Too cute to pass upPudgy Penguin NFTs have been flying off the shelves – perhaps there’s hope for the NFT market yet?
- Pudgy Penguin NFTs were selling like hotcakes in an auction held by fine art broker Sotheby’s. The sale of ten of the collection’s NFTs brought in roughly $129k, with the average token selling for around $12.9k.
- The average sale price was much higher than the collection’s floor price of $1.3k – defying the recent slump in NFT-related hype. That being said, the collection’s got some high-profile supporters including NBA star Steph Curry and rapper Tory Lanez.
- Sotheby’s reported over $100m in NFT sales last year, but the space has been in decline along with the wider crypto market. With most NFTs based on the Ethereum blockchain, ETH’s 66% drop YTD certainly hasn’t helped the space.
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Derebit gets doneA new victim of the crypto hackathon that has been 2022 has emerged, this time in the form of crypto exchange Derebit.
- Derebit suffered a ‘hot wallet hack’ on Monday evening which saw $28m worth of assets stolen. The group has halted withdrawals to prevent further damage, with the funds stolen including BTC,
ETH and USDC.
- The group insists that user funds have not been compromised and that the platform remains in a “financially sound position”. The losses will reportedly be covered by company reserves but with withdrawals still frozen, some customers are understandably concerned.
- Derebit hasn’t been having a great time of it recently, having suffered a blow after the now-bankrupt 3AC failed to meet its margin calls. However, having raised $40m at a $400m valuation in September, the group might be able to weather the storm.
Hacktober scariesWhat’s the scariest thing about this Halloween? The fact that ‘Hacktober’ is living up to its name with hundreds of millions stolen in DeFi hacks.
- October was a terrifying month for crypto exploits, with $760m stolen by hackers. The stats are enough to make your skin crawl, with 44 separate exploits recorded across 53 DeFi protocols in a single month.
- 2022 is shaping up to be much worse than last year for crypto-theft. With two months still to go, more than $3bn has already been stolen compared to the $1.5bn stolen across the whole of 2021 – though there are some glimmers of hope amidst the despair in the form of regretful hackers.
- Over $890m of 2022’s crypto losses have been recovered, $100m of which were stolen in October. Part of that is thanks to the Team Finance hacker from last week, who after swiping $14.5m decided to return $7m of the stolen funds to the platform over the weekend. It'll be interesting to see if crypto can ride this wave into a solid end-of-year performance.
No bull market? No problemIf recent trademarks applications are anything to go by, the financial big dogs are going all-in on crypto despite the current frosty market.
- Financial giants continue to ignore the bear market and jump head first into crypto, according to a slew of trademark applications involving Web3 and crypto-related products and services from the likes of Visa, PayPal, and Western Union last week.
- NFTs and digital goods and collectibles are one of the hottest categories of potential areas of interest for US businesses – Visa has got its eye on a crypto wallet and the metaverse, PayPal is all-in on its new wallet, and Western Union is focusing on digital currency, and that’s only the start.
- More than 6,3k US trademark applications for NFTs have been filed in 2022, which is more than three times the 2,1k filed in the entirety of 2021, with everyone from Moët & Chandon to In-n-Out getting FOMO. With the overall DeFi market value gaining 9% last week, it seems their bets could soon pay off.
HacktoberfestDe-Fi hacks give “spooky season” a new meaning as October takes the crown for the worst month of hacks on record.
- October has become the worst ever month for crypto hacks with a whopping $718m stolen from DeFi protocols over 11 different attacks so far. The month was pushed up the leaderboards after a hat trick of hacks last week that included the $117m exploit of the Solana-based Mango Markets.
- This year’s seen some staggering amounts stolen from well-known protocols including the $200m hack of Nomad bridge, the $325m hack of cross-chain protocol Wormhole and a $625m exploit of Axie Infinity’s Ronin Network, which became the biggest exploit in crypto history. Researchers at Chainalysis now think 2022 will overtake 2021 as the worst on record year for crypto exploits.
- The risk of having crypto funds stolen is now greater than ever, with many turning to offline hardware wallets like Trezor and Ledger for storing their precious crypto holdings. Researchers estimate that the cold wallet market will grow to be worth $1.7bn by the year 2030 as security takes the top spot on people's priority list.
Myth bustersYuga labs might just have some competition brewing as Mythos says “this metaverse town ain't big enough for the two of us”.
- Yuga Labs might need to watch its back as Mythos buckles up for a major web 3 push. The blockchain gaming company, along with 22 partner companies including game giant Ubisoft announced plans to launch a DAO and a new token called MYTH.
- Mythos looks like a solid competitor, but it’s launching at a difficult time. According to data by Nomics, since the beginning of the year more than 12k crypto tokens have effectively ceased trading – a pretty stark reminder of how bearish the scene rly is right now.
- Yuga hasn’t been letting competition slow it down, announcing a new council composed of seven BAYC NFT holders. In a blog post on Wednesday, Yuga stated the group will be tasked with curating community feedback and leading the project’s philanthropic goals.
Getting rid of the “fun” in non-fungibleThere once was a time when NFTs were the coolest kids on the crypto block but the industry has caught a bad case of the bear market blues.
- NFT sales have been having a hard time lately, dropping down 60% from Q2 to Q3 this year. In January, OpenSea sales volumes were on fire with almost $5bn in monthly sales volume, but by the summer this number had dropped to just $700m. June was the last month where NFT sales cracked $1bn in monthly volume.
- As with everything in life, there’s an exception to the rule, and right now it’s Solana. SOL NFTs have seen their monthly sales volume double since August, with $133m of trading volume over September – gaining steadily on the more popular Ethereum NFT space. It might not be long before the two networks are neck-and-neck.
- OpenSea hasn’t let the blues get it down, generating a whopping $144m in fees, with revenues of $35m in Q3 this year. Although in January – OpenSea’s best month of all time – $4.86bn of monthly NFT sales were reported, so it’s still a far cry from its heyday.
Stablecoins settle inStablecoins are finding some sort of stable footing, but it’s going to take more than that for the industry to recover.
- The volume of stablecoins flowing into exchanges is on the rise, with $490m worth of tokens heading to exchanges two weeks ago – representing a 58% seven-day increase. It’s also the third week in a row of stablecoin inflows to exchanges.
- Bank of America thinks this could be pretty good news for the crypto industry, as it might indicate a stabilization of the market. That being said, it’s going to take more than this for the market to fully recover – having dropped almost 60% YTD.
- While inflows might be looking rosy, stablecoins are in the regulatory hotseat. Tether was ordered last week by a New York judge to document how USDT is backed and rumors are circulating that upcoming regulation could see algorithmic stablecoins banned entirely.
Doodles doubles downWho would’ve thought that drawing cute cartoon characters could turn into a multi-million dollar business?
- Sales of NFT project Doodles have skyrocketed, surging 1,200% on Tuesday, with the floor price of the Pharrel Williams-backed project also rising by more than 19% over the same period. A whopping $2.1m worth of NFTs were sold in one day with the collection’s cutesy art style causing them to fly off the shelves.
- Doodles also managed to nab $54m in funding at a $704m valuation led by Reddit co-founder Alex Ohanian’s VC firm Seven Seven Six. The round also included investment by FTX, Acrew Capital and 10T Holdings. In June, the project has plans of launching another collection dubbed ‘Doodles 2’ to grab further NFT market share.
- Interest in Ethereum-based NFTs is still down despite the Doodles excitement. The ‘JPG’ NFT index (an index measuring NFT sales volumes) dropped by 70% from April to June and has struggled to recover – over the last month, it slipped a further 30%. Will the Doodles hype restore investor appetite?
New Free DAO joins the exploit clubFunds contained in New Free DAO were ‘free’ for the taking as it becomes the latest protocol to fall victim to an exploit.
- DeFi protocol New Free DAO was hacked on Thursday which saw roughly $1.25m drained from the platform. It took the form of a ‘flash loan’ attack, where a large loan is taken from another platform without the need for a deposit, and very quickly used to ‘pump and dump’ a token on another platform.
- The platform’s native NFD token has plummeted by 99%, after the attacker borrowed 250 wrapped BNB which was swapped for NFD. A malicious contract was then deployed on the network which allowed the attacker to claim airdrop rewards repeatedly – which were converted back to BNB and sold.
- Auditors have pointed out that New Free DAO could be hacked again. Blockchain security firm Beosin has advised the platform to update the contract of its USDT pool, as it also has security flaws. Blockchain security firms have never been so relevant, as Chainalysis reports almost $2bn was stolen from DeFi platforms in H1 2022 alone.
Bowie on the blockchainThere may be life on Mars, but it seems there’s little tastefulness as fans brand the Bowie estate’s NFT project ‘a bowie too far’.
- David Bowie’s estate is launching a NFT project of David Bowie artwork, with 100% of the proceeds being donated to CARE – a charity tackling world hunger. The ‘Bowie on the Blockchain’ NFT collection is due to be released on Ethereum and sold via OpenSea.
- Its philanthropic ends however weren't enough to win over Bowie fans, who took to Twitter to label the project as “guff” and “a pyramid scheme”. OpenSea on the other hand has thrown its full support behind the collection, tweeting on Tuesday: “Bowie’s undying legacy will impact yet another new frontier”.
- David Bowie’s son Duncan Jones has also joined the outcry, describing NFTs as a “fad”. It’s not all negativity tho as artists commissioned for the project seem excited to be a part of the project, with NFT artist ‘Fewocious’ tweeting their excitement to be working on a sculpture. Perhaps critics should heed Bowie’s words and ‘let the children use it’.
A non-fungible rugpullRugpulls are still in fashion with SudoRare reminding us that stealing other people’s tokens is like soooo on trend rn.
- NFT platform SudoRare has vanished into thin air with a staggering ~$815k in user funds. The platform, which is a fork of LooksRare and SudoSwap, deleted its social media accounts yesterday and moved 519 ETH of user deposits off the platform and into wallets. Anyone who’s been on this ride before knows – that money’s never coming back.
- Twitter users had pointed out that the project looked fishy because of its anonymous founders and heavily marketed attractive staking opportunities. Some NFT platforms like Solana’s Magic Eden are cracking down on anonymity, requiring anyone wanting to mint an NFT to dox themselves before being able to use the service.
- DeFi hacking is causing users to flock to hardware wallets like those sold by French startup Ledger. The company’s sales went to the moon with a 400% increase in the hours after the $5m Solana wallet hack earlier this month, and the group’s Chief Experience Officer Ian Rogers said “these things remind people that security is important”.
Little hope for HodlnautDeFi platform Hodlnaut is burning up as it falls through the atmosphere, with a new court document highlighting the company’s major financial shortcomings.
- Troubled DeFi lender Hodlnaut has reported a $200m financial shortfall in a court affidavit which was leaked on Monday. The Singapore-based group filed for court protection on August 16th, seeking more time to source funds after freezing user-withdrawals on August 8th.
- The company’s already let go of 80% of its workforce in a last-ditch attempt to conserve some cash but its troubles are beginning to stack up. In the filing, Hodlnaut reported that on June 14 users suddenly attempted to withdraw a collective $150m amid widespread panic surrounding asset price-drops.
- Its financial woes can be linked to the wider crypto crash this summer where many lending platforms like Celsius and Voyager ran into massive liquidity issues. It's also not the only Singapore-based firm having major problems – crypto lender Vault reportedly owes over $400m to its creditors. Could be twice as bad then, I guess.
The Genesis of a new CEOEven the world’s largest crypto firms are still feeling the fallout of Terra/Luna, with crypto broker Genesis trying to mend its broken balance sheet by bringing on a new CEO.
- The CEO of crypto broker Genesis has stepped down as the company feels the heat from the collapse of Terra and 3AC (Three Arrows Capital), with Michael Moro set to be replaced by the firm’s COO Derar Islim in the interim. In terms of brokers, it’s something of a titan in the space, facilitating over $17bn in spot volume trading over Q2 this year.
- It also announced plans to cut 20% of its 260 person workforce to reduce operational costs. The firm might be feeling the squeeze as it was the biggest creditor to 3AC, with the now-insolvent crypto VC fund reportedly owing Genesis $2.36bn. 3AC has also been struck with a $1.2bn claim from the parent company of Genesis, Digital Currency Group.
- The company was valued at $10bn once upon a time back in November 2021 but it seems v unlikely to be valued anywhere near that figure now. Since then, the value of the crypto industry has shrunk by more than 60% down to $1.09tn in the biggest sell-off in the history of the space – if the slump continues, we’re prolly going to continue seeing this kind of thing.
Bridges are getting burntThe use of cross-chain bridges for crypto laundering is reaching new heights, and in light of the recent Tornado Cash ban – regulation could be brewing.
- Crypto hackers have laundered at least $540m through RenBridge since 2020, according to new data from blockchain analysis group Elliptic. The group also said that around $153m of the laundered funds were related to ransomware exploits. It’s not painting a pretty picture for RenBridge.
- Cross-chain bridges like RenBridge make it difficult to trace funds and can offer a pretty easy way for cybercriminals to avoid getting caught. Elliptic said that they believe RenBridge was being frequently used by North Korean hacking groups and Russian cybercrime organizations.
- The US Treasury banned Americans from using crypto-mixer Tornado Cash earlier this week, and it’s v possible that similar regulation could be coming soon to cross-chain bridges like RenBridge – especially when OFAC catches wind of the amounts of money being laundered.
Hodlnaut crashes down to earthAnother DeFi platform has fallen to the contagion as Hodlnaut becomes the latest crypto lender to freeze withdrawals.
- DeFi lending platform Hodlnaut has frozen withdrawals citing “difficult market conditions”, as well as suspending their license application to the Monetary Authority of Singapore (MAS). Holdnaut reports that it has around $500m in assets under management, so there are likely a lot of unhappy customers right now.
- The platform says it has no exposure to 3AC or Celsius. What has been reported however, is that Hodlnaut had exposure to Terra’s UST in the region of $187m, which is v likely to be the source of these issues.
- These are dark days for crypto lending platforms as the full effects of Terra and Three Arrows Capital’s (3AC) collapse are felt throughout the industry. If the fates of Celsius and Voyager are anything to go off, it doesn’t look good for Hodlnaut users and it'll prolly be months before they can access their funds – if ever.
Dear users, we regret to inform you that we will be halting withdrawals, token swaps and deposits immediately due to recent market conditions. We have also withdrawn our MAS licence application. Here is our full statement https://hodlnaut.com/press/hodlnaut-message-to-our-users Our next update will be on 19 Aug.
Putting the fun in non-fungibleAn NFT collection that probably attracts a lot of sniggering 16 years-olds (among others) is helping NFT volumes hit promising levels as the crypto winter thaws.
- Daily trading volume of ‘CryptoDickbutts’ NFTs soared by 690% over the weekend. The Ethereum-based collection listed on OpenSea is famed for its memorable artwork by comic book artist K.C Green and has attracted a slew of celebs like Steve Aoki and Blondish.
- The collection is now ranked as #34 by floor price – which has risen by 135% in the past week to a new all time high – the cheapest token in the collection is now selling for 3 ETH (around $5k at the time of writing), with CryptoDickbutts now ranking above a bunch of popular collections like CoolCats and Goblintown.
- The reason for the sudden price-pump is anyone’s guess, but some think a recent Twitter Spaces hosted by CSO of Coinshares and well-known Bitcoiner Meltem Demirors might have been the cause after Demirors described the collection as a “culture” and said that prices are irrelevant.
Nomad funds wander off the bridgeCross-chain token bridging protocol Nomad sees nearly all of its TVL drained in just a few hours in “one of the most chaotic hacks that Web3 has seen”.
- The Nomad token bridge had over $190m pinched on Monday after experiencing a security exploit that let hackers systematically drain the bridge’s funds over a long series of transactions. DefiLlama says that $190.7m has been removed from the bridge and only a meager $651 remains.
- The platform says some of the hacking was friendly tho. Nomad’s team raised alarm bells after becoming aware of the first suspicious transaction, and has said that some of the moola was taken out by “white hat friends” who planned to safeguard the funds from the malicious attack and then return them – so far, one such friend has come forward.
- It’s the latest in a string of v public attacks that have brought into question the safety of cross-chain bridges in the cryptosphere. It comes at a rather inopportune time for Nomad, which only in April participated in a seed round that valued the company at $225m – largely based on the vision that it was fundamentally more secure than other platforms.
Someone call in the KingsmenThe British Army may need some help from Harry Hart after a hacker compromised their socials to push a new crypto scam. Don’t they know that manners maketh man?
- The British Army’s social media accounts have been infiltrated. An anonymous hacker (or group of hackers) took control of the UK army’s Twitter and YouTube accounts, pushing fake crypto giveaways and digital collections and sending people to scam websites.
- The Twitter account’s name and profile pic were changed to promote a fake NFT collection and even tweeted “we are attacking Pakistan” at one point, while the YouTube account name was changed to “Ark Invest” and went so far as to live streamed old clips of Elon Musk and Jack Dorsey talking with added text directing people to a scam website.
- High profile Twitter accounts are like catnip to hackers, – in 2020, the accounts of Elon Musk, Biden, Bezos and others were hacked to swindle people out of Bitcoin. Scams across the industry are getting more frequent, with the FTC revealing over 46k people have reported losing over $1bn to crypto scams since the start of 2021.
Three Arrows Capital fallsSo long, Three Arrows – the crypto hedge fund is set for liquidation after failing to make loan payments.
- Three Arrows Capital (3AC) was ordered to liquidate through a court order given in the British Virgin Islands on Wednesday, making it the first major crypto firm to fall amidst fears of a contagion spreading through DeFi.
- The news won’t come as a surprise to many. Earlier this week, Three Arrows had defaulted on a $670m loan given to them by Voyager Digital, raising fears of the hedge fund’s insolvency. The descent into liquidation arguably started due to 3AC’s exposure to Terra, in which the firm lost $200m and co-founder Kyle Davies admitted it “caught very much off guard”.
- Can DeFi get through this? Other crypto firms like Celsius, CoinFlex, and Babel Finance have all halted withdrawals on their platforms in the last few weeks as they wait to gather enough capital to steady their ships again. Investors will be hoping this isn’t crypto’s Bear Stearns moment and that no more companies suffer the same fate.