Binance Fines, Notcoin Woes, Certik-Kraken Clash & New Secure AI Startup

Hello, readers! If you've been your usual inattentive selves this week and missed out on the latest global crypto and AI updates, fear not – the Hodl fm team is here to save the day. Legal troubles continue to hound Binance, this time in Canada and India. The much-hyped Notcoin seems to be losing its shine post-listing, and Kraken is demanding the return of funds taken during a vulnerability check, but it looks like they want more than was actually taken. And finally, the AI apocalypse has been postponed once again because there's a new ultra-secure AI on the horizon. So, sit back, relax, and dive into the latest hot news with us.

India and Canada Fine Binance with Over $6 Million for AML Non-Compliance

Recently, Binance became one of the first offshore crypto entities to register with the Financial Intelligence Unit (FIU), marking a significant milestone in a sector where Indian authorities demand strict adherence to anti-money laundering (AML) regulations.

India’s FIU)has fined Binance 188.2 million rupees (~$2.2 million) for failing to comply with AML rules. Additionally, the order requires Binance to enhance its compliance protocols following the 2005 Prevention of Money Laundering Act (PMLA) and its rules, which aim to curb money laundering and terrorist financing.

The FIU-India director found that Binance operated in India without fulfilling its statutory obligations under PMLA. So, what were you thinking, Binance? If you're admitted to the legal field, you better follow the rules of the game.

Canada’s Claims

Meanwhile, in Canada, Binance is appealing a $4.4 million fine from the Financial Transactions and Reports Analysis Centre of Canada (Fintrac). The agency cited failures to register as a foreign money services business and to submit reports on large virtual currency transactions.

It’s worth noting that Binance decided to exit the Canadian market last year, highlighting its regulatory challenges across different regions. The exchange claims that its Canadian operations were minimal and insignificant compared to its global presence.

Some Bad News for Notcoin Holders

Notcoin went viral this winter – back in January, a simple game appeared on Telegram, inviting users to click virtual coins. In no time, thanks to clever marketing, this modest idea blossomed into the Notcoin community, boasting millions of users. The game’s straightforward mechanics had a practically magical effect. Millions of Telegram subscribers resulted from the game's incredible accessibility: to become a "real miner," all you needed was a phone, the app, and your fingers.

In April, the game ended, and the real fun began – the opportunity to sell the coins on exchanges. The token listing bolstered community trust in the project, catapulting Notcoin into the spotlight. A recent surge in Telegram Coins thrust Notcoin (NOT) into the limelight, and many people eagerly invested.

However, after a promising rise, it looks like this altcoin is losing steam, much like investors’ bullish enthusiasm.

Bearish Sentiments

The price of Notcoin is currently in a downward trend, and despite attempts to break free, little has changed. The shift in sentiment among NOT holders is becoming more apparent.

Investors are leaning towards bearishness, as evidenced by the negative funding rate for the first time this month.

This negative funding rate implies that short contracts dominate the market, with investors betting on the price falling rather than rising. This reflects a bearish outlook, despite a short-term bullish crossover indicated by the MACD.

The Moving Average Convergence Divergence (MACD) suggests that Notcoin is experiencing a short-term bullish crossover.

Thus, as this altcoin develops, it may avoid a major downturn, but a rally is out of the question. Today it’s Notcoin, tomorrow it’s Hamster Kombat, and so on. Everything evolves, changes, and disappears – and that’s perfectly normal. What’s important is that Notcoin is the first of its kind in the TON ecosystem. This project has opened the doors of cryptocurrency exchanges for the relatively young blockchain. Much depends on the success of Notcoin.

Certik and Kraken Conflict. Help or Bold Extortion?

On Wednesday, Kraken’s Chief Security Officer Nick Percoco made it clear that the exchange views the nearly $3 million loss as a "criminal matter," working with law enforcement to recover the funds after a group of tech-savvy researchers exploited an "isolated bug."

Related: Kraken Review: Features, Fees, Advantages

Later that day, blockchain security firm CertiK revealed they were behind the white hat hack that Kraken labeled as "extortion." CertiK claimed that Kraken had threatened its employees and asserted that the total amount Kraken demanded to be returned did not match the cryptocurrency involved.

Previously unnamed researchers managed to steal millions of dollars in cryptocurrency from Kraken, withdrawing funds credited to their accounts before deposits were finalized, according to Percoco.

Additionally, Percoco stated that the criminals wouldn’t agree to return any funds until a dollar amount estimating the exploit's potential costs was provided.

"Millions of dollars in cryptocurrency were created out of thin air, and no actual Kraken user assets were directly involved in our research activities," CertiK wrote in their defense, echoing Percoco’s assurance that the funds were lost only from Kraken’s treasury.

Moreover, CertiK claimed they were given too little time to return the allegedly stolen funds, despite the exchange reportedly not providing an address for the return. CertiK stated they sent the cryptocurrency to a digital wallet that, according to their records, Kraken could access.

So, is Kraken trying to reclaim more funds than were "stolen," or is CertiK unlawfully holding onto the funds to profit from the exploit? This tangled tale is worthy of Sherlock Holmes’ attention and might end in an unpleasant court battle for the blockchain security firm, according to Taylor Monahan, former CEO and founder of Ethereum wallet manager MyCrypto.

He tweeted that CertiK needs to be cautious about Kraken's legal team, the possible harm to its reputation, and the impact the controversy might have on CertiK’s internal environment.

Former OpenAI Employee Launches Ultra-Secure AI Competitor

Ilya Sutskever, co-founder and former chief scientist of OpenAI, is launching Safe Superintelligence Inc. (SSI), a startup dedicated to developing AI with a primary focus on safety rather than "commercial demands." Sutskever described the startup as having "one goal and one product": creating a safe and powerful AI system.

Teaming up with Sutskever to co-found SSI is Daniel Gross, who previously led AI at Apple, and Daniel Levy, a former technical expert at OpenAI. He left OpenAI in May, hinting at the inception of a new project. Shortly after his departure, AI researcher Jan Leike also left OpenAI, citing that safety processes had "taken a backseat to shiny products."

In an interview with Bloomberg, Sutskever stated that SSI's first product will be a safe superintelligence, and until that goal is achieved, the company "won't be doing anything else." The announcement describes SSI as a startup that "approaches safety and capability in tandem," allowing the company to rapidly develop its AI system while still prioritizing safety.

The announcement also highlights the external pressures often faced by AI development teams at companies like OpenAI, Google, and Microsoft, stating that the company's "singular focus" enables it to avoid "distractions from managerial overhead or product cycles."

More: 

• Digest 60: Stablecoins Bypassing Sanctions, Legal Bitcoin Wallet Hack, Grayscale’s Ether ETF Challenges, and AI Browsers Review
• Digest 61: TFTX Claim Spirals from $44B to $200M, XRP CEO “Seek Regulatory Clarity FIRST” DOG Just Went to the Moon, and Zoom’s New Digital Twin
• Digest 62: Traders Lost $200 Million, AI and Crypto Could Boost GDP, China's Main Bank Crypto Outlook, Superintelligence Alliance Delay

Let's all give a big round of thanks to Ilya Sutskever for delaying humanity's enslavement and prioritizing safety for all of us. That's all for now, folks! Don't be bored, and we'll see you next week.

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