Mass. regulators fine bitcoin mining company $1 million – The Boston Globe

CRYPTOCURRENCY
A Florida bitcoin mining company was fined $1 million by Massachusetts regulators over charges it sold fraudulent and unregistered securities. U.S. Data Mining Group raised $4 million from investors in Massachusetts last year without disclosing that several people involved in the sale previously had been sanctioned by regulators for securities fraud, Secretary of the Commonwealth William Galvin said Tuesday. “I can’t stress enough the importance of knowing who you’re dealing with when you invest your money,” Galvin said in a statement. “This is especially important when your investments involve Bitcoin mining and cryptocurrency, which have in recent years been popular vehicles used by scammers to defraud innocent investors.” Two of the people who assisted in forming the company are classified as “bad actors” under securities law because they previously settled charges for fraud with the SEC, Galvin’s office said. On Tuesday, the company signed a consent decree with Galvin’s office including the $1 million fine. U.S. Data Mining, which did not admit or deny the charges in the decree, also must offer to refund stock purchases by Massachusetts investors with interest. The bitcoin company raised a total of $25 million in the stock sale last year, according to the decree. A phone number listed on an SEC registration form for the company’s headquarters in Miami was out of service on Tuesday. A call to U.S. Data Mining’s lawyer was not returned. ― AARON PRESSMAN
FINANCE
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European Central Bank President Christine Lagarde said there are signs that some Russians are attempting to bypass sanctions over the war in Ukraine by converting rubles into cryptocurrencies and stablecoins. “When you see the volumes of rubles into stable, into cryptos, at the moment it is the highest level that we have seen since maybe 2021,” Lagarde told a virtual event on Tuesday. Crypto assets “are certainly being used, as we speak, as a way to try to circumvent the sanctions that have been decided by many countries around the world against Russia,” she said. Measures announced by the United States and European Union aim to limit Russia’s ability to do business in dollars and other international currencies. They include penalties on major banks and restrictions on the country’s elite. As of last week, there was no evidence of Russia or President Vladimir Putin using cryptocurrencies to evade curbs, according to Jonathan Levin, co-founder of blockchain-analytics firm Chainalysis. He and several industry experts told the US Senate Banking Committee that the crypto market is too small to facilitate any large-scale sanctions evasion by Russians. ― BLOOMBERG NEWS
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AUTOMOTIVE
Tesla officially began making cars in Europe on Tuesday, opening an assembly plant in a critical market where Elon Musk, the company’s CEO, plans to build 500,000 electric vehicles a year. Musk escorted Chancellor Olaf Scholz of Germany and other officials on a tour of the huge, low-slung $7 billion plant just outside Berlin. It was constructed in little more than two years, a speed that amazed German officials and commentators. Musk celebrated the day by handing over the first 30 European-built Teslas to customers who had ordered them and been invited to the event. Tesla will build its Model Y SUV at the plant. The plan for the factory, called Gigafactory Berlin-Brandenburg, was first revealed in a surprise announcement by Musk a little over two years ago, and it overcame a number of legal and political challenges to attain its production certification. The 2.4-million-square-foot plant places Tesla in one of the most important electric car markets in the world. More than 20 percent of new cars sold in Europe and Britain in December were powered solely by electricity. The German site is Tesla’s third major plant after factories in Fremont, California, and Shanghai. Another plant, outside Austin, Texas, is expected to open soon. The new plants are expected to double the company’s production capacity to about 2 million vehicles a year. ― NEW YORK TIMES
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ENERGY
US demand for natural gas that can be produced from waste and other renewable sources could jump 45-fold over the next two decades as utilities seek to reduce their carbon emissions, according to BloombergNEF. Consumption of so-called renewable gas, which so far has been mostly used to replace diesel in truck and bus fleets, could reach as much as 3.15 trillion cubic feet per year by 2040 as it becomes a “key decarbonization tool” for gas utilities, BNEF analyst Jade Patterson said in a report Tuesday. That would compare with about 70 billion cubic feet in 2021. Renewable gas could potentially substitute as much as 12 percent of current US demand, up from less than percent, if technologies still in early stages of development are implemented in a commercial scale, according to the report. ― BLOOMBERG NEWS
ECONOMY
The global economy likely won’t be able to avoid a recession without a resumption of Russian energy exports this year, according to a study by Federal Reserve Bank of Dallas economists. “If the bulk of Russian energy exports is off the market for the remainder of 2022, a global economic downturn seems unavoidable,” economists Lutz Kilian and Michael Plante wrote in an article posted by the Dallas Fed Tuesday. “This slowdown could be more protracted than that in 1991.” The authors drew a parallel to the 1991 global recession, set off by Iraq’s invasion of Kuwait in the year prior that caused an oil-supply shock. Back then, Saudi Arabia partly reduced the impact by pledging to ramp up production, helping ensure what the researchers called “only a brief US recession,” which lasted less than a year. The refusal of financial institutions to support Russian energy exports has been the main development putting those shipments at risk, the Dallas Fed economists wrote. Replacing that supply may be challenging, given that Saudi Arabia and the United Arab Emirates have signaled they won’t provide relief, the researchers said. ― BLOOMBERG NEWS
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ENTERTAINMENT
Goldman Sachs Group Inc. chief executive David Solomon is set to take the stage at Chicago’s Lollapalooza music festival in July, joining a roster headlined by artists including Machine Gun Kelly and Doja Cat. Solomon is among the musicians listed in the lineup released Tuesday by organizers of the four-day event, which also includes legendary bands such as Metallica and Green Day. Solomon, who started as DJ D-Sol, now just prefers using his CEO name as his stage name. Since assuming the top spot at Goldman, he has played at a variety of high-profile events, including a Super Bowl party this year and an Amazon.com Inc. confab in 2019. ― BLOOMBERG NEWS
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AUTO INDUSTRY
Ford is recalling nearly 215,000 pickup trucks and large SUVs in the United States and Canada because brake fluid can leak, causing longer stopping distances. The recall covers the F-150 pickup from 2016 through 2018, as well as Ford Expedition and Lincoln Navigator SUVs from 2016 and 2017. All have 3.5-liter turbocharged six-cylinder engines. The National Highway Traffic Safety Administration says in documents released Tuesday that fluid can leak from the brake master cylinder. That can increase brake pedal travel, requiring greater effort and longer stopping distances. Documents say dealers will replace the master cylinder and front brake booster if needed. Owners are to be notified by letter starting April 25. ― ASSOCIATED PRESS
















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