💻 Even Hackers Are Crypto Degens 👀
In today's edition: 🎙️ New Pod!, 🥷 Wormhole hacker move funds, 🖥️ Shanghai upgrade, 💸 Maker deploys $100M, 🚨 FBI points to North Korean group Lazarus, and much more!
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New Pod Today!
Not Just FTX: One Skeptic’s Take on Why Crypto Is a Scam
James Block, crypto skeptic and author of the Dirty Bubble Media newsletter, rose to prominence with a timely post predicting FTX’s insolvency. The blogger, a doctor by day, explains why he sees crypto as an unregulated morass of would-be securities and outright “Ponzi schemes.” From an early interest in Tether to connecting the dots on Celsius, Block explains why he does what he does and why almost all of crypto is just “regulatory arbitrage.”
Show highlights:
the problems with the legitimacy of crypto projects
the reasons to be bearish on Coinbase
whether every token in crypto is a scam and whether regulations will hit stablecoin issuers hard
how FTX used tokens to create fictitious value worth billions of dollars
why Celsius and FTX were closely linked, and the difference between both cases
the ties James found between FTX's European subsidiary and a company doing binary options, an industry characterized by fraud
James’s concerns around Signature Bank and its "questionable tactics"
why Genesis and DCG got into trouble and how James thinks the situation will likely play out
why he says BNB resembles OneCoin's pyramid scheme
James's contrarian take on the Avi Eisenberg case
What’s Poppin’?
Wormhole Hackers Move $155M
by Samyuktha Sriram
A wallet address associated with the Wormhole hack moved $155 million of ETH, the largest movement of stolen funds in recent months.
Genesis Believes It Can Resolve Creditor Disputes This Week
Genesis’s lawyer Sean O'Neal is optimistic that the firm can resolve all creditor disputes in the following week. In a bankruptcy hearing reported by Reuters, O’Neal said he was confident that the firm could resolve these disputes without the need for a mediator. He also believes that the firm could come out of Chapter 11 bankruptcy by the end of May.
Genesis filed for bankruptcy protection on Jan. 21 – roughly two months after it halted withdrawals and new originations from its lending platform. The DCG subsidiary is working on a restructuring plan and plans to auction some of its assets in the coming months.
BlockFi Looks to Sell $160M in Loans
Bankrupt crypto lender BlockFi wants to sell $160 million worth of loans, backed by 68,000 Bitcoin mining rigs, Bloomberg reported on Monday. Sources familiar with the matter said that BlockFi had begun the bidding process for them last year, but some of these loans have already defaulted given the current prices of Bitcoin mining equipment.
BlockFi filed for bankruptcy in November after halting withdrawals citing a lack of clarity around FTX-related entities. In a bankruptcy hearing on Monday, BlockFi sought permission to pay its employees bonuses after resignations at the troubled firm have accelerated in the last month.
FBI Confirms North Korean Hackers Behind $100M Crypto Theft
The Federal Bureau of Investigation (FBI) issued a statement on Monday confirming that the Lazarus Group were behind the $100 million hack on Harmony’s Horizon Bridge in June. Lazarus is a North Korean-government sponsored cybercrime unit known to have orchestrated a number of exploits over the last few years.
Earlier this month, on-chain sleuth ZachXBT found that the Lazarus group hackers had moved 41,000 ETH worth over $60 million through the privacy protocol Railgun before sending it to three different crypto exchanges. The FBI confirmed that these North Korean entities Lazarus had laundered these funds on Jan. 13.
Ethereum’s Shanghai Upgrade Shadow Fork Deployed
Ethereum core developers announced the successful launch of a shadow fork that will test the Shanghai upgrade on a version of the mainnet. The shadow fork went live at 5:40 pm ET on Monday.
Developers plan to test the resilience of the upgrade by deploying some “evil nodes” on both the execution layer and consensus layer.
The Shanghai upgrade has been widely anticipated because it will finally bring functionality for staked ETH withdrawals from the Beacon chain. The final version is expected to go live on the Ethereum mainnet this March, giving validators access to withdraw the $26 billion that sits in the deposit contract.
MakerDAO to Deploy $100M USDC on Yearn Finance
A MakerDAO community vote on Monday swung in favor of deploying up to $100 million worth of USDC from the Maker reserve on to DeFi protocol Yearn Finance. Maker has estimated that this USDC on Yearn will earn an annual yield of 2% under a specific DeFi strategy.
The development comes as Maker has been looking to diversify its reserve assets to areas where it can earn a steady stream of revenue. The DeFi giant has partnerships with Coinbase and Gemini to this effect.
Uniswap v3 to Launch on BNB Smart Chain
A proposal to launch Uniswap version 3 on the BNB smart chain was approved by the community on Monday. The proposal was approved with a total of 80% or 20 million votes cast in favor, representing the biggest vote in Uniswap governance history.
The proposal was put forth by 0xPlasma Labs, which estimates that deploying Uniswap to BNB chain would garner an additional $1.18 billion in Total Value Locked. The team also estimates that the bridge to BNB chain will create a better liquidity source with less slippage in trades.
In Other News…✍️✍️✍️
Modulo Capital, an obscure crypto trading firm, received $400 million from Sam Bankman-Fried prior to the FTX collapse in November. The firm is now a key focus of the investigation by federal prosecutors into Bankman-Fried and the exchange.
Gemini laid off 10% of staff citing "unprecedented fraud" in the crypto industry.
The value of shares in bitcoin mining firm Argo Blockchain (ARBK) increased by as much as 14% on Monday, following the company's compliance with Nasdaq listing requirements.
As per a leaked document, banks would be required to treat crypto as one of the riskiest forms of assets, under a set of proposed changes to a 2021 package aimed at aligning European Union bank capital regulations with international standards.
The hackers who orchestrated a $100 million attack on the Harmony network last year moved the funds from the Bitcoin blockchain to Avalanche, Tron and Ethereum platforms.
The New York Department of Financial Services (NYDFS) issued guidelines for crypto firms to enhance customer protection in cases of insolvency or similar proceedings, including a mandate for the companies to maintain customer funds in separate accounts.
OpenSea, the leading marketplace for NFTs, achieved consecutive monthly increases in sales for the first time in 12 months, with January sales surpassing the volume for December.
The $$$ Corner…
Tribes, a web3 social wallet, closed a $3.3 million pre-seed funding round.
NFT collection Doodles acquired Golden Wolf, an animation studio, but the terms of the deal were not disclosed.
What Do You Meme
📈 Your Market Update 📉
BTC is up 1.37%, trading at $22,888
ETH is up 0.17%, trading at $1,620
BTC dominance: 40.85%
Crypto market cap: $1.08 trillion
*All data as of today, 5 am ET
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