In the crypto world there is always something happening, be it an attack, a partnership or a new product launch. Today we will be focusing on some of the most notable crypto news and events that transpired this week.
Crypto News of the Week:
Attack Prompts IOTA to Disable Trinity
One of the most talked-about crypto news of this week was the IOTA hack. IOTA has been forced to shut down its entire network for a brief amount of time due to an orchestrated cyberattack that led to the loss of $891 million from their users’ wallets.
The IOTA Foundation posted Thursday on Twitter that they “paused” the Coordinator, which is a validator node for all the transactions of the IOTA network. By halting the node’s functionality, this means that no one can transact with IOTA at the moment.
Currently, #IOTA is working with law enforcement and cybersecurity experts to investigate a coordinated attack, resulting in stolen funds. To protect users, we have paused the Coordinator and advise users not to open Trinity until further notice. Updates: https://t.co/ME3Cvki3k9
— IOTA (@iotatoken) February 13, 2020
IOTA cited that the network’s activities were halted in order to protect its users and that they are collaborating with law enforcement to find the source of the hack.
The project had planned this year to go through “Coordicide,” which involves removing Coordinator and to make IOTA a more “permissionless” and decentralized system.
“Unsurprisingly, it never happened,” stated a partner at Castle Island Ventures, Nic Carter. Carter also tweeted that IOTA’s hasty cessation was not that uncharacteristic.
“A solid chunk of long-tail [altcoins] can be quite simply ‘turned off’ at the sole discretion of the administrators,” he stated. “It’s always fun when they let the veil slip.”
“Despite claims to the contrary, IOTA has never been meaningfully decentralized. As long as there exists a foundation stewarding the network and a coordinator ensuring transactional convergence, it will effectively be centrally controlled.” – was Carter’s response in the interview.
The attack was first reported on the project’s official site on February 12th, announcing a few hours later that thy intend to shutdown Coordinator to “make sure no further theft can occur until we find out the root cause of these thefts.”
Trinity wallets users were cautioned to keep their accounts closed until the problem is resolved. the foundation named at least 10 of the victims that lost their funds in the hack.
The IOTA website states: “We are still evaluating multiple possible root causes, including an exploit of a previous Trinity version with all its dependencies.”
Their newest post on February 14th indicated that the security issue stemmed from a problem with the Trinity, the official wallet of the Foundation. “The team is investigating every single dependency (and their dependencies) of Trinity.”
Additional external cyber security experts have joined the investigation with multiple security teams working on the incident analysis. The investigation has yielded absolutely no indication that there has been a core protocol breach of any kind. Rather, all evidence so far points to a problem with a dependency of the Trinity wallet.
The attack pattern analysis showed that the halt of the coordinator interrupted the attacker’s attempts to liquidate funds on exchanges. The stolen funds have been purposely and repeatedly merged and split to obfuscate the investigation, and with the current token exchange rate as well as exchanges’ KYC limits in mind. We received additional feedback from more exchanges (not all yet), confirming that none of the identified transactions has been received or liquidated. Our current assumption is that the perpetrator targeted high value accounts first, before moving on to smaller accounts and then being interrupted early by the halt of the coordinator. (Again: Hardware wallet users are not affected.)”
IOTA has seemingly identified the stolen funds and channeling their efforts towards stopping the criminals from withdrawing the crypto on exchanges.
Binance Adds VET/USDT Perpetual Futures Contract
Binance has revealed on February 13, 2020, that it will be making a new addition to its Futures platform with the VeChain (VET)/Tether (USDT) perpetual contract. The contract features 1-50x leverage, according to the blog post.
The VET/USDT perpetual contract on Binance Futures will be launched on February 14, 2020.
“The perpetual contracts on Binance Futures are similar to the trading pairs on the spot market. They are priced and settled in the same manner. “– explained Binance on their website.
VET is the native crypto of the VeChain blockchain, currently ranking 30th among the cryptos with the highest market cap.
Additional Crypto News: Binance Order Lags
In other Binance crypto news, the platform’s order books have reportedly been experiencing some major glitches which caused many traders to lose money on their orders.
The most significant losses were sustained by the CHZ/BTC pair, as the coin attracted a wave of new investors due to the newly announced FC Barcelona- Chiliz partnership.
It was reported that dozens of traders experienced delays on the order books, with orders being blocked for hours.
The exchange responded on Twitter to the matter several hours after the complaints were made, assuring that all the user funds were still secure.
There is a slight delay in the order book display across some trading pairs. Team are working on it. Funds are #SAFU.
— CZ Binance 🔶🔶🔶 (@cz_binance) February 13, 2020
As the order book lag has caused losses for many traders on different pairs, those that traded on the CHZ/BTC seemed to be the ones that took the brunt of the glitch.
The FC Barcelona Spanish football club announced its collaboration with the Chiliz blockchain platform to facilitate a more streamlined interaction with its fans form all around the world.
The club intends on issuing in Q2 2020 its own cryptocurrency called the Barça Fan Token (BAR). Fans and traders alike will be able to buy the coin only with Chiliz (CHZ) on its native exchange platform Socios.com.
After FC Barcelona the partnership with Chiliz made headlines on crypto news sites, the coin surged a 64 percent surge in the subsequent 24 hours.
Coinbase Adds Margin Trading
The trading platform branch of popular exchange Coinbase, Coinbase Pro, has made the crypto news by publicly announced that it will be offering 3x margin trading for a select user base.
“Our leverage multiple is based on market analysis,” stated a Coinbase spokesperson when asked by Cointelegraph. “We are rolling this out in a way that we feel is responsible to our customers while offering them an adequate amount of leverage to trade on.”
Per the company’s blog announcement, active users of the platform from 23 states will be able to make leveraged trades on Coinbase Pro.
“We will monitor the market and customer usage and plan to evaluate the feature on an ongoing bases,” said the spokesperson with regards to the company’s future plans.
The 3x margin for Bitcoin, Litecoin, and Ethereum was initially made available by Coinbase Pro back in 2017, but the platform removed the feature after Ethereum experienced a flash crash on 2017. At that time, ETH suddenly dropped from $317 to $0.10 in a blink of an eye.
The Coinbase spokesperson explained why they removed the margin feature the first time:
“Several years ago, we had a different margin offering that we ultimately decided to sunset because it wasn’t the right experience. Since then, we’ve thought through the experience from first principles and built what we believe to be an exceptional user experience that’s robust enough to scale to the largest institutional users while simultaneously offering an great experience to retail users.”
Featured image: PYMNTS.com