WuBlockchain Weekly: BlackRock Submits Application for Ethereum Spot ETF, Binance Launches Web3 Wallet, Poloniex Faces Over $100 Million Theft and Top10 News

Nov 10, 2023

0. Breaking News: Poloniex Exchange Owned by Justin Sun Attacked link

On November 10th, according to Peckshield monitoring, Poloniex exchange, owned by Justin Sun, was suspected of being hacked, with around $60 million in assets being transferred. Poloniex tweeted that the exchange’s wallet had been disabled for maintenance, and they would provide updates once the wallet was re-enabled. Justin Sun mentioned that they are currently investigating the Poloniex hack, and the exchange will fully reimburse the affected funds. Furthermore, they are exploring opportunities to collaborate with other exchanges to recover the funds.

The hacker moved substantial assets, including $21.73 million in USDT, $14.05 million in BTC, $3.65 million in USDD, $1.78 million in USDC, and more, to different addresses on the Tron blockchain before being frozen. Currently, only $6.54 million remains frozen. The $21.73 million in USDT was exchanged entirely for TRX and sent to TXs71PNcHmxgptA3wQ4g398qbToMPhnEoG. The $14.05 million in BTC is in the process of being exchanged for TRX, and these funds are currently held in TMKCrop4pJDSeJVEuZ9Wsi7Lc1nSTLk8BQ. Similar operations were carried out for USDD and USDC, converting them into TRX and transferring them to TEzx5kPky2KE99T2qG9TeEGoYLrBpXREwA and TSVGsgEU33DYrnozEV1iaCvT9uJ6wNUfDH, respectively. These actions led to a short-term increase in TRX price of over 10% following the Poloniex hack. Poloniex (Ethereum + Tron) has suffered losses exceeding $100 million.

Justin Sun tweeted offering a 5% white hat bounty to the Poloniex hacker and requested the hacker to return the funds to specified ETH/TRX/BTC wallets. They gave the hacker 7 days to consider this proposal before involving law enforcement.

1. Nasdaq Submits BlackRock Ethereum Spot ETF Application to the SEC link

On November 10th, Nasdaq submitted a proposed Ethereum spot ETF application to the U.S. Securities and Exchange Commission (SEC) on behalf of BlackRock. The Ethereum ETF will use Coinbase Custody Trust Company as the custodian and will rely on the CME CF Ether-Dollar Reference Rate. Yesterday, BlackRock submitted the application for the iShares Ethereum Trust entity.

2. SEC Holds Talks with Grayscale on Spot Bitcoin ETF link

On November 9th, insiders revealed that the SEC has engaged in negotiations with Grayscale Investments regarding the company’s application to convert its trust product GBTC into a spot Bitcoin ETF. Craig Salm, Grayscale’s Chief Legal Officer, stated that the company is currently focused on constructive dialogues with the trading and markets divisions. He did not provide detailed information about the interactions. These discussions come after the SEC’s prior refusals, citing “arbitrary and capricious” reasons, and all parties are actively working to advance the application process. The SEC declined to comment on these new discussions.

3. SBI to Launch Fund for Investing in Web3 and Other Emerging Companies Worth 100 Billion Yen link

On November 9th, according to CoinPost citing Nikkei News, Japanese financial giant SBI Holdings will begin operating a fund for investing in startups related to Web3, AI, metaverse, and other technologies within the year. It is expected that each investment will range from several hundred million to over a billion yen, with a total of 150 to 200 invested companies. The expected total size of the fund is 100 billion yen (approximately 663 million USD). Sumitomo Mitsui Banking Corporation, Mizuho Bank, Nippon Life Insurance, and Daiwa Securities Group have decided to invest over 50 billion yen in the fund.

4. French Regulatory Agency May Require DeFi Developers to Rewrite Nearly All Smart Contracts link

On November 9th, according to DL News, senior officials from the French Prudential Supervision and Resolution Authority (ACPR) revealed that they are considering requiring smart contracts to obtain new compliance and security certification, or they may be marginalized. French regulatory authorities may ask DeFi developers to rewrite almost all smart contracts. Under the proposal, uncertified smart contracts may be marginalized, and regulatory authorities will certify compliant smart contracts.

5. ICBC Subsidiary ICBCFS in the US Suffers Ransomware Attack Leading to Partial System Outages link

On November 10th, according to The Straits Times, the China Industrial and Commercial Bank Limited’s wholly-owned subsidiary, ICBC Financial Services LLC (ICBCFS), suffered a ransomware attack on Wednesday, November 8th, in U.S. Eastern Time, leading to partial system disruptions. Bloomberg reported that this attack briefly disrupted the U.S. Treasury market, causing some trades to fail to settle. The attack may have come from a hacker group called Lockbit with Russian ties, which has previously targeted companies like Boeing. This group is known for using malware to encrypt files on victims’ computers and then demanding a ransom to unlock the files. LockBit typically accepts payment in cryptocurrencies such as Bitcoin, Monero, or Zcash.

6. Binance’s Weekly Summary

a. Binance Officially Launches Binance Web3 Wallet link

On November 8th, Binance announced the official launch of the Binance integrated Web3 wallet within the Binance App. The wallet operates in a self-custody mode and is integrated with Binance Bridge, allowing users to transfer assets between different chains. It also provides access to decentralized trading services.

The wallet employs a self-custody model, utilizing Multi-Party Computation (MPC) technology, eliminating the need for private keys or mnemonic phrases. Upon usage, it was observed that the Binance Web3 wallet currently supports 37 blockchain networks, encompassing 24 EVM chains and 13 Cosmos chains, although it does not yet support Bitcoin. It includes built-in swap routing providers such as 1inch and Binance Bridge. Furthermore, its terms of service indicate that Binance will monitor transactions for potential fraud, suspicious activities, and sanctions evasion. As a result, in certain instances, transactions and accounts may be temporarily suspended for investigation purposes.

b. CZ Expresses Focus on DeFi Wallet During Binance Blockchain Week in Turkey link

On November 9th, CZ stated during the Binance Blockchain Week in Turkey that besides regulations, his biggest interest lies in DeFi. He also mentioned that he will be dedicating more time to improving the DeFi Wallet because the current wallets lack sufficient security and usability. The Binance Web3 Wallet is just a small step, and there will be more work in the future. He advised not to focus too much on price and cycles but rather on building products that people can use. Additionally, he believes that there will be significant developments in the year following the Bitcoin halving, which is expected around May 2024.

c. Binance Releases Its Twelfth Reserve Audit link

On November 7th, Binance released its 12th Monthly Reserves Report (snapshot date: 11–1). The user’s BTC reserves amounted to 584,000 BTC, a decrease of 0.7% compared to the previous month (10–1), with a reduction of 42,210 BTC. The user’s ETH reserves amounted to 3,910,000 ETH, an increase of 2.2% compared to the previous month, with an addition of 86,000 ETH. The user’s BNB reserves amounted to 31.21 million BNB, a 6.4% increase, with an addition of 1.88 million BNB. The user’s USDT reserves amounted to 15.27 billion USDT, a decrease of 0.29% compared to the previous month, with a reduction of 43 million USDT.

7. FTX’s Weekly Summary

a. SEC Chairman: Restarting FTX Within Legal Framework Is Possible link

On November 9th, according to CNBC, SEC Chairman Gary Gensler stated during the Washington D.C. FinTech Week that if the new leadership at FTX has a clear understanding of the law, it is possible to “operate within the legal framework” to relaunch FTX, which was previously operated by the former president of the New York Stock Exchange.

b. Three Companies Competing to Relaunch FTX link

On November 8th, according to WSJ, former president of the New York Stock Exchange, Tom Farley, through his cryptocurrency exchange platform Bullish, is one of three companies competing to acquire the remaining assets of FTX. The other two companies are financial technology startup Figure Technologies and cryptocurrency venture capital firm Proof. The winning bidder will have the opportunity to relaunch the trading platform after it exits bankruptcy proceedings planned for next year.

c. FTX Seeks to Sell $744 Million Worth of Grayscale and Bitwise Trust Assets link

On November 6th, according to court documents, FTX and its creditors have filed an application with the Delaware bankruptcy court seeking approval to sell approximately $744 million worth of Grayscale and Bitwise trust assets through an investment advisor. This move is aimed at preparing for the upcoming cash distribution to creditors and allowing for the rapid sale of these trust assets when the time is right.

8. Judge Approves Celsius Transformation into a Bitcoin Mining Company link

On November 10th, according to Bloomberg, cryptocurrency lending company Celsius Network LLC has obtained approval from a bankruptcy court judge to transform into a Bitcoin mining company owned by its creditors. They plan to redistribute approximately $20 billion worth of Bitcoin and Ethereum along with equity in NewCo to Celsius creditors. The platform may start distributing assets in early next year, according to Celsius’ lawyers. The transformation plan still requires approval from the SEC, and if the proposal fails, Celsius may turn to liquidation.

9. USDC Stablecoin Issuer Circle Considering IPO in 2024 link

On November 8th, according to Bloomberg, USDC stablecoin issuer Circle is considering an IPO in 2024 with the valuation yet to be determined. Their previous plan to go public through a SPAC merger in 2022 failed, with an estimated valuation of $9 billion at that time. Circle’s investors include traditional financial giants such as Goldman Sachs and BlackRock. USDC stablecoin once had a market capitalization close to $56 billion but experienced a significant decline starting in June 2022.

10. Robinhood Releases Third-Quarter Earnings Report link

On November 8th, Robinhood released its third-quarter financial report, showing a 55% decrease in revenue related to cryptocurrency compared to the same period last year, recording $23 million. In addition, Robinhood plans to expand cryptocurrency trading to the European Union in the coming weeks and intends to operate a cryptocurrency brokerage business in the United Kingdom.

Fundraising

The digital financial firm Galactic Holdings has announced the successful completion of a Series A funding round, raising $6.2 million. link
Ingonyama, a company specializing in Zero-Knowledge Proof (ZKP) acceleration chips, has declared the completion of a $20 million seed funding round. link
Definitive, a startup company, has disclosed a funding amount of $4.1 million, with BlockTower leading the investment. link
Stackr Labs, a startup focused on Ethereum scalability solutions, has secured $5.5 million in its seed funding round. link
Ritual, a decentralized AI computing platform, has successfully completed a funding round, raising $25 million. link
Authentick, a company specializing in NFT authentication, has announced securing $4 million in seed funding. link
Citadel, a GameFi platform, has declared the completion of a $3.3 million seed funding round. link
Pimlico, a developer specializing in account abstraction, has successfully closed a seed funding round led by a16z, totaling $4.2 million. link
StablR, a European stablecoin startup, has concluded its seed funding round with a total of $3.5 million. link
Due, a payment service provider, has successfully completed a $3.3 million seed funding round. link
Llama, an intelligent contract platform, has obtained $6 million in seed funding, with participation from Polygon co-founders and Aave founders. link

Learn more, check out crypto-fundraising.info.

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