AllianceBlock hacked for $12M; Nostr launches Damus app

On Feb 2, 2023

The biggest news in the cryptoverse for Feb. 1 saw DeFi platform AllianceBlock fall victim to a $12 million exploit. Meanwhile, the decentralized social media project Nostr has launched a mobile app called Damus. Plus, FTX has published a financial update that contradicts court filings, former FTX CEO Sam Bankman-Fried has been barred from using Signal and communicating with FTX associates, and the Shredded Apes NFT project has become the victim of theft. Plus, comments from CoinShares and M13 Capital.

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AllianceBlock targeted by $12M exploit

AllianceBlock has been attacked in a multi-million dollar exploit, according to a Feb. 1 announcement by the DeFi project.

That report indicates that an attacker gained access to 110 million ALBT tokens, which were worth about $12 million prior to the attack.

The price of ALBT has dropped dramatically, as its value fell from $0.11 to $0.04 in a matter of hours after the attack. Further losses are expected.

AllianceBlock said that the attacker breached individual “Troves” — smart contracts controlled by users and used to manage deposits — on the related platform Bonq. AllianceBlock added that its own smart contracts were not compromised.

Unconfirmed reports also suggest that the attacker has gained at least $500,000 of stablecoins by selling Bonq’s BEUR token.

Decentralized social network Nostr launches mobile app ‘Damus’

Decentralized social network Nostr’s mobile application Damus launched on Google Play and AppStore on Feb. 1, as announced by the app’s Twitter account.

Twitter co-founder Jack Dorsey re-tweeted the app’s announcement post and said it was “a milestone for open protocols.” Dorsey had previously donated Bitcoin (BTC) to Nostr protocol and added his Nostr address to his Twitter bio.

The Damus app works similarly to Twitter and describes itself as a social network that can be controlled by users. The app claims that it gives users complete control of their data. It doesn’t require a KYC process and secures all messages with end-to-end encryption.

FTX Group interim financial update contradicts court filing, shows exchange had $1.43B in cash

FTX Group released an interim financial update showing the company held $1.43 billion in cash at the end of 2022 — higher than the $1.24 billion reported on Nov. 20, 2022, according to a court filing.

Sister company Alameda Research reported $876.6 million in the filing, as opposed to $401 million reported in November 2022.

Shredded Apes LP drained, 78M tokens liquidated

Shredded Apes announced on Feb. 1 that its main wallet containing royalties and the native token (WHEY) was breached.

The official Shredded Apes explained that all funds were transferred to “‘EgnTKUUsN1nyq4ap7hK9VSqSettH6T4gvLvdj3spneCg‘ about 2-3 hours ago,” at the time.

Approximately 78 million WHEY tokens were transferred to the Shredded Apes royalties wallet the week of Jan. 23, during token migration to Mintinglab V2.

SBF restricted from using Signal, communicating with FTX employees

Federal judge Lewis Kaplan has imposed communication restrictions on former FTX CEO Sam Bankman-Fried, as seen in a Feb. 1 court filing.

The ruling imposes two restrictions. First, Bankman-Fried will be barred from using encrypted and self-deleting messaging apps, including Signal ⁠— a popular messaging app that he has used to contact associates in the past.

Second, Bankman-Fried will be barred from communicating with current and former employees of FTX and Alameda Research unless those individuals are exempted, are his immediate family members, or unless he is in the presence of legal counsel.

CoinShares CEO says lack of political will hindering US regulatory landscape

CoinShares co-founder and CEO Jean-Marie Mognetti said lack of political will is holding back the development of a sound regulatory framework for digital assets in the U.S.

Commenting on the contrasting regulatory styles in the U.S. and Europe, Mognetti said a top-down approach from European political leaders makes the difference.

Citing France as an example, the CoinShares CEO pointed out that French President Emmanuel Macron “pushed forward a law in 2017,” which later culminated in forming the basis of the country’s regulatory approach to digital assets.

M31 Capital bullish on BTC price, adoption in 2023 predictions

Crypto investment firm M31 Capital shared its 2023 predictions and said it expects Bitcoin (BTC) to skyrocket.

The firm said in its 2022 recap report that it expects adoption to increase further.

The document also states that chains and NFTs might evolve in a new direction, and privacy technology might gain importance.

Considering BTC’s price performance during the bear market, M31 Capital said it was “incredibly bullish” for the upcoming cycle. The report states that “no one voluntarily sold BTC,” which shows the community’s trust in BTC. The report finalized its words on BTC by quoting Ryan Selkis, who said: “We’re in a sell-a-kidney-to-buy-more territory.”