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<a href="#traditional">Traditional and Digital Asset Companies Announce New Products, Acquisitions</a>

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<a href="#chair">SEC Chair Announces ‘Project Crypto’; SEC to Hold Crypto Roundtables</a>

<a href="#publishes">SEC Publishes Statement on Certain Liquid Staking Activities</a>

<a href="#fincen">FinCEN Publishes Virtual Currency Kiosk Notice and Red Flags</a>

<a href="#enforcement">SEC Enforcement Action Targets Crypto Fraud</a>

<a href="#tornado">Tornado Cash Trial Ends in Conviction on One Count, Mistrial on Two Counts</a>

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Traditional and Digital Asset Companies Announce New Products, Acquisitions

By <a href="https://www.bakerlaw.com/professionals/keith-r-murphy/">Keith R. Murphy</a> and Brandon Hansen

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In a recent press release, a global payments technology company announced expanded support for stablecoin- and blockchain-based settlement services. As noted in the release, the company’s new partnership with Paxos will enable support of the USDG and PYUSD stablecoins.&nbsp;In addition, the company reportedly has integrated the euro-backed stablecoin EURC and added support for two additional blockchains, Stellar and Avalanche.&nbsp;

In a separate press release, a blockchain-based fintech company announced plans to acquire a major stablecoin payments platform in a $200 million deal. According to the release, among other things the acquisition will enable the companies to offer customers stablecoin pay-ins and pay-outs without the need for customers to hold cryptocurrency on their balance sheets. The acquisition also will allow customers to manage through a single platform multiple payment types, including third-party payments, and will enable customers to conduct digital asset transactions without requiring them to open dedicated crypto bank accounts or wallets on centralized exchanges. The parties reportedly hope to close the acquisition pending regulatory approval by year-end.

In a final development, a decentralized network announced the launch of an onchain token reserve aimed at supporting long-term platform growth. According to the report, the reserve generates revenue through enterprise adoption both on- and offchain, converting revenue into the native token of the reserve. The release states this is achieved through a process known as payment abstraction, a mechanism that enables users to pay in various digital assets, which are then converted into the reserve’s token. The network reportedly has already generated millions in revenue based on demand for onchain services.

For more information, please refer to the following links:

<a href="https://investor.visa.com/news/news-details/2025/Visa-Expands-Stablecoin-Settlement-Support/default.aspx" target="_blank" rel="noreferrer noopener">[] Expands Stablecoin Settlement Support</a>

<a href="https://www.businesswire.com/news/home/20250807771714/en/Ripple-to-Acquire-Rail-for-%24200M-Expanding-Leadership-in-Stablecoin-Payments" target="_blank" rel="noreferrer noopener">[] to Acquire [] for $200M, Expanding Leadership in Stablecoin Payments</a>

<a href="https://www.prnewswire.com/news-releases/introducing-the-chainlink-reserve-a-strategic-link-token-reserve-enabling-chainlink-network-growth-302524057.html" target="_blank" rel="noreferrer noopener">Introducing the Chainlink Reserve: A Strategic LINK Token Reserve Enabling Chainlink Network Growth</a>

SEC Chair Announces ‘Project Crypto’; SEC to Hold Crypto Roundtables

By <a href="https://www.bakerlaw.com/professionals/jonathan-cardenas/">Jonathan Cardenas</a>

On July 31, Chairman Paul S. Atkins of the U.S. Securities and Exchange Commission (SEC) delivered remarks on “American Leadership in the Digital Financial Revolution.” In his speech, Chairman Atkins announced the launch of the SEC’s Project Crypto initiative, which aims to modernize U.S. securities laws in order to achieve President Donald J. Trump’s vision of “making America the crypto capital of the world.” Chairman Atkins stated that he has directed the SEC’s policy divisions to work with the SEC’s Crypto Task Force, led by SEC Commissioner Hester M. Peirce, to develop proposals to implement the regulatory reform recommendations that were set forth in the President’s Working Group on Digital Asset Markets Report on Digital Assets. Chairman Atkins stated that he has directed SEC staff to draft a clear regulatory framework related to crypto asset distributions, custody and trading in order to “reshore” crypto businesses that fled the U.S. as a result of “the previous administration’s regulation-by-enforcement crusade.” According to the speech, Project Crypto will include a broad range of initiatives across the SEC, including engagement with innovators to provide exemptive relief where appropriate.&nbsp;&nbsp;

In related news, on Aug. 1, the SEC announced that its Crypto Task Force will host a second series of crypto roundtables across the U.S. in order to provide opportunities for additional stakeholders from the digital assets industry to meet with Commissioner Peirce. According to the press release, Commissioner Peirce and other members of the Crypto Task Force will visit cities across the U.S. over the coming months to ensure that the Crypto Task Force’s outreach is “as comprehensive as possible.”&nbsp;&nbsp;

<a href="https://www.sec.gov/newsroom/speeches-statements/atkins-digital-finance-revolution-073125" target="_blank" rel="noreferrer noopener">American Leadership in the Digital Finance Revolution</a>

<a href="https://www.sec.gov/newsroom/press-releases/2025-102-road-sec-crypto-task-force-host-series-roundtables-across-us" target="_blank" rel="noreferrer noopener">On the Road: SEC Crypto Task Force to Host a Series of Roundtables Across the U.S.</a>

SEC Publishes Statement on Certain Liquid Staking Activities

By <a href="https://www.bakerlaw.com/RobertAMusiala">Robert A. Musiala Jr.</a><a href="https://www.bakerlaw.com/VeronicaReynolds"></a>

On Aug. 5, the U.S. Securities and Exchange Commission (SEC) Division of Corporation Finance published the Statement on Certain Liquid Staking Activities. The statement references the SEC’s earlier Statement on Certain Protocol Staking Activities, noting that the earlier statement addressed self (or solo) staking, self-custodial staking directly with a third party and so-called “custodial staking,” while the newly released statement addresses a fourth type of protocol staking known as “liquid staking.”

The statement defines “Liquid Staking” as “a type of Protocol Staking whereby owners of Covered Crypto Assets deposit their Covered Crypto Assets with a third-party Protocol Staking service provider (such owners, ‘Depositors’) and in return receive newly ‘minted’ (or created) crypto assets (‘Staking Receipt Tokens’) that evidence Depositors’ ownership of the deposited Covered Crypto Assets and any rewards (as described in the Protocol Staking Statement) that accrue to the deposited Covered Crypto Assets.” The statement explains that “Staking Receipt Tokens are issued to Depositors on a one-for-one basis to the amount of the deposited Covered Crypto Assets” and “enable their holders to maintain liquidity without having to withdraw the deposited Covered Crypto Assets from staking.”

According to the statement, “[p]ersons can participate in … Liquid Staking through protocol-based or third-party service providers,” referred to as “Liquid Staking Providers,” which “facilitate[] the staking of the deposited Covered Crypto Assets on behalf of the Depositor” in exchange for “an agreed-upon fee that reduces the amount of rewards that would otherwise accrue to the deposited Covered Crypto Assets, either using a node the Liquid Staking Provider operates or through a third-party Node Operator the Liquid Staking Provider selects.”

The statement goes on to define certain “Liquid Staking Activities” undertaken by “Liquid Staking Providers” and explains that such “Liquid Staking Activities” and related “Ancillary Services” do not involve the offer and sale of securities within the meaning of Section 2(a)(1) of the Securities Act of 1933 (Securities Act) or Section 3(a)(10) of the Securities Exchange Act of 1934 (Exchange Act). The statement also notes that as defined in the statement, a “Staking Receipt Token” is not a security and Staking Receipt Tokens are not offered and sold as part of or subject to an investment contract within the meaning of the Securities Act and Exchange Act.

<a href="https://www.sec.gov/newsroom/speeches-statements/corpfin-certain-liquid-staking-activities-080525" target="_blank" rel="noreferrer noopener">Statement on Certain Liquid Staking Activities</a>

<a href="https://www.sec.gov/newsroom/press-releases/2025-104-securities-exchange-commission-division-corporation-finance-issues-staff-statement-certain-liquid">Securities and Exchange Commission Divisi</a><a href="https://www.sec.gov/newsroom/press-releases/2025-104-securities-exchange-commission-division-corporation-finance-issues-staff-statement-certain-liquid" target="_blank" rel="noreferrer noopener">o</a><a href="https://www.sec.gov/newsroom/press-releases/2025-104-securities-exchange-commission-division-corporation-finance-issues-staff-statement-certain-liquid">n of Corporation Finance Issues Staff Statement on Certain Liquid Staking Activities</a>

<a href="https://www.sec.gov/newsroom/speeches-statements/crenshaw-statement-liquid-staking-080525" target="_blank" rel="noreferrer noopener">Response to Staff Statement on Certain Liquid Staking Activities: Caveat Liquid Staker</a>

FinCEN Publishes Virtual Currency Kiosk Notice and Red Flags

By <a href="https://www.bakerlaw.com/professionals/john-e-robertson/">John Robertson</a>

On Aug. 4, the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) issued a notice encouraging financial institutions and virtual currency kiosk operators to identify and report suspicious activity linked to virtual currency kiosks. The notice outlines how illicit actors may use virtual currency kiosks to facilitate laundering drug profits, scams and other activities and encourages kiosk operators to verify they are compliant with FinCEN and other U.S. regulations. FinCEN concludes the notice with 15 red flags that institutions and kiosk operators should look for to help detect, prevent and report potential suspicious activity linked to illicit activity involving virtual currency kiosks.&nbsp;FinCEN Director Andrea Gacki described the notice as “safeguarding the digital asset ecosystem for legitimate businesses and consumers” while also supporting the Treasury’s “continuing mission to counter fraud and other illicit activities.”

<a href="https://www.fincen.gov/sites/default/files/shared/FinCEN-Notice-CVCKIOSK.pdf" target="_blank" rel="noreferrer noopener">FinCEN Notice on the Use of Convertible Virtual Currency Kiosks for Scam Payments and Other Illicit Activity</a>

<a href="https://www.fincen.gov/news/news-releases/fincen-issues-notice-use-convertible-virtual-currency-kiosks-scam-payments-and" target="_blank" rel="noreferrer noopener">FinCEN Issues Notice on the Use of Convertible Virtual Currency Kiosks for Scam Payments and Other Illicit Activity</a>

SEC Enforcement Action Targets Crypto Fraud

By <a href="https://www.bakerlaw.com/professionals/amos-kim/">Amos Kim</a>

The U.S. Securities and Exchange Commission (SEC) recently entered into a consent order with Huynh Tran Quang Duy, founder of the crypto lending platform MyConstant, for misappropriating investor funds and misleading thousands of users. The enforcement action stems from MyConstant’s “Loan Matching Service,” which was marketed as a low-risk investment backed by crypto-collateralized loans. Between its launch and collapse, MyConstant allegedly raised over $20 million from more than 4,000 investors. But according to the SEC, Huynh diverted approximately $415,000 for personal use and used $11.9 million of investor funds to purchase TerraUSD stablecoins in his own accounts. According to the SEC order, that speculative investment resulted in losses of nearly $7.93 million when TerraUSD collapsed.

Despite the platform’s deteriorating financial health, Huynh allegedly continued to issue fabricated loan reports to reassure investors and encourage reinvestment. He also made misleading claims about insurance coverage and collateralization, further obscuring the platform’s true risk profile. The SEC accepted Huynh’s offer of settlement, barring him from serving as an officer or director of any public company and ordering him to pay more than $10.6 million in disgorgement, interest and penalties. He must also cease and desist from future violations of securities laws.

For more information, please refer to the following link:

<a href="https://www.sec.gov/files/litigation/admin/2025/33-11382.pdf" target="_blank" rel="noreferrer noopener">In the Matter of HUYNH TRAN QUANG DUY (A/K/A DUY HUYNH)</a>

Tornado Cash Trial Ends in Conviction on One Count, Mistrial on Two Counts

In a closely watched case with potential implications for decentralized finance (DeFi), a federal jury in Manhattan returned a partial verdict in the criminal trial of Roman Storm, co-founder of Tornado Cash. Storm was convicted of conspiring to operate an unlicensed money transmitting business, but jurors could not reach a unanimous decision on two additional charges, conspiracy to commit money laundering and conspiracy to violate U.S. sanctions. The judge declared a mistrial on those counts.

Prosecutors argued that Tornado Cash was intentionally designed to conceal illicit funds, citing its use in laundering proceeds from cybercrime and sanctions evasion. Prosecutors argued that Storm’s involvement in designing and launching Tornado Cash amounted to actively enabling illicit financial activity. The defense countered that Tornado Cash was an open-source, autonomous protocol intended to enhance user privacy and that Storm lacked the intent or control necessary for criminal liability.

Storm now faces sentencing on the single conviction, which carries a maximum penalty of five years in prison. The unresolved charges raise broader questions about developer liability, the legal boundaries of privacy-enhancing protocols, and how courts interpret intent and control in decentralized infrastructure.

<a href="https://www.law360.com/fintech/articles/2371881?nl_pk=269c598f-8e37-49e3-bf43-b88e05d4215b&amp;utm_source=newsletter&amp;utm_medium=email&amp;utm_campaign=fintech&amp;utm_content=2025-08-07&amp;read_main=1&amp;nlsidx=0&amp;nlaidx=0" target="_blank" rel="noreferrer noopener">Tornado Founder Gets Partial Mistrial, Convicted On 1 Count</a>

<a href="https://www.justice.gov/usao-sdny/pr/founder-tornado-cash-crypto-mixing-service-convicted-knowingly-transmitting-criminal" target="_blank" rel="noreferrer noopener">Founder Of Tornado Cash Crypto Mixing Service Convicted Of Knowingly Transmitting Criminal Proceeds</a>

Weekly Blockchain Blog – August 11, 2025