Evening News | Binance accused of providing money laundering channels for $2.35 billion in funds; BlockFi's latest financing valuation down 66%
The cryptocurrency lending platform Celsius Network reportedly lost at least 35,000 ETH in the Stakehound private key loss incident.Organizer: Biscuit, Chain Catcher
"What important events have occurred in the past 24 hours?"
1. Reuters reports that Binance provided money laundering channels for illegal funds between 2017 and 2021, Binance responds by disclosing the full email interview with Reuters
According to an investigation released by Reuters, Binance provided money laundering channels for at least $2.35 billion in illegal funds over the past five years, with transactions stemming from hackers, investment fraud, and illegal drug sales. Reuters stated that this data was calculated based on court records, statements from law enforcement, and blockchain data reviews, with data provided by Chainalysis and Crystal Blockchain, and reviewed by two industry experts.
In response to the investigative report, Binance stated that Reuters' data is overly one-sided and the calculations are inaccurate. Binance countered that cryptocurrency is more transparent than the traditional cash economy, citing Chainalysis data that shows only 0.15% of all cryptocurrency transactions in 2021 were related to some type of illegal activity. The United Nations estimates that 2% to 5% of traditional fiat currency (cash), amounting to approximately $800 billion to $2 trillion in current dollars, is related to some type of illegal activity. Additionally, Binance officially disclosed the full email interview content with Reuters.
2. Forbes releases the 2022 Fintech 50 list, with 9 crypto companies including FTX and OpenSea making the cut
Forbes has released its 2022 Fintech 50 list (the most innovative fintech companies of 2022), which includes 9 crypto companies: FTX (latest valuation $32 billion), OpenSea ($13.3 billion), Alchemy ($10.2 billion), Ava Labs (token AVAX market cap $8.5 billion), Circle ($9 billion), Chainalysis ($8.6 billion), Fireblocks ($8 billion), Paxos ($2.4 billion), and TRM Labs ($600 million).
3. Bloomberg: U.S. SEC launches investigation into Binance Coin (BNB) initial ICO
According to insiders, investigators from the U.S. Securities and Exchange Commission and other regulatory bodies are investigating whether the initial coin offering in 2017 amounted to the sale of securities that should have been registered with the agency, potentially violating securities rules.
Insiders mentioned that for Binance, facing multiple investigations in Washington, the scrutiny of BNB's inception could be a concerning matter, as the SEC has taken dozens of enforcement actions regarding ICOs. Another insider indicated that besides BNB, the SEC is also investigating potential trading abuses by Binance insiders and whether the U.S. subsidiary Binance.US, established in 2019, has appropriately separated from its global counterparts.
4. Insiders: BlockFi is raising funds at a $1 billion valuation, down 66% from previous valuation
According to three insiders, crypto financial services company BlockFi is concluding a funding round at a lower valuation compared to previous rounds. The new funding round will be led by venture capital firm Bain Capital Ventures, with participation from DST and Valar. It is reported that this round's valuation has dropped over 66% from previous valuations.
BlockFi was founded in 2017 by Zac Prince and Flori Marquez, aiming to provide a way to borrow funds using crypto assets, and announced in March 2021 that it raised $350 million at a $3 billion valuation. At that time, the company touted high growth metrics, such as a $10 billion loan book and 265,000 retail accounts.
5. Crypto lending platform Celsius Network reportedly lost at least 35,000 ETH in the Stakehound private key loss incident
According to Dirty Bubble Media, crypto lending platform Celsius Network lost at least 35,000 ETH in the Stakehound private key loss incident.
It is reported that Celsius Network sent 35,000 ETH to Stakehound in a transaction on February 2, 2021, while known Celsius wallets currently hold at least 42,306 Stakehound stETH. Based on today's Ethereum price, this amounts to a loss of approximately $71 million. Currently, Celsius has not disclosed this information to its customers.
Previously, on June 22, 2021, Eth2 staking solution company Stakehound announced that it had lost the private key representing over 38,000 ETH deposited by clients. This loss was initially discovered on May 2, but the company remained silent and attempted to recover the key. Stakehound attributed this loss to its custody provider Fireblocks and has sued the company in an Israeli court. As of now, the issue remains unresolved.
6. Optimism reflects on the airdrop incident: severely underestimated traffic, will enhance communication transparency and service redundancy
Optimism officially reflected on the high load during the OP airdrop that caused severe delays in the mainnet and remote procedure calls (RPC), stating that the internal team is closely collaborating with partners and infrastructure providers to alleviate the issues and provide compensation to all users attempting to access their tokens.
Regarding this issue, Optimism reflected that it greatly underestimated the traffic generated by the airdrop, only realizing afterward that the capacity of public endpoints needed to be increased by 7 times. Lessons learned include regularly conducting load tests, replacing drops with oversupply, requiring partners to scale capacity in advance, and prioritizing concurrent batch submissions. Additionally, Optimism is currently subsidizing the ecosystem's reliance on public endpoints to exit the endpoint business and increase additional vendors and redundant services. Furthermore, in the event of similar issues, status pages will be quickly updated within minutes to gain community trust through timely and transparent communication.
7. Terra ecosystem cross-chain stablecoin bank Orion Money will gradually shut down the project within 12 months
The Terra ecosystem cross-chain stablecoin bank Orion Money will gradually shut down the project over the next 12 months. Starting today, for the next three months, Orion Money will focus on maintaining the Web UI to provide users with withdrawal opportunities (UST, ORION, xASTRO), and the team will upgrade the Orion smart contract to allow users to directly withdraw their tokens from the smart contract after the Web UI is removed; three months later, users will be able to directly withdraw their tokens from the smart contract over the following nine months.
Additionally, the Orion Money team will continue to collaborate with the Terra Builders Alliance, TFL, and Astroport teams to find ways to distribute new LUNA and ASTRO token airdrops to Orion Money users, which will be allocated based on the deposit ratio on the snapshot date.
8. U.S. Senators Gillibrand and Lummis release crypto regulation bill
According to CoinDesk, U.S. Senators Kirsten Gillibrand and Cynthia Lummis have released a crypto regulation bill that favors the U.S. Commodity Futures Trading Commission (CFTC) as the regulatory body and eliminates tax concerns for users purchasing goods with cryptocurrency.
It is reported that this bill is the first bipartisan attempt in the U.S. to establish a comprehensive regulatory framework for digital assets, defining the domains between crypto securities and commodities, allowing crypto companies to test new products on a limited scale and duration, and requiring companies raising funds through digital asset sales to disclose specific information to the SEC.
Additionally, the bill stipulates that all crypto transactions below $200 will be tax-exempt and will establish new federal laws for stablecoins, micro-payment taxes, and the jurisdiction of regulatory agencies. The bill needs to pass through congressional committees in 2023 to take effect.
9. Pension account platform IRA sues Gemini exchange over hacking incident
Pension account platform IRA Financial Trust has filed a lawsuit against cryptocurrency exchange Gemini, alleging that Gemini did not have adequate protections in place to safeguard customers' crypto assets.
According to previous reports, on February 8, IRA Financial Trust claimed to have been hacked, resulting in the theft of $36 million in cryptocurrency, which belonged to clients' retirement accounts held in custody by Gemini. After IRA notified Gemini, criminals were still able to transfer funds from the accounts of exchange customers.
Since the incident came to light, both companies have been blaming each other for the loss of funds. IRA has been working to find solutions for its affected clients and has now committed to using the proceeds from the lawsuit to compensate clients impacted by the incident.
"What interesting articles are worth reading in the past 24 hours?"
The rise of Zee Prime is largely attributed to the influence of one of its founding partners, Fiskantes. This self-proclaimed "risk communist" has made sharp critiques of the market and social phenomena on Twitter using very cool language, presenting some quite brilliant viewpoints. Zee Prime is also the owner of a very famous Smart Money wallet monitored by Nansen, and to succeed in cryptocurrency market investments, one must learn to control their emotions.
2. "New York Times Investigation: OpenSea Faces Numerous Lawsuits Over Theft, Fraud, and More"
OpenSea is one of the most prominent cryptocurrency startups, facing accusations of NFT theft and plagiarism. This article illustrates some core contradictions of Web3 through the poor experiences and conflicts of early holders of Bored Apes on OpenSea, showing that even a more democratic Web3 network controlled by ordinary people instead of large tech companies remains merely a utopian vision.
3. "Rollup Ecosystem Overview: What New Designs Exist Beyond Optimistic Rollup and zk Rollup?"
Since the concept was born in early 2019, Rollup has made significant progress. Currently, there are two main competitors in the market, giving rise to a plethora of imaginative design theories and hybrid evolutions. This article will review the development status of the Rollup ecosystem as of mid-2022.
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