FBI Prevents Ransomware Attack At Tesla’s Gigafactory; Hacker Sought $4M Bitcoin Payment

US-based electric carmaker Tesla working closely with the Federal Bureau of Investigations (FBI) has thwarted a planned ransomware attack that involved millions worth of Bitcoin payments.

According to a complaint that was filed by the FBI, the attackers were targeting Tesla’s Gigafactory situated in Nevada.

The FBI revealed that it arrested a 27-year-old Russian. Pavel Kriuchkov, who was residing in Los Angeles. he had lived almost a month in the United States looking to rope in as a Tesla employee for what he called a ‘special project.’

The FBI’s claim states that the ‘special project’ involved a lucrative incentive of a bribe amounting to $500,000, which was later upgraded to $1 million. An advance bribe was to be paid into the employee’s Bitcoin wallet that was installed via a Tor browser to avoid detection.

The Tesla employee was to help in the installation of malware into Tesla’s servers that were to be carried out in two stages consisting of a distributed denial-of-service attack as well as stealing of sensitive company data.

The attack was to involve holding Tesla to a ransom with threats of making vital private data and information public. The FBI states that Kriuchkov was eyeing a $4 million ransom from Tesla.

However, the Tesla employee who remains anonymous alerted the company’s management following the first meeting with Kriuchkov. It is at this juncture that Tesla informed the FBI about the hacking plot.

The FBI then went ahead to surveil a number of meetings in August between Kriuchov and the anonymous employees. This allowed the FBI to collect vital intelligence in regards to the hacking plot against Tesla and other related cyberattacks by Kriuchov and his accomplices.

The conspirator was planning to deposit a $1 million to the Russian-speaking anonymous Tesla employee’s Bitcoin account. Kruichov revealed to the staffer that the money would be deposited in a few days but was to leave the country on August 22. However, the hacker was arrested by the FBI on August 22.

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Author: Joseph Kibe

Compound Backers Decreasing the Number of COMP Tokens Issued to Users After Price Explosion

COMP, the governance token of the lending platform Compound exploded in value after the US-based cryptocurrency exchange, Coinbase, listed it. In less than two weeks, the token went live on both the Coinbase retail and Pro platform and is now available on the firm’s Android and iOS apps.

This explosion was one of the fastest Coinbase listings ever since the launch of a digital asset.

Compound was actually the first-ever investment by Coinbase’s venture fund which was part of the $8.2 million seed round led by VC Andreessen Horowitz, crypto hedge fund Polychain Capital and Bain Capital Ventures.

COMP prices dropped 35% this week only to get a jump after the Coinbase listing and Binance’s announcement of opening trading for COMP/BTC, COMP/BNB, COMP/BUSD, and COMP/USDT.

COMP was launched on June 15 with an initial price of $80 that made an all-time high of $375 last weekend, which even Compound team didn’t expect, and is currently trading around $250.

For now, the token has formed a local top as crypto data tracker Santiment noted, “As is our golden rule, when an asset like COMP enters the top 3 on the @santimentfeed emerging trends list, it is generally indicative of an upcoming local top forming.”

The Long & Short of it

The governance token is awarded freely to both borrowers and lenders to incentivize people to use the Etereum-based platform. This led traders to borrow against themselves to receive free tokens.

In order to increase the prices further, traders were also buying COMP tokens from spot markets along with perpetual swaps, futures with no expiry on crypto derivatives exchange FTX.

“Because of the relatively large size of the COMP Perpetual Swap market, it would be profitable to buy the Perp and then buy spot in significant enough size to move the price, amplifying gains in the Perp and squeezing the shorts,” said Tony Sheng from Multicoin Capital. COMP price dropped the same day.

The Proposal

COM’s success saw its supplied assets growing from ~140M to ~870M and borrowed assets from ~30M to ~320M. And just a few days after the launch, a governance proposal 010 was created, succeeded, and is ready to be executed.

The proposal is to “change the reserve factor of BAT, ZRX, REP from 10% to 50%, and correct the COMP Distribution speed to 2,880 COMP/block as intended,” down from the current 3,297~ / day distributed COMP.

As per the proposal, the network encountered two problems; users concentrating extreme liquidation risk into the BAT (and ZRX) market, “placing the protocol in jeopardy” and the majority of existing users, who are using it “honestly”, are receiving little to no COMP Distribution.

Compound founder Robert Leshner proposed several solutions to the problems, including increasing the Reserve Factor on each asset, making interest rate models across all assets more uniform, and reducing the COMP speed.

He also proposed updating the distribution formula to “totalBorrows * USD Value” from “totalBorrows * borrowingRatePerBlock * USD Value.”

The proposal has been approved with 1,198,438 COMP votes, while 189,177 COMP was not in favor. But those in favor have been the ones that put their money into the project.

Given that, the team and investors of the project hold about 46% of the total tokens compared to mere ~0.03% of tokens issued every day; it was to be expected.

But now the question is, how decentralized is this DeFi (Decentralized Finance) project?

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Author: AnTy

Coinbase Pro Adds Support For DeFi Project Compound’s Governance Token, COMP

Major US-based crypto exchange Coinbase Pro has stated it is now supporting COMP which is the token that is powering Compound, the decentralized lending protocol.

In a press statement released on Thursday, Coinbase clarified that trading for the COMP token will kick off on June 23 but will depend on whether the set liquidity standards are met. Also, users will be allowed to deposit COMP on June 22.

According to Coinbase, after enough supply of COMP has been attained within the platform, COMP-USD, as well as COMP-BTC order books, will commence in phases, starting with post-only mode then going on to full trading when the requisite metrics are met.

The compound is Ethereum-based decentralized finance (DeFi) platform that enables its users to borrow tokens as well as deposit them to earn or pay interest. COMP is the token which governs the Compound platform.

Currently, Compound is ranked as the second most commonly used DeFi protocol, and $276 million worth of crypto is at the moment being used within the protocol.

COMP token was launched on June 15 and has so far amassed about $1.1 billion in market cap which essentially makes it the most valuable DeFi token within a week after introduction.

Coinbase clarified that the token is not yet available in its main consumer platform. However, most of the tokens are launched in Coinbase’s consumer platform after being introduced on Coinbase Pro.

Coinbase also revealed that it holds an unspecified amount of COMP tokens after investing in Compound back in 2018. The exchange also clarified it has no intention of dumping its stash of tokens soon.

Coinbase stated that the listing of COMP tokens on its Pro platform was in line with its commitment to provide a wide array of assets for trading within its platform. The exchange also stated that plans are underway to support other assets that will meet its listing process.

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Author: Joseph Kibe

Capital One Patents An AI-Based System To Enhance Crypto Trading Security

US-based banking group, Capital One Services, announced that it has patented a new system that utilizes artificial intelligence (AI) that will ensure crypto trading and other related activities are more secure.

The firm announced that the new system would leverage the power of AI technology in checking the credibility of crypto-related transactions and information. By leveraging Artificial Intelligence, Capital One hopes to prevent traders from falling into common investment pitfalls, while helping them participate in more well-informed, long-term cryptocurrency trading.

The filed documents explain that people face lots of challenges and obstacles when dealing with cryptos.

The firm states that given the crypto market operates 24/7, it is prudent for investors and traders to understand and be updated on the intricacies and nuance of various protocols. In addition, be updated on different ongoings such as hacks, forks, or airdrops, which emanate from multiple sources like crypto news sites, Twitter, and Medium posts. Such content is not easy to verify.

“In particular, it is difficult to verify the credibility of speculation, rumors, opinions, and other information posted on social media and elsewhere,” the patent titled, “System And Method For Mapping Decentralized Identifiers To Real-World Entities” reads. Capital One’s AI-based verification system was awarded the patent last week by the U.S. Patent and Trademark Office.

According to Capital One, the system can be nuanced and sophisticated in the interpretation of information. This will allow it to detect fake volumes, analyze the speed at which news like exchange hacking starts trending in various social media platforms as well as news sites.

The patent itself, labeled as no.10,679,229, is comprised of three core components:

  1. A specific AI program that keeps an eye on very specific pieces of information, such as social media posts.
  2. Once this information has been obtained, it is then fed into a ‘credibility analysis machine.’ This second component cross-references this information with other historical pieces of information or events to test its credibility.
  3. It then compiles this legitimate information and leverages it to conduct and inform its trading decisions. It then analyzes how the market responded to such an event previously.

Capital One has been upfront about the difficulty involved in finding legitimate information within the crypto market. The firm hopes that its solution can help inform trader activity.

However, the system will not be launched immediately, as further refinement is still needed. The way it is set up, however, would allow it to see a progressive improvement in its performance, especially as it processes more data, and learns from past trends.

This is understandable as the filing of a patent does not necessarily mean that a product or service is going to be launched. This, however, isn’t the only crypto-related patent that Capital One holds, as just last year they secured two other patents: Blockchain-Backed Content Validator and one for Blockchain-based Banking Security and User Authentication.

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Author: Joseph Kibe

Over 22,000 BTC Flows Out of Coinbase; Users Retaliating to Exchange’s Deal with the Govt.?

Earlier this week, a massive outflow of funds was registered on US-based cryptocurrency exchange Coinbase.

The exchange saw a negative flow of 22,137 BTC, worth more than $214 million on Monday.

Source: Glassnode

WhaleAlert reported the transfer of 1,975 BTC from Coinbase to an unknown wallet on June 9th. On June 6th three separate transactions were made to unknown wallets of 6,000 BTC, 2,000 BTC, and 1,859 BTC.

Such massive outflow of bitcoin funds came after it became public knowledge that Coinbase would allow the IRS and DEA to use their blockchain surveillance software Coinbase Analytics.

A Delete/Stop Using Coinbase poll conducted on Twitter by trader Josh Rager revealed that 66% of the 5000 respondents are willing to delete to stop using their Coinbase account while only 33% are interested in continuing to use the platform.

But these massive outflows could be just in-house movements as Rafael Schultze-Kraft of Glassnode, a crypto data firm points out, “it’s very well possible Coinbase is creating new cold wallets and aiming at reshuffling their funds.”

Coin Metrics co-founder Jacob Franek agrees with this as the destination address looks like an exchange address or mixer and it’s “always possible that a large withdrawal is a cold wallet transfer to a new address (not always easy to verify) unless a single whale withdrew >$22m+. Unlikely that it represents lots of little withdrawals.”

Interestingly, Coinbase is the largest bitcoin holder with 984,300 BTC in its wallets. Coinbase leads with a big margin as it is followed by Huobi (413,000) which doesn’t hold even half of the funds held by Coinbase. The list further moves down to Binance (318k BTC), OKEx (268k BTC), and BitMEX (217k BTC).

But the latest disaster has #DeleteCoinbase trending on Twitter yet again while the exchange maintains that they are not selling personal data of its clients.

“Data in our Analytics tool is fully sourced from publicly available data, and does not include any personally identifiable information,” said John Mart, a Coinbase executive.

Competitor exchange Kraken’s co-founder and CEO Jesse Powell countered if it isn’t augmented by any other information provided by clients.

“It is fully-sourced from public data, so yes, any other company can arrive at the exact same product with publicly available data,” said Mart.

Coinbase’s deal with the IRS and DEA is just the latest piece of information causing a public uproar as people are already fed up with the exchange’s constant service outages during times of bitcoin volatility.

Previously, the exchange was criticized for its Neutrino acquisition, privacy violations, and suspending Wikileaks’ bitcoin account.

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Author: AnTy

Black Swan Author and Bitcoin Supporter Nassim Nicholas Taleb Closes his Coinbase Account

  • Coinbase users are getting fed up with it and the exchange continues to irk its users by refusing to do better.
  • The US-based cryptocurrency exchange already has been struggling with connective tissues during a period of volatility in the bitcoin market.

In 2020, so far, Coinbase has gone offline several times, the most recent one was the first day of June.

“It’s 2020 and coinbase still goes offline with a 5% Bitcoin move. Meanwhile, they’re the ones holding almost 1 million BTC,” said WhalePanda.

Besides these network issues, Coinbase isn’t helping out its customers either.

Coinbase users calling out the company’s lack of support isn’t anything new but this time, it ended up costing them big.

Nassim Nicholas Taleb, the author of 2007’s “The Black Swan: The Impact of the Highly Improbable” and “Fooled By Randomness” took to Twitter on June 5 to share his displeasure with the exchange.

“@Coinbase What is going on with you? Why don’t you respond to errors?,” called out Taleb adding “Even their account closing page is messed up. Does not respond.”

This initiated a response from the exchange that apologized for the delay and said they’ll be following up “shortly” to his support case.

Coinbase was quick to respond but it was already too late for Talib who replied with, “Too late. Closing account.”

In a separate tweet, Taleb shared that he has been a Coinbase customer for a few months now.

With Coinbase out, other cryptocurrency exchanges took this opportunity to shill their exchanges with Kraken co-founder and CEO Jesse Powell asking Taleb to check out Kraken and “contact me directly if you have any problems.”

Taleb might have quit Coinbase but he isn’t quitting crypto and has been a staunch supporter of them for some time now.

Recently, he advised to “use cryptocurrencies,” after a user posted that the central bank of Lebanon is confiscating all the foreign currency remittances and forcing the money counters to pay their value in their local currency Lira.

Back in 2018, he had said “bitcoin is an excellent idea,” because “it fulfills the needs of the complex system,” and has no owner and no authority and even has a huge advantage over gold in transactions.

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Author: AnTy

Maker (MKR) is the Latest Crypto Pumping on Coinbase Pro Listing Announcement

Last week, OmiseGo (OMG) saw the “Coinbase Effect” after the US-based cryptocurrency exchange announced its listing. Following the support, they even airdropped OMG to users who didn’t receive the tokens in 2017.

This week the latest cryptocurrency to enjoy this effect is Maker (MKR).

Today, Coinbase Pro announced the launch of Maker and the digital currency has already soared over 35% to $465. In 2020, so far, MKR has recorded negative returns of 7.42%.

Maker is supported on Coinbase Pro and starting Monday, June 8, it will start accepting inbound transfers of MKR. Trading will begin for MKR/USD and MKR/BTC 9 AM Pacific Time (PT) the following day but only “if liquidity conditions are met.”

This isn’t the first time Coinbase has launched support for Maker. Back in April 2019, Coinbase Pro added support for MKR along with EOS (EOS) and Augur (REP) but “due to limited liquidity,” trading for the cryptocurrency couldn’t proceed.

The 26th largest cryptocurrency will now be once again available in all Coinbase supported jurisdictions except for New York.

The ERC20 token is a utility and governance token of the Maker system that manages another ERC20 token, the DAI stablecoins.

Back in June 2019, Coinbase also added DAI as the first stablecoin to its Earn Program which joined EOS, XLM, ZEC, BAT, and ZRX.

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Author: AnTy

FalconX Exchange Raises $17M to Enhance Trading Services For Its Growing Demand

FalconX, the US-based virtual assets trading startup that offers its customers best execution via data science, has announced that it has raised $17 million from different investors.

The firm stated that the funding round comprised Coinbase Ventures, Accel, Fenbushi Capital, Accomplice VC, Lightspeed Venture Partners, Flybridge Capital Partners as well as Avon Ventures.

According to a press release shared with Bitcoin EXchange Guide, the money will be utilized in rolling out fresh products, enhancing FalconX’s crypto trading services, as well as, enhancing its infrastructure in order to serve the expanding institutional clients in the market.

According to FalconX CEO, Raghu Yarlagadda, the firm’s technology is set to offer the right infrastructure that will define the future of digital assets.

According to the firm, in the last 10 months, it has processed over $7 billion in worldwide trading volume, which also translates to 600% quarterly growth rate which is fueled by tight spreads, removing spillage as well as hidden fees. The firm also attributes the exponential growth to high levels of enterprise-grade security.

The San Francisco, CA-based Exchange FalconX provides digital asset trading and has developed robust liquidity via various liquidity pools or exchanges as well as proprietary dark pools. Currently, the firm boasts more than 100 financial-based institutions ranging from crypto miners, hedge funds, payment gateways, and exchanges. The firm also revealed that it was seeking licenses in different jurisdictions in efforts to expand its footprint in the world.

FalconX was started in 2018 by Prabhahar Reddy as well as Raghu Yarlagadda. Before founding FalconX, Yarlagadda, an engineer and renowned entrepreneur, held various leadership positions including an executive role at Google. Yarlagadda played a vital role in scaling Chromebooks, helping to turn it into a multi-billion dollar venture. On the other hand, Reddy previously worked at Accel, a venture capital firm.

The FalconX team is made up of experienced individuals from Silicon Valley as well as Wall Street.

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Author: Joseph Kibe

Ripple Taking Legal Action Against YouTube for Aiding & Profiting from XRP-Giveaway Scams

US-based fintech startup Ripple is taking legal action against YouTube “to prompt an industry wide-behavior change and set the expectation of accountability.” As per the company’s announcement on Tuesday, Ripple is taking a step

“to protect customers around the world from dangerous online giveaway scams and false impersonations across YouTube, Twitter, and Facebook.”

Plaintiff Ripple and its CEO Brad Garlinghouse allege that both are suffering “irreparable” harm to their public image, brand, and reputation because of the Google subsidiary’s “deliberate and inexplicable failure to address a pervasive and injurious fraud occurring on its platform.”

Scams like “the XRP1 Giveaway” is a third party attack on XRP holders that are thriving because of YouTube’s “complacency and unwillingness to take seriously Ripple’s repeated demands for action.”

They further elaborated that these scams have been going on for a long time and being replicated many times and in one such instance resulting in the theft of $15,000 worth of XRP.

As per the 22-page long complaint, the scam is misappropriating the company and Garlinghouse’s image further leading to “profound uncertainty and confusion into the broader digital asset market.”

Despite repeatedly demanding that YouTube take action, the online video sharing platform has reacted inadequately but they “must do better” with the company touting its robust tools for self-regulating content.

“YouTube’s inaction undermines its public commitments,” reads the document adding that with its community Guidelines barring precisely the sort of content at issue in this case, they have ignored Ripple’s repeated demands for action.

In doing so, they aren’t only validating the scam as legitimate but profiting from them by aiding and abetting the scammers.

The company is now asking for restraining Defendant YouTube from refusing to apply its content regulation, ignoring and delaying its response to takedown notices, profiting from scams, verifying accounts perpetuating the scam, and awarding fraudulent channels verification badges.

Ripple and Garlinghouse are also seeking damages, reasonable costs including attorneys’ fees, pre- and post-judgment interest, and recovery in restitution equal to any unjust enrichment enjoyed by the Defendant.

Ripple has also hired external cybersecurity and digital threat intelligence vendor to help them with reporting and takedown of these giveaway scams.

Our Team here at BitcoinExchangeGuide have tried to do our part in warning investors, traders, and onlookers to be wary of these types of scams. Here are just a few of the posts we covered on the subject:

And you can bet there are many more that are being reported every day and plenty that are still duping investors that don’t take proper precautions.

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Author: AnTy

After the Supreme Court Lifts RBI Ban, Kraken Renews Plans To Enter Indian Market

The US-based cryptocurrency exchange Kraken kas plans to expand its Indian market operations on digital asset trading services.

The announcement was made public on Monday, right after the Supreme Court of India has ruled against the Reserve Bank of India’s (RBI) ban on banking services involving crypto businesses. Here’s what Sunny Ray, the head of global business development at Kraken, had to say about the events that happened in India as of late:

“This is an incredibly emotional moment for India. Satoshi created Bitcoin because he felt that central banks were inefficient. The fact that the crypto industry just battled, and won, against the central bank located in the second-most populous country in the world is a massive achievement. We fought for 1.5 billion people to have the right to access crypto.”

A Huge Market Opening Up for Kraken

Kraken was already operating in India by offering services such as digital assets spot, futures and derivatives trading. However, the authorities in the country being hostile towards the crypto market has limited the exchange’s development. Now that banking services have been reinstated, Kraken is ready to expand its offerings to traders all over India. Here’s what the exchange’s latest announcement reads exactly:

“Armed with the ability to expand our offering, Kraken is excited to recommit resources to grow its service in the region through new features and offerings.”

Plans Not Yet Disclosed

Kraken didn’t reveal yet its exact plans for the Indian market, which now has immense potential. Even if the Indian crypto trading has slowed down, Binance still decided to enter the country’s market by buying WazirX, one of the most popular local exchanges that used to offer peer-to-peer (P2P) services to fiat-based trading. With the RBI’s bank lifted, exchanges like WazirX have resumed their centralized spot trading fiat deposit services.

In the meantime, the RBI has plans to appeal the Supreme Court’s ruling on crypto, invoking the reason that the banking sector may be damaged if exposed to the crypto space.

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Author: Oana Ularu