Crypto Weekly Update
This week, the crypto landscape saw major developments in security, regulation, and investment. The most shocking news came at the end of the week: Bybit suffered a $1.4 billion Ethereum hack, raising concerns over exchange vulnerabilities. Meanwhile, the SEC dropped its lawsuit against Coinbase, marking a significant win for the crypto industry.
Argentina’s President Milei is in focus over a crypto scam, while OKX Ventures invested in another crypto blockchain innovation, Cygnus Finance. MetaMask and Ledger also collaborated on security enhancements, alongside MicroStrategy’s pause on Bitcoin purchases, which could signify a strategic shift.
Bybit Hack: $1.4 Billion in Ethereum Stolen
Bybit experienced a major security breach on January 21st, losing about $1.4 billion in Ethereum-based tokens. This led to negative market reactions, with Ethereum’s price falling 2% to $2,685 and Bitcoin dropping over 1% to $96,632.
Ben Zhou, Bybit’s CEO, confirmed that the hackers exploited a planned transfer to the attackers’ wallet. Bybit’s cold wallet was tricked into altering its smart contract, allowing the hackers to withdraw the funds. The stolen assets were moved to an unknown address suspected to belong to the notorious Lazarus Group. The incident is under investigation, and users are advised to remain cautious while the platform enhances security.
SEC Drops Lawsuit Against Coinbase, Crypto Industry Wins
In a major victory for the crypto industry, the U.S. SEC has dropped its lawsuit against Coinbase. This provides relief for Coinbase and cryptocurrency supporters, although the decision is still pending approval. The SEC had previously authorized Coinbase to become a public company in 2021, only to sue later over regulatory inconsistencies.
Many believe this lawsuit dismissal is due to changes in SEC leadership rather than Coinbase’s actions. This resolution could influence future regulatory approaches to digital assets.
Argentine President Milei Under Investigation for Crypto Scandal
Javier Milei, the president of Argentina, and two cryptocurrency businessmen are under investigation for involvement in the $LIBRA scandal, initiated by prosecutor Eduardo Taiano.
On February 14, Milei promoted $LIBRA on social media, linking it to a private project called ‘Viva La Libertad’ aimed at assisting small businesses. After a brief surge, the price of LIBRA plummeted following the alleged withdrawal of $100 million from developers, raising concerns about a pump-and-dump scheme and insider trading. Critics argue the timing suggests prior coordination, and the investigation seeks to clarify Milei’s potential involvement in market manipulation.
Cygnus Finance Secures Pre-Seed Funding from OKX Ventures
OKX Ventures, the investment arm of crypto exchange OKX, has participated in Cygnus Finance’s pre-seed investment round. This highlights OKX Ventures’ confidence in Cygnus Finance’s ability to merge Web3 and Web2 through innovative solutions for the creator economy.
Cygnus Finance is recognized for its solid restaking infrastructure, functioning as a modular real yield layer that enhances blockchain networks’ security while facilitating updates. With this support, OKX Ventures aims to promote blockchain scalability and innovation in the long run.
MetaMask and Ledger Partner to Improve Crypto Security
Leading hardware wallet provider Ledger has partnered with notable crypto wallet provider MetaMask to enhance user security through Clear Signing. This feature ensures that users fully understand transactions before approving them.
Blind signing, a practice leading to $3.7 billion in thefts during 2022, will be addressed by the Clear Signing feature. The partnership aims to improve transparency in the transaction process, thereby reducing risks of fraud and unauthorized asset transfers.
MicroStrategy Pauses Bitcoin Purchases
MicroStrategy, the largest corporate Bitcoin holder, announced it did not buy any Bitcoin last week—a surprising move considering its previous acquisition activity. Chairman Michael Saylor confirmed the company’s total Bitcoin holdings remain at 478,740 BTC, acquired for approximately $31.1 billion at an average price of $65,033 per Bitcoin.
No additional Class A shares were sold or Bitcoin purchased, leading to speculation that the pause may reflect a temporary strategic shift while monitoring market conditions.
Conclusion
This week highlighted both security and regulatory challenges in crypto. The $1.4 billion hack raised concerns over exchange safety, while regulatory wins, such as the SEC dropping the Coinbase lawsuit, showcased industry progress. Argentina’s President Milei faces scrutiny over a crypto scandal, and OKX Ventures supports Cygnus Finance for blockchain innovation.
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