Today in Crypto: US House Eyes Probe of Cawthorn’s Crypto Dealings; Investors Take $10B Out of Tether

Tether, Probe, Bank, Fraud, DoJ

U.S. Rep. Madison Cawthorn, who recently lost his primary to represent western North Carolina again, is now under investigation for crypto-related matter, a press release from the U.S. House Committee on Ethics said Monday (May 23).

This comes after he might have improperly promoted a cryptocurrency in which he may have had an undisclosed financial interest, the release said.

Meanwhile, CNBC writes that investors have pulled over $10 billion out of tether in the last two weeks as regulatory scrutiny increases.

Tether, the world’s biggest stablecoin and meant to be pegged to the U.S. dollar, dipped as low as 95 cents on May 12 in the wake of the collapse of the UST stablecoin, which completely collapsed around that time and sent crypto as a whole spiraling down.

In other news, Crypto Valley Venture Capital is debuting an Africa-focused fund to support blockchain startups on the continent, Coindesk wrote.

The fund will invest in 100 startups on the continent in the next four years.

It has already invested in 12 startups in which blockchain use cases “go far beyond cryptocurrencies to drive Africa’s future to date.”

Elsewhere, Binance promoted TerraUSD as “safe” weeks before the collapse, Financial Times (FT) reported.

It advertised on April 6 a new investment scheme where clients lend out terra to earn a yield of around 20% as a “safe and happy” way to earn.

Binance is one of the most influential crypto players and its promotion, according to FT, “highlights the central role crypto exchanges play in choosing which digital tokens are made easily accessible to mainstream traders.”

Meanwhile, Bithumb and Upbit, two of the big Korean crypto exchanges, are warning about Litecoin due to an update allowing transactions to be sent confidentially.

Litecoin’s activation of privacy-focused tech Mimblewimble adds confidential transactions, letting users send tokens while hiding transaction information. The two exchanges cited anti-money laundering and know-your-customer laws, and may delist Litecoin.

Furthermore, FTX is looking at buying brokerage startups as the company expands into stocks, CNBC reported.

The CEO of the exchange has also taken a big stake in brokerage app Robinhood.

The company has already approached at least three privately held startups about buying them, the report said.

Luxury fashion house Balenciaga plans to start accepting cryptocurrency as payment, wrote.

That will start out with flagship stores in the U.S. and the company site, though there will be further rollouts later, the report said.

In more crypto news, industry representatives don’t want to report details of NFTs, DeFi and other such activities to tax authorities, they’ve said at a Organisation for Economic Co-operation and Development (OECD) meeting in Paris on Monday.

The report notes that international tax standard-setters want to make it so bank sector rules in this arena can also stop foreign bitcoin holdings from being kept secret from revenue services.