Cryptocurrency

Former CEO of Bankrupt Crypto Lender Celsius Network Arrested Amidst Probe into Company’s Collapse

The arrest, which occurred on Thursday morning, comes amidst mounting concerns surrounding the collapse of one of the most prominent players in the cryptocurrency industry.

Published

3 months ago

July 13, 2023

Investors King

The former chief executive officer of Celsius Network Ltd., a crypto lending platform that recently went bankrupt, has been arrested as part of an investigation into the company’s downfall.

The arrest, which occurred on Thursday morning, comes amidst mounting concerns surrounding the collapse of one of the most prominent players in the cryptocurrency industry.

The individual’s identity is being kept confidential, as the criminal case remains undisclosed to the public. However, insiders have revealed that the Securities and Exchange Commission (SEC) has also taken legal action against the former CEO and the company, further intensifying the scrutiny surrounding the case.

Celsius Network had gained significant recognition by offering exceptionally high interest rates on digital-asset deposits, attracting numerous investors seeking lucrative returns. Unfortunately, the company faced a series of setbacks that ultimately led to its demise while the collapse of the TerraUSD stablecoin and a sharp decline in the digital-asset markets left Celsius Network grappling with substantial financial losses, rendering it unable to honor customer withdrawal requests.

The former CEO’s attorney has yet to respond to inquiries seeking comment on the arrest. This recent development marks another significant blow to the crypto industry, as various figures within the sector have faced charges in the wake of market turbulence and exposed fraudulent activities.

Having played a pivotal role in the establishment of Celsius Network in 2017, the former CEO has faced intense scrutiny from multiple government agencies since the company’s bankruptcy filing twelve months ago. At that time, Celsius Network declared a staggering $1.19 billion deficit, triggering widespread investigations into the company’s financial practices.

Celsius Network’s downfall has reverberated throughout the crypto community, tarnishing its reputation as a reliable platform for investors seeking secure alternatives to traditional banking. Once lauded for its high interest rates and assurances of safety, the company’s credibility came crashing down when it failed to weather the storm of the TerraUSD collapse and the subsequent market downturn. This left Celsius Network unable to fulfill customer withdrawal demands, leaving many investors in a state of uncertainty.

Earlier this year, the New York Attorney General, Letitia James, took legal action against the former CEO, filing a lawsuit in January on charges of fraud. James accused the individual of deceiving New York investors, alleging that false and misleading statements were made about the lender’s safety, resulting in billions of dollars in crypto assets being lost.

As the case unfolds and further details emerge, the crypto industry remains on edge, grappling with the fallout from the collapse of once-prominent players. The arrest of the former CEO serves as a stern reminder that transparency, accountability, and regulatory oversight are crucial elements for the sustainable growth of the cryptocurrency market.

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Cryptocurrency

Mixin Network Halts Services After $200 Million Security Breach; Recovery Plan in Progress

Published

6 days ago

September 25, 2023

Investors King

Mixin Network, a prominent decentralized wallet service provider, has been rocked by a massive security breach resulting in a loss of $200 million.

The breach, attributed to vulnerabilities in its cloud service provider’s database, has raised questions about the platform’s dependence on centralized infrastructure.

Mixin Network, known for its support of 48 public blockchains and an impressive total network asset value exceeding $1 billion, halted deposit and withdrawal services following the breach.

This incident has prompted discussions within the crypto community regarding the risks associated with centralization in decentralized platforms.

In response to the breach, Mixin Network has taken swift action, enlisting the expertise of blockchain security specialists from SlowMist.

The company has pledged to resume services only after thoroughly addressing identified vulnerabilities, a decision reached through consensus among all network nodes.

The plan for asset recovery will be announced in due course, and Mixin founder Feng Xiaodong will provide a detailed explanation in a public livestream.

The Mixin incident follows closely on the heels of the JPEX cryptocurrency exchange scandal in Hong Kong, which has left countless individuals reeling from financial losses totaling $178 million.

Experts now speculate that these recent setbacks may lead the Hong Kong government to reconsider its enthusiastic promotion of Web3 technologies, as concerns over security and public sentiment cast a shadow on the region’s cryptocurrency ambitions.

Carlton Lai, head of blockchain and cryptocurrency research at Daiwa Capital Markets, said, “I think this scandal will have a pretty sizeable negative impact on retail sentiment, given its significant local presence and the various celebrities involved.”

As Hong Kong grapples with the fallout from these high-profile incidents, the future of cryptocurrency in the region remains uncertain, with questions of regulation and security taking center stage.

Cryptocurrency

Dallas Mavericks Owner and Billionaire Tech Investor, Mark Cuban, Falls Victim to Phishing Attack, Losing $870,000 in Crypto Assets

Published

2 weeks ago

September 18, 2023

Samed Olukoya

Mark Cuban, owner of the Dallas Mavericks and a prominent billionaire technology investor, recently fell prey to a phishing attack, resulting in a loss of approximately $870,000 worth of tokens.

The incident occurred over the weekend after months of inactivity on Cuban’s crypto wallet.

Phishing attacks, a prevalent threat in the crypto industry, deceive users into revealing sensitive information, downloading malicious software, and exposing their private data.

These attacks exploit users’ trust, often causing them to overlook the authenticity of incoming requests on their crypto wallets or unwittingly download counterfeit applications designed solely to pilfer their assets.

Cuban’s crypto wallet was emptied of various assets, including U.S.-pegged stablecoins, staked ETH (stETH), SuperRare (RARE) tokens, and some Ethereum Name Service (ENS) domains, according to blockchain data.

The initial discovery of these suspicious transactions was made by the vigilant on-chain investigator @wazzcrypto.

Fortunately, Cuban was alerted to these transactions, and he managed to safeguard over $2.5 million worth of Polygon’s MATIC tokens.

He accomplished this by promptly logging into his wallet and transferring the tokens to a secure Coinbase exchange address.

Cuban revealed that the phishing attack was apparently initiated through a fraudulent MetaMask wallet application that he had unwittingly downloaded.

This incident marks the second high-profile phishing attack in as many weeks, following Ethereum co-founder Vitalik Buterin’s experience in early September. Buterin’s X account was compromised in a phishing attack, although he did not appear to lose any of his own funds.

Nevertheless, unsuspecting users collectively suffered losses of up to $700,000 by sending tokens to a malicious link that falsely appeared to have Buterin’s endorsement.

As the crypto industry continues to thrive, it is crucial for users to exercise caution and remain vigilant to safeguard their digital assets from the ever-present threat of phishing attacks.

Ethereum

RxR Analysis Reveals: Ether’s True Worth 27% Higher than Market Price

Published

2 weeks ago

September 18, 2023

Samed Olukoya

RxR, a research-driven partnership between Republic Crypto and Re7 Capital, has revealed that Ether (ETH), the native token of the Ethereum blockchain, is currently trading at a 27% discount to its actual fair value.

This revelation comes as a result of RxR’s innovative approach to evaluating the worth of cryptocurrencies. Instead of relying solely on traditional metrics, RxR’s methodology incorporates a blended version of the Metcalfe law that takes into account both the active user base on the continuously expanding Ethereum scaling networks and the users on the Ethereum mainnet.

Ether, as a fundamental component of the Ethereum ecosystem, facilitates a wide range of activities, from simple transactions to participating in network security through staking, earning interest, and even storing non-fungible tokens. As such, the value of Ether has long been intertwined with Ethereum’s network usage.

Lewis Harland, an analyst at RxR, explained the significance of this approach, stating, “Ethereum’s network valuation exhibits a closer alignment with the updated Metcalfe law index when the active user base of Ethereum’s scaling networks is included in the model, in contrast to when it is omitted.”

Harland continued, “The updated model, which factors in these networks, places ETH’s valuation at $275 billion, indicating that the current market capitalization is trading at a substantial 27% discount.”

Ether’s market capitalization consistently tracks the blended Metcalfe law model more accurately than the traditional model, which fails to consider the growing activity on layer 2 networks or offchain solutions built atop the Ethereum mainnet.

In essence, this analysis challenges the perception that Ether might be overvalued, as suggested by the traditional Metcalfe law Model.

The emergence of Layer 2 technology has undoubtedly become one of the most dynamic and exciting developments in the crypto market. Key protocols, such as Coinbase’s BASE, Arbitrum, and Optimism, have found their unique niches within this landscape.

According to data from L2Beat, the total value locked in layer 2 protocols has surged more than threefold in just two years, reaching an impressive milestone of over $9 billion.