBurnArmy (LBA), the project manager of the L1 Joint Task Force (L1JTF), submitted the proposal eight days ago.

The upgrade, which was initially set for May 31, was pushed back to June 14 to allow the L1JTF to make further tests. The postponement would also allow the team to include a feature to limit minimum validator commission to 5%. On May 31, the L1 Team successfully upgraded the rebel-2 testnet to v2.1.0. This signaled that the upgrade is without issues and a mainnet update was next in line.

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Disclaimer: This content is informational and should not be considered financial advice. The views expressed in this article may include the author's personal opinions and do not reflect The Crypto Basics opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.

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Binance to Support Major Terra Classic Upgrade to Bring LUNC to ... - The Crypto Basic

Social media attention has recently turned to Ethereum (ETH), XRP and Binance Coin (BNB) at the expense of Bitcoin, a sign of increasing confidence in these altcoins among crypto traders even as the price of the most popular cryptocurrency holds above the $25,000 level.

Recent news affecting these altcoins is the main reason behind the surge in social media mentions. Binances hearing on Tuesday marked an important milestone for holders of BNB, the exchanges native token. Judge Amy Berman Jackson, of the D.C. District Court, asked the Securities and Exchange Commission (SEC) and Binance to continue negotiating and to submit a status update by Thursday.

BNB price rallied 10.5% in response to the hearing.

Similarly, the release of the so-called Hinman emails, key documents for Ripples defense against the SEC, fueled a temporary bullish sentiment among XRP holders.

Also read: XRP volatility surges as Hinman documents support Ripple's case against the SEC

Bitcoins social volume declined after the assets price rally in March, according to data from crypto intelligence tracker Santiment. Social volume is built on top of social data collected by the tracker. The platform combs text documents containing the asset name at least once, on Twitter, Telegram and Reddit.

As seen in the chart below, Bitcoin social volume increased sharply in mid-March, weeks before reaching its recent price peak of $30,899.76 in April.

ETH, XRP and BNB social volume

A spike in social volume is typically followed by a rally in the assets price in the weeks following a spike in social volume.

ETH, XRP and BNB registered an increase in social volume after Tuesdays events. The Hinman documents, key to Ripples defense against the SEC, were unveiled for public view. Their content fueled a bullish sentiment among XRP holders and the altcoin yielded 6% gains before pulling back. Find out more here.

The Hinman documents shed light on the regulators stance on Ethereum and why the asset was considered a non-security, putting the second-largest altcoin by market capitalization under the spotlight too. ETH price held above key support at $1,724, trading at $1,739.57 at the time of writing.

On Tuesdays hearing, Judge Amy Berman Jackson asked the SEC and Binance to continue negotiating to arrive at a compromise. The Judge asked the two parties to submit a status update by Thursday.

In the court hearing, the Judge expressed skepticism about the US financial regulators move to enforce its powers on Binance and called it inefficient and cumbersome, according to a report from the hearing by The New York Times. These comments fueled hopes among Binances native token holders, pushing BNB price higher.

BNB price climbed from $228.90 to $252.90, or 10.5%, since Tuesdays hearing. The exchanges native token is therefore on track to recoup its recent losses and yield gains for holders ahead of Thursdays update.

Read the rest here:

Top 3 cryptocurrencies seeing uptick in social volume: Ethereum, XRP, Binance Coin - FXStreet