Crypto
Who is Mike Belshe, the cryptocurrency executive hosting JD Vance fundraiser in Palo Alto?
Tech entrepreneur Mike Belshe was set to host vice presidential contender Ohio Sen. JD Vance for his second fundraising visit to the Bay Area on Monday in his Palo Alto home.
Belshe is one of several tech executives who have come out in support of the GOP ticket or have helped in their efforts to raise more cash.
Vance worked closely early on in his career in venture capital in San Francisco with venture capitalist and PayPal co-founder Peter Thiel and counts billionaire investor Marc Andreessen and Tesla and X CEO Elon Musk as among his tech industry connections.
Donald Trump’s Republican vice presidential pick is hoping to use his Silicon Valley connections to bolster the war chest of the Republican presidential campaign.
And the tickets to the fundraiser come at a steep price. A $25,000 donation per person includes participation in the roundtable, a photo and dinner with the vice presidential candidate. For $15,000, attendees can get a photo and dinner, while $3,300 allows participation in the dinner only.
Last time Vance, known for his best-selling memoir “Hillbilly Elegy,” about his Appalachian roots, was in the Bay Area in June, he helped raise $12 million at the San Francisco home of billionaire tech entrepreneur David Sacks.
The announcement that Belshe, a crypto executive, would host Vance for the fundraiser should come as no surprise. Trump has positioned himself as a pro-crypto president if he were to be elected for another term.
According to a Newsweek report, the former president spoke at a cryptocurrency conference on Saturday, making five major promises to the cryptocurrency industry. These promises included fighting inflation with crypto-friendly policies, encouraging the use of excess energy for cryptocurrency mining, and firing a government official viewed as anti-crypto.
Here are five things to know about Belshe:
— Belshe is the CEO and co-founder of BitGo, a pioneering cryptocurrency wallet, digital asset trust and security company based in Palo Alto. The company was founded in 2013 by Belshe and Ben Davenport, a former software engineer with Google and Facebook. BitGo’s valuation was pegged at $1.75 billion last year after securing Series C funding.
— As a computer engineer, Belshe helped program the SPDY protocol, which made web browsing faster, and authored HTTP/2.0, which allowed websites to communicate with users’ web browsers more efficiently.
— Belshe began his tech career as a software engineer at Hewlett Packard in 1993 before joining Netscape in 1995, where he worked on the Netscape Enterprise server.
— He is an alumnus of California Polytechnic State University-San Luis Obispo, graduating in 1993. According to his LinkedIn profile, Belshe was voted “Computer Science Senior of the Year.”
— Belshe has been posting political content on his X account over the past month. On July 27, two days before the fundraiser, he posted this pro-cryptocurrency quote from Trump: “Bitcoin is not a threat to the US dollar. They have it backwards. The US government is the biggest threat to the US dollar.”
“Bitcoin is not a threat to the US dollar. They have it backwards. The US government is the biggest threat to the US dollar.”
– President Donald Trump
— Mike Belshe (@mikebelshe) July 27, 2024
—
Originally Published:
Crypto
Bitcoin Jumps on Calls to Integrate Crypto Into US Asset Arsenal
The price of bitcoin hit a six-week high Monday (July 29). The alleged reason? Separate comments made over the weekend by presidential candidates Donald Trump and Robert F. Kennedy Jr. at Nashville’s Bitcoin Conference that observers believe could signal, if not herald, greater legitimization of the cryptocurrency sector.
Kennedy, an independent candidate, called for launching a multi-million-dollar U.S. strategic reserve of bitcoin that matched the government’s current stake in gold.
Republican candidate Trump refrained from calling for a full-on strategic reserve, pledging instead to maintain the U.S. government’s current stash of bitcoin rather than selling it off, calling it a national “stockpile” of cryptocurrency.
The U.S. government, through various agencies, has increasingly seized significant amounts of cryptocurrencies in the course of financial crime enforcement. These assets are typically auctioned off, with proceeds going to the Treasury Forfeiture Fund or other government accounts. The current approach treats these digital assets as financial gains rather than strategic reserves.
The notion of potentially integrating digital assets into the U.S. government’s strategic reserves presents a disruptive approach that recognizes the evolving financial landscape and sees a role in it for cryptocurrencies. That’s something that proponents of the sector have been working toward, but skeptics remain wary in the face of crypto scams and other illicit activity in the sector.
Read more: Crypto’s Three Priorities for 2024: Interoperability, Acceptance, Regulation
Crypto and Global Financial Crime
According to a report by Chainalysis, $24.2 billion of illicit cryptocurrency was transferred in 2023, with over 60% of illegal crypto activity being tied to sanctioned groups or terrorist organizations.
Financial crime remains a challenge for financial institutions (FIs) worldwide, evolving in complexity and scale with each passing day. The U.S. government, through agencies such as the Department of Justice (DOJ) and the Treasury Department, has increasingly encountered cryptocurrencies in its enforcement actions against financial crimes. These assets are often seized during investigations related to money laundering, drug trafficking, and other illegal activities. Traditionally, seized cryptocurrencies are auctioned off, with proceeds directed to government funds.
But as digital assets become more integral to the global financial system, the question arises: Should the U.S. government consider stockpiling cryptocurrencies as part of its strategic reserves?
Holding cryptocurrencies could provide the U.S. government with a flexible financial tool. Unlike traditional reserves, which are often physical commodities, cryptocurrencies are highly liquid digital assets. They can be quickly converted into fiat currencies or used directly in transactions that accept digital payments. This flexibility could be invaluable during financial crises or emergencies, providing the government with a readily accessible source of funds.
Establishing a cryptocurrency reserve would signal the U.S. government’s recognition of the growing importance of digital assets. This could encourage further development of blockchain technology and related innovations within the U.S.
But there is considerable public skepticism about the government’s involvement in holding digital currencies, given their association with illicit activities — and the ongoing rise in frequency of those illicit activities, particularly in the financial sector.
Read more: Blockchain’s Benefits for Regulated Industries
Countries around the world, including the U.S., have expressed concern that privately operated, highly volatile digital currencies could undermine government control of the financial and monetary systems, increase systemic risk, promote financial crime and hurt investors.
After all, on Thursday (July 25) cryptocurrency exchange Coinbase was fined $4.5 million by a U.K. regulator for serving “high-risk” customers. And this past April, U.S. Treasury Deputy Secretary Wally Adeyemo testified that cryptocurrency is increasingly becoming a safe haven for “malign actors” such as terror groups.
As a result, FIs have needed to step up their financial crime defenses. Seven in 10 FIs are now using AI and machine learning (ML) to fend off fraudsters, according to the PYMNTS Intelligence and Hawk collaboration, “Financial Institutions Revamping Technologies to Fight Financial Crimes.”
In an interview with PYMNTS, Wolfgang Berner, co-founder and CPO of Hawk, discussed the opportunities that large transaction models (LTMs) — generative artificial intelligence (AI) models adapted to financial crime — represent in establishing more robust, accurate and comprehensive detection and prevention mechanisms.
“The core idea is we treat transactions as sentences, teaching the transformer model the language and grammar of transactions, similar to how large language models like GPT-4 are trained on the text of the web,” Berner said. “And by doing that, it develops a very good understanding of the transactions, how transactions relate to each other, and what is genuine or possibly suspicious with them.”
Crypto
Bitcoin price hits six-week high after Trump backs cryptocurrency
Bitcoin has hit its highest level in more than six weeks after Donald Trump said at the weekend he would end the “persecution” of the crypto industry if he wins the US presidential election.
The cryptocurrency’s price rose by more than 3% on Monday to peak at about $69,745, the highest since 12 June when the currency changed hands at more than $69,800.
The increase comes after supportive comments from Trump at the Bitcoin 2024 convention in Nashville, Tennessee, where he said on Saturday he would make the US the world’s cryptocurrency leader and embrace a more pro-bitcoin stance than his rival, Kamala Harris.
The former president said: “I pledge to the bitcoin community that the day I take the oath of office, Joe Biden and Kamala Harris’s anti-crypto crusade will be over … If we don’t embrace crypto and bitcoin technology, China will, other countries will. They’ll dominate, and we cannot let China dominate. They are making too much progress as it is.”
He also said he would sack the chair of the US financial watchdog the Securities and Exchange Commission (SEC), on the first day of his presidency if he won the election. “On day one, I will fire Gary Gensler,” Trump said, to cheers of approval from the audience.
Gensler is a noted sceptic about cryptocurrencies, despite aiding them in January by approving exchange-traded funds (ETFs) – a basket of assets that can be bought and sold like shares on an exchange – that track the price of bitcoin.
The SEC chair said in a statement approving the ETFs that bitcoin was a “speculative, volatile” asset used for illegal activities including ransomware and terrorist financing. Since 2023 the SEC has launched more than 40 crypto-related enforcement actions.
Speaking at the bitcoin convention, Trump said he would establish a crypto presidential advisory council and create a national “stockpile” of bitcoin using cryptocurrency the US government held that was largely seized in law enforcement actions.
“Never sell your bitcoin,” Trump said. “If I am elected, it will be the policy of my administration, the United States of America, to keep 100% of all the bitcoin the US government currently holds or acquires into the future.”
The Financial Times also reported on Saturday that Harris’s advisers had approached top crypto companies to try to “reset” the relationship between the Democratic party and the sector. Approaches had been made to the Coinbase crypto exchange, the stablecoin company Circle and the blockchain payments group Ripple Labs, the FT said.
Crypto
GA man sentenced to prison after pleading guilty to bilking 40+ people in cryptocurrency scheme
An east Georgia man has been sentenced to prison after pleading guilty to a scheme to sell expensive computer equipment to more than 40 people who never received their orders.
Steven Drawdy, 40, of Grovetown, Georgia, was sentenced to 32 months in prison after pleading guilty to wire fraud.
He was ordered to pay more than $1.1 million in restitution to his victims and will serve three years of supervised release at the end of his prison term.
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Between August 2021 and April 2022, Drawdy participated in an online cryptocurrency discussion forum and received over $1 million from at least 42 victims who believed they were paying him to receive cryptocurrency “mining” computers.
None of the customers ever received the computers.
According to the U.S. Attorney for the Southern District of Georgia, Drawdy would pocket the payments and eventually stop communicating with his customers.
Is some cases, he would offer a partial refund but would require they pay a “processing fee” to get the refund, and then would never deliver the refund nor the computer and cut off all communication with the customer.
“Steven Drawdy ripped off dozens of people by preying on their desire to make money in the complex world of cryptocurrency,” said U.S. Attorney Steinberg. “Our law enforcement partners did exceptional work in identifying and shutting down this scheme.”
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