DeFi platform, Wintermute loses $160m to hack + other crypto stories this week

There has been a relative quiet in the blockchain space this week. Players still haven’t recovered from the monumental ETH Merge of a week ago. Aside from that, the major news from the week is that Wintermute, a global algorithmic market maker in digital assets, has been hacked for $160 million.

There is also a bit of good news. The United Kingdom government has introduced new legislation that will give the government the greater power to “seize, freeze and recover crypto assets” used in crime.

And, we have a follow-up on our weekly update on The defunct Terra Labs. Founder, Do Kwon has come out to say that he is not “on the run” following an arrest warrant issued on him following reports that he is no longer in Singapore. 

Now, here is a bit of detail on these and many more stories from the crypto world this week. So, here we go:

Do Kwon says he is not on the run 

Do Kwon, the founder of Terraform Labs, the platform behind the collapsed Terra ecosystem, has denied allegations that he is on the run after a South Korean court issued a warrant of arrest against him. 

In a tweet on Sunday, Kwon alleged that he is ready to cooperate with any state agency interested in talking to him while maintaining that he has nothing to hide. 

“I am not “on the run” or anything similar – for any government agency that has shown interest to communicate, we are in full cooperation and we don’t have anything to hide,” Do Kwon said.

Kwon was adamant as he revealed his whereabouts online. But, he stated that he was in the process of working on defending himself in different jurisdictions. 

“We are in the process of defending ourselves in multiple jurisdictions – we have held ourselves to an extremely high bar of integrity, and look forward to clarifying the truth over the next few months” 

This is coming after a court in Seoul issued a warrant for Do Kwon and five additional persons, citing violations of the country’s Capital Markets Act.

But, can this Terra drama come to an end anytime soon? 

Binance announces Global Advisory Board 

Binance, the world’s largest cryptocurrency exchange by trading volume, has announced the creation of its new Global Advisory Board (GAB), composed of distinguished experts in public policy, finance, economics, and corporate governance. 

Recall that we reported that the purpose of the board is to advise Binance on some of the most complex regulatory, political, and social issues facing the entire cryptocurrency industry due to its rapid growth and evolution. 

The new board is composed of well-known 11 members which include two Africans, Leslie Maasdorp from South Africa and Ibukun Awosika from Nigeria. Others include Former U.S. Ambassador to the People’s Republic of China, Max Bacus (USA), Advisor of the Korea Presidential Committee, HyungRin Bang (Korea), Managing Partner, Cathay Capital, Bruno Bezard (France), Former Minister of the Economy, Brazil and Henrique de Campos Meirelles (Brazil).

Read also: Kenya, Nigeria drop out of the top 10 countries on 2022 global crypto adoption index

Others include the Honorary Board Member of The Aspen Institute Mexico, Adalberto Palma (Mexico), Non-Profit and Political strategist, David Plouffe (USA), Founder and Managing Director of acs plus, Christin Schäfer (Germany), Member of the House of Lords, Lord Vaizey (UK) and Chair, EUROFI, David Wright (Europe).

UK’s new bill will crack down on crypto crimes 

The United Kingdom lawmakers have introduced legislation titled the Economic Crime and Corporate Transparency bill, which is designed to empower authorities to crack down on crypto-related criminal activity.

According to an announcement by a government rep on Thursday, the new bill will allow law enforcement agencies like the National Crime Agency to “seize, freeze and recover crypto assets.”

The government said that cryptocurrency is increasingly being used to launder revenue from fraudulent activity, the drug trade, organized crime, and cybercrime. The Greater London’s Metropolitan Police Service reported “a big rise in cryptocurrency seizures last year.”

In the summer of 2021, police set two records by seizing cryptocurrency worth $158 million and $250 million just weeks apart.

In addition to targeting illegal crypto activity, the bill also targets illicit finance in general. It will require anyone registering a business to verify their identity and will curtail the abuse of limited partnerships. 

Wintermute loses $160 million to hack 

Wintermute, a global algorithmic market maker in digital assets, has been hacked for $160 million, the company’s founder and CEO Evgeny Gaevoy confirmed on Tuesday. 

In a tweet, Gaevoy said that the market maker had lost the nine-figure sum through its DeFi operations. He added that the firm remained solvent and said its centralised and over-the-counter services were not affected.

“We are solvent with over twice [the amount stolen] in equity left,” he wrote, assuring customers that their funds were safe. 

Gaevoy said that 90 different assets were stolen. Of those assets, two of the sums lost were worth between $1 million and $2.5 million. The takings from the remaining 88 were worth under $1 million each. 

Rounding out the announcement of the hack, Gaevoy said that the firm would be happy to treat the incident as a white hat attack and invited the perpetrator to come forward. 

Wintermute is one of crypto’s leading market makers. It adds liquidity to markets across both centralised and decentralised trading venues to improve efficiency. It also runs an over-the-counter service for high-net-worth individuals and institutional clients. 

The DeFi space is becoming increasingly unsafe as stories of hacks and exploits continue to inundate the space. 

Russia now bullish on crypto 

According to a report from the Russian news agency Kommersant on Thursday, the Bank of Russia and the Ministry of Finance have reached a consensus on the usage of cryptocurrencies for international payments.

Kommersant quoted Russia’s Deputy Finance Minister Alexey Moiseyev as saying that the government department and the central bank have agreed “on the whole” on a bill that would allow citizens to send money internationally using crypto.

Moiseyev noted that the proposed bill looks to give Russian residents access to digital wallets.

“It generally describes how to acquire cryptocurrency, what can be done with it, and how it can or cannot be settled with it in the first place in cross-border settlements.”

Great development considering how tumultuous Russia’s relationship with the crypto sector has always been.

That is all from us this week. See you next week!