ICYMI - Last week in crypto: Jerry Powell releases the Kraken, Wintermute gets hacked and Disney makes new moves
September's ending on a mid
In this episode of ICYMI, we feature the top stories that emerged from the crypto space last week: Wintermute was hacked in a $160M attack and another top crypto mining firm filed for bankruptcy. Meanwhile, Disney is set to dive into the Web3 space following a new job posting while the "crypto king" is on the run after duping investors of $20 million.
Also, our friends from epicweb3 are back with a virtual meetup on hiring in Web3! Read to the end to find out how!
Crypto Market maker Wintermute loses $160M in DeFi Hack
According to Evgeny Gaevoy, the founder and CEO of Wintermute—a cryptocurrency market maker based in the UK, the company was the most recent victim of hacks targeting decentralized finance (DeFi) platforms, losing almost $160 million.
The CEO of Wintermute has said that the company would communicate with the hacker and is "open" to treating the attack as a white hat hack.
Etherscan reports that the "Wintermute exploiter" received transfers of over 70 different tokens, including $61,350,986 in USD Coin (USDC), 671 Wrapped Bitcoin (wBTC), equivalent to about $13,030,061, and $29,461,533 Tether (USDT). It indicates that USDC has the highest token amount.
However, the hacker(s) withdrew money from the company's DeFi operations, the over-the-counter and centralized financing operations were unaffected. Gaevoy emphasized that consumers' cash are secure by claiming that the market maker is solvent and still has twice as much equity as was taken.
Wintermute — an artificial market maker, deals in digital assets like bitcoins and stablecoins. The Financial Conduct Authority oversees the group, which is based in Cheshire and has a UK corporate registration. Evgeny Gaevoy is a director holding "more than 25%, but not more than 50%" of shares, according to Companies House.
The nature of the exploit shows that Wintermute's hot wallet was compromised, according to Ajay Dhingra, head of research and analytics at smart exchange Unizen. “The attacker cleverly manipulated the bug in the smart contract," Dhingra added.
"This incident again brings focus on tightening the screws around smart contract security, which is an uncharted territory as of now."
Following the hack, Gaevoy stated that the attack could be considered a white hat hack in the brief tweet thread. To prevent future hacks, the offender could get in touch with Wintermute and disclose the flaws they found.
Recently, White hat hacks are frequent in crypto space. Hacker bounties are occasionally rewarded with cash or jobs by exchanges, market makers, and businesses. The Wintermute Exploiter's public Ether (ETH) address has received spam from cryptocurrency enthusiasts with messages like "plz give. I'm poor. Even $5,000 would be fantastic."
BTC Mining Firm Compute North Files for Chapter 11 Bankruptcy
Compute North, a company that hosts bitcoin (BTC) mining operations, has filed for Chapter 11 bankruptcy after mounting pressure on the company brought on by the effects of crypto winter and rising energy prices. Dave Perrill, the company's CEO, has also resigned but will still serve on the board.
Albeit, Compass Mining—a hosting partner of Compute North, has declared that the company will carry on with operations as usual for the time being.
Last Thursday, the firm filed for Chapter 11 bankruptcy before Judge David Jones in the United States Bankruptcy Court for the Southern District of Texas.
The company can continue operating under a Chapter 11 filing while it develops a strategy to pay off creditors. According to the statement, Compute North owes 200 creditors over $500 million, although its assets are supposedly worth between $100 million and $500 million.
Compute North provides hardware, hosting services, large-scale crypto mining facilities, hardware, and a BTC mining pool. It is one of the biggest U.S. data center providers and has well-known BTC mining industry partners including Compass Mining and Marathon Digital.
Both businesses have issued statements on Twitter stating that, based on the information they currently have, their business activities will go normally.
"The personnel at Compute North told us today that the bankruptcy filing shouldn't affect normal business operations, We are keeping an eye on the situation and will provide more updates as they become available." Compass Mining noted in a statement.
The mining industry has been significantly impacted by BTC's bearish performance in 2022, and in the case of Texas, increased energy prices and frequent power outages during sweltering heat waves haven't helped either.
A huge mining plant in Texas that Compute North was unable to monetize for months experienced a significant delay, Bloomberg Business writer David Pan noted on Twitter.
"Compute North’s massive 280MW mining facility in TX was supposed to run rigs in April but it couldn’t due to pending approvals. From then to later this year when it finally was able to energize the machines, Bitcoin prices had gone through multiple downward cycles, fundraising opportunities dried up and major lenders scaled back,” he wrote.
Compute North joins a long list of cryptocurrency companies that have either experienced the effects of the crypto winter or, in some cases, contributed to its development. These companies include, for example, Voyager Digital, Three Arrows Capital, Celsius Network, and BlockFi.
Bankrupt 'Crypto King' with 11 Supercars Allegedly Owes $35M to Investors
Reports from last week entails how a Canadian man who calls himself "Crypto King" allegedly owes $35 million to investors — but just $2 million has been recovered so far.
According to reports, Aiden Pleterski lived a life of luxury, renting a luxurious waterfront property for $45,000 a month in addition to having 11 high-end vehicles.
But this is little comfort to over 150 investors who handed over $20 million to his company AP Private Equity Limited.
Two McLaren sports cars, a Lamborghini, and two BMWs have reportedly so far been found, according to CTV News.
While it's unclear where exactly all the funds went, Norman Groot, a fraud recovery attorney who represents Pleterski's alleged victims, told the news source that he was "burning a lot of money."
He's accused of luring investors with promises of up to 7% profits, but has since declared bankruptcy.
Rob Stelzer has been appointed as his bankruptcy trustee, and said:
We take this very seriously, we know there's a lot of people who are owed a lot of money. Many of these are ordinary people who've invested $25,000, $50,000, $100,000. That's a lot of money for most people."
Pleterski is only 23 years old, and he claims that he lost all of the money entrusted to him in a sequence of disastrous trades and margin calls. However, it is stated that he has yet to show proof that this is the case.
He allegedly tried to justify himself by claiming to be a "20-something-year-old kid."
This is the latest in a long series of crypto chances that have gone bad for investors — and Canadian officials are emphasizing the importance of customers understanding what they're putting their money into... If something seems too good to be true, it probably is.
Disney Hiring Top Lawyer to Work on NFTs, Blockchain, Metaverse and DeFi
Disney posted a job listing for an experienced corporate attorney who is familiar with emerging technologies, "including NFTs, blockchain, metaverse, and decentralized finance," as it gets ready to enter the Web3 space.
The position was covertly posted on LinkedIn over the weekend and demonstrates how seriously the entertainment behemoth is taking virtual worlds and digital artifacts.
The responsibility for "complete product life cycle legal counsel and assistance for global NFT products" and verifying their compliance with laws would fall to the successful candidates. Other duties would involve investigating potential partners, such as marketplaces and blockchains.
Additionally, this lawyer would be required to offer frequent legal counsel on "NFT and cryptocurrency-related concerns and challenges," particularly with regard to securities regulations, which have long been a contentious subject in the promotion and sale of digital art.
Candidates are cautioned that new projects tend to be released "on an accelerated and aggressive timeline," indicating that Disney plans to accelerate its ambitions. Prior experience in the NFT, cryptocurrency, and Web3 space is described as highly desirable.
Disney following the Web3 trend
Bob Chapek, the CEO of Disney, is a proponent of "next-gen storytelling," and he thinks that the metaverse might be a major player in this. It might give immersive experiences in a customer's home if done properly. As it fine-tunes its strategy, it uses data from theme park visitors as well as what viewers are streaming on Disney+.
The company has also dabbled in the area of NFTs before, releasing a small selection in time for Disney+ Day last year.
It released "Disney Golden Moments" in association with VeVe, which featured "some of the most cherished characters and icons" from franchises present on the streaming platform.
NFTs and the metaverse have not yet won over many users, largely due to high technical entry barriers and unusable features on some platforms. Others have criticized the speculative character of this market, where some items fetch eye-popping prices. Another issue with Proof-of-Work blockchains has been their influence on the environment, but this criticism has been considerably subdued by Ethereum's switch to Proof-of-Stake.
Disney should investigate this market due to its extensive library of movies and TV shows. Being an early adopter may also put the business in a better position to fight off replica NFT collections that use its intellectual property without authorization.
Although exact details of Disney's NFT and metaverse ambitions remain unclear at this stage, this job listing is significant — and its arrival in Web3 could be a watershed moment for adoption.
Kraken’s Jesse Powell steps down as CEO
After more than 11 years as CEO of the cryptocurrency exchange Kraken, Jesse Powell will stand down from his position.
Powell will be succeeded as CEO by chief operating officer Dave Ripley, who has been with Kraken since 2016, according to a statement released by the company last Wednesday. The cryptocurrency exchange's soon-to-be-former CEO will continue working there as the board's chair while the business looks for a replacement.
In light of Powell's ascent to the new leadership role, Ripley said that his objectives were "in lockstep" with Powell's. Powell reportedly stated that the expansion of Kraken was the reason he decided to withdraw: It's simply become less enjoyable and more draining for me. He said, "I still plan to stay very engaged with the company."
Since 2011, Powell has served as Kraken's CEO. Powell guided the American exchange through the early days of the cryptocurrency industry. Kraken was hit with a $1.25 million fine by the U.S. Commodity Futures Trading Commission in 2021 for failing to register as a futures commission merchant and offering illegally margined retail commodity transactions in digital assets. Powell lambasted "awake activists" in June for not being a good match for working at the cryptocurrency exchange and said in April that Kraken will be closing its global headquarters in the heart of San Francisco.
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