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Tron founder Justin Sun has an idea for the struggling financial giant Credit Suisse should UBS fail to acquire it — he wants to buy it and turn it into a “crypto-friendly” bank.

“I would like to propose my own offer of $1.5 billion to acquire Credit Suisse and integrate it into the Web3.0 world,” he wrote Sunday in a thread on Twitter, praising Switzerland’s crypto-friendly regulation. “We can leverage the country’s progressive policies and position ourselves as a leader in financial innovation.”

The Financial Times reported that UBS had agreed to buy Credit Suisse for more than $2 billion, one of the latest financial institutions to tread water after the collapses of Silicon Valley Bank and Signature Bank in the U.S. earlier in the month. The bank’s market capitalization was over $7 billion at the close of trading on Friday, according to TradingView data. 

While it wasn’t clear on Twitter just how serious Sun was in his offer, or if Swiss regulators would even entertain it, he has a history of floating offers for deals that don’t materialize. In January, he told Reuters that he was willing to spend up to $1 billion for assets belonging to Digital Currency Group. 

Sun said last year that he was ready to spend up to $5 billion on struggling crypto firms. 

Spokespersons for Credit Suisse and the Swiss Financial Market Supervisory Authority FINMA did not immediately respond to emailed requests for comment. 

“By acquiring Credit Suisse and transforming it into a crypto-friendly financial institution, we can create a new standard for financial innovation that benefits everyone,” Sun wrote. 

© 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.

0xngmi, a pseudonymous employee of DefiLlama, is attempting to fork the blockchain data platform after accusing the company’s founders of launching a token without support. 

“There is an ongoing attempt to launch a token that does not represent us,” 0xngmi said on Twitter while verifying on-chain that their account had not been hacked. “We don’t want to be associated with it.” 

In a Twitter thread yesterday, the data firm hinted at a token airdrop.

The company, Llama Corp., has rebutted that a hostile takeover is underway suggesting that 0xngmi’s actions are independent.

“Llama Corp. will continue operating DefiLlama as it has done for the past three years,” said the company in a statement. “The actions of 0xngmi are regrettable. We are hoping to resolve things privately and amicably.”

0xngmi’s forked platform is currently hosted as Llama.fi. DefiLlama was co-founded by Charlie Watkins and Ben Hauser.

“0xngmi and a few team members have gone rogue, they are actively looking to seize DefiLlama IP and community while inaccurately claiming the rightful owner to be doing a hostile takeover,” according to a post on the DefiLlama Round Up Telegram account. 

© 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.

FTX will auction its derivatives exchange LedgerX to bidders on April 4.

The counsel for FTX filed the notice of revised dates on March 18 in U.S. Bankruptcy Court for the District of Delaware.

The auction will now be held on April 4 at the offices of Sullivan & Cromwell and a sale hearing will take place April 12, the filing said. Notice of the successful bidder should occur within one business day of the conclusion of the auction.

The auction had previously been scheduled for March 7 and then was revised to March 22, according to court filings. A reason for the most recent date revision was not provided.

FTX secured approval early this year to sell business units to raise money for creditors. It is also looking to sell Embed Financial Technologies, FTX Japan and FTX Europe. About 117 parties have shown interest in buying entities of FTX, according to a legal filing at the start of this year.

The exchange’s U.S. operation acquired LedgerX in Oct. 2021 and rebranded it as FTX.US Derivatives.

 

 

© 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.

U.S policymakers seem to be doing their best to suffocate dollar on-ramps into crypto, leaving the door open for other mature markets to gain a competitive edge.

A hacker was able to upload their own Java application onto General Bytes’ bitcoin ATMs, which enabled the attacker to read and decrypt API keys to access funds on exchanges and hot wallets.

The company posted a high severity security incident warning on its Confluence page on March 18. The attacker was able to access the database, download user names and passwords as well as turn off two-factor authentication and scan terminal event logs for instances when customers scanned private keys in the ATM, the company said.

“We urge all our customers to take immediate action to protect their funds and personal information and carefully read the security bulletin listed here,” the company said on Twitter.

How did it happen?

The hacker was able to mount the attack by uploading their own Java application and running it remotely, using the master service interface, which is used in bitcoin ATMs to upload videos to the server, the company said.

Both General Bytes’ cloud service and standalone servers were compromised and as a result the company is closing down its cloud service.

“It is theoretically (and practically) impossible to secure a system granting access to multiple operators at the same time where some of them are bad actors,” said the company in the post, adding that it would provide support to customers to transition from the cloud service to running their own standalone servers.

The company published steps to implement the security fix. It also said that in multiple audits that had been completed since 2021 it had not identified this vulnerability.

$1.5 million of bitcoin stolen

The security post also listed the crypto addresses and APIs used by the attacker. On-chain analysis shows a balance of 56 bitcoin ($1.5 million) in the bitcoin wallet linked to the attacker. 

This isn’t the first time General Bytes has experienced an attack. In August of last year, a hacker was able to steal funds from customers making deposits at its bitcoin ATMs. In that case, the hacker modified the crypto settings of two-way machines with their wallet settings and the invalid payment address setting.

General Bytes website states that it has sold more than 15,000 machines in over 140 countries.

The company didn’t immediately respond to request for comment.

© 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 value of the two biggest cryptocurrencies surged last week amid continuing turmoil in the banking industry. Bitcoin jumped 35.05% last week to $27,401 and Ethereum similarly spiked 24.75% to close the week at $1,794. 

Chart from TradingView.

Crypto stocks and structured products

Shares of Silvergate plummeted 38.62% to close the week at $2.05.

Coinbase shares rose 33% and MicroStrategy gained 30% for the week. Jack Dorsey’s Block gained 5%.

For the week, Grayscale’s structured bitcoin trust surged 33% and Ethereum trust rose 16%.

Macro Matters

Grayscale said it’s possible the Federal Open Market Committee will forgo any interest rate increase when in it meets March 22 if the banking crisis persists. Before the crisis, it was widely assumed the central bank would hike rates by 0.25% 

Inflation fell to 6% in February from 6.4% in January, according to a report from the U.S. Department of Labor.

© 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.

Tech giant Microsoft is working on a non-custodial crypto wallet for its web browser Edge, Bleeping Computer reported Friday, citing testing of the new feature.

Microsoft sleuth Albacore first spotted the feature by tweeting some screenshots of the wallet. “I mostly do software research and reverse engineering. That’s how I ended up discovering the wallet functionality in the first place,” Albacore told The Block. 

Bleeping Computer said it tested the wallet, which is most likely only available to Microsoft Edge Dev Channel users as part of a limited test phase.

“This is a non-custodial wallet, meaning you are in complete control of your funds. We will not have access to your password and recovery key. It is embedded in Edge, making it easy to use without installing any extension,” one of the screenshots tweeted by Albacore read.

“As a tester, you will use your own funds. In the event of loss of funds, Microsoft will not reimburse any loss. This is a confidential project and no details should be shared externally.”

Other screenshots show integrations with Coinbase and Moonpay and support for NFTs and crypto swaps.

Bleeping Computer said Microsoft has partnered with Ethereum development studio Consensys to offer a built-in crypto swap feature between ether (ETH), Uniswap (UNI), the dai stablecoin (DAI), and the USD coin (USDC) and Tether (USDT) stablecoins.

“At Microsoft, we regularly test new features to explore new experiences for our customers,” a Microsoft spokesperson told Bleeping Computer. “We look forward to learning and collecting feedback from customers but have nothing further to share at this time.”

When asked if it is probable that Microsoft will launch a crypto wallet, Albacore said: “I would personally lean toward yes. While Microsoft has a wide range of experimental projects in all kinds of fields, if one happens to land in publicly accessible versions of a product (say Windows, or in this case Edge) it rarely gets completely canceled. Worst case scenario usually is that it gets launched and decommissioned later if it doesn’t get the traction they were hoping for.”

Rival web browsers Opera and Brave offer several crypto features, including a built-in wallet.

© 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.

Crypto exchange Binance responded to criticism from U.S. senators without addressing financials, Bloomberg reported Friday, citing a 14-page letter.

In the letter, Binance’s chief strategy officer, Patrick Hillmann, reportedly described the company’s compliance efforts but offered few details of its finances. The response failed to provide much of the information senators had asked for in a March 1 letter, according to the report.

Three senators on the Senate Banking Committee — Elizabeth Warren, D-Mass., Chris van Hollen, D-Md., and Roger Marshall, R-Kan. — wrote to Binance and Binance.US about their operations. The bipartisan trio said, “Binance and its related entities have purposefully evaded regulators, moved assets to criminals and sanctions evaders, and hidden basic financial information from its customers and the public.”

The senators also asked for information about the relationship between Binance and Binance U.S. and any communications about alleged efforts by Binance CEO Changpeng Zhao to limit compliance. The senators asked for a response by March 16.

Binance’s response, dated March 16, didn’t provide much of that information, according to the Bloomberg report. The response emphasized that Binance and its U.S. arms “are separate entities — contrary to suggestions in public reporting.”

Commenting on the exchange’s compliance efforts, the response noted that Binance has a team of about 750 core and supporting compliance staffers, including various former regulatory and law-enforcement officials.

“Binance leverages both internal tools and tools from established third-party vendors to scan user transactions and profiles in real time,” Hillmann’s letter said. “Indeed, as a point of reference, between August 2021 and November 2022, Binance stopped over 54,000 transactions as a result of transaction monitoring alerts.”

© 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 past week was busy in the crypto world, with five major stories making headlines.

Ethereum Layer 2 Arbitrum announced a schedule of its long-awaited token airdrop. The U.S. Justice Department began investigating the collapse of the TerraUSD stablecoin. DeFi protocol Euler Finance lost $197 million in a flash-loan attack. Meta ditched NFTs on Facebook and Instagram., and Coinbase is exploring an overseas derivatives trading platform.

In this recap, let’s take a closer look at each of these five stories.

Arbitrum airdrop

Arbitrum, the biggest player in the Ethereum Layer 2 space, said it will airdrop its ARB governance token on March 23, distributing 12.75% of the token’s total supply to community members who have used the network over the past year.

Arbitrum once said it wouldn’t launch its token. Still, now the project argues that the token is needed as part of its next phase of decentralization. ARB will control the governance of the Arbitrum One and Nova networks through a DAO. It will also be used to govern any other Layer 2 networks that the DAO officially endorses. The token won’t be used for paying transaction fees on the network.

Besides 12.75% to the community, the ARB airdrop will hand out 11.6% of the total supply to Arbitrum users, with an additional 1.1% to DAOs in the Arbitrum ecosystem and Protocol Guild, a DAO made up of Ethereum developers. A large portion of the supply — 42.8% — will go to the Arbitrum Foundation, which will be under the control of the newly formed Arbitrum DAO.

Offchain Labs and advisers will receive 27% of the token’s supply, while Offchain Labs investors will get 17.5% of the supply. The total supply of tokens is 10 billion.

TerraUSD probe

The Justice Department began investigating the collapse of the TerraUSD stablecoin, according to a report from The Wall Street Journal, citing unidentified sources.

Terraform Labs and its co-founder Do Kwon are already facing civil charges brought by the U.S. Securities and Exchange Commission last month. If charges are ultimately brought by the Justice Department, those would be criminal and could carry a prison sentence.

U.S. prosecutors are also looking into chat-group conversations among trading firms including Jump Trading Group, Alameda Research and Jane Street Group about a potential bailout of TerraUSD that never happened, according to a separate Bloomberg report on Monday.

The TerraUSD stablecoin lost its peg in May last year and wiped out about $40 billion in market value. Its failure caused a ripple effect throughout the market, resulting in the collapses including Three Arrows Capital, Celsius, Voyager, BlockFi and FTX.

Euler attack

DeFi lending protocol Euler Finance lost $197 million in a flash-loan attack. The attacker then transferred about $1.8 million to cryptocurrency mixer Tornado Cash in an attempt to launder the stolen funds.

Euler Finance offered the attacker a 10% bounty ($19.7 million) to return the remaining 90% of the stolen funds. It warned that if the assets were not returned within 24 hours, it would launch a $1 million reward for information that would lead to their arrest and the return of all funds.

Earlier Saturday, the exploiter returned 3,000 ether (ETH) worth about $5.4 million to Euler, indicating a deal may have been reached.

Euler Finance is backed by high-profile investors, including Haun Ventures, Jump Crypto and Uniswap Labs Ventures, having raised $32 million in a June 2022 funding round.

Meta ditches NFTs

Meta ended NFT support on Facebook and Instagram “to focus on other ways to support creators, people, and businesses,” said the head of the company’s commerce and fintech business, Stephane Kasriel.

The initiative lasted about five months. The reaction was mixed, as The Block reported. One artist, Dave Krugman, called the move “shortsighted.” Still, a critic said if the initiative had been successful and popular, Meta wouldn’t have discontinued it.

The winding down of Instagram’s NFT program may have an impact on Polygon, the blockchain company Meta chose to help it run Instagram’s NFT play. Polygon was disappointed by Meta’s sudden move to end the initiative, according to a person familiar with the matter.

Coinbase perps

Crypto exchange Coinbase is exploring launching an offshore platform to trade perpetual swaps tied to cryptocurrencies, The Block reported, citing unidentified sources.

Coinbase has briefed market-making and trading firms about the plans to roll out the platform in an offshore jurisdiction. Perpetual swaps — a type of future and a popular product in the crypto space – will be among the offerings. They provide a more capital-efficient way for traders to make bets on the underlying crypto market.

Coinbase rival Binance currently commands a plurality of market share in bitcoin futures, according to The Block’s data dashboard.

© 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.

Cathie Wood’s Ark Investment Management bought more Block (SQ) shares on Friday.

Ark’s flagship exchange traded fund, Ark Innovation ETF (ARKK), purchased 50,858 shares in Block, according to an update from the fund manager’s trading desk on Friday.

Its Ark Next Generation Internet ETF (ARKW) bought 8,064 shares. Together, the purchases were worth around $4.3 million, based on the stock’s closing price of about $74 on Friday.

SQ chart by TradingView

Friday’s purchases marked the fourth day in the past week. The asset manager added Block stock worth about $29 million in the previous three purchases of the week.

© 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.