The CFTC filed a memo urging the US Court of Appeals for the 7th Circuit to uphold a $231 million judgment against Sam Ikkurty, who the agency says ran a crypto Ponzi scheme, arguing that it is “undisputed” that the CFTC has authority to regulate the trading of BTC and ETH. The CFTC responded to Ikkurty's arguments that a federal judge was wrong in ruling the digital tokens that Ikkurty's crypto hedge funds supposedly invested in were commodities covered by the Commodity Exchange Act. The judge granted summary judgment in the agency's favor in July, ordering Ikkurty and his company, Jafia LLC, to pay restitution, disgorgement, and a civil penalty.

The Treasury Department’s Office of Foreign Assets Control (OFAC) announced that it has sanctioned two individuals and one entity for their involvement in a digital assets money laundering network in support of the North Korean government. Treasury stated in a press release that Lu Huaying and Zhang Jian, based in the UAE, worked through a UAE-based front company to facilitate money laundering and crypto conversion services that funneled the illicit proceeds back to Pyongyang. The sanctions are part of ongoing efforts to disrupt North Korea's money laundering operations.

At the Blockchain Association policy summit in Washington, D.C., SEC Commissioners Hester Peirce and Mark Uyeda, and CFTC Commissioner Summer Mersinger, told crypto industry participants that they will urge their agencies to collaborate more closely on providing regulatory relief and clarity in the new year. The commissioners stated that enforcement will not be their tool of choice to establish guardrails for the crypto industry going forward. Mersinger noted that enforcement will not go away entirely, but the focus will be on fraud.

Senate Banking Committee Chair Sherrod Brown (D-OH) scrapped plans to vote on SEC Commissioner Caroline Crenshaw’s renomination. An aide for Chair Brown stated that he was confident he had the votes to advance Crenshaw's nomination out of committee, but he ultimately did not see a path for the full Senate to advance it before the end of the year. Sen. Bill Hagerty (R-TN) praised Committee Republicans for blocking the attempt to install an “anti-crypto, climate activist at the SEC.” Crenshaw's renomination drew strong opposition from the crypto industry. Nonprofit advocacy group Stand with Crypto stated that 107,000 emails were sent to senators opposing her renomination over the last week.

NFT platform CyberKongz announced that it has received a Wells notice from the SEC, with the agency stating that a token in tandem with a blockchain game cannot be issued without it first being registered as a security. CyberKongz said in a statement on X that the company has "been suffering in silence for the last two years, ever since we first received contact from the SEC. Throughout the entire process they have showcased a complete lack of understanding of blockchain technologies that has resulted in unjust accusations and information inaccuracies." The platform stated that it will "fight for a clearer regulatory pathway for digital assets on the blockchain."

DOJ announced that a jury convicted Virginia man Mohammed Azharuddin Chhipa for charges related to his efforts to provide material support to ISIS by raising funds and converting the money to crypto. According to court records, between 2019 and 2022, Chhipa collected and sent money to female ISIS members in Syria to benefit ISIS in various ways, including by financing the escape of ISIS members from prison camps and supporting ISIS fighters. Chippa would raise funds online on various social media accounts, then convert the money to crypto and send it to Turkey, where it was smuggled to ISIS members.

The SEC has asked a Colorado federal judge to order religious-themed financial literary organization Cast Your Nets Ministries to comply with a subpoena in the agency’s investigation into possibly unregistered securities and crypto assets. The SEC filed suit against Cast Your Nets Ministries, its subsidiary, and their board members, submitting an application to show cause and for an order appealing compliance with subpoenas. The agency said it issued subpoenas in May, August, and September in order to determine the structure and nature of the companies' products, including a crypto asset that promised to double a buyer's retirement savings in five years.

US District Judge Ana Reyes issued an order directing the FDIC to re-review four heavily redacted crypto letters it handed over in response to a Freedom of Information Act lawsuit filed on behalf of Coinbase. Last week, the parties in the case made public 23 missives between FDIC and regulated institutions in which the regulator directed banks to slow or pause crypto efforts to accommodate additional regulatory discussions. All the correspondence contained redactions to obscure the financial institutions and products at issue. Relatedly, FDIC Chair Martin Gruenberg told reporters that the agency’s directives for some banks to pause crypto-related activities do not amount to “debanking” of the industry, but are instead based on concern for the risks posed by banks’ involvement with digital assets.

DOJ announced that Michael Joseph McElhiney was sentenced to 41 months in prison for defrauding investors by pretending to operate a crypto investment fund known as MAC Blockchain Solutions. According to court documents, McElhiney promised prospective investors that he and his purported business partners ran a successful crypto investment fund that invested in emerging cryptocurrencies and other blockchain-based projects, such as ETH staking and crypto liquidity pools. McElhiney solicited investors online through data apps and Call of Duty, as well as in person via Uber. He defrauded investors of more than $350,000.