New York Attorney General, Letitia James, has filed a lawsuit against cryptocurrency exchange CoinEx, accusing it of conducting business illegally over its failure to register with the state. The attorney general accuses CoinEx of engaging in “repeated and persistent fraudulent practices.”

The Canadian Securities Administrators (CSA), an organization made up of securities regulators from each of the ten provinces and three territories in the country, has published a long list of new requirements for crypto firms looking to stay legally compliant.

Ethereum’s core developers have scheduled the launch of the Shanghai-Capella upgrade on the Sepolia testnet for February 28, at epoch 56832. Shanghai-Capella, also known as Shapella, is an upgrade that aims to enable staked ether withdrawals for network validators.

 Top stories in the Crypto Roundup today:

• New York Sues CoinEx Over Failure to Register With the State
• Canadian Regulators to Ban Algorithmic Stablecoins
• Ethereum Developers Schedule Shanghai Upgrade on Testnet
• Stablecoin Market Cap Falls for 11th Consecutive Month

New York Sues CoinEx Over Failure to Register

New York Attorney General Letitia James, has filed a lawsuit against cryptocurrency exchange CoinEx, accusing it of conducting business illegally over its failure to register with the state. The attorney general accuses CoinEx of engaging in “repeated and persistent fraudulent practices.”

In documents filed with a New York state court in Manhattan, Letitia James says the exchange’s failure to register as a commodity broker-dealer, securities broker, or securities dealer violated the Martin Act, a state law used to fight financial fraud.

New York’s Attorney General also said that CoinEx held itself without state permission as a global cryptocurrency exchange, and failed to comply with a subpoena for testimony about its activities last month.

The lawsuit seeks restitution and a ban on access to CoinEx’s mobile application and website in the state of New York. CoinEx is a Hong Kong-based cryptocurrency exchange founded in 2017.

Canadian Regulators to Ban Algorithmic Stablecoins

The Canadian Securities Administrators (CSA), an organization made up of securities regulators from each of the ten provinces and three territories in the country, has published a long list of new requirements for crypto firms looking to stay legally compliant.

The CSA has ordered domestic cryptocurrency trading platforms to obtain prior written approval before enabling customers to purchase or deposit stablecoins or any other type of "Value Referenced Crypto Assets" (VRCAs). To obtain consent, these platforms must meet numerous due diligence requirements set by the administrators, which include ensuring that the stablecoin is fiat-backed. In a notice, the regulator wrote:

“For greater certainty, we would not expect to provide consent in respect of a VRCA that is not fully backed by an appropriate reserve but rather maintains its value through an algorithm.”

Stablecoins are digital currencies that attempt to offer investors price stability through a mechanism that allows them to remain pegged to the value of a specific asset. Leading stablecoins USDT and USDC are pegged to the value of the US dollar by keeping reserves backing every token in circulation at a 1:1 ratio.

Algorithmic stablecoins, on the other hand, rely on complex algorithms to keep their prices stable.

Ethereum Developers Schedule Shanghai Upgrade on Testnet

Ethereum’s core developers have scheduled the launch of the Shanghai-Capella upgrade on the Sepolia testnet for February 28, at epoch 56832. Shanghai-Capella, also known as Shapella, is an upgrade that aims to enable staked ether withdrawals for network validators.

The upgrade involves changes to both the execution layer and the consensus layer of Ethereum. Shanghai will focus on enhancing the execution layer, while Capella will improve the consensus layer of the blockchain.

Developers have scheduled several phases of public testing to ensure the final upgrade in March is successful. The upcoming launch on Sepolia will be the second public testnet to implement the upgrade, while Shapella has already undergone testing on the Zhejiang testnet earlier this month.

Some minor bugs were discovered during the Zhejiang testing, which have since been resolved. After deploying Shapella, developers are set to move to the Goerli testnet for a final testing phase ahead of enabling withdrawals on the mainnet.

Stablecoin Market Cap Falls for 11th Consecutive Month

Stablecoins experienced a 0.68% decrease in their total market capitalization in February, dropping to $136 billion. This marks the lowest market cap for stablecoins since September 2021, and the eleventh consecutive month of decline.

The current market share for stablecoins stands at 11.4%, down from 12.31% in January and marking the lowest market share since April 2022. The decline in stablecoin dominance can be attributed to the recent surge in crypto asset prices and the resulting decrease in stablecoin market capitalization.

Dive deeper into the stablecoin space with CryptoCompare’s latest Stablecoins & CBDCs Report.

State of the Crypto by Top Tier Exchange Volume

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