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Tigran Gambaryan: The Star Crypto Investigator Kidnapped by Nigeria

The star IRS investigator-turned-executive was unlawfully detained by Nigeria and charged with tax evasion for Binance. His case shocked the crypto industry.

After eight long, harrowing months locked up in a Nigerian prison, Tigran Gambaryan is finally back home in Atlanta, recovering from his ordeal.

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The Nigerian government finally agreed to release Gambaryan on humanitarian grounds in October to allow him to return to the U.S. to receive medical care for a host of conditions he developed while in Kuje prison including malaria, double pneumonia, and a herniated disc in his back that left him in excruciating pain and struggling to walk.

In addition to releasing Gambaryan, Nigerian officials dropped the money laundering charges they’d been prosecuting him for since March, as a stand-in for his employer, Binance. The Nigerian government accused Binance of tanking the value of the naira by facilitating the movement of some $23 billion in untraceable funds in 2023. Equally unjust tax evasion charges against Gambaryan had previously been dropped in June. Binance, however, still faces both charges; the Nigerian government is seeking $10 billion in penalties.

Gambaryan’s detention sparked outrage across the crypto industry and beyond. As Binance’s Head of Financial Crime Compliance, Gambaryan had nothing to do with his employer’s actions, criminal or not, in Nigeria. And, as an American citizen, it was unthinkable for many, including several members of Congress, that he could be snatched by a foreign country – especially one that is an ally of the U.S. – and left to languish in a cell for nearly a year.

And, perhaps most perplexingly, Gambaryan wasn’t just any American executive getting held for ransom – he’s a former federal agent, a one-time Internal Revenue Service (IRS) investigator that was part of an elite group of early crypto tracers in the federal government. During his tenure at the IRS, Gambaryan had a central role in some of the biggest crypto crime busts in the industry’s history, including the takedown of child sex abuse video network Welcome to Video and darknet marketplace Alpha Bay, the seizure of nearly 70,000 bitcoins stolen from the Silk Road, and the recovery of 650,000 bitcoins stolen from Mt Gox.

That Nigeria would detain any American executive to use as a scapegoat for their employer was bad enough. But that Nigeria detained Tigran Gambaryan, a former U.S. government employee, was an outrage.

Star investigator

Gambaryan’s detention came as a shock to many of his former government colleagues, including Lili Infante, CEO of CAT Labs. During her tenure as a special agent at the Drug Enforcement Agency (DEA), Infante frequently crossed paths with Gambaryan, working with him on investigations and sharing investigative techniques.

“Tigran is a very rare breed of elite investigator,” Infante said. “It’s very difficult to find his personality type in the government. If IRS-CI had the equivalent of a special forces, he would probably be front and center leading them.”

Infante, along with Gambaryan, was part of an elite cadre of early crypto tracers working across several government agencies who figured out how to track transactions that were, at the time, largely thought to be anonymous. And, of all the federal agencies developing cutting-edge crypto tracing techniques, the IRS was the best.

“They were accountants. They were really good at following the money, and this was just following the money on blockchains,” said Ari Redbord, global head of policy at blockchain intelligence firm TRM Labs. “And Tigran really became the star amongst that group of agents in those early days… In large part, he invented what it means to be a cryptocurrency investigator.”

Infante said that Gambaryan was “instrumental” in catapulting IRS-CI into being the leading federal agency in crypto investigations.

“Not only did he work on some of the most impactful, high profile crypto cases, which resulted in multi-billion dollars of digital asset seizures, he also mentored other agents and laid the groundwork for IRS-CI to continue dominating in the area of crypto investigations even after he left [for Binance],” Infante said. “He left a legacy.”

Infante attributes part of Gambaryan’s success at the IRS to his personality, which she and other former colleagues of his described as driven, ambitious and innovative.

“He’s like a dog with a bone. No challenge is too difficult,” Infante recalled. “The government was lucky to have him. It’s very, very difficult to innovate in the government because of the level of bureaucracy…Innovation requires a certain level of risk tolerance which Tigran had, and still does. Sometimes it pays off, and sometimes it bites you.”

Pioneer at Binance

When Gambaryan left the IRS and took a position at Binance in 2021, Infante said she wasn’t surprised. By the time he left the government, the crypto investigative space had matured significantly, and Gambaryan was ready for a new challenge.

And Binance presented a significant challenge, even for the OG crypto investigator. When Gambaryan joined the company, it was still willingly violating the Bank Secrecy Act (BSA) by failing to set up a proper know-your-customer/anti-money laundering regime, which allowed money launderers and international criminals to use the platform freely. Last year, the company agreed to pay $4.3 billion in fines to settle criminal charges against it, and then-CEO Changpeng “CZ” Zhao was sentenced to four months in federal prison — half the time that Gambaryan ended up serving in Nigeria.

Though Gambaryan was well aware of Binance’s troubles, he took the job anyway.

“He said, ‘Well, it’s the largest exchange. They have the most impact on the industry right now, and I want to help them get their shit together,’” Infante recalled Gambaryan saying before he left the IRS. “And he wasn’t kidding.”

Redbord pointed out that, though it is now common for government officials to take jobs in the crypto industry, it was “pretty extraordinary” when Gambaryan joined Binance.

“He’s a man of firsts,” Redbord said. “This was a very unique thing at the time. Not only did he go to a cryptocurrency business, he went to the largest by a magnitude of 15, and one that was really having to rethink the way it did anti-money laundering and compliance. And he came in and really became the face of that in many respects.”

Infante pointed to the exchange’s response process to law enforcement inquiries as an example of how Gambaryan had positively changed Binance.

“It’s night and day. Before Tigran came in, you’d send a request or a subpoena and you’d wait a month or two or six or forever — the compliance program was nonexistent,” Infante said. “After Tigran came in, you’d get an answer within 24 hours.”

“Imagine taking a borderline criminal organization and turning it into a force for good to help law enforcement with their cases, be extremely compliant with subpoena requests, helping return assets to victims of cybercrime and pig butchering – it’s an impact. It’s a massive impact,” Infante added.

A spokesperson for Binance said Gambaryan brought “unparalleled expertise” to the exchange when he joined in 2021.

“His contributions have solidified Binance’s position as a leader in compliance and innovation within the cryptocurrency ecosystem,” the spokesperson added.

Colleagues, Congressmen push back

For many in the crypto industry, especially for compliance officers and former government officials, Gambaryan’s stellar track record made his detention in Nigeria — and the U.S. government’s disturbingly lackluster response — even more incomprehensible.

“Nobody should go through what he went through, but the fact that he’s literally a national treasure…and it took us eight months to get him out of a hostage situation in another country is insane,” said Infante.

Infante and Redbord joined a group of former federal agents and prosecutors that worked, behind the scenes and in public, to secure Gambaryan’s freedom. They both signed a letter, spearheaded by investor and former federal prosecutor Katie Haun to Secretary of State Antony Blinken, asking the State Department to “step up” its efforts to get Gambaryan home. Some of Gambaryan’s former government colleagues also protested outside the UN in September and regularly posted on social media demanding his freedom.

Read more: Former Government Employees, Compliance Officers Rally for Detained Binance Executive

Their efforts to free Gambaryan also attracted people who didn’t know him before his detention.

Gary Weinstein, founder of Infinity Consulting, told CoinDesk he worked pro bono for four hours a day for months to help free Gambaryan.

“I felt a personal responsibility to act. I think Tigran’s dedication to compliance and integrity resonated with my values,” Weinstein said. “I couldn’t just sit by hoping for a good result.”

Members of Congress also took steps to advocate for his release. Sixteen members of Congress signed a June 2024 letter to President Joe Biden, Blinken, and Roger Carstens, the Special Presidential Envoy for Hostage Affairs, urging them to take “immediate action” to get Gambaryan released.

Rep. French Hill (R-Ark.), who signed the letter, and Rep. Chrissy Houlahan (D-Penn.) traveled to Nigeria to visit Gambaryan in prison in June.

Poorly handled

Though Gambaryan was ultimately released, many of those involved in advocating for his freedom remain frustrated by the way that his situation was handled by the Biden Administration.

Infante credited Hill and Rep. Rich McCormick (R-Georgia), Gambaryan’s congressman, with advocating for his release on Capitol Hill, but stressed that their degree of involvement should not have been necessary.

“Something like that happens to me, God forbid, I hope I have a representative like Rich McCormick to fight for me,” Infante said. “But they can only do so much. Because, really, it should have been a phone call from the President. It could have been resolved very early on, in my opinion, and it wasn’t. It wasn’t prioritized, and it should have been. That’s where the frustration lies – with the White House.”

Though a spokesperson for Binance said the company doesn’t believe Gambaryan’s situation was “unique to the crypto industry,” others, including Amanda Wick, a former money laundering process who now works as a crypto consultant, believe Gambaryan’s employment in the crypto industry was part of the reason the White House dragged its feet freeing him.

“Just look at all the things about him: he was a former IRS agent that had served his country as a law enforcement agent, he was a compliance officer and he was an American. And all of that was getting subsumed and ignored because he was in crypto.”

While the government ultimately secured Gambaryan’s release, the lack of transparency throughout the negotiation process left many people closely watching the situation — including Rep. Hill — frustrated.

“Tigran is back where he belongs – home with his family in America. I remain deeply disappointed that an American business executive was held under horrible conditions on unsubstantiated charges by Nigeria, a nation that the United States considers a friend,” Hill told CoinDesk.

On November 19, Hill introduced a bill, the American Detainee Transparency and Recovery Act, aimed at increasing the transparency in the recovery process.

“Tigran should have never been wrongfully detained by the Nigerian government in the first place and his case should be an example to the incoming Trump administration of how not to treat Americans who are taken by our friends and allies,” Hill said.

Chilling effect

Wick and others said that Gambaryan’s situation is likely to create a chilling effect across the industry, and perhaps beyond, when it comes to sending American employees to foreign countries on business.

At the September protest at the UN, Wick said one of the attendees was a man who did not know Gambaryan personally, but worked in compliance at a traditional finance firm.

“Most of us were former prosecutors and agents – crypto people who either knew Tigran or were in that community. But there was a guy who came [to the protest] who used to be at Wells Fargo, and he came because it could have been him,” Wick said.

“People forget that, at the end of the day, he was just a compliance employee who was kidnapped in a foreign country for the compliance failures of his financial institution,” Wick added. “And the only reason why people were so comfortable with it was because Binance was a crypto company…but if it had been TD Bank? If it had been Wells Fargo, and an American had just been kidnapped because of the company he worked for not having a sufficient AML program and then held in a prison with terrorists? If you say it out loud, it’s ridiculous.”

Weinstein said Gambaryan’s situation raises a “huge issue” — that foreign governments, including those allied with the U.S., might feel emboldened to target and detain compliance officers without just cause to hold them as bargaining chips.

“It sets a dangerous precedent that could deter talented professionals from entering the field, engaging and frankly, is a setback for the industry’s growth and its efforts to build trust with regulators,” Weinstein said.

“Tigran’s wrongful detention was a wake up call for the entire crypto industry, and it highlighted vulnerabilities that compliance officers and professionals face when engaging with international regulators.”

Moving forward

Gambaryan is now at home and focusing on his recovery. A spokesperson for his family declined CoinDesk’s request for an interview for this story, citing his ongoing recovery.

“There is an overwhelming sense of relief and gratitude among the Binance team. Tigran’s safe return is not just a moment of personal joy but also a collective victory for those who supported him throughout this ordeal,” a Binance spokesperson said.

“That said, we remain deeply concerned about his health and are focusing right now on providing support to help him and his family during this time of healing.”

This profile is part of CoinDesk’s Most Influential 2024 package. For all of this year’s nominees, click here.

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Fairshake: Crypto Titans Use Old-School Dollars to Turn Tide in Congress

The industry went from pariah in Washington to being a top political player in less than two years, thanks in part to unlimited spending and hard-nosed tactics.

Here’s the new political calculus for a U.S. congressional candidate: You nod to crypto and say you’re on the pro-innovation side, and chances are, a million dollars (or more) could drop from the sky to pay for TV spots that highlight your strengths or pillory your opponent.

In any of hundreds of lesser known districts of the House of Representatives, a few hundred thousand dollars tends to make or break a candidate. When the leading crypto-driven political action committee notices you, a massive influx of cash can pave your way straight to Congress. The Fairshake super PAC isn’t subtle. It’s nuclear. For a relatively small industry, Fairshake is the biggest corporate money player in U.S. politics. And it’s not close to hanging up its hat as the Nov. 5 elections recede into the past.

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The main PAC and its two affiliate cousins spent some $139 million on the 2024 elections. Just Congress, mind you, not the presidential showdown. What the crypto sector wants is legislation, and Fairshake is all about securing the most expedient path toward the right number of supporters on Capitol Hill.

It’s got about $30 million left from this cycle. And its top industry benefactors have committed to another $73 million. Before the 2026 cycle even begins, this super PAC is already dominating the field with $103 million.

Thanks to current U.S. election rules, corporate interests can spend unlimited amounts to support or oppose campaigns, as long as they do so through “independent expenditures” that purchase advertising without coordinating with the campaigns they’re helping. Fairshake aimed to take full advantage of that with a simple goal. According to its primary spokesman, Josh Vlasto, the goal was to “support candidates who supported this industry and wanted to work across the aisle to advance responsible regulation,” he told CoinDesk in an interview.

They set out to show Washington that crypto was now “really focused on building a professional political operation that was going to be very well resourced and effective.”

Into 2026

So what can we still expect from what may be the most influential, issue-driven political force in the U.S.? A close look at 2024 probably tells you all you need to know about what’s still to come.

Coinbase, Ripple Labs and crypto investment firm a16z raised Fairshake from the ashes of the industry’s most recent campaign machinery, tapping at least two people involved in running a previous version. But, in contrast to the customary radical-transparency vibe the industry is proud of, Fairshake’s origin story is a no-go for the involved companies. They won’t talk about how Fairshake was formed and who hired whom. They won’t discuss the ongoing relationship between the heavy donors and the PAC management.

“We have consultants and advisors on both sides of the aisle,” said Vlasto, the person who most often does the talking for Fairshake. “We also take input from our supporters, you know, which represent real industry leaders from the crypto and blockchain sector.”While the activity of the organization is publicly disclosed, as the rules require, and the broad strategy of Fairshake is clear, the nuts and bolts are off-limits.

“I’m not getting into the sort of day-to-day,” Vlasto said. “All I can speak to is sort of the outcome of it. And the outcome is a very successful election cycle.”The industry had a profoundly tarnished reputation to build on, because disgraced FTX frontman Sam Bankman-Fried was the leading driver of crypto’s campaign contributions in the last congressional election. One in three members of Congress were funded by he and other FTX executives under his watch, though the dollar amounts paled in comparison to what the industry spent this time. Still, all those members were forced to figure out how to deal with the tainted contributions after the company imploded in a cloud of fraud.

That’s nothing Vlasto can speak to, he insists, because Fairshake is an entirely new effort with “really the crème de la crème and the blue chip companies across crypto and blockchain.”

And, while they were erecting their political siege engine, Coinbase also propped up an advocacy organization called Stand With Crypto meant to rally the troops. It was billed as “crypto’s first true grassroots movement,” despite its origin as a corporate-funded project in which Coinbase initially handled its public relations and staffed its events.

It features Fairshake’s company-led effort on its website, but it also raises money for its own activities, such as running events and maintaining a database evaluating politicians’ crypto support. The organization says it’s so far taken in $2.8 million, though its supporter list indicates $2.3 million of that is from companies Exodus and Moonpay.

Stand With Crypto signed up almost 2 million online supporters. That large number of digital assets enthusiasts is often touted as evidence of a groundswell in public support.

From political pariah to belle-of-the-ball in less than two years, the crypto industry learned in 2024 that aggressive tactics and a whole lot of money were the answer to overcoming reputational damage.

Influencing the agenda

This current congressional session provided Fairshake a live-fire exercise in influence. Instead of a theoretical idea of what crypto legislation future members of Congress may be willing to support, Fairshake got to make a more urgent case with its outsized war chest.

Two highly significant crypto test cases made a splash in Congress earlier this year.

First — and most notably — the Financial Innovation and Technology for the 21st Century Act (FIT21) was Representative Patrick McHenry’s effort to move a wide-reaching set of standards to regulate the U.S. crypto markets from top to bottom.

The other was a campaign to permanently erase a Securities and Exchange Commission crypto accounting policy in which the agency sought to make public companies hold their customers’ digital assets on their own balance sheets. It effectively forced banks to maintain capital against those assets — a cost-prohibitive demand that contributed to U.S. bankers shying away from crypto.

Both matters came up for votes. FIT21 was shepherded personally by McHenry, the Republican chairman of the House Financial Services Committee, who hoped the bill could be his swan song as he leaves the Hill at the end of the year. The Republican legislation became the first significant crypto measure to clear the committee and win passage by the House, pulling in a massive 71-vote block of Democrats and demonstrating that there’s a wide bipartisan cooperation available on digital assets legislation.

And it provided the simplest litmus test possible for the industry to know which House lawmakers were worthy of crypto cash. At the time the bill was on the House floor, the existence of Fairshake’s campaign muscle had already been noisily demonstrated when it spent about $10 million to throttle the Senate hopes of Representative Katie Porter, a crypto skeptic in California. The lawmakers who voted on FIT21 were well aware that the new player in campaign finance was watching and stood very willing to spend millions to bolster friends and defeat enemies.

Even before it spent millions to ensure more allies in the 2025 session of Congress, Fairshake was already influencing policy.

The SEC’s controversial accounting rule — known as Staff Accounting Bulletin No. 121, or SAB 121 — came up for a vote in the Senate as lobbyists sought to reverse the SEC’s position. That vote was made possible after the Government Accountability Office said the regulator mishandled the policy by trying to tuck it into staff guidance rather than treating it as a full-blown rule. Lawmakers sought to toss it out under the Congressional Review Act, and both the House and Senate passed the effort. Most notably, the 60-38 Senate vote showed a significant number of Democrats bucking their leadership to join. It forced President Joe Biden to make good on a veto threat, meaning the policy remained intact at the SEC despite Congress’ wishes.

Still, it gave Fairshake and the crypto industry a list of which sitting senators were on the side of this financial technology.

“The broad strategy was to pick races where ultimately someone who was pro-crypto, pro-blockchain, pro-innovation would come out on top and win the scene,” Vlasto said.

During the primaries, the PAC often deployed money in big bursts, sometimes dumping more than $1 million into a relatively obscure campaign where that kind of money could drown out opposition. On social media, high-profile Democrat Representative Alexandria Ocasio-Cortez characterized the spending as “insane sums.” At first, much of it was based on relatively flimsy evidence of crypto support on candidate websites, but with incumbent lawmakers, their recent voting record made for harder targets.

In the Democrat-dominated congressional district that covers Westchester County and part of the Bronx in New York, incumbent Representative Jamaal Bowman has opposed both of the big crypto efforts. Fairshake dropped more than $2 million in negative ads against him in that race, and Bowman was easily defeated in the primary.

When it came to lining up the congressional races it would support, the group was also very careful to balance its choices between the two major parties, often angering both. In the end, it backed about the same from each, though its two marquee efforts devoted tens of millions to derailing Democrats the industry disliked: Porter in California and Senator Sherrod Brown (Ohio), chairman of the Senate Banking Committee.

Where its practical thinking was obvious, though, could be seen in Massachusetts, where Fairshake didn’t devote money to crypto lawyer John Deaton’s race against Senator Elizabeth Warren, the well-known Democrat who is arguably the industry’s most powerful critic on Capitol Hill. The odds were always very long against beating Warren in her state, and money spent there was ultimately wasted.

A point of pride for Fairshake staff is that any time a candidate started objecting that corporate money from crypto was underwriting their opponent, the argument was unsuccessful. The PAC organizers interpret that record as demonstrating that voters aren’t moved by efforts to use digital assets as a political scare tactic.

“When we supported a candidate aggressively who was pro-crypto, their opponent attempted to make an issue out of the spending and say that voters should not support our preferred candidate because they were receiving support from crypto,” Vlasto recalled, and that opponent tended to lose.

“Every time.”

Going into 2025 and a new congressional session, more than four dozen members of Congress were backed by Fairshake — almost half of them new arrivals in their elected office. At this point, the PAC estimates that about 300 of the 535 members of the House and Senate are on crypto’s side.

But Fairshake has $103 million in its pockets before most other super PACs have even started, meaning sitting lawmakers in the next session will be aware that a huge stockpile of cash will be ready to help them in 2026 if they cooperate with crypto legislation.

And those hoping to join Congress in the 2027 session will know that a simple nod toward crypto could help them raise fast support.

This profile is part of CoinDesk’s Most Influential 2024 package. For all of this year’s nominees, click here.

Fairshake’s approach will not only influence the U.S. legislative branch. The crypto industry has now demonstrated that large amounts of money concentrated into a single purpose can have an outsized electoral impact.

“We were on the right side of the arguments,” Faryar Shirzad, chief policy officer of Coinbase in a CoinDesk interview, when asked whether another group could repeat the results.

Beyond the campaign money, there was a wider upswell of crypto support. “I don’t know if other industries can replicate the grassroots and the merits of the arguments in the way we can. But I doubt it.”

Florida’s DeSantis Waging Toothless Campaign Against Digital Dollars, Lawyers Say #prizmabet

The political movement to use state commerce rules to stop central bank digital currencies is based in legal nonsense that has no power to ban anything, experts contend.

The state-level campaign against a U.S. digital dollar made its first foray into established law with Governor Ron DeSantis’ signature on Florida’s effort to block the use of virtual government-backed money in business transactions.

But the Florida governor’s rhetoric that his state is banning central bank digital currencies (CBDCs) as “government overreach and woke corporate monitoring” may not amount to much on paper. Legal experts in this facet of commercial law suggest the state’s effort is nonsensical and potentially harmful for the digital assets sector DeSantis said he’s trying to protect.

“They didn’t ban anything,” said Carla Reyes, an assistant professor at Southern Methodist University’s Dedman School of Law, who has done work in both digital assets law and the Uniform Commercial Code (UCC) that Florida is focused on. “The law does exactly zero of the things that it says that it does.”

The state’s new tweak “expressly prohibits the use of a federally adopted CBDC by excluding it from the definition of money within Florida’s Uniform Commercial Code,” according to the governor’s office. From introduction to his signature last week took just 43 days.

DeSantis – one of the Republican Party’s early favorites as a potential presidential candidate next year – turned his May 12 signing of the law into a political event, claiming it as the start of a potential multi-state push from Republican state lawmakers to counter a digital dollar well before the federal government decides whether to issue it or not. North Carolina has also been considering a measure to oppose a U.S. CBDC, and South Dakota Gov. Kristi Noem recently vetoed a bill to update its UCC in a way she argued would have allowed for CBDCs and “a potential future overreach by the federal government.”

“We’re on offense in the state of Florida,” DeSantis said at a press conference, standing behind a sign reading “Big Brother’s Digital Dollar,” referencing George Orwell’s tale of supreme government control, “1984.” The new law – effective in July – declared digital dollars won’t be considered money in the state’s version of the commercial code.

The UCC represents an accord among states, which have largely adopted this common set of rules for buying and selling of goods and conducting other financial transactions across state borders. Florida has officially thrown its CBDC wrench into that standardization, saying digital dollars aren’t money as defined in the code. But it doesn’t really ban CBDC use in interstate commerce, just puts those assets in another category than money, lawyers say.

“I could still buy a computer using CBDCs if that’s what they wanted me to pay in,” said Reyes, who said the government-backed assets would now fall into the bucket of “general intangibles” under the UCC. “The UCC doesn’t have the power to ban people from using any type of exchange. That’s not what it does.”

CBDC Opposition

DeSantis called the CBDC “a massive transfer of power from individual consumers to a central authority,” and he said the federal government would “have the ability to control where that money is going,” citing a future government’s ability to stop gun purchases or halt somebody from buying too much gasoline.

Though DeSantis and other Florida Republicans suggest the U.S. is definitely heading toward issuing a digital dollar, that view isn’t yet reflected by what’s happening. While the administration of President Joe Biden is under orders to develop the concept of a U.S. CBDC, no federal entity has yet declared support for issuing it.

The Federal Reserve would be in charge of the digital dollar, and officials including Chair Jerome Powell have said the central bank won’t act without backing from the White House and Congress. The Fed also doesn’t want to be in the retail CBDC business, so officials have declared that it won’t administer individual accounts and that people’s transactions would have to be managed by banks or in other outside digital wallets.

DeSantis acknowledged that if Congress eventually authorizes a U.S. CBDC, the state may have to back down. But more than that, Andrea Tosato, a legal scholar who has advised on UCC amendments and teaches at University of Pennsylvania’s Carey Law School, said that any federal law on this point will automatically override state law.

If that happens, though, it won’t have anything significant to override in Florida, he and Reyes suggested.

The UCC Reality

The UCC represents longstanding, battle-tested standards for basic transactions, and they‘re meant to be “super boring” and nonpolitical, Tosato said. The Florida effort to use it as a shield against digital dollars is “painting the UCC as something that it is not.”

The UCC gives both sides of transactions basic legal protections, Tosato explained, but it doesn’t tell them what they can or can’t exchange. That’s the job of regulations or criminal codes.

When one digs into “the rabbit hole and the craziness of what was done with this Florida bill,” Tosato said, “there is no light-bulb moment. It makes no sense.”

The governor’s office didn’t respond to a request for comment on these points. DeSantis suggested during his press conference that he wasn’t just protecting people’s financial privacy but was also seeking to defend crypto from federal government interference.

“I think they want to crowd out and eliminate other types of digital assets like cryptocurrency, because they can’t control that,” he said.

While Florida rewrites its single-state corner of the 50-state standards, though, it’s also rebuffing a set of amendments suggested last year that were meant to set standards for the interstate use of cryptocurrencies, including in such examples as the use of bitcoin as collateral in lending. That could have been a foundation for digital assets in commerce, Tosato argued, and other states have been moving forward to adopt the changes.

Even the way Florida defines a CBDC could be problematic. Its new law says a CBDC is a government-issued digital currency “that is made directly available to a consumer,” but Tosato contends that doesn’t reflect any of the current or planned CBDCs, which generally have service providers manage the accounts or wallets for using the virtual currency.

“There is no CBDC anywhere that is issued directly to consumers,” Tosato said.

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As DeSantis and his allies celebrate their CBDC ban, Tosato says they’ve compromised the UCC’s crypto modernization and are misrepresenting the meaning of their overhaul of Florida law.

“It’s done in a way that makes no sense and is completely broken,” he said.

A $1.4T Financial Giant Expands Its Money Market Fund on Polygon #prizmabet

Franklin Templeton claims that fund will be the first U.S. registered mutual fund run on blockchain technology.

Franklin Templeton, with about $1.4 trillion assets under management, said its OnChain U.S. Government Money Market Fund (FOBXX) is now supported on Ethereum via layer 2 blockchain Polygon.

The investment giant said in a press release, during Consensus 2023, that it continues to see operational efficiencies through use of blockchain-integrated systems, including increased security and faster transaction processing.

Read full coverage of Consensus 2023 here.

The fund is the first U.S. registered mutual fund to use a public blockchain to process transactions and record share ownership, the investment firm claimed in the press release. On Monday, the Stellar Network announced the fund is available on its network. Stellar has a $2.5 billion market capitalization and Polygon’s is over $9.5 billion.

“Extending the reach of the Franklin OnChain U.S. Government Money Fund to Polygon enables the fund to be further compatible with the rest of the digital ecosystem, specifically through an Ethereum-based blockchain,” said Roger Bayston, head of digital assets at Franklin Templeton, in the press release.

Franklin Templeton, which has been a proponent of blockchain technology in the past, continues to see operational efficiencies through use of a blockchain-integrated system, according to the statement. The firm announced in September that it will offer digital asset strategies to wealth managers.

The fund, which aims to provide steady income for its holders, invests at least 99.5% of its assets in government securities, cash and repurchase agreements. Money market funds are mutual funds that invest in highly liquid and short-term investments that intend to offer investors with low-risk options.

In the wake of recent market volatility and banking crisis, investors have been pouring into money market funds to hedge their investment risks. With more institutional investors pushing further into digital assets, traditional finance (TradFi) players are using this opportunity to merge both worlds by offering such funds via blockchain technology. Most recently, Ondo Finance said it is offering a stablecoin alternative that will be pegged to the U.S. dollar and backed by money-market funds that trade on traditional exchanges.

One share of Franklin Templeton’s fund is represented by one “BENJI” token, where the holders are able to gain exposure to the fund through digital wallets via the Benji Investments app, according to the press release.

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“Tokenized assets are going to positively rewire the global financial system, and Franklin Templeton is at the forefront of this movement,” said Colin Butler, global head of institutional capital at Polygon Labs, in the press release.

Edited by Aoyon Ashraf.