Cryptocurrency Hacks and Industry Developments

This week, CoinEX and investor Mark Cuban counted losses as hacks continue. Despite these setbacks, Deutsche Bank, PayPal, and Franklin have stepped into the cryptocurrency spotlight.

A large number of hacks

Just like in previous weeks, cryptocurrency-related hacks dominated the scene this week. Vitalik Buterin, co-founder of Ethereum, faced a cybersecurity breach in his X account.

Unfortunately, this hack resulted in significant financial losses, totaling $691,000 for unsuspecting users who fell victim to a phishing scam spread by hackers using Buterin’s account.

Shortly after the attack on Buterin The attack occurred on September 14 and involved the movement of tokens such as USDT and USDC across three chains.

Furthermore, hackers exploited a flaw in the GALA contract after a recent upgrade of the project which led to the creation of another GALA token. These bad actors started spamming old GALA code in deposits to several exchanges to exploit fake balance top-up vulnerabilities.

CoinEX suffers from multi-million dollar exploit

Hong Kong-based cryptocurrency exchange CoinEx also faced a security breach on September 12. Reports indicate losses amounting to $27.8 million in various cryptocurrency assets from its Ethereum hot wallet.

As the accident continued, subsequent reports revealed that losses amounted to up to $54 million.

The notorious Lazarus Group, a hacking organization with suspected ties to the North Korean government, has come under scrutiny again in connection with the CoinEX hack.

Reports from blockchain platform SlowMist and on-chain investigator ZachXBT have pointed the finger at Lazarus as the possible culprits of the recent attack on cryptocurrency exchange CoinEx.

It is worth noting that the same wallets involved in the CoinEx hack are believed to be involved in the theft of a large sum of $41 million from Stake.com, a cryptocurrency-based sports betting platform.

The FBI had previously attributed the Stake.com attack to Lazarus. Interestingly, on-chain data further supports this suspicion by linking a network of addresses to the CoinEx and Stake.com thefts.

On September 15, CoinEx adopted a unique refund strategy. They reached out to the hackers in an open letter on X, inviting them to discuss a potential solution. CoinEx even offered a reward for the return of the stolen assets, along with contact information and instructions to contact their team.

Lazarus Group scams

Interestingly, investigations conducted this week have raised a worrying connection between North Korea’s Lazarus Group and a series of cryptocurrency hacks.

These cyberattacks, which occurred over the course of just 102 days, led to the staggering theft of more than $270 million in digital assets from major cryptocurrency platforms.

This revelation was made possible by a comprehensive list of the latest and greatest cryptocurrency-related breaches, carefully compiled by MetaMask’s Lead Product Manager, Taylor Mohanna, with valuable contributions from well-known on-chain investigator, ZachXBT.

Furthermore, on September 12, before the CoinEX attack, blockchain security firm SlowMist revealed that the Lazarus Group may have set its sights on the cryptocurrency sector.

SlowMist’s findings have revealed the alarming fact that a hacking group is using Advanced Persistent Threat (APT) attacks to infiltrate platforms in the cryptocurrency scene.

Mark Cuban loses $870,000 in MetaMask hack

On-chain investigator Wazz revealed on September 16 that one of billionaire Mark Cuban’s cryptocurrency wallets was exhibiting strange behavior amid multiple outflows in minutes.

Cuban substantiated these claims in a statement to DL News, stating that the exploit may have been caused by a fake MetaMask wallet he downloaded. The investor was able to save $2 million worth of assets by transferring them from the wallet before the hackers could take them.

PayPal and Sony dive deeper into web3

Amid these challenges associated with the hack, accreditation continued until this week. Payments giant PayPal has delved into the cryptocurrency scene by offering a comprehensive on-and-off feature.

This feature essentially gave PayPal merchants the opportunity to offer access to web3 payments to their customers using PayPal services. This development marks PayPal’s latest foray into the cryptocurrency scene.

On September 12, Sony and Startale Labs revealed plans to partner to pioneer a blockchain project that could revolutionize the web3 landscape. Under the name “Sony Network Communications Labs Pte. Ltd.” This project aims to redefine the future of digital infrastructure.

Deutsche Bank and Franklin are showing interest

PayPal and Sony weren’t the only giants looking to cash in on blockchain offerings this week. Deutsche Bank, a global financial institution based in Germany, entered the cryptocurrency and blockchain space on September 14 in collaboration with Swiss company Taurus.

In this partnership, Deutsche Bank’s primary focus is on providing custodial services for specific cryptocurrencies and stablecoins, with a particular focus on serving institutional clients within their local regions.

Additionally, Franklin Templeton, a large asset management firm overseeing $1.5 trillion in assets, has taken an important step by formally applying for regulatory approval to introduce a Bitcoin exchange-traded fund (ETF) in the United States.

Their strategy entails the Franklin Bitcoin ETF debuting on the Cboe BZX exchange, aligning with Coinbase as the custodian of the fund. In addition, they appointed the Bank of New York Mellon to protect the financial capital of the investment vehicle. Franklin joins a slew of financial giants looking to launch similar products.

BinanceUS problems

Binance US has significantly reduced its headcount, laying off 100 employees, representing a reduction of a third of its workforce. This restructuring followed the departure of CEO Brian Schroeder.

According to Bloomberg News, Chief Legal Officer Norman Reid will serve as interim CEO during this transition period.

BinanceUS attributed the layoffs to regulatory hurdles imposed by the Securities and Exchange Commission, which affected its operations and hampered its innovative efforts. Its parent company, Binance, has filed a joint request with the Securities and Exchange Commission to seal confidential information in the ongoing lawsuit.

Interestingly, the US Securities and Exchange Commission came out on September 15 to claim that BinanceUS had not complied with an investigation into its operations.

The regulatory agency claimed that the exchange was making use of a custody service called Ceffu facilitated by its parent company. According to the SEC, the move violates the previous agreement to prevent the movement of assets outside the United States

Just days after reports of Schroeder’s departure, BinanceUS has lost two more high-profile employees. The company’s chief legal officer, Krishna Govade, and chief risk officer, Magalia Sidney, were the last to leave.