Good morning. President Biden’s Commerce Department published an online-security rule on Friday, aiming to strengthen its legal hand against foreign-based apps—including TikTok—that could threaten the U.S.

• What's in the rule? The final rule, which focuses on how to regulate foreign-based apps, provides additional criteria that the Commerce secretary may consider when determining whether technology transactions involving apps present “undue or unacceptable risks,” according to a summary published in Friday’s Federal Register. 
   
• What's the context? The move comes as the U.S. continues to weigh what to do about the popular video-sharing app owned by Beijing-based ByteDance Ltd., as well as other Chinese-based apps.
   
• What's the next move? The administration likely still needs new legislation to further strengthen its legal position before taking any dramatic action against TikTok such as banning it in the U.S., and Congress has been at odds over the issue thus far. But Friday’s regulatory action shows that the Biden administration still has its eye on Chinese-based apps that could pose security risks, and could serve to rekindle efforts in Congress.

See also: Talk of a U.S. TikTok Ban Is Shaking Up the Creator Economy

Crypto exchange Binance.US avoids broad asset freeze.

A U.S. district judge ordered Binance’s American exchange to keep all assets in the U.S. and limit spending to expenses needed for regular operations.

A big step, but not all the SEC wanted. The order falls short of the Securities and Exchange Commission’s original request for a broad asset freeze. Earlier this week, a federal court judge questioned what evidence the agency had to support claims that customer funds were leaving the country. Binance.US had said that a broad asset freeze would cripple its business.

Do Kwon sentenced to four months for passport fraud in Montenegro.

A Montenegrin court sentenced South Korean cryptocurrency mogul Do Kwon to four months in prison for using a fake passport in an attempt to leave the country.

Han Chang-joon, former chief executive of South Korean payments app Chai and a close colleague of Kwon, also received a four-month sentence for the same charge, according to a court statement. Kwon, creator of the failed TerraUSD stablecoin, has been indicted in the U.S. on eight counts of fraud.

• More crypto firms and other companies are moving through chapter 11 without disclosing the identities of their creditors, a shift from past practice as some courts give priority to data privacy over public transparency.
   
• The China-led Asian Infrastructure Investment Bank has spent much of the past decade fighting to convince people the bank isn’t a Chinese tool. The resignation this week of an executive who claimed the bank had been infiltrated by China’s Communist Party has made their job that much harder.
   
• Swiss voters overwhelmingly supported a global move to establish a minimum tax on corporate profits, with the world’s largest offshore center feeling the pressure to help crack down on tax avoidance by the biggest international companies.
   
• JPMorgan Chase reviewed its ties to Jeffrey Epstein in 2019 and found that he had regularly given business advice to onetime JPMorgan executive Jes Staley and invited him to meetings with senior officials in foreign governments.

Xi Jinping meets Antony Blinken as U.S., China resume high-level engagement.

China and the U.S. took steps to halt the downward spiral in relations, with Secretary of State Antony Blinken meeting Chinese leader Xi Jinping, though the two powers might have trouble keeping their global rivalry from swamping the tentative rapprochement.

First step in improving relations. During two days of meetings in Beijing, Blinken and senior Chinese foreign-policy officials agreed to more high-level talks, continuing a thaw after months of near-frozen contacts. They also promised to find common ground on increasing flights between the two countries and combating the flow of fentanyl into the U.S.

• China Stimulus Pivot Spurred by Fear Slowdown Could Get Lot Worse
• U.S. Grapples With Potential Threats From Chinese AI
• Why the War in Ukraine May Not Deter China
• China Cuts Borrowing Rates Again in Bid to Juice Recovery
• Beijing Plans a New Training Facility in Cuba

European Union flags payment companies’ money-laundering risk management.

Payment-facilitating companies in Europe and their regulators aren’t effectively managing the risk of money laundering, the European Banking Authority said in a report released Friday.

Internal controls at payment institutions are often not adequate to prevent money laundering, the EBA said. Some regulators in Europe are also failing to supervise the sector effectively, it said. The failures, it said, could “impact the integrity of the EU’s financial system.”

Payment institutions, as defined by the EU, are a broad group that includes credit-card networks, digital wallet providers, money transfer firms and others. A spokesman for the European Payments Institutions Federation said the trade group was “disappointed” with the EBA's findings. He added that the non-bank payment sector has developed sophisticated risk-mitigation techniques that the group felt weren't sufficiently reflected in the EBA report.

• Ukrainians’ early setbacks are a sign that their offensive will be a long, deadly grind, and not a repeat of their rout of Russian troops in the northeast region of Kharkiv late last summer.
   
• The world’s central banks underestimated inflation last year. They are trying not to make the same mistake twice.
   
• An executive at a leading artificial-intelligence company has said what many people fear: While its technology may create new jobs, it will likely eliminate some too.
   
• Around a third of the winter wheat grown nationwide is expected to be abandoned because it is uneconomical to harvest it this year. 

• Technology stocks are on a tear. But investors can’t agree on whether their recent run looks like the prelude to an eventual bust—like that of the dot-com era—or the start of a more durable rally.
   
• Silicon Valley Bank’s customers in Asia whose deposits were recently seized by the Federal Deposit Insurance Corp. are in a bind for another reason: they still have loans outstanding—to First Citizens Bank.
   
• The number of homeless people counted on streets and in shelters around the U.S. has broadly risen this year, according to a Wall Street Journal review of data from around the nation.
   
• The hiring boom obscures what looks like a contradictory economic trend: Employees are working fewer hours.
   
• Micron Technology said it would invest about $600 million to expand production in the Chinese city of Xi’an, a move that comes about a month after Beijing blacklisted the memory-chip company.
   
• If there’s one thing that voters of both parties—and independents—agree on, it’s that few are looking forward to the run-up to the presidental election in November 2024.
   
• An international search-and-rescue team is racing to find a submersible that went missing while visiting the wreck of the Titanic before the five people aboard run out of air.

Follow us on Twitter at @WSJRisk. Follow Risk & Compliance editor David Smagalla @DSmagalla_DJ and reporters Mengqi Sun @_MengqiSun, Dylan Tokar @dgtokar and Richard Vanderford @VanderfordRich.

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