HOLIDAY NOTICE: Blockchain Bites will publish next on Tuesday, Feb. 18. Happy Presidents Day to our US readers. And Happy Valentine's Day to all.
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ILLEGAL MIXING: After Larry Harmon's arrest for allegedly participating in a money-laundering conspiracy worth more than $300 million in cryptocurrency, the Department of Justice has said mixing, the process of obfuscating transactions on a blockchain, is illegal. “This indictment underscores that seeking to obscure virtual currency transactions in this way is a crime," Brian Benczkowski, a DOJ Assistant Attorney General, said. Full story

$1M MINIMUM: Cryptocurrency investment firm Polychain Capital is raising $200 million for a second fund aimed at venture investing, that’s $25 million more than its first fund. According to an investor slide deck obtained by CoinDesk, the new fund opened at the beginning of 2020 and is accepting minimum investments of $1 million for up to three years. Full story

TOUGH TALK: Tensions with Iran may be behind U.S. Treasury Secretary Steven Mnuchin’s cryptocurrency compliance comments on Wednesday. The New York Times reported the Trump administration “has expressed growing concern” that this technology is being used to “evade American sanctions on countries like Iran.” Full story

SMALLER GALAXY: Galaxy Digital, the cryptocurrency merchant bank founded by Michael Novogratz, has laid off 13 people, roughly 15 percent of its workforce, sources said. The layoffs occurred across the board in early January, though all of the New York-based firm's business divisions were left intact. Full story

BLACK SWANS: The U.S. Office of the Director of National Intelligence is advertising for a post-doc researcher to study what would happen if the U.S. dollar lost its status as the world’s reserve currency. The agency said the research – the first of its kind for the intelligence community’s post-doc program – could help the U.S. prepare for “black swan” events that would threaten the dominance of the dollar. Full story