Five Major Crypto Stories from Last Week
Last week, the crypto industry witnessed five significant stories. These include the hacking of Mixin Network resulting in a loss of $200 million and the arrest of two well-known figures in the crypto space. Additionally, VanEck is preparing to launch an ether futures ETF, while Circle and Paradigm have voiced their support for Binance in its case against the SEC. Furthermore, Binance has decided to exit the Russian market due to ongoing legal challenges.
Mixin Network Hacked for $200 Million
Mixin Network, a decentralized wallet service, experienced a security breach that led to a loss of approximately $200 million. As a result, the company temporarily suspended deposit and withdrawal services. The blockchain security firm SlowMist was called upon to assist with the investigation into the attack, which targeted Mixin Network’s cloud service provider database.
Founder Feng Xiaodong revealed that only half of the user assets remained secure after the hack. To address this situation, he proposed issuing “bond tokens” for users to claim, with plans for Mixin to repurchase them in the future. Mixin Network also extended an on-chain offer to the hacker, suggesting a $20 million “bug bounty reward” in exchange for returning the stolen funds. The company also stated that the losses from the hack might be less significant than initially estimated.
Arrests of Two Prominent Crypto Figures
Su Zhu, co-founder of defunct crypto hedge fund Three Arrows Capital, was detained at an airport in Singapore for failing to comply with a court order related to an investigation into the fund’s liquidation. Consequently, he was sentenced to four months in prison.
In another incident, crypto influencer Ben Armstrong, also known as Bitboy Crypto, was arrested while attempting to confront a former business associate. Prior to his arrest, Armstrong had been livestreaming his attempt, with speculation that he was trying to retrieve his Lamborghini. This arrest followed his departure from the Bitboy Crypto YouTube channel amid allegations of substance abuse and causing harm to the community.
VanEck’s Ether Futures ETF Offering
VanEck is preparing to launch its Ethereum Strategy ETF (EFUT), focusing on ether futures contracts. The actively managed ETF will not directly invest in ETH or other digital assets but will concentrate on standardized, cash-settled ETH futures contracts traded on the Chicago Mercantile Exchange. The ETF will be listed on the CBOE and overseen by Greg Krenzer, VanEck’s head of active trading.
In a show of support for the Ethereum community, VanEck announced its intention to donate 10% of the ETF’s profits to The Protocol Guild, a collective of Ethereum core protocol contributors. This donation pledge will last for at least 10 years, demonstrating VanEck’s commitment to supporting Ethereum’s infrastructure development and stewardship.
Circle and Paradigm Back Binance
Circle, the issuer of stablecoin USDC, has expressed its perspective on the SEC’s lawsuit against Binance. Circle argues that stablecoins designed for payments do not possess the characteristics of investment contracts and should not fall under the SEC’s jurisdiction. They emphasize that users of such stablecoins do not expect profits from holding them.
Meanwhile, crypto venture capital firm Paradigm criticized the SEC’s approach in the Binance case, accusing the agency of attempting to change the law without following proper rulemaking procedures. Paradigm highlights that assets like gold and fine art can appreciate in value without necessarily being considered securities. Both Circle and Paradigm’s statements contribute to the ongoing debate surrounding the classification and regulation of digital assets.
Binance Exits the Russian Market
Due to legal challenges, Binance has decided to completely withdraw from the Russian market. The company announced the sale of its Russian business to CommEX, a newly launched crypto exchange. Binance recognized that operating in Russia did not align with its compliance strategy. During the transition, Binance assured its Russian users that their assets are secure, although the migration to CommEX may take up to a year.
Binance’s founder and CEO, Changpeng Zhao, clarified that some former Binance employees may have joined CommEX. He also mentioned that CommEX’s design and APIs are similar to Binance’s to ensure a seamless user experience. Zhao emphasized that CommEX does not serve users from the United States or European Union, and he does not hold any shares in the new exchange. However, there is limited information available about CommEX’s ownership and operations, leading to questions within the crypto community.
Hot Take: Recap of Key Crypto Stories
Last week brought several significant developments in the crypto industry. Mixin Network suffered a major hack resulting in a loss of $200 million, while prominent figures like Su Zhu and Ben Armstrong faced legal issues. VanEck made preparations for an ether futures ETF offering, demonstrating their commitment to Ethereum’s development through donations. Circle and Paradigm voiced their support for Binance against the SEC’s lawsuit. Meanwhile, Binance decided to exit the Russian market due to legal challenges, with details about its successor, CommEX, raising curiosity among crypto enthusiasts.
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