Crypto News Headlines (05-Aug-2022)

This week’s nearly $200 million exploit of Nomad, the cross-chain bridge, and the $6 million drained from Slope Financial wallets have something in common: Both projects are backed by Circle Internet Financial’s venture-capital division.

It’s an additional headache for Circle as it aims to go public later this year. The company, which got into VC investing in late 2021, is best known for issuing a stablecoin called USD Coin (USDC). The entire stablecoin space finds itself under greater regulatory scrutiny following this year’s collapse of Terra’s terraUSD (UST).

Circle, which invests in early-stage blockchain projects and companies, participated in the $8 million Series A for Slope Finance in February and the $22.4 million seed round for Nomad in April.

“We are monitoring the current situation,” a Circle spokesperson responded when CoinDesk asked for a comment regarding the Nomad exploit. The statement was repeated when Circle was asked about Slope Finance.

Anthony Scaramucci, founder and managing partner at global asset management firm Skybridge Capital, shared his firm’s predictions on the fair market values of bitcoin (BTC) and ether (ETH) in an interview with Marketwatch, published Tuesday.

He believes that the worst of the crypto bear market has passed and bitcoin has already bottomed. His comments followed bankruptcy filings by a number of crypto firms, including Celsius Network and Voyager Digital.

“We believe that the leverage has been blown out of the system,” Scaramucci said. While recognizing that BTC could still slide, he emphasized: “I don’t think it’s going below the low that was reached for this cycle, which would be at around $17,500.”

The Skybridge Capital founder further shared:

According to our fair market value metrics based on adoption, wallet size, use cases, growth of wallets, we think the fair market value for bitcoin right now is about $40,000.

One of the leading bitcoin mining companies – Riot Blockchain – mined 318 BTC in July – a 28% production decrease compared to June’s figures. The main reason for the crippled productivity was last month’s extremely hot weather in Texas.

It caused the company to shut some of its mining rigs in the area as an emergency step to prevent the electricity network from an outage. As a result, Riot Blockchain earned approximately $9.5 million in credits.

The Consequences of the Heat Wave

Last month’s extreme weather conditions in Texas caused numerous problems to the residents of the state and the companies located there. In fact, experts estimated that it was Houston’s hottest July in history as temperatures were hovering around 40 degrees.

A bunch of cryptocurrency mining firms shut down their operations because of the heat wave. Had they not done that, the problems to the state’s power grid could have been more significant, and the population could have been left with an unstable electricity supply during the scorching month.

For unlucky crypto investors looking to turn lemons into lemonade — it turns out that digital assets lost during an exploit or hack can potentially be claimed as a tax loss, provided you live in the right country, experts told Cointelegraph. 

Following the news that more than 8,000 Solana wallets had been compromised and that an estimated $8 million dollars in crypto had been stolen due to a security breach in Web3 wallet provider Slope’s network, this may be some much-needed consolation.

In correspondence with Cointelegraph, Shane Brunette, the CEO of Australia-based CryptoTaxCalculator confirmed that crypto lost via a hack or an exploit couldd be declared as a loss for tax purposes in certain jurisdictions. 

“This means the original amount you paid for the asset(s) can be used to offset other capital gains.”

Shiba Inu has come a long way since the days when it was just a meme coin trying to shed its identity in favor of something more utilitarian.

The official launch of its decentralized platform called Shibaswap confirmed Shiba Inu’s commitment to growth.

Fast forward to the present and Shibaswap has secured the top spot in the list of the leading Ethereum dapps based on social signals.

This is according to findings by crypto analyst Ben GCrypto. This is an impressive feat for the DEX which managed to outdo OpenSea and the Bored Ape Yacht Club which came in second and third consecutively.

The mining difficulty reading was at 28.17 trillion, as of block height 747,936, the data showed.

The difficulty level, which changes about every two weeks, recorded its largest fall in a year during the last adjustment on July 22.

Bitcoin mining difficulty is a measure of how hard a miner would have to work to verify transactions in a block to add to the blockchain, or “dig out” Bitcoins.

Such mining difficulty adjustments are highly correlated to changes in the mining hashrate — the level of computing power used for mining.

Bitcoin’s hashrate was at around 197.4 exahashes per second on Thursday on a seven-day average, slightly up from 195.9 exahashes on July 22, data showed.

Bitcoin was trading at US$22,925 as of 10 a.m. on Friday in Hong Kong, down 1.1% over 24 hours, according to data from CoinMarketCap.

BTC-e operator Alexander Vinnik has been extradited to the U.S. from Greece, according to Vinnik’s French lawyer Frederic Belot. CNN first reported about the extradition.

A few weeks ago, U.S. authorities had called off their request to extradite the Russian national from France. However, by calling off the extradition request Vinnik could be sent to Greece and later to the U.S, his lawyer had said at the time.

At the time, Belot declined to explain the legal mechanism being used by U.S. authorities, only responding that “by withdrawing their request, the U.S. reactivate the Greece request.”

In 2020, Vinnik was indicted by a California court on allegations of “computer intrusions and hacking incidents, ransomware scams, identity theft schemes, corrupt public officials and narcotics distribution rings.”

Portugal, a leading European crypto hub, is risking the loss of its attractiveness for crypto businesses and talent working in the industry as some of its largest banks are now closing accounts of companies operating with digital currencies.

Last week, the nation’s biggest listed bank, Banco Comercial Portugues, and another major institution, Banco Santander, shut down all the accounts of Lisbon-based Criptoloja, Bloomberg reported, quoting the exchange’s co-founder and CEO Pedro Borges. The development follows the decision of two smaller banks to close the platform’s accounts.

No official explanation was provided in either of these cases, the crypto entrepreneur emphasized. Meanwhile, the state-owned bank Caixa Geral de Depositos and the Lisbon-based BiG have also started rejecting or closing down crypto exchange accounts, Jornal de Negocios unveiled this week.

At least two other crypto brokers have been hit by bank account closures this year, the report notes. Mind the Coin has been unable to open an account for months, and rival Luso Digital Assets had some of its accounts closed down, its executives complained.

A United States Senator Cynthia Lummis staffer believes that United States Congress will have to step in and resolve the dispute between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) regarding who regulates cryptocurrencies if the matter cannot be resolved internally. 

The issue stems from 2014, when the CFTC first asserted jurisdiction over virtual currencies. This was later reaffirmed by a U.S. Federal Court ruling in 2018, which stated that the CFTC had jurisdiction to prosecute criminals over fraud cases involving virtual currencies. However, it has been the SEC that has predominantly been investigating U.S.-based crypto exchanges and crypto assets to date.

On Wednesday, Senators Debbie Stabenow of Michigan and John Boozman of Arkansas introduced the Digital Commodities Consumer Protection Act of 2022 (DCCPA). If the bill is passed into law by the U.S. legislature, the CFTC would be granted rights to regulate digital commodities.

The British fintech firm Revolut plans to increase crypto-focused staff by 20% across the U.K., U.S., and Europe over the next six months.

It is now advertising for 13 industry-related roles, including software engineers, crypto legal professionals, and financial compliance and crime prevention experts.

The Long-Term Crypto Play

According to Bloomberg, Revolut has already hired 43 crypto-focused staff members in 2022, increasing its crypto team’s headcount by ~200%. Across all teams, the firm has 230 open positions.

The hiring push is intended to help Reovolut expand its cryptocurrency offerings. It currently operates as an exchange platform for trading over 80 digital assets, or for earning crypto by rounding up spare change on daily purchases. It also lets users earn when learning about cryptocurrency on its platform.