Russia-based Sality watched for copied bitcoin and Ethereum addresses and quietly replaced them with the attacker’s. CrowdStrike and law enforcement have now isolated more than 15,000 infected machines.
A federal judge has allowed parts of an investor class-action lawsuit against Coinbase and certain executives to proceed, keeping allegations over risk disclosures alive in court.
US District Judge Katherine Polk Failla ruled on August 20 that some claims could move into discovery. The court dismissed several claims but allowed allegations that Coinbase misled investors by concealing potential bankruptcy risks and downplaying SEC scrutiny to proceed.
The ruling is procedural.
It does not mean Coinbase has been found liable. It does not prove wrongdoing. It means the plaintiffs cleared enough of an early legal hurdle for certain claims to continue.
TL;DR
- A federal judge allowed parts of a Coinbase investor class action to proceed.
- The claims center on risk disclosures tied to bankruptcy and SEC scrutiny.
- The ruling does not decide liability.
Why The Case Matters
Coinbase is one of the most important public companies in crypto.
Its disclosures, risk factors, regulatory statements, and investor communications are watched closely by both traditional markets and digital asset investors. A securities class action against the company therefore has broader relevance.
The case goes to a familiar question.
How much risk must crypto companies disclose, and how clearly must they explain regulatory uncertainty to investors?
That question has become more important as crypto firms operate in public markets, face agency scrutiny, and deal with fast-changing rules.
Risk Disclosure Is The Core Issue
The surviving claims reportedly concern whether Coinbase adequately disclosed certain risks.
Investors say the company concealed or downplayed potential bankruptcy-related concerns and regulatory scrutiny. Coinbase can still defend itself, and the facts remain contested.
But the court’s decision means those claims can proceed into discovery.
Discovery matters because it can force production of documents, communications, internal analysis, and testimony. That process can be expensive and revealing, even if a company ultimately wins.
Public Crypto Companies Face A Higher Bar
Private crypto firms can often operate with limited disclosure.
Public companies cannot. They must file risk factors, financial statements, management discussion, legal updates, and material event disclosures. Investors rely on those filings when buying shares.
That creates legal exposure.
If plaintiffs believe a company misrepresented risks or omitted material information, they may bring securities claims. Courts then decide which claims are strong enough to proceed.
Coinbase is not alone in facing this type of scrutiny, but its position makes the case especially visible.
No Liability Finding Yet
The caution is essential.
A motion-stage ruling is not a verdict. The court did not conclude that Coinbase misled investors. It only allowed certain allegations to continue.
Many class actions narrow over time.
Claims can be dismissed later, settled, or defeated after discovery. Coinbase can still challenge the allegations and defend its disclosures.
Markets should not treat the ruling as proof of wrongdoing.
Why Crypto Regulation Remains Central
The case also shows how regulatory uncertainty can become a securities-law issue.
If a crypto company’s business depends heavily on regulatory treatment, investors may argue that regulatory risk is material. Companies then need to describe that risk clearly enough that investors understand the potential impact.
That is difficult in crypto because rules can shift quickly.
SEC scrutiny, exchange registration questions, custody concerns, staking services, token listings, and bankruptcy treatment can all affect business models.
Coinbase operates directly inside that uncertainty.
What Comes Next
The case now moves forward on the surviving claims.
Discovery will determine what evidence the plaintiffs can obtain and how Coinbase responds. The company may later seek dismissal, summary judgment, settlement, or trial depending on how the case develops.
For now, the key takeaway is narrow but important.
Coinbase has not been found liable, but it must continue defending parts of an investor lawsuit over risk disclosures.
That keeps public-company crypto disclosure standards in the spotlight.
This article is based on filings and court materials from the Southern District of New York.
This article was written by the News Desk and edited by Samuel Rae.
A US appeals court has allowed a proposed Binance-related theft lawsuit to proceed in federal court, rejecting a lower-court order that had forced the plaintiffs into arbitration.
The Eleventh Circuit issued an extraordinary writ of mandamus on August 19, directing the lower court to vacate its arbitration order. The panel found that the eight alleged crypto theft victims had never opened Binance accounts and therefore were not bound by Binance’s Terms of Use.
That is an important procedural ruling.
It does not mean Binance has been found liable. It does not prove RICO or anti-money-laundering allegations. It only determines that the plaintiffs can pursue the case in federal court rather than being forced into arbitration.
TL;DR
- The Eleventh Circuit allowed eight alleged crypto theft victims to pursue claims in federal court.
- The panel found they were not bound by Binance’s arbitration terms because they never opened Binance accounts.
- The ruling is procedural and does not decide liability.
Why Arbitration Was The Key Issue
Many online platforms include arbitration clauses in their terms.
Those clauses can require users to resolve disputes privately instead of suing in court. Companies often prefer arbitration because it can reduce litigation costs, limit class-action risk, and keep disputes out of public court proceedings.
But arbitration usually depends on agreement.
If someone never opened an account and never accepted the terms, the argument that they must arbitrate becomes weaker.
That appears to be the issue in this case.
The plaintiffs argued they were victims of crypto theft and did not agree to Binance’s user terms. The appeals court agreed that forcing arbitration under those terms was improper.
Why This Matters For Crypto Platforms
Crypto theft cases often involve complicated chains of transactions, exchanges, wallets, and intermediaries.
Victims may claim stolen funds passed through major platforms even if they were never customers of those platforms. Exchanges, meanwhile, may argue that claims connected to their services should be handled under platform terms.
The Eleventh Circuit ruling limits how far that argument can reach.
If non-users are not bound by platform terms, they may have more room to pursue claims in court. That could matter in future theft, laundering, fraud, and tracing cases.
It does not guarantee those plaintiffs will win. It simply keeps the courthouse door open.
The Allegations Still Need To Be Proven
The lawsuit reportedly includes serious allegations, including RICO and anti-money-laundering compliance claims against Binance-related defendants.
But allegations are not findings.
The court did not rule that Binance laundered funds, violated RICO, or caused the plaintiffs’ losses. It only addressed whether the plaintiffs could be compelled to arbitrate.
That distinction is essential.
Crypto litigation headlines can easily make procedural rulings sound like judgments on the facts. This ruling is about venue and consent, not liability.
A Wider Compliance Signal
Even though the ruling is procedural, it still adds pressure to exchanges.
Major platforms are already under scrutiny from regulators, plaintiffs, and law enforcement over transaction monitoring, sanctions compliance, fraud controls, and the movement of stolen assets.
A federal case moving forward can create discovery, public filings, and legal risk.
That may encourage platforms to keep strengthening compliance systems, especially around suspicious flows and account activity linked to hacks or scams.
What Comes Next
The case now returns to federal court unless further review changes the outcome.
The plaintiffs still need to prove their claims. Defendants can still challenge the allegations, seek dismissal, contest class certification, and defend the case on the merits.
For now, the key point is narrower.
The appeals court found that alleged victims who never opened Binance accounts could not be forced into arbitration based on account terms they did not accept.
That gives the case a path forward in federal court — and adds another legal development to the growing list of crypto exchange liability battles.
This article is based on the Eleventh Circuit’s mandamus ruling and related court materials.
This article was written by the News Desk and edited by Samuel Rae.
A federal judge has temporarily barred Minnesota from enforcing its new prediction-market felony law against federally regulated exchanges designated by the Commodity Futures Trading Commission as contract markets, including Kalshi and Polymarket US, days before the statute takes effect on Aug. 1.
Judge Katherine Menendez granted preliminary-injunction motions filed by the CFTC, KalshiEX and QCX, the registered entity doing business as Polymarket US. Her July 27 order prevents named Minnesota officials from enforcing Minn. Stat. § 609.7615 against CFTC-designated contract markets until the cases reach a final merits decision.
Why the court found likely partial preemption
Menendez found the plaintiffs likely to prove that the Commodity Exchange Act expressly preempts part of Minnesota’s law. Federal law gives the CFTC exclusive jurisdiction over swap transactions conducted on designated contract markets, and the swap definition can include event contracts whose outcomes have a reasonably connected potential financial, economic or commercial consequence. A trader’s potential profit alone is not enough.
The order does not treat every event contract as a swap. Menendez identified markets tied to a Senate election, the World Cup winner, a LeBron James signing and Strait of Hormuz traffic as likely swaps. She questioned a 20-point-lead market and said contracts on the winning Love Island USA couple or words used by World Cup announcers appeared unlikely to qualify. Any permanent injunction could therefore apply to fewer contracts.
Chapter 118 replaced the prediction-market provisions enacted earlier in Chapter 97. The law remains scheduled to take effect Aug. 1 for crimes committed on or after that date.
Under its core offense, creating or operating a covered prediction market, or intentionally facilitating it through specified listing, funds, settlement, counterparty or pricing activity, is a felony when done for consideration and as part of a business. Other provisions cover providers who knowingly supply data directly to a market, or geolocation, funds-transfer or payment services to one, to enable or settle prohibited wagers. A separate clause criminalizes advertising or marketing financial or technological products that promote prohibited transactions.
Because the order protects only CFTC-designated contract markets, it does not expressly shield customers, independent advertisers or outside service providers. The statute remains in force, and the court has not decided the plaintiffs’ implied-preemption or First Amendment claims.
Polymarket US welcomed the ruling and said it expected to keep serving Minnesota users. Attorney General Keith Ellison said the state disagreed and would continue defending the law as the record develops.
By contrast, a New York court denied Kalshi interim protection from existing state gambling enforcement earlier in July. Both cases remain open, and the opposite preliminary results do not settle how federal registration interacts with state gambling laws nationwide.
President Donald Trump’s command of U.S. financial and economic policy may have taken a step closer now that his Department of Justice has backed down from an investigation of Federal Reserve Chair Jerome Powell, meaning his nominee to replace Powell may now have an open path to confirmation.
Fed chair nominee Kevin Warsh, whose own considerable wealth includes some crypto-world assets, is awaiting a final vote from the Senate after appearing in a confirmation hearing this week. Trump, who has relentlessly blamed Powell for maintaining overly high U.S. interest rates, chose Warsh to remedy that, but Republican Senator Thom Tillis had promised to block the confirmation as long as the DOJ pressed an investigation against Powell for cost overruns in a Fed building project.
That criminal probe was dropped on Friday, and Attorney General Jeanine Pirro said the DOJ asked the Fed’s inspector general to look into the renovation situation and issue a report. When the news emerged, Kalshi’s prediction betting on Walsh’s confirmation before May 15 shot up from about 30% odds to more than 80%.
“I expect a comprehensive report in short order and am confident the outcome will assist in resolving, once and for all, the questions that led this office to issue subpoenas,” Pirro wrote in a post on social media site X. “Accordingly, I have directed my office to close our investigation as the IG undertakes this inquiry. Note well, however, that I will not hesitate to restart a criminal investigation should the facts warrant doing so.”
Putting his own people atop the Federal Reserve not only equates with Trump’s greater influence over U.S. monetary policy, but it also leaves him with more allies on the Fed board as it makes decisions about financial policy — including implementing rules that govern the crypto industry and stablecoin issuers.
Because of Tillis’ threat, Warsh may have been in a holding pattern as long as the DOJ pursued its investigation, which could have left Powell in charge of the Fed indefinitely, well beyond the May 15 expiration of his term. Now, the Republican-majority Senate may be able to move more quickly toward confirmation of the nominee, who insisted during his hearing that he would act independently of White House direction.
Senator Elizabeth Warren, the ranking Democrat on the Senate Banking Committee that’s considering his nomination, dismissed the move and noted the administration is still pursuing Fed Governor Lisa Cook in court.
“This is just an attempt to clear the path for Senate Republicans to install President Trump’s sock pocket Kevin Warsh as Fed chair,” Warren said in a statement. “Let’s be clear what the Justice Department announced today: They threatened to restart the bogus criminal investigation into Fed Chair Powell at any time while failing to drop their ridiculous criminal probe against Governor Lisa Cook.”
Tillis called Warsh a “great nominee.” In his own posting this week on X, the senator said he’d vote yes on Warsh once the DOJ backs off of Powell:
“I look forward to supporting him out of committee once the DOJ drops their bogus investigation into Chairman Powell that threatens the independence of the Fed.”
A US federal court has rejected Custodia Bank’s final attempt to challenge the Federal Reserve’s authority over granting master accounts — effectively ending the crypto-focused bank’s five-year-long battle for direct access to the central bank’s payment system.
The US Court of Appeals for the Tenth Circuit said in a filing on Friday that it wouldn’t hear Custodia’s final appeal on that point in a 7-3 vote.
Custodia first applied for a master account in October 2020, which allows financial institutions to hold reserves directly at the Federal Reserve and access its payment rails, enabling them to settle transactions without relying on intermediary banks.
After the Fed rejected its master account application, Custodia turned to the courts, arguing the Monetary Control Act entitles state-chartered banks to access Fed services and therefore a master account.
However, the multiple courts have now ruled that the Fed retains discretion over whether to grant master accounts.
Custodia’s blow comes as Kraken became the first crypto platform to receive a master account from the Federal Reserve Bank of Kansas City on March 4.
Kraken’s master account enables it to connect to the Fedwire payments system, though it does not include the full range of services available to traditional banks.
The move raised hopes that US regulators could offer “skinny” or limited master accounts to crypto firms.
Banks not given master accounts akin to “death sentence”
While only three judges sided with Custodia, one of them, Judge Timothy Tymkovich, wrote a strong dissenting opinion, stating that “a master account is ‘indispensable’ for a bank’s operations” and being denied one is “akin to a death sentence.”
Related: Democrats say they will oversee reported DOJ probe into Binance
He noted that three months after Custodia’s application in October 2020, the Fed said Custodia was eligible and told it there were “no showstoppers” with its application.
He added, “I do not agree that Reserve Banks have discretion over account applications and would have allowed the mandamus claim to go forward.”
Magazine: Clarity Act risks repeat of Europe’s mistakes, crypto lawyer warns
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Kalshi has scored another win in its fight to define the future of sports prediction markets.
On Monday, a California federal judge refused to block the platform’s contracts, siding with the company’s argument that it is a federally regulated exchange and not a sportsbook. The ruling hands tribes their first loss in a fast-expanding legal battle that could redraw the boundaries of gambling law.
Court Says CFTC, Not Tribes, Regulates Event Contracts
U.S. District Judge Jacqueline Scott Corley rejected a motion for a preliminary injunction from Blue Lake Rancheria, Chicken Ranch Rancheria of Me-Wuk Indians, and Picayune Rancheria of the Chukchansi Indians. The tribes sought to block Kalshi from offering “sports event contracts” accessible from tribal lands, arguing that the operator’s activities violated the Indian Gaming Regulatory Act (IGRA) and constituted unlicensed Class III gaming.
Corley disagreed. In her 28-page order, she ruled that Kalshi’s operations fall under the Commodity Exchange Act (CEA) and the oversight of the Commodity Futures Trading Commission (CFTC).
“The UIGEA, unlike IGRA, expressly addresses internet gaming that can be accessed in locations where such gaming is unlawful, including Indian lands,” Corley wrote, referring to the Unlawful Internet Gambling Enforcement Act (UIGEA). Because Kalshi is registered with the CEA, its online contracts “are not bets or wagers under the UIGEA,” even if users trade them while on tribal property.
Judge Corley is also persuaded by Kalshi’s argument that interstate (or in this case, state-to-Indian) gaming issues are governed by UIGEA, not IGRA, and UIGEA carves out trading activity governed by the CEA. pic.twitter.com/n7hdJx5aJw
— Andrew Kim (@akhoya87) November 10, 2025
Expanding Legal Battles
The ruling follows a string of federal victories for Kalshi, which has faced regulatory pressure from states including Maryland, Nevada, and New Jersey. In each case, judges have declined to halt its operations while litigation continues, citing the CFTC’s exclusive jurisdiction over federally registered exchanges.
Still, tribal governments remain central to the fight. Their lawsuits argue that prediction markets siphon revenue from tribal gaming and erode sovereign authority. Earlier this year, a similar challenge helped pause Crypto.com’s event-contract offerings in Nevada.
Judge Acknowledges Tribal Concerns
Corley acknowledged those sovereignty concerns but said they weren’t grounds for a preliminary injunction.
“By self-certifying the legality of its event contracts in a way that insulates its activities from judicial review,” she wrote, “Kalshi may have found a way around prohibitions on interstate gambling that were created with the Tribes’ best interest in mind.”
What the Decision Means for Prediction Markets
While the order is limited to preliminary relief, it reinforces the federal footing Kalshi and similar firms rely on. The court’s reasoning effectively affirms that CFTC-regulated exchanges sit outside state and tribal gambling frameworks, at least for now.
That interpretation narrows the reach of IGRA and state gaming laws in the online prediction-market space, underscoring the jurisdictional gap between traditional gambling regulation and federally registered financial exchanges.
Industry observers say the decision could encourage other platforms to expand their offerings while awaiting further federal guidance.
At the same time, the ruling heightens pressure on the CFTC, which has yet to issue clear rules around sports-based or election-based event contracts. Congress and federal agencies may now face renewed calls to clarify where prediction markets end and gambling begins.
For tribes, the legal route has narrowed but not closed. Their best leverage may now shift from courtroom litigation to legislative advocacy, pushing for clearer boundaries between financial contracts and games of chance.
Ultimately, Corley’s order keeps Kalshi trading, keeps tribes frustrated, and keeps the federal government in charge — at least until the Ninth Circuit or the CFTC decides otherwise.
Trusted Editorial content, reviewed by leading industry experts and seasoned editors. Ad Disclosure
According to remarks by Federal Reserve Governor Christopher J. Waller at the Payments Innovation Conference on October 21, 2025, Fed staff are examining a new kind of account that would let certain non-bank firms connect directly to the central bank’s payment system. Reports have disclosed the idea is being called a “payment account” or informally a “skinny” master account.
What The Federal Reserve Is Proposing
The plan would stop short of giving full bank privileges. The accounts would likely not earn interest and would not have access to the Fed’s discount window. Balance caps and other risk limits are expected to be part of the design. Waller said staff are still working through the details and that the concept remains exploratory rather than a finalized rule.
Limits And Safeguards
Regulators intend to keep guardrails. According to public comments, only “legally eligible” entities would qualify. That phrase leaves open which corporate forms — for example, trust companies, state-chartered firms or other charter types — will be allowed.
🌊 Fed opens the gates for fintech and crypto access
Federal Reserve Governor Christopher Waller revealed today that the Fed is studying a new model of “payment accounts”. Streamlined accounts that would allow fintech and crypto firms to access the Fed’s payment infrastructure,… https://t.co/QphKaopcRo
— StrongSHx (@StrongSHX) October 21, 2025
Reports note the accounts would be smaller in scope than a normal master account, with explicit restrictions aimed at reducing exposure to the payment system. Oversight, AML/KYC checks and operational risk controls are expected to be central to any application process.
The Federal Reserve. Photo: Shutterstock
Why This Matters Now
Access to the Fed’s rails has long been limited to banks, which forced many fintech and crypto firms to rely on intermediary banks. Connecting directly, even in a limited way, could reduce steps in settlement and cut certain counterparty risks.
There is also context: the Fed withdrew earlier guidance on bank crypto activities this year — on April 24, 2025 — signaling a shift in tone toward integrating new players into payments.
Who Stands To Gain Or Lose
Crypto firms and stablecoin issuers could find it easier to move funds and settle transactions. Banks that currently provide access to non-banks may face stiffer competition for those services.
At the same time, regulators and bank supervisors will still carry the burden of preventing fraud, illicit finance and operational breakdowns. Market participants are likely to watch how the Fed coordinates with the OCC and the FDIC on questions of charters and deposit insurance.
Featured image from Unsplash, chart from TradingView
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