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US Crypto Tax Crackdown: US Files First Criminal Case

The post US Crypto Tax Crackdown: US Files First Criminal Case appeared first on Coinpedia Fintech News The United States has filed its first-ever criminal tax evasion case focused entirely on cryptocurrency, signaling tougher rules ahead for crypto investors. Recently, U.S. has sentenced Frank Richard Ahlgren III, a Texas resident, to two years in prison for evading over $1 million in taxes from Bitcoin transactions. This is the country’s first criminal tax evasion case focused entirely on cryptocurrency. Ahlgren, an early Bitcoin investor, hid $3.7 million in profits between 2017 and 2019 by inflating purchase prices and using tools to mask transactions. Despite selling $4 million worth of Bitcoin, he filed false tax returns and failed to report his gains. In addition to prison, Ahlgren must pay $1,095,031 in restitution. Authorities pointed out that cryptocurrency tax evasion will face severe penalties, as IRS tools now track blockchain transactions effectively. Bitcoin.com

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Germany’s Largest Bank Deutsche Bank to Launch an Ethereum Layer-2 for Financial Institutions

Deutsche Bank, the largest bank in Germany by total assets, is exploring the launch of an Ethereum layer-2 to address compliance issues for financial institutions. This is according to a report from Bloomberg today. Notably, the layer-2 network will especially be useful for mainstream financial institutions looking to get into blockchain but are hindered by compliance concerns. The Purpose of Project Dama 2Named Project Dama 2, the initiative seeks to improve transaction efficiency while ensuring stricter regulatory compliance for financial institutions.Public blockchains, such as Ethereum , hold great promise for asset tokenization and improving operational efficiency. However, they could present compliance challenges for regulated organizations, including risks of interacting with unauthorized or sanctioned entities. To address these issues, Deutsche Bank`s Layer-2 solution will connect with Ethereum and leverage ZKsync technology to enable more efficient and affordable transactions.Boon-Hiong Chan, who leads applied innovation for Deutsche Bank in the Asia-Pacific region, stated that the Layer-2 framework enables banks to design a tailored list of validators for processing digital asset transactions. Notably, this method improves compliance by ensuring only approved entities are involved in validation. Furthermore, the platform is designed to provide regulators with exclusive oversight abilities, allowing them to track fund movements when required.For context, Project Dama 2 is a component of the Monetary Authority of Singapore`s (MAS) Project Guardian, a program that brings together 24 leading financial institutions to explore blockchain-based asset tokenization. Centralization Risks?Deutsche Bank`s participation confirms its dedication to using blockchain for enhancing operations while adhering to stringent regulatory standards. The bank plans to release a minimum viable product of the platform next year, subject to regulatory approval.However, the project`s design, which includes curated validators and exclusive oversight rights for regulators, raises concerns among blockchain enthusiasts who value decentralization as a core principle. With the decision to hand over regulators "super admin rights" and limit transaction validation to approved entities, the initiative could undermine the open and permissionless nature of blockchain. Deutsche Bank Warming up to Crypto and BlockchainMeanwhile, this development is not Deutsche Bank`s first foray into blockchain and digital assets. In June 2024, the bank partnered with Austrian crypto broker Bitpanda to facilitate cryptocurrency transactions for its clients. This collaboration enabled Deutsche Bank customers in Germany to buy and sell cryptocurrencies through internal transfers, simplifying the investment process in digital assets. Furthermore, Deutsche Bank has been exploring crypto custody services. In May 2024, reports confirmed that the bank plans to offer digital asset custody solutions, aiming to provide secure storage for cryptocurrencies and other digital assets. Before this, last June, Deutsche Bank applied with Germany`s regulator Bafin to procure a digital asset custody license. Most recently, Deutsche Bank inked a partnership with leading exchange Crypto.com to help the platform bolster its banking support in the Asia Pacific (APAC) region. Bitcoin.com