Over the Christmas period, we’ve seen Do Kwon face justice, Richard Heart continue to run from it, and the IRS making life difficult for crypto users (again).
Do Kwon Appears in US Court
Having been on the run for almost two years, Terraform Labs’ co-founder Do Kwon finally entered a US courtroom this week following his extradition from Montenegro. Kwon pleaded not guilty to nine types of financial fraud, including a recently added money laundering charge, which could see him jailed for a bazillion years if found guilty.
Kwon is going to have to put up quite a strong defence to ward off all nine charges, and it wouldn’t be a surprise to see him coming to an agreement with prosecutors as we get closer to the trial date. If not, buckle up.
Richard Heart Joins Interpol Red List
HEX founder Richard Heart has been on the run from authorities since August 2023, with the U.S. Securities and Exchange Commission charging him with spending over $12 million of investors’ money on luxury clothes, cars, and more. Three months later, the SEC was forced to admit that they couldn’t find him and so couldn’t serve him with the lawsuit, a state of affairs that remains to this day.
In its attempts to track him down, US authorities have turned to Interpol, with Heart’s name added to its top priority Red List, a list normally reserved for the worst kinds of fugitives. This increases the likelihood that Heart will eventually be found, where the reception will be frosty to say the least.
IRS Faces Rebellion Over Broker Definition
Crypto users and the Internal Revenue Service (IRS) have never been the best of friends, but things got worse over Christmas when the IRS enforced the U.S. Treasury’s definition of brokers to include digital asset brokers. While Congress specifically excluded decentralized exchanges and peer-to-peer marketplaces, the Treasury’s new rules interpret “brokers” more broadly to encompass entities facilitating DeFi transactions, regardless of their intermediary status.
As a result, the Blockchain Association, Texas Blockchain Council, and DeFi Education Fund filed a lawsuit against multiple entities, contending that this redefinition is unlawful, emphasizing that decentralized finance operates without traditional brokers and cannot comply with requirements like identifying and reporting user transaction details.
