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Sichuan police cracked a cross-border pornography-related case involving fund flows exceeding USD 1.66 million, including transfers via virtual currencies.
According to the Xinhua Daily, police in Ya’an City, Sichuan Province, have cracked a cross-border online pornography-related criminal case. The pornographic manga website “Xiuxiu Seman” lured adolescents into making frequent small-value top-ups for profit. The site recorded over 100 million page views, with illicit transaction volumes reaching more than RMB 12 million (approximately USD 1.66 million). Police investigations revealed that domestic suspects received illicit funds through multiple corporate and personal accounts, and then transferred the proceeds overseas via virtual currencies under the direction of Li Mouwu and others. Recently, the Ya’an City Mingshan District People’s Court issued a first-instance verdict, sentencing five defendants to prison terms for crimes including profiting from disseminating obscene materials and aiding information network-related criminal activities. Judicial authorities are still investigating the overseas financial backers behind the website.
CFTC sues New Mexico, continuing battle for regulatory control of sports prediction markets
: The U.S. CFTC has filed a lawsuit in the U.S. District Court for the District of New Mexico against Governor Michelle Lujan Grisham, Attorney General Raúl Torrez, and other officials, aiming to prevent the state from applying gambling regulations to prediction market platforms.Previously, New Mexico sued Kalshi, accusing it of offering unauthorized sports betting to state residents and allowing users below the state's legal gambling age of 21 to participate. The New Mexico Attorney General stated that legal gambling in the state can only operate under tribal-state gaming compacts or a strict state regulatory framework.The CFTC argues that platforms like Kalshi offer federally regulated derivative contracts, not gambling products under state law. CFTC Chairman Michael Selig stated that New Mexico is attempting to impose state gambling laws on a federal derivatives exchange that falls under the CFTC's exclusive jurisdiction.Over the past few months, the CFTC has filed lawsuits against several states, including Wisconsin, Illinois, Arizona, Connecticut, and New York, to establish its regulatory authority over sports prediction markets. This week, the agency also proposed broader rules for prediction markets that still generally permit sports-related contracts, indicating an escalating conflict between federal and state governments over the boundaries of prediction markets and sports betting.
60-year-old woman poses as a 20-year-old girl in online romance, defrauding a young man of over 200,000 yuan for virtual currency investment that ended in total loss
Odaily Odaily News Recently, the Haidian District Court ruled on a fraud case. Retiree Meng, addicted to virtual currency trading and unwilling to use her own pension, pretended to be a young woman named Xiaohong, claiming to work for a central ministry in her 20s, on a short video platform. She established an online romantic relationship with a young man. Under the pretext of needing urgent surgery fees for a family member and preparing for overseas study exams, Meng defrauded the man of more than 200,000 yuan.Meng invested all of the defrauded 200,000 yuan into virtual currency trading, opening a ten-times leverage position. Subsequently, due to a market downturn, her position was liquidated, resulting in a total loss of all funds. The Haidian District Procuratorate previously indicted Meng for fraud. Ultimately, the Haidian District Court sentenced Meng to four years in prison and imposed a fine, while also ordering her to compensate the victim for his economic losses. (Beijing Evening News)
A man in Shandong sentenced to 10 years and 9 months in prison for stealing 107 Bitcoins from a victim
the Qingdao Licang District Procuratorate issued an announcement stating that the defendant, surnamed Zhang, took advantage of an opportunity to register a virtual currency wallet on behalf of the victim to obtain the seed phrase, and subsequently transferred 107 Bitcoins from the victim, surnamed Feng, in multiple batches during the early morning hours. Zhang then layered the transfers through various virtual currency trading platforms, converting the Bitcoin into over 660,000 RMB. The Qingdao Licang District People's Court sentenced Zhang to 10 years and 9 months in prison and imposed a fine of 100,000 RMB for the crime of theft in the first instance.After the defendant appealed, the Qingdao Intermediate People's Court ruled to dismiss the appeal and uphold the original verdict. The case determined the theft amount based on the actual illegal proceeds from the sale, totaling over 660,000 RMB. (Shandong Legal Daily)
US SEC Sues Texas Man in Crypto Fraud Scheme, Alleging $12.3 Million Scheme
the U.S. Securities and Exchange Commission (SEC) has filed a lawsuit against Texas resident Nathan Fuller, alleging he fraudulently raised approximately $12.3 million from about 150 investors through a fake "AI crypto trading bot" project.The SEC stated that from October 2022 to mid-2024, Fuller offered and sold crypto investment joint venture interests through entities named Privvy Investments LLC and Gateway Digital Investments. He claimed to use an "AI high-frequency arbitrage bot" for crypto asset trading and promised investors "guaranteed returns" of 40% to over 100% within 21 to 45 days.Regulators allege that Fuller also falsely claimed investment funds were protected by FDIC insurance, surety bonds, and professional liability insurance. In reality, the purported trading bot did not operate as advertised. The SEC charges that Fuller misappropriated at least $6.2 million of investor funds for personal expenses and used approximately $5.5 million from new investors for "Ponzi-like payments," while misleading investors through fake account statements and fictitious institutional communications.The SEC has filed a lawsuit in the U.S. District Court for the Southern District of Texas, accusing Fuller of violating securities offering and anti-fraud laws, and is seeking permanent injunctions, disgorgement of ill-gotten gains, and civil penalties.
U.S. CFTC Sues to Block Rhode Island’s Application of State Gambling Laws to Prediction Markets
The U.S. Commodity Futures Trading Commission (CFTC) has filed a motion to intervene in litigation before the U.S. District Court for the District of Rhode Island to block Rhode Island’s enforcement—under state gambling laws—against CFTC-registered prediction markets. The CFTC asserts that it holds clear and longstanding exclusive jurisdiction over event contracts under the Commodity Exchange Act, and that applicable state laws cannot override designated contract markets. Previously, Rhode Island had initiated a parallel state-court action seeking substantial civil penalties and demanding that the prediction markets cease operations and disgorge profits. This case marks the latest instance—following similar challenges by Arizona, Connecticut, Illinois, New York, and Minnesota—in which a state government has contested the CFTC’s regulatory authority over prediction markets.
Sichuan police cracked a cross-border pornography-related case involving fund flows exceeding USD 1.66 million, including transfers via virtual currencies.
According to the Xinhua Daily, police in Ya’an City, Sichuan Province, have cracked a cross-border online pornography-related criminal case. The pornographic manga website “Xiuxiu Seman” lured adolescents into making frequent small-value top-ups for profit. The site recorded over 100 million page views, with illicit transaction volumes reaching more than RMB 12 million (approximately USD 1.66 million). Police investigations revealed that domestic suspects received illicit funds through multiple corporate and personal accounts, and then transferred the proceeds overseas via virtual currencies under the direction of Li Mouwu and others. Recently, the Ya’an City Mingshan District People’s Court issued a first-instance verdict, sentencing five defendants to prison terms for crimes including profiting from disseminating obscene materials and aiding information network-related criminal activities. Judicial authorities are still investigating the overseas financial backers behind the website.
Google security engineer arrested and charged with insider trading on Polymarket
Odaily News Court documents released by the U.S. Attorney's Office for the Southern District of New York reveal that Google security engineer Michele Spagnuolo has been arrested and charged with using material non-public information to place bets on Polymarket related to Google user search results. According to the court documents, Spagnuolo used internal Google tools to track the list of the most searched-for individuals in 2025 and transferred approximately 3.8 million USDC to a Polymarket address. His associated account, AlphaRaccoon, placed bets on D4vd becoming one of the most searched-for individuals in late November just hours after accessing the internal tools. The documents further allege that AlphaRaccoon transferred 5 million USDC.e from a Polymarket account to a wallet, and subsequently moved the funds through exchange services and privacy tools, with some of the funds ultimately ending up in an account at a payment processing institution in Italy. Spagnuolo is accused of profiting over $1.2 million from these transactions and currently faces charges of commodities fraud, wire fraud, and money laundering.
A man sentenced to 12 years and 7 months for stealing 4 BTC, Fuzhou court rules that stealing Bitcoin constitutes theft
the Cangshan District People's Procuratorate of Fuzhou City disclosed that a man was sentenced to 12 years and 7 months in prison and fined 300,000 yuan for stealing 4 Bitcoins from another person and illegally profiting approximately 900,000 yuan. The verdict was upheld in the second instance.According to the case details, at the end of 2020, a person surnamed Wang commissioned a person surnamed Lin to assist in liquidating his Bitcoin holdings. While accessing Wang's Bitcoin wallet hard drive and computer, Lin stole the wallet's "private key" and related data, transferred 4 Bitcoins to his own account, and subsequently sold them off for profit. In 2024, Wang discovered the asset anomaly and reported it to the police, leading to Lin's arrest.The procuratorate stated that although current Chinese regulations clarify that virtual currencies do not hold legal tender status, Bitcoin possesses value, manageability, and transferability, which aligns with the general characteristics of "property" under criminal law. Therefore, it constitutes an object of property crimes, and related infringing actions will also be subject to criminal liability.
Swan Bitcoin faces nearly $1 billion lawsuit over Prime Trust collapse, accused of using insider information to transfer assets early
: Bitcoin financial services company Swan Bitcoin (along with its operating entity Electric Solidus Inc. named as defendants) is facing a lawsuit filed in the U.S. Bankruptcy Court for the District of Delaware, with claims approaching $1 billion.The lawsuit was filed by PCT Litigation Trust, aiming to recover crypto assets related to the 2023 collapse of Prime Trust. The plaintiff accuses Swan of using "material non-public information" to transfer funds out of Prime Trust before its failure, thereby avoiding significant losses.According to the court filing, Swan had transferred assets including approximately 11,992 Bitcoin (currently valued at around $917 million) out of Prime Trust before it filed for bankruptcy, along with roughly $22.4 million in fiat currency, $5 million in stablecoins, and 91,444 XRP tokens.The plaintiff also alleges that Swan had ties to a senior executive at Prime Trust, who also served as an external consultant for Swan. This individual is suspected of providing Swan with information prior to regulatory meetings, thereby helping the company withdraw its assets early.Swan Bitcoin responded, stating that the relevant assets belong to client trust property and should not be used for bankruptcy liquidation, expressing confidence that the court will ultimately support its position. (Decrypt)
US Judge Approves Aave to Proceed with Transfer of $71 Million in ETH Linked to North Korean Hackers
Odaily News: Margaret Garnett, a U.S. District Judge in Manhattan, has approved Aave's asset recovery proposal, allowing the transfer of approximately $71 million in ETH previously frozen on Arbitrum and linked to North Korean-linked attacks, to a wallet controlled by Aave LLC, while preserving the legal claims of terrorism victim plaintiffs over the funds. The ruling also amended the earlier freeze notice against the Arbitrum DAO, permitting the transfer to be executed through an on-chain governance vote and exempting those who propose, vote on, or participate in the transfer from liability under the freeze order. The transfer is still subject to an official vote by Arbitrum's on-chain governance. (CoinDesk)
Crypto Whale Sues Coinbase for Refusing to Return $55 Million in Stolen Funds
According to Decrypt, an anonymous cryptocurrency whale filed a lawsuit against Coinbase this week in the U.S. District Court for the Northern District of California, accusing the exchange of refusing to return over $55 million worth of DAI stablecoins stolen in a phishing attack in 2024. The plaintiff claims to have engaged multiple on-chain investigation firms to trace the funds, ultimately identifying that the stolen assets flowed into a Coinbase account. Coinbase confirmed in December 2024 that it had frozen the relevant assets but refused to return them, citing the need for a court order. As of today—more than a year and a half after the incident—the victim has still not recovered the assets and has therefore turned to litigation. The attack was carried out by hackers using the “Inferno Drainer” tool to spoof the DeFi Saver login page; after the victim inadvertently interacted with the fake page, their wallet was fully compromised by the attackers.
Bitcoin ATM operator Bitcoin Depot files for bankruptcy amid regulatory tightening and security vulnerabilities that rendered its business unsustainable
According to The Block, Bitcoin Depot (BTM), a Nasdaq-listed Bitcoin ATM operator, filed for Chapter 11 bankruptcy protection on the 18th in the U.S. District Court for the Southern District of Texas, announcing an orderly liquidation and asset sale. CEO Alex Holmes stated that increasingly stringent state-level compliance requirements, transaction limit restrictions, and operational bans in certain regions have rendered the company’s existing business model unsustainable. Previously, the company suffered a security breach in April 2026, resulting in a $3.7 million loss; its Q1 2026 revenue declined 49.2% year-on-year, with a net loss of $9.5 million. Currently, all over 9,000 Bitcoin ATMs operated globally by Bitcoin Depot have been taken offline, and its overseas entities—including those in Canada—will also be shut down.
US Judge Approves Aave to Proceed with Transfer of $71 Million in ETH Linked to North Korean Hackers
Odaily News: Margaret Garnett, a U.S. District Judge in Manhattan, has approved Aave's asset recovery proposal, allowing the transfer of approximately $71 million in ETH previously frozen on Arbitrum and linked to North Korean-linked attacks, to a wallet controlled by Aave LLC, while preserving the legal claims of terrorism victim plaintiffs over the funds. The ruling also amended the earlier freeze notice against the Arbitrum DAO, permitting the transfer to be executed through an on-chain governance vote and exempting those who propose, vote on, or participate in the transfer from liability under the freeze order. The transfer is still subject to an official vote by Arbitrum's on-chain governance. (CoinDesk)
Crypto Whale Sues Coinbase for Refusing to Return $55 Million in Stolen Funds
According to Decrypt, an anonymous cryptocurrency whale filed a lawsuit against Coinbase this week in the U.S. District Court for the Northern District of California, accusing the exchange of refusing to return over $55 million worth of DAI stablecoins stolen in a phishing attack in 2024. The plaintiff claims to have engaged multiple on-chain investigation firms to trace the funds, ultimately identifying that the stolen assets flowed into a Coinbase account. Coinbase confirmed in December 2024 that it had frozen the relevant assets but refused to return them, citing the need for a court order. As of today—more than a year and a half after the incident—the victim has still not recovered the assets and has therefore turned to litigation. The attack was carried out by hackers using the “Inferno Drainer” tool to spoof the DeFi Saver login page; after the victim inadvertently interacted with the fake page, their wallet was fully compromised by the attackers.
U.S. Law Firm Files for Restraining Order to Prevent Arbitrum DAO from Transferring Stolen and Frozen ETH from Kelp
According to Cointelegraph, U.S. law firm Gerstein Harrow LLP has filed an application with the U.S. District Court for the Southern District of New York seeking a temporary restraining order and three writs of execution to prevent the Arbitrum DAO from transferring 30,766 ETH (valued at approximately $73 million) frozen following the Kelp vulnerability. The firm argues that its clients obtained default judgments against North Korea in U.S. courts in 2010, 2015, and 2016, entitling them to roughly $877 million in compensation—and contends that the stolen ETH constitutes North Korean-linked assets that should be used to satisfy those judgments. Kelp DAO suffered a $292 million hack on April 18; the attacker was identified as TraderTraitor, a subgroup of the North Korean state-sponsored hacking group Lazarus Group. Aave Labs previously proposed unfreezing the seized funds and transferring them into the “DeFi United” fund to compensate rsETH holders—but this legal action by Gerstein Harrow may significantly delay compensation for victims. Members of the Arbitrum DAO community have criticized the move, arguing it shifts the burden of North Korea’s debts onto another set of victims, thereby exacerbating the original harm. Gerstein Harrow had previously pursued litigation related to the 2023 Heco Bridge hack involving Teth
ZachXBT: US Law Firms' "Free-Riding Claims" May Hinder Recovery and Compensation of Funds for Hacking Victims
Odaily Odaily PaperImperium, the head of MegaETH, disclosed on X platform that documents from the U.S. District Court for the Southern District of New York show that a U.S. court has issued an injunction against the Arbitrum DAO, prohibiting it from transferring approximately $71 million in ETH assets that were previously frozen during the KelpDAO hacking incident. In response, on-chain detective ZachXBT posted on X platform, stating that certain U.S. law firms are using his investigative work and on-chain forensics to help victims of some hacking incidents file legal claims. However, this practice may actually slow down or hinder victims from receiving compensation or recovering funds.ZachXBT added that in previous hacking incidents involving the Lazarus Group, such law firms often stepped in after on-chain fund tracking or freezing was completed, proposing subsequent legal actions that were weakly related to the crypto incidents themselves. Similar "free-riding claims" strategies were used in events like Harmony and Bybit. He called on the crypto community to establish a DAO to resist such practices.
New York court orders Arbitrum DAO to freeze $71 million in ETH, potentially for compensation to victims of North Korea-related cases
: MegaETH lead PaperImperium disclosed on X platform a court document from the U.S. District Court for the Southern District of New York, showing that a U.S. court has issued an injunction against the Arbitrum DAO, prohibiting it from transferring approximately $71 million worth of ETH assets that were previously frozen in the KelpDAO hacking incident. The plaintiffs are attempting to use these funds to enforce outstanding judgment compensation in cases related to North Korea's involvement in terrorism, kidnapping, and other matters spanning several years. They have also filed a motion to serve legal notice to the Arbitrum DAO via alternative means, treating it as an accountable "partnership." The court document further notes that the Arbitrum DAO has a Security Council governed by ARB holders, which has the authority to take action in emergencies. As a result, relevant members who refuse to comply may face legal consequences such as contempt of court. Market observers believe that this case could set an important precedent for the U.S. judicial system to directly constrain DAO governance structures, further highlighting the compliance pressure faced by DeFi protocols under real-world legal frameworks.
CFTC sues New Mexico, continuing battle for regulatory control of sports prediction markets
: The U.S. CFTC has filed a lawsuit in the U.S. District Court for the District of New Mexico against Governor Michelle Lujan Grisham, Attorney General Raúl Torrez, and other officials, aiming to prevent the state from applying gambling regulations to prediction market platforms.Previously, New Mexico sued Kalshi, accusing it of offering unauthorized sports betting to state residents and allowing users below the state's legal gambling age of 21 to participate. The New Mexico Attorney General stated that legal gambling in the state can only operate under tribal-state gaming compacts or a strict state regulatory framework.The CFTC argues that platforms like Kalshi offer federally regulated derivative contracts, not gambling products under state law. CFTC Chairman Michael Selig stated that New Mexico is attempting to impose state gambling laws on a federal derivatives exchange that falls under the CFTC's exclusive jurisdiction.Over the past few months, the CFTC has filed lawsuits against several states, including Wisconsin, Illinois, Arizona, Connecticut, and New York, to establish its regulatory authority over sports prediction markets. This week, the agency also proposed broader rules for prediction markets that still generally permit sports-related contracts, indicating an escalating conflict between federal and state governments over the boundaries of prediction markets and sports betting.
U.S. Department of Justice: Two Men Arrested for Allegedly Laundering Over $389 Million Through Cryptocurrency
The U.S. Attorney's Office for the Eastern District of Pennsylvania announced that Ruslan Igorevich Tkachuk and Alexander Vladimirovich Ledenev have been arrested for allegedly operating the cryptocurrency money laundering service AudiA6. Since its launch in 2021, the service has received approximately 10,333 bitcoins, valued at over $389 million at the time of the transactions. Of this amount, at least $19.234 million worth of bitcoin came directly from illegal sources such as darknet markets and ransomware groups. A joint international law enforcement operation has seized and frozen the servers, domain names, and Telegram accounts associated with AudiA6.
60-year-old woman poses as a 20-year-old girl in online romance, defrauding a young man of over 200,000 yuan for virtual currency investment that ended in total loss
Odaily Odaily News Recently, the Haidian District Court ruled on a fraud case. Retiree Meng, addicted to virtual currency trading and unwilling to use her own pension, pretended to be a young woman named Xiaohong, claiming to work for a central ministry in her 20s, on a short video platform. She established an online romantic relationship with a young man. Under the pretext of needing urgent surgery fees for a family member and preparing for overseas study exams, Meng defrauded the man of more than 200,000 yuan.Meng invested all of the defrauded 200,000 yuan into virtual currency trading, opening a ten-times leverage position. Subsequently, due to a market downturn, her position was liquidated, resulting in a total loss of all funds. The Haidian District Procuratorate previously indicted Meng for fraud. Ultimately, the Haidian District Court sentenced Meng to four years in prison and imposed a fine, while also ordering her to compensate the victim for his economic losses. (Beijing Evening News)
A man in Shandong sentenced to 10 years and 9 months in prison for stealing 107 Bitcoins from a victim
the Qingdao Licang District Procuratorate issued an announcement stating that the defendant, surnamed Zhang, took advantage of an opportunity to register a virtual currency wallet on behalf of the victim to obtain the seed phrase, and subsequently transferred 107 Bitcoins from the victim, surnamed Feng, in multiple batches during the early morning hours. Zhang then layered the transfers through various virtual currency trading platforms, converting the Bitcoin into over 660,000 RMB. The Qingdao Licang District People's Court sentenced Zhang to 10 years and 9 months in prison and imposed a fine of 100,000 RMB for the crime of theft in the first instance.After the defendant appealed, the Qingdao Intermediate People's Court ruled to dismiss the appeal and uphold the original verdict. The case determined the theft amount based on the actual illegal proceeds from the sale, totaling over 660,000 RMB. (Shandong Legal Daily)
Swan Bitcoin faces nearly $1 billion lawsuit over Prime Trust collapse, accused of using insider information to transfer assets early
: Bitcoin financial services company Swan Bitcoin (along with its operating entity Electric Solidus Inc. named as defendants) is facing a lawsuit filed in the U.S. Bankruptcy Court for the District of Delaware, with claims approaching $1 billion.The lawsuit was filed by PCT Litigation Trust, aiming to recover crypto assets related to the 2023 collapse of Prime Trust. The plaintiff accuses Swan of using "material non-public information" to transfer funds out of Prime Trust before its failure, thereby avoiding significant losses.According to the court filing, Swan had transferred assets including approximately 11,992 Bitcoin (currently valued at around $917 million) out of Prime Trust before it filed for bankruptcy, along with roughly $22.4 million in fiat currency, $5 million in stablecoins, and 91,444 XRP tokens.The plaintiff also alleges that Swan had ties to a senior executive at Prime Trust, who also served as an external consultant for Swan. This individual is suspected of providing Swan with information prior to regulatory meetings, thereby helping the company withdraw its assets early.Swan Bitcoin responded, stating that the relevant assets belong to client trust property and should not be used for bankruptcy liquidation, expressing confidence that the court will ultimately support its position. (Decrypt)
OpenAI Lawsuit: Microsoft CEO Satya Nadella Testifies in Court as Altman-Musk Dispute Escalates to Core Partnership Relations in the AI Giant
Odaily Odaily News: In the OpenAI lawsuit, Satya Nadella testified in court as Microsoft's CEO at the U.S. District Court in Oakland, California. The case centers on the ongoing legal dispute over OpenAI's non-profit structure and its path to commercialization. The lawsuit, filed by Elon Musk in 2024, accuses Microsoft of "aiding and abetting the breach of charitable trust obligations" during OpenAI's transition from a non-profit organization to a commercial entity. Microsoft has been making strategic investments in OpenAI since 2019, with cumulative investments reaching approximately $13 billion by 2023, making it one of OpenAI's most important external supporters.During the trial, Satya Nadella reviewed the early partnership between Microsoft and OpenAI, mentioning that the two parties had established deep technological and computing power collaboration before the launch of ChatGPT. In his earlier testimony, Musk stated that Microsoft's additional investment of approximately $10 billion in OpenAI in 2023 was the key turning point that prompted him to file the lawsuit, adding that the scale of the investment altered OpenAI's original non-profit-oriented structure. During the trial, Musk stated: "We are concerned they are turning a charitable organization into a commercial tool." He also questioned Microsoft's potential dominant position in the development of Artificial General Intelligence (AGI) and pointed out that its deep integration with OpenAI could impact the competitive landscape of the industry.The case is currently still under trial, and the debate surrounding OpenAI's governance structure, non-profit status, and control over the AI industry is expected to continue. (CNBC)
Related news
xAI's trade secret lawsuit against OpenAI dismissed by federal judge
A federal judge has dismissed xAI's trade secret lawsuit against OpenAI, without leave to amend the complaint. U.S. District Judge Rita Lin ruled that xAI failed to prove that OpenAI induced its former engineer to disclose trade secrets related to the Grok chatbot during the hiring process.The judge noted that merely asking job candidates to discuss their past work is a standard hiring practice and does not imply inducement to leak confidential information. Accepting xAI's allegations could expose employers to legal risks whenever they inquire about a candidate's previous work experience. Previously, Elon Musk had sued OpenAI, Sam Altman, and co-founder Greg Brockman for deviating from the company's non-profit mission, a lawsuit that was dismissed by a federal jury last month. (decrypt)
Sichuan police cracked a cross-border pornography-related case involving fund flows exceeding USD 1.66 million, including transfers via virtual currencies.
According to the Xinhua Daily, police in Ya’an City, Sichuan Province, have cracked a cross-border online pornography-related criminal case. The pornographic manga website “Xiuxiu Seman” lured adolescents into making frequent small-value top-ups for profit. The site recorded over 100 million page views, with illicit transaction volumes reaching more than RMB 12 million (approximately USD 1.66 million). Police investigations revealed that domestic suspects received illicit funds through multiple corporate and personal accounts, and then transferred the proceeds overseas via virtual currencies under the direction of Li Mouwu and others. Recently, the Ya’an City Mingshan District People’s Court issued a first-instance verdict, sentencing five defendants to prison terms for crimes including profiting from disseminating obscene materials and aiding information network-related criminal activities. Judicial authorities are still investigating the overseas financial backers behind the website.
CFTC sues New Mexico, continuing battle for regulatory control of sports prediction markets
: The U.S. CFTC has filed a lawsuit in the U.S. District Court for the District of New Mexico against Governor Michelle Lujan Grisham, Attorney General Raúl Torrez, and other officials, aiming to prevent the state from applying gambling regulations to prediction market platforms.Previously, New Mexico sued Kalshi, accusing it of offering unauthorized sports betting to state residents and allowing users below the state's legal gambling age of 21 to participate. The New Mexico Attorney General stated that legal gambling in the state can only operate under tribal-state gaming compacts or a strict state regulatory framework.The CFTC argues that platforms like Kalshi offer federally regulated derivative contracts, not gambling products under state law. CFTC Chairman Michael Selig stated that New Mexico is attempting to impose state gambling laws on a federal derivatives exchange that falls under the CFTC's exclusive jurisdiction.Over the past few months, the CFTC has filed lawsuits against several states, including Wisconsin, Illinois, Arizona, Connecticut, and New York, to establish its regulatory authority over sports prediction markets. This week, the agency also proposed broader rules for prediction markets that still generally permit sports-related contracts, indicating an escalating conflict between federal and state governments over the boundaries of prediction markets and sports betting.
U.S. Department of Justice: Two Men Arrested for Allegedly Laundering Over $389 Million Through Cryptocurrency
The U.S. Attorney's Office for the Eastern District of Pennsylvania announced that Ruslan Igorevich Tkachuk and Alexander Vladimirovich Ledenev have been arrested for allegedly operating the cryptocurrency money laundering service AudiA6. Since its launch in 2021, the service has received approximately 10,333 bitcoins, valued at over $389 million at the time of the transactions. Of this amount, at least $19.234 million worth of bitcoin came directly from illegal sources such as darknet markets and ransomware groups. A joint international law enforcement operation has seized and frozen the servers, domain names, and Telegram accounts associated with AudiA6.
A South Korean currency exchanger involved in the Huione Group was sentenced to two years’ imprisonment for failing to report virtual asset transactions.
According to Digital Asset, a Korean currency exchange dealer in his 40s, identified as “A,” was sentenced to two years’ imprisonment and ordered to forfeit 133 million KRW by the Seoul Central District Court for unreported virtual asset transactions linked to Huiwang Group—a Cambodian money laundering organization. The court ruled that between 2022 and 2024, A conducted approximately 15.5 billion KRW worth of digital asset transactions across 194 instances without reporting them to financial authorities; and between 2021 and 2023, he engaged in approximately 2.9 billion KRW worth of unregistered foreign exchange activities—including remittances to China—across 135 instances. This marks the first time a South Korean court has issued a guilty verdict related to digital asset money laundering allegations involving Huiwang Group.
60-year-old woman poses as a 20-year-old girl in online romance, defrauding a young man of over 200,000 yuan for virtual currency investment that ended in total loss
Odaily Odaily News Recently, the Haidian District Court ruled on a fraud case. Retiree Meng, addicted to virtual currency trading and unwilling to use her own pension, pretended to be a young woman named Xiaohong, claiming to work for a central ministry in her 20s, on a short video platform. She established an online romantic relationship with a young man. Under the pretext of needing urgent surgery fees for a family member and preparing for overseas study exams, Meng defrauded the man of more than 200,000 yuan.Meng invested all of the defrauded 200,000 yuan into virtual currency trading, opening a ten-times leverage position. Subsequently, due to a market downturn, her position was liquidated, resulting in a total loss of all funds. The Haidian District Procuratorate previously indicted Meng for fraud. Ultimately, the Haidian District Court sentenced Meng to four years in prison and imposed a fine, while also ordering her to compensate the victim for his economic losses. (Beijing Evening News)