Update: Memo #1

Gunnar Larson g at xny.io
Sun Jan 2 11:49:39 PST 2022


Memo #1's draft to the DOJ on the Goldman Deferred Agreement's breach is
coming along. The rush to get Memo #1 out is real, but the quality factor
will be apparent as delivered sometime next week.

Meanwhile, Memo #1 has a point about Goldman's obvious intent to manipulate
virtual currency markets across the globe. We have been discussing
marketplace manipulation with our friendly New York regulators for over a
year.

As a disclosure technique, I am sharing the below correspondence (and as a
Memo #1 update).

Thank you.

From: *Gunnar Larson* <g at xny.io>
Date: Tue, Mar 2, 2021 at 1:49 PM
Subject: Tech Sprint | xNY Design Mechanism to Report Digital Regulatory
Computer Crimes
To: Shah, Seema (DFS) <seema.shah at dfs.ny.gov>
Cc: dfs.sm.DfsNext <DfsNext at dfs.ny.gov>, Joshua Plant <joshua at plantpr.com>,
<innovation at dfs.ny.gov>, <VCLicenseQuestions at dfs.ny.gov>

Dear Ms. Shah:

Attending each of the Tech Sprint “info-calls” and our subsequent email
correspondence, being denied Tech Sprint participation without context or
reply
<https://thecapital.io/article/tech-sprint--ny-department-of-financial-services-MURgxG7Cnk1c3HwsKGV>
leaves
us in an awkward situation. The facility of the Tech Sprint offered four
“all day working sessions” along with two weeks of workshops for problem
solving issues like “marketplace manipulation.”

Moving on, and to properly close the Tech Sprint chapter from our
perspective, today's memo is a vehicle that aims to deliver the tool of a
“new-clean-slate” as foundation to our continued dialogue together. Yes,
xNY.io <http://xny.io/> is very fond of the idea of our friendly regulatory
future relationships with DFS.

Either way, xNY.io <http://xny.io/> is under strict mandate of earning the
Superintendent's various approvals, thus leaving no room for us to wallow
in Tech Sprint blues.

*Tech Sprint Submission : A Design Mechanism to Report Digital Regulatory
Computer Crimes*

Today I briefly submit an outline of reporting innovation observations and
key concerns defined by the four Tech Sprint Problem Statements. Delivery
of this submission files xNY.io’s Tech Sprint participation as complete.

The best hybrid virtual currency architecture and pioneering modern
innovation, xNY.io <http://xny.io/> and the proposed “xNY” virtual currency
is of pedigree with foundational intentions beyond our counterparts xRP
(Ripple) and NEXO (Nexo.io). From our direct experience on the matter, xRP
and NEXO built entire global operations as direct/indirect BitLicensees
with intent to profit from various cross-border computer crimes
<https://www.justice.gov/sites/default/files/criminal-ccips/legacy/2015/01/14/ccmanual.pdf>
such
as market manipulation while being partially funded and/or directed out of
New York.

   -

   Virtual currency fraud is a serious problem for such a developed country
   as the United States, whose bank regulators have drawn attention to the
   increase of these crimes. Having discovered that an unregulated virtual
   currency sphere (such as in Africa, or other developing markets) is very
   popular among virtual currency fraudsters
   <https://www.americanbanker.com/news/jpmorgan-chase-warns-of-upcoming-fine-over-internal-controls>,
   the New York State Department of Financial Services concluded that this
   kind of regulatory fraud was threatening US national security.
   -

      If the basic problem with crypto reporting innovation is monopoly
      power, policy should address that issue directly. If the problem
is a lack
      of transparency and accountability in government activities, one should
      find ways to open up the public sector to oversight from
outsiders. If the
      problem is an opaque and confusing regulatory structure, rules should be
      simplified and clarified.


   -

   As elegantly as possible xNY.io <http://xny.io/> must strive to innovate
   beyond a Laissez-faire attitude concerning the systems and processes in
   which transactions between our peers are now free from (or, almost free
   from) any form of economic/regulatory interventions such as the BitLicense
   lacking cross-border regulatory logic concern.
   -

   Ms. Shah, the BitLicense and bank innovation from the great state of New
   York touches people on all continents on Earth, and it seems that if given
   the opportunity, DFS would want to solve any market manipulation matter
   through technology
   -

      xNY.io <http://xny.io/> underscores the need for reporting innovation
      specific to virtual currency marketplace manipulation and/or other crypto
      cross-border regulatory arbitrage frameworks directed out of New
York that
      touching over 1 billion people (as clearly detailed in the Earth_ID
      conditional BitLicence application currently in DFS review).
      -

   xNY.io <http://xny.io/> is concerned that DFS has potentially ignored
   our interests ensured through interpretations of specific provisions in the
   existing national and supra-national legal framework (civil law, securities
   law, bankruptcy law, international human rights law and civil rights law).
   The Superintendent may now lead New York and the global virtual currency
   industry in clarify the rights of the public and obligations of BitLicense
   members engaged in the global virtual currency economy.
   -

      This can be achieved through subtle action on “conditional approvals”
      that are well earned from DFS review.


   -

   BitLicense regulation must preserve a technology-neutral,
   principle-based, non-discriminatory framework for the next generation of
   modern New York virtual currency public policy, naturally to support
   innovation within the limits imposed by overriding international public
   interests.

Our Tech Sprint participation was aimed at working through these matters
together in a structured setting. Being champions for the rights of our
future customers, it is xNY.io’s observation that DFS is not winning at
engaging technology and reporting processes specific to fostering civil
<https://www.nysenate.gov/legislation/laws/CVR>/human rights
<https://drive.google.com/drive/folders/1R1ExVvx8uIibM_w5X3BjG4eTDbJH_oSC?usp=sharing>.
There should be no open question on where New York stands on any matter
concerning human and civil rights at home or abroad.

*About the Design Mechanism Behind our Tech Sprint Concept*

Ms. Shah, during our calls together, we discussed focusing on the listed
problem statement concerning “Marketplace Manipulation.” xNY.io
<http://xny.io/> is concerned that these "Computer Crimes" are a
marketplace manipulation matter associated with current BitLicense
architecture and subject to DFS attention related to
cross-border/international organized groups (that are cyber-based in New
York).

Given the critical role that honest and fair dealing of virtual currency is
core to the BitLicense mandate, should admitted felons and serial
miscreants (aka New York banks) be allowed to further expand their racket
via global crypto regulatory arbitrage?

xNY.io’s key definition of virtual currency computer crimes, is a
consistent message across markets. These crimes are relatively new, having
been in existence for only as long as Bitcoin has—which explains how
unprepared society and the world, in general, is towards combating these
crimes AND we see this as no fault of DFS and the original BitLicense
mandate (unless not resolved before end of 2021). Goldman Sachs’ MoneyGram,
NEXO, BitGo, Ripple and several BitLicensee connections profit daily from
virtual currency market manipulation computer crimes with cross-border
reach operating as a large syndicate group from lower Manhattan.

Many DFS sanctioned BitLicencees today are very profitable enterprises and
they may straddle nationalities in ways that you never would have imagined.
xNY.io <http://xny.io/> notes our relationship with xRP and NEXO as
examples.

   -

   Ms. Shah, the jury is in and the NY-EU "CryptoBank '' regulatory
   loophole is a case for virtual currency market manipulation affecting
   computer systems and software (aka the Bitcoin blockchain) in Africa,
   Europe and New York State at the very least...
   -

      This activity is harming New York and xNY.io’s international virtual
      currency computer systems, process and overall technology (as outlined in
      the Earth_ID conditional Bitlicense application under DFS review) ...
      -

      xNY.io <http://xny.io/> points to Ripple.com <http://ripple.com/> and
      Nexo.io <http://nexo.io/> as party to delaying blockchain innovation
      AND possibly humanity as a whole only in the name of profits of Goldman
      Sachs and associated bad actors
      -

   For example, New York, Europe and Africa are connected by a freeway of
   cross-border arbitrage frameworks. Due to easily exploitable laws in
   developing countries, some BitLicensees straddle daily New York, Europe and
   in Africa operations that evade detection and prosecution from law
   enforcement. Our first “conditional BitLicense” application outlined this
   matter in detail.
   -

   xNY.io <http://xny.io/> efforts to bypass this creatively, certainly
   pioneering innovation and modern New York enterprise with opening
   CryptoBank and the xNY virtual currency

Keeping all this in mind with a positive/optimistic attitude, many agree
any best Tech Sprint design mechanism must have potential to innovate
virtual currency industry's reporting standards should (at the very
least...) aim to tackle computer crime and/or innovate beyond and strive to
meet a new level that is required to support the generation of a New York
international CryptoBank.

Ms. Shah, in reality foreign regulators have repeatedly filed enforcement
actions against the largest banks on Wall Street for engaging in fraud and
rigging markets. Communicating it another way, NY-DFS may find xNY.io’s
approach exotic and/or fresh, but in reality our foreign regulators have
repeatedly enforced actions against (directly or indirectly) BitLicensees
now freely leveraging virtual currency frameworks to rig markets abroad
while being headquartered in New York.

*Computer Crimes (Cross-Border) and Modern BitLicense Regulatory Logic*

xNY.io <http://xny.io/> seeks various approvals by the Superintendent to
protect our enterprise and overcome any and all unnecessary delay or
further loss or harm related to interstate or international transmission of
threats directed against computers and computer systems (aka the Bitcoin
Blockchain) and CryptoBank.

New York banks’ traditional engagement of regulatory arbitrage has
overflowed the BitLicense and correspondingly is responsible for global
virtual currency marketplace manipulation computer crimes, some experts
debate if Goldman Sachs is a RICO concern. xNY.io <http://xny.io/> is at
various levels a product of the best of New York banks domestically and
internationally (New York, Europe and Africa…) and as such chooses to
innovate rather than litigate.

Given the inherent universal cross-border nature of virtual currencies,
there is no real good reason for New York firms under the BitLicense
mandate to manipulate other global markets via regulatory arbitrage.
Circumnavigating this problem is key to modern BitLicense logic

   -

   MoneyGram, for example banks customer fees spanning postal mail, a
   telephone call, electronic mail, or through a other computerized messaging
   service. Computer Crimes as a threat is no less a threat because it is
   contingent, because the speaker does not intend or is unable to carry it
   out because the threat was not directly communicated to the MoneyGram
   customer as a target, or because the language used might be considered
   cryptic or ambiguously not part of the current BitLicense mandate.
   -

      Goldman Sachs’ legacy MoneyGram investment vs. direct correlation
      between xRP and NEXO virtual currencies arguably covers many computer
      crimes including wire fraud and cross-border marketplace manipulation.
      -

      Additionally, xRP and NEXO operating as potential bad actors have put
      the purity of blockchain systems, processes and pose purity risks to
      exchange software as Dark Pools, from our direct experience on the matter.
      -

         Over the last five years Goldman Sachs created layer upon layer
         (MoneyGram, NEXO, xRP, BitGo) of BitLicense related disguises and
         cross-border systems under potential conspiracy and plausible
deniability
         to computer crimes and marketplace manipulation.
         -

         Our CryptoBank aims to elegantly side-step all this basing our
         innovative operations in New York and winning necessary DFS approvals.
         -

   xNY.io’s approach in seeking confidence in “reporting systems and
   process” as a fundamental best practice that protects ourselves and our
   customers from interstate or international transmission of threats against
   computers, computer networks, and virtual currency data networks and their
   programs.
   -

      *xNY, CryptoBank:* xNY.io <http://xny.io/> vs. Nexo.io
      <http://nexo.io/> and Ripple.com <http://ripple.com/>
      -

      *XNY, Cryptocurrency:* xNY vs. NEXO and xRP

Finally, and forever forgetting any sentiments about being denied Tech
Sprint participation, we encourage DFS to consider that the Tech Sprint’s
overall success is already a success from the xNY.io <http://xny.io/> side.
>From our Tech Sprint “marketplace manipulation” calls together ... DFS now
has a potential cross-border human/civil rights solution developed as a
"tech-based" response to the problem statement(s) that specifically
addresses both the threats of future damage AND the current cross-border
"computer crime" merry-go-round responsible for extortionate damage already
inflicted.

Thank you, Ms. Shah!

*Next Steps … Onward!*

Surveying the best next steps, we hope DFS embraces the fact that xNY.io
<http://xny.io/> has no other option outside of moving from low into high
gear on the journey of seeking various conditional approvals and beginning
a long-term regulatory relationship all at the will of the Superintendent's
action.

   -

   For all people on planet Earth, the question should not hinge on any
   debate or worry that New York regulators are not taking market manipulation
   seriously.
   -

   xNY.io <http://xny.io/> again has every right to earn conditional
   approvals with the aim to serve billions of people as customers. PayPal,
   MoneyGram and Robinhood had their chance, so did xRP … While now NEXO aims
   to further leverage computer crimes at the expense of New York and the
   BitLicense.

Our team in Europe, Africa and New York comes to DFS with an impressive and
sophisticated solution of xNY.io <http://xny.io/> to evolve up and innovate
beyond whatever roadblocks stand in our way. Moreover, we look forward to
doing all this in collaboration with DFS while fostering meaningful
contributions to the legacy of New York (if nothing else, via evergreen
State tax contribution).

   -

   xNY.io <http://xny.io/> will be submitting a new/updated folio for DFS
   review and hopeful consideration of "conditional approval(s)" by the
   Superintendent over 2021. The new application is remarkably revolutionary …
   Including wise architecture for DFS and xNY.io <http://xny.io/> to
   leapfrog cross-border computer crimes efficiently as foundation to
   CryptoBank and the xNY virtual currency being an elegant solution as the
   world deserves
   -

   Note, xNY.io <http://xny.io/> aims to privately seek DFS' signal,
   through a series of upcoming private conversations together … Given many
   good reasons, DFS has a historic opportunity to signal sentiments on
   xNY.io’s new “conditional approval(s) on the viability spectrum on/before
   the DFS Tech Sprint's public 12 March "demo day" awards party.
   -

      This way, everyone wins … New York and the world is watching, let’s
      deliver what is deserved over 2021 via innovation that xNY.io
      <http://xny.io/> can deliver in various forms with DFS regulatory
      oversight controls.

xNY.io’s obvious consequences on the emotional level are associated with
economic risks, directly linked to the obligation and respect to the
institution of CryptoBanking and/or DFS as the regulatory body from which
xNY.io <http://xny.io/> entrepreneurship and innovation are required to
interact. Every effort has been made to offer DFS the best possible
scenario to advance xNY.io’s successful review while planting the seed for
historic contributions to New York State and lead virtual currency
CryptoBank innovation worldwide.

Ms. Shah, please keep a lookout for xNY.io's updated “conditional”
application materials concerning our good natured enterprise for DFS’
corresponding review with hopeful 2021 approval(s). Let nobody stop us.

Please let me know if you or the DFS team has any feedback.

Wishing you the very best Tech Sprint!

All the best,

Gunnar Larson

--
*Gunnar Larson - www.xNY.io <http://www.xny.io/>*
MSc
<https://www.unic.ac.cy/blockchain/msc-digital-currency/?utm_source=Google&utm_medium=Search&utm_campaign=MSc-Digital-Currency-North-America&utm_term=blockchain%20unic&gclid=Cj0KCQiAyJOBBhDCARIsAJG2h5ctwwMz0MRbVSk-LaYD-GMU5UgDSw7ynxbGr_a7SkaFAZzJc1-pzxEaAi4NEALw_wcB>
-
Digital Currency
MBA
<https://www.unic.ac.cy/business-administration-entrepreneurship-and-innovation-mba-1-5-years-or-3-semesters/>
-
Entrepreneurship and Innovation (ip)

G at xNY.io
+1-646-454-9107
New York, New York 10001
-------------- next part --------------
A non-text attachment was scrubbed...
Name: not available
Type: text/html
Size: 31666 bytes
Desc: not available
URL: <https://lists.cpunks.org/pipermail/cypherpunks/attachments/20220102/2dcefc9a/attachment.txt>


More information about the cypherpunks mailing list