Binance founder and former CEO Changpeng “CZ” Zhao has been sentenced to four months in prison, while Bitcoin (BTC) experienced a turbulent week, dropping to a two-month low below $56,000 before bouncing back above $62,000. Additionally, spot Bitcoin ETFs saw record outflows.

Sustained Regulatory Efforts

Last week saw a flurry of regulatory actions, with reports indicating that the U.S. Securities and Exchange Commission (SEC) has been viewing Ethereum (ETH) as a security for over a year. The SEC is investigating certain Ethereum sales, while U.S. prosecutors are looking into transactions on Block’s Square and Cash App divisions for potential compliance violations.

The FBI also brought charges against Idin Dalpour, accusing him of running a Ponzi scheme that defrauded investors of over $43 million. In Nigeria, the trial of two Binance executives detained on money laundering and tax evasion charges has been postponed to May 17.

Binance Founder’s Jail Sentence, FTX Executive’s Forfeiture

Reports emerged this week regarding Binance and FTX. Binance founder CZ received a four-month jail term for the exchange’s AML law violations. In a separate case, former FTX executive Ryan Salame agreed to forfeit his $5.9 million mansion in the Bahamas and contribute $5.6 million to creditor compensation as part of a plea deal.

Spot Bitcoin ETFs Record Outflows

Last week saw a bearish trend in the market, with spot Bitcoin ETFs experiencing significant outflows. On April 29, 11 spot Bitcoin ETF products saw $51.53 million in outflows. BlackRock reported no inflows for the fourth consecutive day. Two days later, on May 1, total outflows reached $563 million, the highest since the ETFs began trading. BlackRock’s iShares Bitcoin Trust (IBIT) saw $37 million in outflows, its first since launch.

The Grayscale Bitcoin Trust (GBTC) saw a net inflow of $63 million on May 3, the first daily increase since its debut in January.

Bitcoin’s Rollercoaster Ride

Bitcoin faced bearish pressure last week, dropping below $57,000 on May 1 for the first time since late February. However, a recovery pushed BTC back above $58,000. The Fear and Greed Index entered Fear territory on May 2 for the first time since October 2023.

BitMEX founder Arthur Hayes predicted a gradual price uptick, while CryptoQuant CEO confirmed no signs of miner capitulation. MicroStrategy took advantage of the dip, buying 122 Bitcoin worth $7.8 million to increase their holdings to 214,400 BTC.

Bitcoin leveraged a U.S. labor market report to spike by 6.46% on May 3, reclaiming the $62,000 threshold. This rally boosted the global crypto market cap by 7.7% on May 4, with meme coins like Dogwifhat (WIF), Floki (FLOKI), and Dogecoin (DOGE) seeing double-digit gains.

Hacks and Scams Decline

Despite reports of crypto-related hacks and scams, losses from such incidents decreased significantly in April. A user lost $69.3 million to a scammer through an address poisoning scheme, while overall losses from crypto hacks and scams amounted to $60 million in April, a 67% drop from March.

CertiK reported that funds lost to cybersecurity threats in the cryptocurrency industry have fallen to their lowest levels since 2021.

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