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Saddle Finance, a decentralized exchange for trading stablecoins, was hacked in a DeFi exploit today.

The unknown hacker carried out the exploit at 07:40 AM UTC and netted about 3,540 ether ($10 million), according to on-chain data.

Saddle Finance confirmed the incident, saying its team was investigating a “possible exploit.” 

A smart contract audit firm called BlockSec was the first to notice the exploit and notified Saddle. BlockSec was able to rescue $3.8 million from the exploiters with an internal system that can detect and front-run hacking incidents using off-chain arbitrage bots called flashbots.

“The project was taken for around 4,900 ether ($13.8 million). Among them, 1,360 ether ($3.8 million) was rescued by us,” BlockSecTeam told The Block on Twitter.

Still, the hacker made off with more than $10 million in ETH from Saddle’s liquidity pools. Saddle Finance said it was in the process of recovering the $3.8 million from BlockSec.

© 2022 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.

Panama’s National Assembly almost unanimously approved a bill to regulate the use and commercialization of crypto assets in a country already known as a hub of offshore financial services, Reuters reported.

The bill, which now goes to President Laurentino Cortizo for signing, passed through the assembly on Thursday with 38 votes in favor, two abstentions and no votes against.

The bill covers the trading and use of crypto assets, issuance of digital securities, new payment systems and the tokenization of precious metals, Reuters said. Panamanians would be able to use crypto assets as means of payment for any civil or commercial operation not prohibited by law in the country.

Panama is on the EU’s list of tax havens, and Romain Dromard, CEO at financial investment advisory firm K&B Family Office, told Reuters that the crypto bill may not help it appear more transparent.

The Block reported in September on independent lawmaker and promoter of the bill Gabriel Silva, who said the legislation was broader in scope than measures passed last year by El Salvador.

© 2022 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.

Offers of triple pay are luring some specially trained UK cybercrime police officers into the private sector, and the trend is expected to increase, Bloomberg reported on Friday.

In 2018, the UK began training about 250 officers to investigate, seize, and realize the value of digital currencies, Bloomberg said. Last year, UK Metropolitan Police seized about $400 million of crypto in two hauls involving money laundering, The Block reported.

“The loss of experienced cyber officers and staff is a significant problem for us,” Andrew Gould, head of the UK National Police Chiefs’ Council’s cybercrime unit, told Bloomberg. “Their skills are in high demand in the private sector so we can see them doubling or tripling their pay which is why they go.” The NPCC expects the trend to increase over the next year to 18 months.

Coinbase, the biggest US crypto exchange, and crypto research company Chainalysis are among those employing former law enforcement staff. A Coinbase spokesperson told Bloomberg they “can play an integral role in keeping our customers’ funds safe and secure.”

© 2022 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.

Brazil’s Senate passed a bill this week that would regulate the cryptocurrency market in the country, giving new momentum to legislation that has been in the works for years. 

The Senate voted to move the bill forward on April 26, which includes input from three other bills that have been making their way through the halls of Brazil’s Congress as lawmakers have sought to keep up with the evolving technology.

Well-defined cryptocurrency legislation in Brazil would be significant for a few reasons. The law would define virtual assets and their service providers, which is especially relevant considering that Brazil is the largest crypto market in Latin America based on transaction volume. The country has also seen a significant number of scams in recent years, and the regulation would provide more clarity on how to combat crimes like money laundering.

Under the proposed law, Brazil’s executive branch would decide which bodies will regulate and supervise cryptocurrency providers, and these companies would need to get that agency’s approval before operating. In a February interview with Bloomberg, the bill’s rapporteur Irajá Abreu said that he expects Brazil’s Central Bank to be charged with regulating cryptocurrency businesses. 

Under the law, virtual asset service providers would be required to follow certain guidelines around protecting clients’ funds and personal data, and preventing money laundering in line with international standards. 

“We advanced the discussions of the report so that we could finally vote here today on this matter of regulation of crypto assets, which some call cryptocurrencies — an extremely important and urgent matter,” the Senate news agency quoted Abreu as saying during the vote meeting. “The Central Bank was constantly asking Congress to position ourselves in relation to a regulatory framework that could understand the dimension of this new business environment.”

In its latest Geography of Crypto report, Chainalysis reported that Brazil was the largest cryptocurrency market in Latin America based on transaction volume, receiving nearly $91 billion worth of cryptocurrencies in the year-long period between July 2020 and June 2021.

The proposed bill would update Brazil’s penal code to define digital asset fraud as: “Organizing, managing, offering wallets or intermediating operations involving virtual assets, securities or any financial assets in order to obtain an unlawful advantage, to the detriment of others, or misleading someone, through artifice, ruse, or any other fraudulent means.”

The bill would also modify Brazil’s penal code to bring two to six years of jail time and a fine to anyone found to be fraudulently offering virtual asset services. This is lower than the four to eight years that had been proposed in an earlier working version of the bill. According to Brazil’s Senate news service, crypto scams totaled 2.5 billion reals ($503 million) in 2021.

The bill will now advance to Brazil’s lower house, the Chamber of Deputies, for consideration. If it passes, the law would then be sent to Brazil’s president Jair Bolsonaro for a vote (if it makes it there before the country’s October presidential elections).

It appears the bill is in a position to advance without much pushback, considering how it has progressed so far. The chamber had passed another version of a law aimed at regulating cryptocurrencies in December, which was first introduced back in 2015. As the Brazil Crypto Report newsletter pointed out in February, Bolsonaro’s son Flávio has vocally supported the bill, per a report from Portal do Bitcoin. 

Despite some chatter on social networks in recent months, this law is not focused on making bitcoin legal tender. Also, this cryptocurrency regulation does not include NFTs, according to a report from Brazil’s Senate news agency.

© 2022 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.

Earlier this week, the New York Assembly voted yes on a controversial bill that would place a two-year moratorium on certain types of crypto mining operations that use electricity generated by “carbon-based fuel.”

The debate over the bill has attracted a fair amount of attention from cryptocurrency advocates opposed to the policy. But in order for it to become law — at least during this legislative session — a version of it has to pass in the state Senate before the session ends on June 2.

At the moment, moving it through the Senate does not appear to be on the agenda. But that could still change. 

A “robust discussion” ahead

The Senate version is currently in the Environmental Conservation Committee, which is meeting next Tuesday. And according to the agenda posted online Thursday, the moratorium bill will not be heard. As of publication time, the committee has not scheduled any additional meetings before the end of the legislative session.

It’s still possible for the bill to make it to the floor if the Democratic majority leadership decides to move it. The open question now is whether or not there is enough support among New York State senators to put the bill to a vote before the session adjourns.

“That discussion among the conference of majority Senators has not yet taken place,” Democratic Senator Todd Kaminsky, the Chair of the Environmental Conservation Committee, told The Block. “And I expect there to be a real robust discussion.”

The bill has not been debated in committee or by the Senate majority, according to Kaminsky, so its future is largely unknown.

The bill specifically calls for a moratorium on new permits for proof-of-work mining operations that use behind-the-meter electricity generated by fossil fuel, allowing the state time to act on a comprehensive impact study. The Assembly passed it with a tally of 95 in favor and 52.

But it has been drawn criticism from cryptocurrency advocates who have cast it as an anti-crypto ban. Assemblywoman Anna Kelles — a democrat and the main sponsor of the bill — has repeatedly insisted that it was not a ban and would only apply to a select number of fossil-fuel power plants.

Other Assembly members were concerned that it would send the wrong signal to the financial services sector in New York and drive miners away from the state. An earlier version of the bill, which called for a three-year moratorium on a broader scope of mining facilities, died in the Assembly in June of last year.

Senator Kaminsky said he’s worried that even this scaled-back version could make New York look like “an anti-crypto state.”

“I think that it’s important that crypto as a nascent but powerful industry be nurtured in New York,” he said. “We want to find a way to get them to stay in New York and be green.”

Kaminsky argued that while there are “bad actors” in the industry, that only represents a “very small” amount of the state’s energy usage.

Parallel to the moratorium bill, there is another bill making its way through the legislature, sponsored by the same lawmakers, which calls only for a study on crypto mining with renewable energy. It is currently on the Senate’s floor calendar and in committee in the Assembly. 

“I think if there is a bill that could help green the industry without hurting the industry and driving it out of New York it would be something I’d be very interested in looking at,” Kaminsky said.

© 2022 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.

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As Congress weighed US rules for digital wallets on Thursday, lawmakers were particularly keen on the roles of data privacy and consumer protections. 

The hearing focused heavily on Representative Stephen Lynch’s (D-MA) new ECASH bill. Introduced at the end of March, the bill calls on the Treasury to put out digital hardware that offers a user experience that’s as much like cash as possible. In practice, this would mean full privacy, and woudl bar a ledger of any kind. 

Lynch presides over the Task Force on Financial Technology, a sub-group of the House Financial Services Committee that hosted the hearing. He considers it a good sign for the bill’s fate that the chair of the full committee, Representative Maxine Waters (D-CA), scheduled such a hearing so soon after its introduction. 

“It’s getting some interest from unexpected quarters,” Lynch said of the bill in an interview with The Block. “There’s something about the total surveillance aspect of everything else that just rubs me the wrong way, in terms of having to surrender your data for every transaction, or establishing an account.”

Even so, Warren Davidson (R-OH), the ranking member on the task force, said he was still studying the proposal and had not come out for or against. 

“A lot of the problem that they’re trying to solve on the Democratic side of the aisle is how do we get funds to the unbanked in a quick way,” Davidson told The Block. “I”m not sure that his idea makes it easier to do that, because you still have to get this piece of hardware to someone and if you can get this hardware to them why can’t you actually get the cash to them?”

Bill Foster (D-IL), who sits on the Financial Services Committee and may well be the only member of Congress who has actually written the code to a blockchain, was likewise non-committal on the proposal.

“I have to understand the technology that actually makes that work. Offline transactions are very tough,” Foster told The Block. “Trying to deal with the double-spend problem requires trusted hardware rather than trusted collaboration on the internet so it’s a very different set of security challenges. Things like that, I would guess, would work well for transactions of limited value.” 

Lynch noted that the current bill leaves technological specifics open to pilot programs with the Treasury. 

Alongside Lynch’s proposal, the hearing focused on a range of players offering payments, including Google, Apple, Paypal, Block, Zelle and digital asset wallets, with stablecoins receiving particular note. 

Raúl Carillo, a fellow at Yale who helped draft the ECASH Act, noted inadequate consumer protections for current digital payments, particularly the fact that digital wallets generally hold pass-through, rather than FDIC, insurance. He said in his testimony: 

“This is not a direct relationship between a consumer and a bank. It does not protect against a failure of the wallet provider or the coin issuer, it just protects against a bank failure. So it’s insufficient.”

The Treasury and many of the Biden admin’s financial regulators have been pushing to restrict stablecoin issuance to insured depository institutions since putting out a report in November. 

The hearing took place just hours after the House Financial Services Committee hosted testimony from the leader of the Financial Crimes Enforcement Network, the Treasury’s anti-money laundering wing. 

© 2022 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 floor price of Bored Ape Yacht Club (BAYC) NFTs hit a record high on Friday as its creator, Yuga Labs, prepares to drop a new collection for its metaverse project, dubbed Otherside.

One BAYC NFT now costs a minimum of 152 ETH (nearly $434,000) on the NFT marketplace OpenSea. That’s a new all-time high in both ETH and USD, according to The Block Research, citing data from Dune Analytics.

The BAYC NFTs were launched exactly a year ago for 0.08 ETH each (around $200). The current floor price means its early adopters are now sitting on gains of 216,900% in dollar terms.

Yuga Labs has been growing fast since it launched Bored Apes. The firm recently hit a valuation of $4 billion in a seed round worth $450 million.

The BAYC collection has seen total sales volume of nearly $2 billion to date, according to data from CryptoSlam. Yuga is also the creator of the Mutant Ape Yacht Club and Bored Ape Kennel Club NFT collections, which have seen sales volume of over $1.3 billion and $312 million respectively.

Yuga Labs also recently acquired two collections from Larva Labs: CryptoPunks and Meebits. These have seen a total combined sales volume of $2.7 billion to date.

Otherside, Yuga’s latest project, will debut on Saturday with a sale of Otherdeed NFTs at a flat minting price of 305 ApeCoin (currently worth around $6,660). It plans to sell a total of 55,000 Otherdeed NFTs to wallets that have passed know-you-customer checks. That will translate to $363 million for Yuga Labs if all the pieces sell out, which would be the highest gross for an NFT project to date.

Yuga Labs was created by a team of four pseudonymous people: Gargamel, Gordon Goner, Emperor Tomato Ketchup and No Sass. Earlier this year, Gargamel and Gordon Goner’s identities were revealed by BuzzFeed News as Greg Solano and Wylie Aronow. Yuga Labs later confirmed the identities — while Tomato Ketchup and No Sass revealed their names as Kerem and Zeshan. 

© 2022 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.

• Decentralized exchanges are a cornerstone of crypto markets and, in many ways, the cutting edge of disintermediated finance. 
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Binance announced on Thursday that it has closed several accounts associated with relatives of Russian officials since the beginning of the war with Ukraine, following last week’s announcement that the exchange was limiting services in the country.

Russian Foreign Minister Sergei Lavrov’s stepdaughter and the daughter of President Vladimir Putin’s spokesman, Dmitry Peskov, have both had their accounts blocked since Russia invaded Ukraine in February, Binance’s head of sanctions told Bloomberg. 

Binance also revealed that the son of Konstantin Malofeev, a Russian oligarch who was indicted by the US Department of Justice for violating US sanctions, has also been blocked as the exchange continues to search for users with links to sanctioned individuals. 

Russia’s invasion of Ukraine brought with it a raft of financial sanctions aimed at limiting the country’s ability to continue its war. Although the sanctions have, so far, failed to discourage President Putin. 

Mykhailo Fedorov, Ukraine’s minister of digital transformation, welcomed the news in a tweet on Friday, saying “everyone connected with Putin’s regime will feel the consequences of war.”

The first accounts were blocked on March 3, while Malofeev’s son had his account closed this week after he was added to the US Treasury’s Russia-related designations on April 20, according to Bloomberg’s report.

None of the affected individuals responded to requests for comment, according to Bloomberg. 

Political leaders in Europe and the U.S. have focused their attention on cryptocurrencies several times since the war began, fearing that Russia might use crypto to sidestep sanctions.

Until recently most major exchanges maintained that crypto was a terrible means of avoiding sanctions. Binance CEO Changpeng Zhao told CNN this month that crypto was too traceable and that governments were improving how they track crypto transactions.

However, last week Binance revealed in a blog post that it was enforcing tougher Know Your Customer (KYC) checks for Russian users due to the latest European Union’s fifth package of anti-Russia sanctions.

Specifically it was aimed at “Russian nationals or natural persons residing in Russia, or legal entities established in Russia” with crypto holdings exceeding €10,000 (just under $11,000). These restrictions won’t apply to Russian’s living outside of the country, who can verify their address, and those within the country who hold less than €10,000.

© 2022 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.