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Ameen Soleimani, the co-founder of SpankChain and Reflex Labs, has teased a revival of sorts for the controversial Ethereum transaction mixer, Tornado Cash.

Soleimani’s tweet indicated the involvement of Moloch DAO, which provides grants for Ethereum project development. 

“I sincerely hope no one thought we were finished,” said Soleimani.

Transaction mixing protocols like Tornado Cash use a variety of techniques to obfuscate the origin of cryptocurrency, which has attracted widespread scrutiny from regulators. Last year, the U.S. Office of Foreign Assets Control accused Tornado Cash of enabling money laundering by North Korea-linked hacking group Lazarus. 

Tornado Cash developer Alexey Pertsev was arrested last summer by Dutch authorities. Pertsev remains detained until a hearing scheduled this April.

© 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 price of testnet ether on the Goerli testnet spiked to $1.60 on Feb. 25 as traders speculated on a token that’s supposed to be worthless.

Last week, cross-chain platform LayerZero created a way for Goerli’s testnet ether to be traded and swapped between the Ethereum mainnet and the Goerli testnet. The idea was to create a way for developers to buy testnet ether in a more convenient way than the traditional approach of using faucets or asking the testnet’s developers for coins. Still, critics warned that monetizing the native currency of a testnet — which is designed to have no value, allowing the network to support pre-production testing — would render it less suitable for its main purpose.

“This is the start of the end of Goerli testnet. It served us well,” said Polygon Chief Information Security Officer Mudit Gupta on Twitter. “Testnet ether is supposed to be free, but is being marked up by speculators.”

The token traded around $0.15 at the end of last week but rose to a peak of $1.60 yesterday. Since then the token has traded downward, but still retains a value of about $0.37.

The price of testnet Goerli spiked over the weekend. Image: DEXScreener.

The distribution of testnet ether on Goerli is in the hands of a few validators. These developers could have a big impact on the market if they were to sell a large amount of the tokens at once, which also adds an element of risk.

Ethereum developers have proposed one solution that may address the problem. They are planning to build a new testnet called Holli that would make it easier for developers to acquire its testnet ether, reducing the need for a secondary market where it must be purchased.

© 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.

One of the biggest crypto stories this past week was the explosion of trading volumes on NFT marketplace Blur, which far outpaced rival OpenSea. The big question is whether this activity will find a sustainable path forward or if it’s all just airdrops and trading taking advantage of them.

This week will also see ETHDenver get underway, with a lot of key speakers and some big topics. Look for news coming from the conference. 

Beyond that, former FTX CEO Sam Bankman-Fried remains stuck in deliberations over possible changes to his bail terms. Even though the deadline may get pushed back to the end of the week, there should be some updates on how he may find a path forward.

Will Blur’s volume continue or diminish?

NFT marketplace Blur’s trading volumes have surged into the lead against rival OpenSea. 

Over the last month, Blur had held a slight edge on its competitor, but last week it raced into the lead with trading volumes about four times higher, according to data via Dune.

The marketplace saw a high of 62,351 ETH in daily trading volume last week from 55,000 sales, according to a different Dune dashboard. So far, Blur has seen almost $1 billion in trading volume this month, compared with just $240 million for OpenSea, according to The Block’s Data Dashboard. That said, OpenSea continues to have about twice as many users.

There are reasons for Blur’s performance. One is that many users may be trading on the platform in anticipation of upcoming airdrops set to reward “loyalty” to the marketplace. This has certainly helped to drive up volumes.

Another aspect is that NFT holders have been taking advantage of the increased liquidity — further boosting volumes. Last week, two ​​Bored Ape Yacht Club NFT holders who run research and trading firm Degenz Finance cashed out to the tune of more than 6,000 ETH ($10 million). They had long considered how they would be able to cash out in size and saw this as an opportunity. “The liquidity provided by Blur is insane at the moment,” they said.

Still, while volume numbers are rising, it’s unclear whether this model is sustainable and if the activity will continue once the incentives disappear. Next week may provide more information, though the picture won’t be clear until there are no more potential airdrops.

ETHDenver gets underway

Flagship Ethereum conference ETHDenver kicks off this week. Following a hackathon, the main event will run from March 2 to March 5.

Jesse Pollack, Coinbase’s senior director of engineering and head of protocols, will be speaking at the conference. He’ll likely focus on the exchange’s recent testnet launch of its Layer 2 network Base.

ZkSync’s Head of Engineering Anthony Rose will be talking about zkEVMs, which are zero-knowledge proof-based Layer 2 networks that are Ethereum-compatible. Obol Labs will be talking about its distributed ledger technology, which is being slowly rolled out this year. 

Other talks will include decentralizing social media and upcoming Ethereum withdrawals.

Sam Bankman-Fried set to negotiate bail terms

Former FTX CEO Sam Bankman-Fried has asked the court to delay a deadline for him to propose bail terms amid a current dispute. He wants the deadline pushed back to March 3. 

The dispute comes as prosecutors have urged the court to further restrict his bail terms regarding VPN usage. Bankman-Fried requested more time to find a technology expert to educate the court. He will also be filing a proposal for new bail conditions.

Bankman-Fried is awaiting an October trial in the U.S. District Court for the Southern District of New York. He was hit with four new charges last week, including bank fraud, when the court unsealed a superseding indictment in the case.

“The former CEO and majority shareholder of The Block has disclosed a series of loans from former FTX and Alameda founder Sam Bankman-Fried.”

© 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 Solana blockchain is back online after two attempts to restart the network.

The fix occurred at 01:28 UTC, after which engineers were said to continue monitoring the performance of the network, according to monitoring site Solana Status. At 02:09 UTC, the issue was deemed to be resolved.

The network went down in the early hours of Feb. 25, meaning transactions weren’t processing on the network as they’re supposed to. A few hours later, a first network restart took place but it was ineffective, leading to the second solution.

The blockchain has dealt with downtime multiple times in the past. This is largely because of its focus on supporting a high transaction throughput, which can put heavy pressure on nodes to stay in sync.

© 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.

Both bitcoin and ether declined on Saturday, continuing downward momentum after another week of macroeconomic uncertainty and ongoing jitters on the regulatory front. Both cryptocurrencies fell 6.4% over the past week.

Bitcoin was trading at $23,001 on Saturday afternoon, down 0.8% over the past 24 hours. Ether was down 1.4% over the period at $1,586, according to TradingView.

TradingView chart of Bitcoin price over past week.

Altcoins also had a tough week, with XRP falling 4.7%, Cardano declining 11.3% and Solana falling 6.2%. Memecoins didn’t fare any better, with Dogecoin declining 9.1% and Shiba Inu down 7.2%.

There was one bright spot, and the biggest winner of the week was Stacks’ STX token, which rose 101% over the past seven days. The move has been linked to the rising popularity of Ordinals that are bringing NFTs onto Bitcoin. 

Macro matters

Data released on Friday continued to place macroeconomic themes and stubborn inflation at the forefront of traders’ minds, with the price index for personal consumer expenditures rising 0.6% last month compared to an estimate of 0.4%.

The International Monetary Fund, meanwhile, took a hardened stance toward growing crypto adaptation with a set of recommendations for member countries and a call for a “coordinated response.” It said crypto posed a threat to the effectiveness of global monetary policy.

Crypto stocks

Crypto stocks also had a tough week. 

Coinbase shares were down 10% over the week, while Microstrategy declined 9.7%. Silvergate had yet another hard week, with shares falling 21%. Block fared better, rising 0.5% over the week.

The declines came amid continued regulatory concerns, with the U.S. Securities and Exchange Commission, the New York Department of Financial Services and the Attorney General of the State of New York objecting to Binance.US’s amended plan to acquire crypto lender Voyager. New York’s Attorney General is also suing cryptocurrency exchange CoinEx for allegedly failing to register with the state.  

Cathie Wood’s Ark Invest has continued to buy the dip, however, adding 181,972 Coinbase shares to its Ark Innovation ETF and 31,547 shares to Ark Next Generation Internet on Wednesday. Additional shares were added throughout 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.

Lido Finance said Saturday that it saw the largest daily stake inflow ever on the protocol, with over 150,000 ether worth almost $240 million staked.

“Upon reaching this number, a curious (but important) protocol safety feature called Staking Rate Limit was activated,” Lido said, adding the limit “affects all parties who may try to mint stETH, regardless of approach.”

Dragonfly Capital data scientist known as hildobby said the 150,000 ether had been staked by Tron founder Justin Sun, in a move that was also noted by the Twitter account Lookonchain. 

“This is now the highest week by staked amount in almost a year,” hildobby wrote.

Lido Finance earlier this month finished the design for the second version of its protocol that will add support for Ethereum staking withdrawals post-Shanghai. It’s expected to go to a vote on Lido’s governance platform by the end of the month.

© 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.

Platypus Finance, a decentralized finance protocol on Avalanche, announced that the French National Police have arrested two people suspected of hacking its protocol. The project assisted French law enforcement in tracing the identity of the attackers to a KYC-verified Binance account that was being used in an attempt to cash out the stolen funds.

Platypus said the alleged hackers were taken into custody after the firm provided information to trace them with help from pseudonymous on-chain analyst ZachXBT and crypto exchange Binance. On Feb. 16, hackers stole almost $9.1 million in crypto assets from Platypus. Since then, recovery efforts have been underway.

About $2.4 million in USDC stablecoin was recovered, after it had been placed in the attacker’s contract. This was made possible by the efforts of blockchain security firm BlockSec. The security firm found a loophole in the attacker’s contract and retrieved 2.4 million USDC by transferring it from the contract to Platypus’s contract. Another $1.5 million in stolen USDT was frozen with the help of its issuer, as Platypus had noted earlier.

Platypus Finance has assured its users that it will continue to take steps to enhance its security measures to prevent such incidents from happening in the future.

© 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.

Users attempting to make transactions on the Solana blockchain, which is in mainnet beta phase, faced disruptions from a technical issue that began at about 1 a.m. ET on Saturday.

Although the reason for the issue was unclear, validator operators and core engineers suspected there may be a bug in the latest version of the Solana code, which was released just hours before the incident.

A problem reportedly arose from a blockchain forking issue that created conflicting versions of transaction history. “The Solana network is experiencing non standard behavior (fork). Our engineers are investigating the issue and how to help best,” noted Chorus One, a blockchain infrastructure provider for Solana.

This, in turn, resulted in increased memory usage by validators and a significant reduction in transaction throughput, ultimately causing the network to stop processing user transactions, as further noted by Chorus One.

As a result, Solana’s validators have been instructed to restart its network clusters from a specific snapshot period, a process that is currently ongoing. An official Discord channel provided the necessary instructions for this.

Team members of the Solana Foundation did not immediately respond to requests 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.

Cathie Wood has resumed purchasing shares of Coinbase (COIN) for her firm’s exchange-traded funds, after having also bought them last week. 

Ark added a total of 150,192 COIN shares to its ARK Innovation ETF and ARK Next Generation Internet on Friday, consisting of 128,396 shares and 21,796 shares, respectively, according to its latest trade filing.

Shares for Coinbase closed down 3% to about $59 Friday. Based on the price at the close, Ark’s most recent purchase cost just over $8.8 million. This comes after Ark bought more than $13 million worth a few days earlier, on Wednesday.

So far this year, ARK’s Innovation ETF (ARKK) has gained 21% in value, while the ARK Fintech Innovation ETF (ARKF) has increased by 16%.

© 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.

No week in crypto goes by without eye-catching headlines. This past week saw the birth of a new scaling blockchain from Coinbase, Jump recovering $140 million worth of stolen assets from its Wormhole bridge hacker, new indictment charges for FTX founder Sam Bankman-Fried and layoffs at two major blockchain firms.

Here are the details on these four stories:

Coinbase unveils a blockchain

Crypto exchange Coinbase released its own blockchain, Base, on a testnet version developed using a software stack called “OP Stack” provided by Optimism, a popular Layer 2 blockchain. Base aims to offer developers an easier, low-cost platform to build decentralized apps (dApps) on-chain. Coinbase will also serve as a primary developer for the OP Stack in partnership with Optimism. It has introduced the Base Ecosystem Fund to support projects building on the blockchain and will contribute a small percentage of fees collected to Optimism’s governance body, Optimism Collective.

FTX founder Sam Bankman-Fried faces new criminal charges

FTX founder Sam Bankman-Fried is facing new criminal charges, including conspiracy to commit bank fraud, operating an unlicensed money transfer business, wire fraud on FTX customers, securities fraud on FTX investors, conspiracy to make unlawful political contributions and defrauding the Federal Election Commission. He has pleaded not guilty and is under house arrest on a $250 million bond. His trial is scheduled for October.

More layoffs hit blockchain developers

Dapper Labs, the company behind the NFT-focused blockchain Flow, decided to lay off another 20% of full-time staff, while Polygon Labs, the developer of the Polygon blockchain, said it was going to reduce headcount by 20%, affecting about 100 people. Despite the layoffs, Polygon’s founders said that its treasury remains healthy, with a balance of over $250 million and more than 1.9 billion MATIC tokens.

Jump recovers stolen funds 

Jump Crypto, a crypto trading and investment firm, with help from DeFi project Oasis successfully recovered $140 million in crypto assets, a portion of $323 million stolen from Jump-operated Wormhole bridge in February 2022. The hacker had been recently moving the stolen assets around and parked the funds into Oasis-run smart contracts to earn yield. The two teams secured the stolen funds by upgrading an Oasis contract and adding a function to direct the assets of the hacker’s address into their own. 

The former CEO and majority shareholder of The Block has disclosed a series of loans from former FTX and Alameda founder Sam Bankman-Fried.

© 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.