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Blockchain forensics firm Elliptic said Tuesday that losses suffered by Atomic Wallet users from an apparent hack have risen to more than $100 million.

The wallet provider on June 3 acknowledged receiving reports that some wallets had been compromised and said less than 1% of its active users had been affected. It has yet to provide an additional update. 

Elliptic, which tracked over 5,500 wallets believed to have been targeted in the attack, said that the North Korean hacking association Lazarus Group was responsible in what would be its first major crypto theft since the $100 million exploit of the Horizon Bridge a year ago. 

“Since the theft took place, Elliptic has been working to retrieve the stolen assets,” Elliptic said. “Our team has partnered with several investigators and exchanges around the world to trace and freeze the stolen funds. This has led to over $1 million in stolen assets being frozen.”

Atomic Wallet hack is latest for Lazarus Group

The thief has now started to change its behavior, turning to Russian crypto exchange Garantex to launder the assets.

The U.S. government linked the Lazarus Group to the high-profile Ronin exploit that resulted in $600 million worth of digital assets being stolen from the Axie Infinity sidechain. In all, Elliptic estimates the Lazarus Group has pilfered more than $2 billion in digital assets across numerous heists. 

“I’m afraid we have no insights into the underlying exploit,” Elliptic’s Chief Scientist and co-founder Tom Robinson told The Block. “It’s becoming clear that this is a major crypto heist, and most probably another significant success for North Korea’s Lazarus Group. They had been relatively quiet since last year’s Horizon bridge hack, but this shows that they are still actively targeting the crypto ecosystem.”

Atomic Wallet didn’t immediately respond to a request for comment from The Block. 

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Binance and Binance.US have made their case against the SEC’s motion to freeze all Binance.US funds.

CEO Konstantin Gladych told CoinDesk Atomic is cooperating with law enforcement after a $100 million exploit of the non-custodial wallet.

Bitstamp, one of the oldest crypto exchanges, has received regulatory approval from the Financial Conduct Authority (FCA) to operate in the UK.

The approval, granted on June 13, makes Bitstamp UK Limited the latest addition to the FCA’s crypto register and comes just a day after broker/dealer trading company Interactive Brokers (UK) secured approval. 

Notably, the FCA had not approved any crypto asset firms since Hidden Road’s registration in December, making these recent approvals the first in six months, joining companies such as TP ICAP, Revolut, Gemini, Kraken and eToro. 

Easing crypto regulations

Operating in the UK requires crypto firms to meet the FCA’s anti-money laundering checks. The UK government has been promoting London as a hub for cryptocurrencies, but the regulatory approval process has been criticized for its slow pace and conservative approach. 

The FCA began applications for registration under its money-laundering rules in January 2020. However, many struggled to meet the regulator’s criteria by a deadline of March 31, 2022, and only 42 crypto firms have been successfully registered to date, causing frustration within the digital assets community. 

However, the regulatory landscape could soon gain greater clarity as the UK’s Financial Services and Markets Bill, currently making its way through parliament, is set to lay the legislative foundations to bring stablecoins and crypto assets into financial services regulation, furthering the FCA’s powers.

“The achievement acknowledges Bitstamp for our constant and unwavering commitment to operating at the highest standard. It additionally confirms that our platform offers compliant and secure access to cryptocurrencies in the UK, in accordance with the strict requirements set forth by the FCA,” Bitstamp said in a blog post.

Bitstamp and Interactive Brokers join a growing number of firms, including a16z, interested in establishing a UK presence and operating within a more favorable regulatory environment for crypto companies compared to recent enforcement actions by the Securities and Exchange Commission in the U.S. market.

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

As the Treasury Department studies a possible central bank digital currency, senior official Graham Steele says the effort is looking at privacy, but is also wary of CBDC run risks.

The crypto lawyer isn’t buying the argument that the SEC refuses to give the industry “regulatory clarity.” Chair Gary Gensler has been quite clear over the last two years about what is and what isn’t a security, she says.

Gary Gensler, chair of the U.S. Securities and Exchange Commission, hasn’t recently wanted to say whether or not ether is a security, refusing to opine on the subject when pressed in Congress in April by Republicans on the House Financial Services Committee.

Yet prior to his time at the SEC, Gensler used to have a much clearer view on which crypto tokens counted as securities — and which didn’t. He said on multiple occasions that bitcoin, ether, litecoin and bitcoin cash didn’t likely pass the threshold, while tokens issued through initial coin offerings did.

The distinction is thorny and at the center of legal disputes involving many of the biggest names in crypto including Ripple and Coinbase. If a token is determined to be a security, it’s subject to much stricter regulatory supervision and placed under the purview of the SEC. 

“Over 70% of the crypto market is bitcoin, ether, litecoin, bitcoin cash. Why did I that name those four? They’re not securities,” Gensler said at an institutional crypto conference held at Bloomberg’s headquarters in 2018. “Three quarters of this market is probably not securities.”

He echoed these comments in his own cryptocurrency course called Blockchain and Money at the Massachusetts Institute of Technology in the same year. 

“So we already know in the U.S. and in many other jurisdictions that three quarters of the market are not ICOs or not what would be called securities, even in the U.S., Canada, and Taiwan — the three jurisdictions that follow something similar to the Howey Test that we’ve talked about. Three quarters of the market is non-securities. It’s just a commodity, a cash crypto,” he said.

Most ICOs are securities

Gensler added that his audience will hear debates about initial coin offerings and which coins are securities. He said this debates, while relevant and important in general, were not relevant as a legal or regulatory matter to three quarters of the crypto market.

At the Bloomberg conference, Gensler said, however, that most ICOs — naming Ripple’s XRP and EOS — likely met all four criteria of the Howey test, rendering them securities. He added that ether in 2014 likely met the same criteria and was a security when it launched.

Yet he pointed to former SEC chair William Hinman’s comments at the time that this had changed. “Now, subsequently, the SEC has said by 2018 it’s decentralized enough and they’ve sort of said, you know, we’ll let it go the other way.”

These days, Gensler and the SEC claim that most tokens are securities, crossing over heavily with Gensler’s views on ICOs, although neither have clarified whether this applies to ether. In the SEC’s lawsuit against Coinbase filed earlier this month, it claimed that the exchange offering ether through a staking service was a security — but it didn’t touch on the underlying asset itself. 

When asked by The Block about ether in April, Gensler was opaque. 

“If the public is anticipating profits based upon the efforts of others in a common enterprise, those are the indicia of a security, he said.” As for whether the SEC should issue more guidance on ether, he replied that the space already has clarity.

As for that clarity, Coinbase is currently suing the SEC to find out what it is, and Ripple Labs is hoping documents released today relating to the Hinman speech in 2018 might shed a little more light.

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

The combined market capitalization of BTC, ETH and stablecoins reached the highest since February 2021, digital asset research firm K33 Research noted.

The updated plan from mediated discussions with parent company DCG reflects “substantial agreement” on several key issues.

The bitcoin network’s energy efficiency has improved dramatically in the past five years.