Weekly Crypto News in Review: 2nd Feb – 9th Feb

WhatsApp Image 2024 02 13 at 4.34.58 PM 1 jpeg

Key Highlights

  1. South Korean authorities apprehended executives at Haru Invest for allegedly looting $828 Mn worth of crypto
  2. Bitcoin ETFs saw a notable influx of $700 Mn in net inflows, driven by BlackRock and Fidelity, while Grayscale’s GBTC experienced outflows
  3. Solana experienced a significant five-hour outage, affecting transaction processing, before recovering
  4. Genesis seeks approval to sell $1.6 Bn in Bitcoin, Ether, and Ethereum Classic trust holdings
  5. New Hybrid Token Standard ERC-404 on Ethereum

South Korean Crypto Executives Apprehended for Allegedly Looting $828 Mn Worth of Crypto

South Korean authorities arrested three executives from yield platform Haru Invest on Feb 6, 2024, as they were accused of stealing $828 million worth of crypto from ~ 16K customers. The CEO is among those arrested, with allegations pointing to misappropriating customer funds between March 2020 and June 2023, purportedly while advertising “risk-free, diversified investment techniques.” Haru Invest, known for promising double-digit yields, has been under scrutiny since pausing withdrawals and deposits last June, with suspicions of running a “rug pull” scam, a common occurrence where project founders vanish with investors’ funds.

Bitcoin ETFs See $700 Mn Net Inflows as BlackRock, Fidelity Gains Offset GBTC Outflows: CoinShares

Since their introduction in January 2024, Spot Bitcoin ETFs have made a significant impact on the market, amassing $7.7 billion in funds. Recently, they saw a net inflow of $700 million, largely due to BlackRock and Fidelity offsetting outflows from Grayscale’s Bitcoin Trust (GBTC). According to CoinShares, BlackRock’s IBTC and Fidelity’s FBTC, leading the new wave of ETFs, recorded weekly inflows of $884 million and $674 million respectively, showing an increase from the previous week. Meanwhile, GBTC saw investors withdraw approximately $927 million.   

Solana Faces Significant Outage, Recovers from Five-Hour Disruption

Solana, the high-speed blockchain that has seen a surge in activity recently, experienced a significant outage lasting approximately five hours. This disruption led to a temporary dip in the value of Solana’s SOL token, which fell from around $96 to below $94 during the incident. However, the token has since recovered almost all of its losses. Transactions, which had halted around 09:52 UTC on February 5, resumed around 15:00 UTC on the same day.

In response to the outage, validators began generating snapshots using their local ledger state, which is the most recent data before the disruption, in preparation for a network restart. The Solana Foundation, which oversees the network, released new validator software that includes a patch to address the issue that caused the network to halt. The foundation advised validator operators to prepare for an upgrade and restart of the network.

Genesis Seeks Approval to Sell $1.6 Bn in Bitcoin, Ether Trust Holdings

Genesis, a crypto lender that recently declared bankruptcy, has taken a significant step toward resolving its financial obligations. The company has filed a motion seeking court approval to sell over $1.6 billion in cryptocurrencies, including Bitcoin, Ether, and Ethereum Classic. These assets are currently held in Grayscale’s trust products, a popular investment vehicle for digital assets.

A substantial portion of Genesis’ assets are held in GBTC, Grayscale’s Bitcoin Trust. The company’s aim to liquidate these holdings could potentially exert selling pressure on Bitcoin, affecting its market price. This development underscores the interconnected nature of the crypto market, where the actions of a single entity can have ripple effects across the entire ecosystem.

The filing also sheds light on the scale of Genesis’ obligations. Gemini, a major creditor of Genesis, estimates that there are over ~ 100K users affected by the bankruptcy. These users are owed between $1 billion and $10 billion, a staggering amount that underscores the severity of Genesis’ financial situation.

New Hybrid Token Standard ERC-404 on Ethereum

ERC-404, an experimental Ethereum standard, is being developed to become a hybrid of fungible and nonfungible tokens (NFTs). The standard is created by pseudonymous developers “ctrl” and “Acme” under the Pandora project and combines the technology behind ERC-20 fungible tokens and ERC-721. It is used for unique tokens like NFTs in the Bored Ape Yacht Club (BAYC) collection.

It has sparked a new sub-asset class in the crypto market. The first token of this kind, Pandora, saw a staggering 12,000% increase in value within a week, trading as high as $32,000 from an initial $250. With a limited supply of 8,000 tokens, Pandora traded around $76 million in volumes in just 24 hours. The success of Pandora has led to several projects issuing their own ERC-404 tokens, some even airdropping a portion of their supply to Pandora holders to boost demand and hype. Others have launched different blockchains like Arbitrum and Solana, aiming to pioneer a new ecosystem.

Closing Thoughts

As we reflect on the events of this week in the crypto space, it’s evident that the industry continues to navigate through both opportunities and challenges. While incidents like the Haru Invest arrest highlight the need for stricter oversight, the success of Bitcoin ETFs and the resilience of blockchain networks like Solana demonstrate the industry’s growing maturity. However, events like Genesis’s bankruptcy filing underscore the interconnected nature of the market and the potential consequences of individual actions. Nevertheless, innovations such as ERC-404 offer exciting opportunities for growth and development within the crypto ecosystem, underscoring the importance of balancing innovation with regulatory compliance for sustainable progress in the industry.

    Get Daily Crypto Insights

    Stay ahead of the crypto game with Tradedog's exclusive research
    subscribe now for valuable insights and expert analysis

    Related Posts