FTX hacker has been busy moving funds, the United States government avoided a shutdown, the CFTC charged four people over a fraudulent crypto scheme and more.
FTX hacker moves total of $38M across several days
The crypto hacker accused of stealing hundreds of millions worth of crypto from bankrupt crypto exchange FTX has moved 22,500 Ether (ETH) worth $38 million over the last two days.
The hacker’s wallet, identified as 0x3e957E, moved around $8.6 million worth of Ether to a new address across two transactions on Sept. 30 — the first significant movement of funds in 10 months. A day later, another $17 million was moved across to five addresses on Sept. 30, with a significant portion transferred through THORChain’s router and the Railgun contract, according to Spot On Chain.
However, on Oct. 1, the hacker made another movement, transferring 7,500 ETH, worth $12.6 million, and bringing the total ETH moved over the weekend to $38 million, according to a blockchain analytics platform Lookonchain.
Lookonchain noted the FTX hacker now has 163,000 ETH, worth $275 million left from the exploit.
FTX Accounts Drainer transferred 7,500 $ETH($12.62M) out again 1 hour ago.
The FTX Accounts Drainer has transferred 22,500 $ETH($38M) out in the past 2 days and currently has 163,235 $ETH($275M) left.https://t.co/YMSdqrSTxZ pic.twitter.com/dL6K47zC3n
— Lookonchain (@lookonchain) October 1, 2023
The FTX hacker drained $477 million worth of assets (according to crypto prices at the time) out of multiple FTX global and FTX US exchange wallets within hours of the cryptocurrency exchange filing for Chapter 11 bankruptcy on Nov. 11.
On Nov. 21, the hacker split 180,000 ETH, worth $200 million at the time across 12 separate wallets.
The FTX hack made the exploiter the 27th largest ETH whale at the time of the exploit.
FTX Exploiter 0x3e9 has transferred out a total of 10,250 $ETH ($17.1M) via 5 addresses over the past 24 hours:
– sent 7,749 $ETH ($13M) to the Thorchain router and Railgun contract
– swapped 2,500 $ETH ($4.19M) to 153.4 $tBTC at $27,281 on avg
Notably, the address has been… https://t.co/xzmDz8Vmma pic.twitter.com/4Ykp0zih6G
— Spot On Chain (@spotonchain) October 1, 2023
The transfers come only a few days before former FTX CEO Sam Bankman-Fried’s fraud trial on Oct. 3, as well as the possible launch of the United States’ first Ethereum futures ETFs.
U.S. government avoids shutdown on the 11th hour
The United States narrowly avoided a feared government shutdown on Oct. 1, at least for now, after the Senate and House of Representatives agreed on a short-term funding deal.
U.S. President Joe Biden signed a 45-day bill minutes before the deadline, which will give the two chambers more time to finalize the funding legislation, according to an Oct. 1 report by CNN.
President Biden signs government funding bill into law pic.twitter.com/jDYwPocdKJ
— CNN (@CNN) October 1, 2023
The United States Securities and Exchange Commission was one of the agencies warning that a government shutdown would cause it to furlough over 90% of its staff and hinder its ability to perform market oversight.
Bloomberg analyst James Seyffart has previously premised that the then-looming government shutdown was accelerating Ethereum futures exchange-traded funds (ETFs) approval, adding they could launch as early as Oct. 2.
OKAY: This looks to be the full list of #Ethereum Futures ETFs that will be given SEC accelerated approval to launch on Monday. Assuming they are all operationally ready to go & assuming no last minute entrants. A potential 9 ETFs with ETH futures trading on Monday pic.twitter.com/eQF6MWL4kP
— James Seyffart (@JSeyff) September 29, 2023
“Our understanding is that the SEC is accelerating approvals for these things,” Seyffart explained on Sept. 29.
U.S. CFTC charges four people over Cryptobravos scheme
The United States Commodity Futures Trading Commission (CFTC) has charged four individuals and a company for involvement in a fraudulent cryptocurrency platform Cryptobravos.
According to the CFTC, the crypto scheme operated between January 2017 and October 2021, enticing customers to deposit Bitcoin and other funds, promising to generate risk-free returns for them.
@CFTC charged four individuals and a Seychelles company with operating a fraudulent digital assets trading scheme and misappropriation. Learn more: https://t.co/tiOt4YVIzg
— CFTC (@CFTC) September 29, 2023
However, according to the Sept. 29 complaint, the defendants did not trade Bitcoin (BTC) or other digital asset commodities and did not earn customer returns through trading.
Instead, Cryptobravos accepted customer funds, refused to return them and encouraged customers to withdraw funds from retirement accounts or take out loans to make additional deposits, according to the complaint.
“The majority of customers who deposited money with Cryptobravos did not have their funds returned,” said the CFTC.
The complaint charges four defendants in Israel, Italy, Germany and Ukraine, along with a Seychelles-based company Expected Value Plus Ltd with fraudulently soliciting and misappropriating tens of millions of dollars from hundreds of individuals.
The commodities regulator is seeking restitution, disgorgement, civil monetary penalties, permanent trading and registration bans, and a permanent injunction against further violations of the Commodity Exchange Act (CEA) and CFTC regulations against the four defendants.
CFTC’s Director of Enforcement Ian McGinley said the charges came on the back of strong international cooperation:
“The roster of agencies who assisted the Division of Enforcement’s investigation makes it clear to fraudsters in our markets that we will pursue them wherever they are located.”
Open Exchange token plummets following Su Zhu’s arrest
The Open Exchange token (OX) has fallen nearly 50% since the news broke that one of its creators, Su Zhu — the co-founder of Three Arrows Capital — was arrested by Singaporean authorities amid an attempt to flee the country.
OX fell 58.5% from $0.024 to $0.01 in a three-hour window on Sept. 29, and has since rebounded to around $0.012 at the time of writing, according to CoinGecko.
Zhu was arrested at Singapore Changi Airport while attempting to leave the country after a court granted a committal order in late September.
The committal order granted in Singapore sentenced Zhu to four months imprisonment for failing to comply with a court order.
Related: 3AC liquidators look to recoup $1.3B from founders
Open Exchange was launched on April 4, 2023, a cryptocurrency exchange and marketplace for investors who lost funds from recent crypto project collapses.
Leslie Lamb currently serves as CEO of Open Exchange. Zhu and Kyle Davies played a key role in launching the platform in April.
Su Zhu's arrest led to a 50% drop in $OX. After 3AC's $10B bankruptcy, founders Su Zhu & Kyle Davies started the Open Exchange, evading creditors. The Tie Terminal reported this just before markets reacted, underscoring the need for swift info in the dynamic crypto world. pic.twitter.com/EKaObOtJxb
— The Tie (@TheTieIO) September 29, 2023
Since the collapse of Three Arrows capital, co-founders Zhu and Davies had avoided being taken in, despite remaining active on social media. Authorities have not yet reported capturing Davies.
OX is now down 84.4% from its all-time high price of $0.081 on Aug. 9, according to CoinGecko.
Other news
The U.S. Department of Justice has confirmed its intention to summon former FTX clients, investors and staff as witnesses in the upcoming trial involving former FTX CEO Sam Bankman-Fried after submitting a letter of motion in limine on Sept. 30.
Ethereum co-founder Vitalik Buterin expressed concerns over decentralized autonomous organizations exerting a monopoly over the selection of node operators in liquidity staking pools, suggesting that it can expose the pool’s funds to potential risks from malicious actors.
Magazine: Huobi sues… Huobi? 3AC rises from ashes, Korea crypto contagion: Asia Express
