Cryptocurrency News: Building in Resiliency and International Co-Operation
As Bitcoin and Ethereum plummet to 6-month lows, the crypto market still sees great interest in both day traders and long term institutional investors. This month’s round up is as follows:
The Federal Reserved refused to commit or to scrap the idea of a Central Bank Digital Currency (CBDC), in their long-anticipated paper. Within the paper, the Federal Reserve commented on the need for extreme resiliency to cybersecurity threats on any proposed CBDC system. Among the benefits to adopting a CBDC listed is to both support the dollar’s international role, and improve cross border payments, however, to achieve the latter requires significant international co-operation.
Turning to cybersecurity news within cryptocurrencies this month, Crypto.com admitted that login issues that had plagued users turned out to be a $30 million dollar hack. Crypto.com confirmed that 4,836.26 ETH (around $15 million), 443.93 BTC (around $18 million) had been stolen from the exchange and run through a cryptocurrency tumbler, which is a mixing fund to mix ‘tainted’ funds with other funds, making the trail untraceable.
In response to the hack, Crypto.com announced a new “Worldwide Account Protection Programme” to cover user compromises up to the value of $250,000. This perhaps marks a new era of a personal user no longer losing all their funds if there were to be a backend compromise on the platform, and that the larger centralised exchanges are maturing to be able to cover costs of any compromise through the effective use of segregation and protocol validation on their hot wallets.
Various prominent cryptocurrency Youtubers were compromised on the 23 January, and the hacking group simultaneously posted multiple videos on all compromised accounts telling users to send their funds to the attackers BNB address. Thankfully, the videos were spotted reasonably quickly and at the time of writing the wallet only had around $850 within it.
According to Chainalysis, money laundering through cryptocurrencies rose by around 30% to $8.6bn in 2021. This is not surprising, as cryptocurrencies have seen huge amounts of interest by both legitimate and illegitimate investors throughout 2021. One interesting takeaway from the report was that scammers, still tend to send their stolen crypto to wallets on centralised exchanges. This highlights those exchanges must do more to accurately identify their customers (using processes such as KYC) and also apply techniques such as machine learning to spot anomalies within transactions.