Stolen ETH is on the move

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Watching Stolen 5,505 ETH Move

If you’ve watched Ocean’s 11, initially you’re not quite sure how the money moves out of Terry Benedict’s vault. It’s a series of misdirections and in the middle of that, the money disappears. Except when there’s this big reveal and then they tell us. 

We’re watching a version of that happen right now. Sure, it’s not Brad Pitt carrying ~5,500 ETH in a black duffel bag with SWAT written on it. But 5,505 stolen ETHs from the Ronin Bridge and Axie Infinity hack are on the move. And the world can see it happen. 

What hack?

Ronin Bridge is an Ethereum-backed network that powers the NFT video game Axie Infinity. A hacker was watching the play-to-earn game’s rising popularity and decided to make money. Here’s what happened:

• On March 29, someone crept into the bridge connecting Ronin to the Ethereum blockchain.

• Within minutes, this attacker drained 173,600 Ether worth $625 million.

• Ronin runs the Axie backend, so users got swindled.

• Hackers started transferring funds to masked blockchains to encash them.

• Axie’s parent Sky Mavis raised $150 million a week later to repay gamers.

Soon after, the FBI blamed North Korea’s Lazarus Group for the hack. By the last week of April, about $5.8 million worth of crypto assets were recovered by Binance. This happened when hackers transferred a portion of the bounty to this exchange.  

They are getting away with it

Hackers seem to be moving quickly to avoid detection. 

1. In the first week of April itself, close to 21,000 Ethers were moved through Tornado Cash.

2. The illegal funds were cashed immediately since Tornado’s privacy rules mask all addresses.

3. On May 18, there was a major transfer again.

4. The destination wallet just had 3.4 Ether, meaning that the rest was quickly withdrawn. 

China’s Crypto Love 

There is a ban. But people can’t get enough of it. Just like Indians and TikTok, China’s infatuation with mining doesn’t abate. Data by Cambridge Digital Assets showed ‌that Chinese miners account for over 1/5th of the total global network hashrate. 

What about the ban?

Well, it was partially successful. China’s hashrate dipped to 0 in July 2021, for the first time. But this was short-lived since the Bitcoin hashrate swelled up to 22.3% the very next month. And since then, this rate has not inched below 18%. Currently, with a 21% global hashrate share, China is next only to the US in terms of BTC hashrate. The US still dominates the mining scene with 38%. 

What’s hashrate?

Hashrate is a measure of a blockchain’s total computing and mining capacity. Basically, crypto mining involves correctly solving complex mathematical problems to achieve the next block of bitcoins. Every hash represents a guess at solving this problem. 

Terra’s Zooming Mess

There seems to be no end in sight for Terra’s woes. Over the last few weeks, it has lost $40 billion worth of value. Nearly 90% of initial voters have rejected founder Do Kwon's hard-fork solution to salvage the blockchain. Now his employees seem to be losing hope too. 

Now what?

Terra’s internal legal team, including the chief corporate and regulatory counsel, has quit. Although reasons remain unclear, it's not hard to connect the dots. Terra is trying to play it down by claiming that most team members are “committed to the project’s mission”. Ignoring naysayers, Terra is firm on its forking plans. Let’s see whether they take the internet feedback seriously. 

Closing in

Terra needs all the forces it can marshall. Billionaire investor Bill Ackman has likened Terra to pyramid schemes. 

Meanwhile, South Korea is circling in on local crypto exchanges under an ‘emergency’ inspection. There are about 200,000 South Koreans who have invested money in TerraUSD and LUNA. 

Web3 FOMO Hits  

Robinhood wants what MetaMask and Coinbase have. The trading platform is launching a Web3 crypto wallet to catch up with its rivals. Users can lend, stake, and even buy NFTs using this separate wallet by the end of 2022. 

Just to recap, Coinbase expanded its Web3 offerings on May 17, allowing users to access decentralised apps on the Ethereum network. 

What’s the HOOD difference?

• Distinct from a trading account, the Web3 wallet will be used for all crypto transactions.

• Users can transact in DeFi without leaving their wallets.

• Users can buy and store NFTs.

• Assets in the Web3 wallet will help earn yields.

There’s more

And while we’re on Web3, the hardware crypto-wallet company Ledger is also adding its extension on Safari. It’ll let users easily connect their wallets to any Web3 application. 

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