Three biggest crypto stories from the past week

The past week in crypto was eventful with news across beats, especially on the policy side. The U.S. Securities and Exchange Commission (SEC) fined and settled with Kim Kardashian for a crypto promotion. The European Council passed the European Union's (EU's) landmark Markets in Crypto-Assets (MiCA) bill. The EU also banned crypto payments from Russia in a new sanctions package. And finally, bankrupt crypto lender Celsius set dates for the auction of its assets. Here's a quick recap of the three biggest crypto stories from the past week.

Kim Kardashian's SEC settlement

Kim Kardashian hit the headlines last week when the SEC announced a fine and settlement with her for allegedly failing to disclose income related to her promotion of the EthereumMax (EMAX) token. The reality TV star-turned-business mogul had earned $250,000 for publishing a post to her Instagram account about EMAX tokens.

SEC Chair Gary Gensler said the Kardashian case is a reminder that when celebrities endorse investment opportunities, it doesn't mean those investment products are suitable for all investors.

As part of her settlement, Kardashian agreed not to promote any "crypto asset securities" for three years. The SEC's investigation into EthereumMax is ongoing.

While the SEC settlement ends Kardashian's case with the government, it may complicate a class action lawsuit that seeks damages from her, other celebrities and executives of EthereumMax, The Block reported on Friday.

The class action lawsuit was filed in January by Ryan Huegrich on behalf of all investors who purchased EMAX tokens between May 14 and June 17 of 2021, claiming executives and promoters of EthereumMax made false or misleading statements through social media and other promotions. Among those promoters are Kardashian, boxer Floyd Mayweather Jr. and former NBA player Paul Pierce, all of whom have filed motions to dismiss the case against them.

But Kardashian's settlement with the SEC gives "instant credibility" to the plaintiff's claims in the class action lawsuit case, Curtis Miner, an attorney at Colson Hicks Eidson, told The Block.

Other attorneys agreed, though they declined to go on-record regarding the case.

EU's MiCA bill and ban on crypto payments from Russia

The past week saw two significant policy developments in Europe. The EU's landmark Markets in Crypto-Assets (MiCA) bill passed in the European Council on Wednesday. A day later, the EU banned crypto payments from Russia in a new sanctions package.

The MiCA bill sets out to bring the issuance of cryptocurrencies under the wing of institutional regulation and establishes a first-time regime for crypto-asset service providers across the EU's member states. The bill will need to pass an additional vote in the European Parliament next week. If approved, laws will be in place at the start of 2024 at the earliest.

As for the EU's Russia crypto ban, it slashed the previous cap of €10,000 on crypto payments from Russia to nil. The sanctions package responds to recent referenda in Russian-occupied regions in Ukraine.

As part of the fresh EU sanctions against Russia, NFT company Dapper Labs issued warnings to users who have "connections" to Russia that funds held in their account-based crypto wallets have been frozen, according to emails seen by The Block.

The correspondence, which apologizes for "any inconvenience," states that clients will be able to view their NFTs but will not be able to sell or transfer them to other wallets. The letter cites the EU's recent financial sanctions against Russia for its invasion of Ukraine in February.

Celsius's auction of its assets

Bankrupt crypto lender Celsius set a timeline for the auction of its assets. It will have a final bid deadline of Oct. 17 at 4 p.m. Eastern Time — with an auction, if necessary, on Oct. 20 at 10 a.m. ET. A sale hearing will be held on Nov. 1 at 11 a.m. ET.

A large number of participants is expected to attend the sale hearing. It remains to be seen who emerges as the highest and best bid for Celsius's assets.

Amid the bankruptcy proceedings, Celsius co-founder Daniel Leon resigned this week, a few days after the firm's founder and CEO, Alex Mashinsky, departed. New court filings showed that Leon and Mashinsky withdrew more than $1o million in cryptocurrency before the company froze client withdrawals and ultimately declared bankruptcy.

This past week, Celsius also disclosed the names and trading history of its platform's users in the latest court filing. The huge data leak could let anyone connect the named users with their previously anonymous cryptocurrency wallets and see their crypto holdings and other transaction information. What's also potentially damaging about this information is the way it could identify high-value cryptocurrency owners. While home addresses were not revealed, this information can be found separately — and many crypto users already had that data publicly leaked via the Ledger data breach.