Crypto Weekly: Unravelling a $3.6bn exchange hack Crypto Weekly: Unravelling a $3.6bn exchange hack Crypto Weekly: Unravelling a $3.6bn exchange hack

Crypto Weekly: Unravelling a $3.6bn exchange hack

Summary:  The US authorities announced last week the seizure of Bitcoins worth $3.6bn, originating from a 2016 exchange hack. MasterCard has announced a positive push into crypto consulting, and Sunday’s Super Bowl gives some negative associations to early 2000.


$3.6bn in Bitcoins seized

In 2016, one of the largest crypto exchanges at the time, Bitfinex, was hacked for 119,754 Bitcoins, worth around $72 million then. For years, the hackers have laundered some of the funds, but the majority has been kept at the over 2,000 Bitcoin addresses, which the funds were sent to following the hack. On the 1st of February, though, these remaining 94,643 Bitcoins were transferred to a single address over the span of one and a half hours. This was rather unexpected since the prior laundering was done somewhat sophisticatedly with minor amounts each time. Around a week later, on the 8th of February, the answer came to why the funds were moved. According to the U.S. Department of Justice, the US authorities had seized the amount and arrested a married couple on charges that they conspired to launder proceeds from the Bitfinex hack. The US authorities stated that they came across the couple in its pursuit to allegedly launder the Bitcoins. Following this, the execution of a court-authorized search warrant of online accounts belonging to the couple led the authorities to find an encrypted file in the man’s cloud storage counting over 2,000 addresses and their corresponding private keys associated with the hack, which empowered the seizure. The couple has not been charged for the exchange hack itself.

Following the press release, the crypto market declined slightly in value as investors expect the 94,643 Bitcoins to be liquidated at some point in the future. However, in our view, the seizure is fairly positive for the market as a whole because it shows that crypto is not a safe haven for criminals to operate in. This highly publicly covered case should frighten criminals and encourage the authorities to spend more resources on crypto, and with better analytical software and know-how in the future, it should become more complicated for criminals to operate in the space.

MasterCard to push further into crypto

The global payment provider MasterCard has today announced its intention to hire more than 500 employees in its consulting business named Data & Services, which already counts over 2,000 employees. The hiring sprint is partially dedicated to the division’s focus within crypto consulting, which stresses that there is an increasing demand for such services. Alongside Visa, MasterCard has been keen on crypto for some years, leading the company to recently acquire crypto analytics software CipherTrace and to partner with Coinbase in regard to its upcoming NFT platform.

The crypto bowl

On Sunday, the annual Super Bowl was held in Los Angeles, California, in which Los Angeles Rams won over Cincinnati Bengals. One might ask how this relates to crypto. To answer that, one should have seen the advertisements throughout the match, where crypto companies were heavily represented. Companies such as Coinbase, FTX, Crypto.com, and eToro were running ads. Budweiser even promoted NFTs in their ad. On one hand, it emphasizes that companies within the industry now have the necessary financial capabilities to run such ads to catch the attention of a broader audience. On the other hand, at the Super Bowl in 2000, 17 respective dot-com companies were advertising. Fast forward a few years the majority of these companies had filed for bankruptcy, so Sunday’s event gives some bad associations to the past. Hence, the crypto-related events at the Super Bowl can arguably both be regarded as positive and negative.
Bitcoin/USD - Source: Saxo Group
Ethereum/USD - Source: Saxo Group
Disclaimer

The Saxo Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website is not intended to and does not change or expand on this. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Please read our disclaimers:
- Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)
- Full disclaimer (https://www.home.saxo/en-hk/legal/disclaimer/saxo-disclaimer)

None of the information contained here constitutes an offer to purchase or sell a financial instrument, or to make any investments. Saxo does not take into account your personal investment objectives or financial situation and makes no representation and assumes no liability as to the accuracy or completeness of the information nor for any loss arising from any investment made in reliance of this presentation. Any opinions made are subject to change and may be personal to the author. These may not necessarily reflect the opinion of Saxo or its affiliates.

Saxo Capital Markets HK Limited
19th Floor
Shanghai Commercial Bank Tower
12 Queen’s Road Central
Hong Kong

Contact Saxo

Select region

Hong Kong S.A.R
Hong Kong S.A.R

Saxo Capital Markets HK Limited (“Saxo”) is a company authorised and regulated by the Securities and Futures Commission of Hong Kong. Saxo holds a Type 1 Regulated Activity (Dealing in Securities); Type 2 Regulated Activity (Dealing in Futures Contract); Type 3 Regulated Activity (Leveraged Foreign Exchange Trading); Type 4 Regulated Activity (Advising on Securities) and Type 9 Regulated Activity (Asset Management) licenses (CE No. AVD061). Registered address: 19th Floor, Shanghai Commercial Bank Tower, 12 Queen’s Road Central, Hong Kong.

Trading in financial instruments carries various risks, and is not suitable for all investors. Please seek expert advice, and always ensure that you fully understand these risks before trading. Trading in leveraged products may result in your losses exceeding your initial deposits. Saxo does not provide financial advice, any information available on this website is ‘general’ in nature and for informational purposes only. Saxo does not take into account an individual’s needs, objectives or financial situation. Please click here to view the relevant risk disclosure statements.

The Saxo trading platform has received numerous awards and recognition. For details of these awards and information on awards visit www.home.saxo/en-hk/about-us/awards.

The information or the products and services referred to on this site may be accessed worldwide, however is only intended for distribution to and use by recipients located in countries where such use does not constitute a violation of applicable legislation or regulations. Products and services offered on this website are not directed at, or intended for distribution to or use by, any person or entity residing in the United States and Japan. Please click here to view our full disclaimer.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the US and other countries. AppStore is a service mark of Apple Inc. Android is a trademark of Google Inc.