M3TA Recap

Weekly Report: August 8 – August 14, 2022
Cryptos outperform expectations, Huobi Global up for grabs, and billions lost in crypto scams yet again. Read on for this week's market updates and latest headlines!


Clara Lee


15 Aug 2022


Crypto Hack
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Decentralized Exchange
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  1. Crypto Winter Sees Some Bulls Amidst Ethereum Merge News

CoinDesk – August 14, 2022 at 10:36pm EST; August 13, 2022 at 6:10pm EST

Only a month ago, it seemed Bitcoin ($BTC) was clinging to the $20K price cliff for dear life, leaving many investors afraid of a tumbling bear market. Now, in the middle of August, $BTC approached $25K on multiple occasions in the past week, signaling some steady but noticeable upward momentum for the leading crypto.

Over the past 24 hours, $BTC was trading roughly flat at around $24,400 and slightly lower than where it was on Friday, but it’s difficult to ignore its somewhat optimistic ascent in the past weeks, climbing toward the upper end of the $20K to $24K range. 

“$BTC’s resilience above $20,000 did see bulls pushing for more upside, especially after a successful retest of that range. However, we are yet to witness the breakout above $25,000, which could see $BTC moving quickly toward the $29,000-$30,000 range.” – Joe DiPasquale, CEO of BitBull Capital.

However, the star crypto this past week wasn’t $BTC but rather Ether ($ETH). Down about 1.6% over the past day and now trading at around $1,950, the second largest crypto by market cap has gained significantly over the past week, topping $2000 on both Friday and Saturday, compared to its low of $950 back in June.

Undoubtedly, $ETH’s surge arrives in tandem with anticipation of the Merge, which will move the Ethereum protocol from Proof-of-Work (PoW) to the more energy-efficient Proof-of-Stake (PoS) model. Last Wednesday, Ethereum successfully completed its third and final testnet known as Goerli, which merged with the Bellatrix beacon chain that was an upgrade from its predecessor known as Prater.  Shortly following, $ETH surged in sync with the growing optimism of investors who see a successful Merge as a greater likelihood later this year.

To top it off, Vitalik Buterin rang in the Blockchain Futurist Conference in Toronto this past weekend, a three-day event held at two popular nightclubs, Rebel and Cabana. Given the news of the Merge and some upside for $ETH, the air at the conference was bullish and not bearish.

“For the first time in a long time, people were inspired again. Maybe it was Vitalik showing up. Maybe it’s news of the Merge nearing reality. Or maybe it was just the beautiful indoor-outdoor venue during two perfect Toronto summer days – but for the first time in a while, things felt bullish again.” – Greg Gopman, CMO at Ankr

Other altcoins were mostly in the red, with an amusing rally from meme coins Shiba Inu ($SHIB) and Dogecoin ($DOGE) jumping by over 30% and 10% respectively.


  1. US Government Blocks Tornado Cash For Abetting Money Laundering

CoinDesk – August 9th, 2022 at 11:44am EST

The U.S. Treasury’s Office of Foreign Assets Control has just banned American accounts from utilizing Tornado Cash, a cryptocurrency mixing service that obfuscates the origin and destination of cryptocurrency transactions. By adding Tornado Cash to its “Blacklist” this past Monday, OFAC effectively prevents any U.S. residents from interacting with Tornado Cash and any Ethereum wallet addresses tied to the protocol.

Tornado Cash, well known for its intent of providing maximum anonymity to its users, has been accused on multiple occasions of abetting money laundering schemes by the Lazarus Group, a hacker collective based out of and back by the government of North Korea. This was the exact scheme that they implemented earlier this year to launder $625M from Axie Infinity’s sidechain, the Ronin Network, according to OFAC. 

To bolster the claim with information gathered on-chain, Nansen revealed around 18% of the total amount of $ETH flowing through Tornado Cash in recent months (167,400 $ETH) came from the Ronin hack. In addition, Tornado was also used to launder the stolen 4,600 $ETH from Crypto.com, the $100M hack on the Harmony bridge, and a very recent $200M Nomad bridge hack.

Shortly after adding Tornado to its blacklist, Circle, the issuer of the stablecoin $USDC, also swiftly froze funds related to the Tornado Cash addresses sanctioned by OFAC. According to Dune Analytics, over 75,000 $USDC associated with the 44 Tornado Cash addresses in question were frozen.  

On August 8th, Github also deleted Tornado Cash on its platform and banned Tornado’s developers. Shortly after this decision by GithubInfura and Alchemy Block also followed suit and blocked users related to Tornado Cash. 

On August 10th, the biggest derivative decentralized exchange, DyDx, announced that it had also forbidden specific blockchain addresses found on the blacklist. Shortly after, the Dutch government agency responsible for investigating financial crimes, known as the Fiscal Information and Investigation Service, reported they arrested a 29-year-old man suspected of being a Tornado Cash developer. 

As of now, Tornado has not responded to its requests for comment regarding its sanctions. The price of $TORN decreased by 54% to $13.6 since its recent price recovery to $30.2 at the beginning of the month.


  1. $1.2B of Polkadot’s Native Stablecoin by Acala Blown Away in Latest Hack

CoinTelegraph – August 15th, 2022 at 4:35am EST

aUSD, the native stablecoin on Polkadot, developed by Acala, is the latest to fall victim to a hack, resulting in a massive loss of $1.2B.

According to 

, the hackers in question conducted their attack via a new liquidity pool for $iBTC/$aUSD. At the time of writing, 99% of the hacked tokens still remain in the hacker’s Acala Wallet, with only a tiny proportion of aUSD being swapped for $ACA and four other tokens.

Despite the relatively small sale enacted by the hacker, aUSD lost its peg quickly due to the sheer volume of $aUSD that was sold. After dropping by almost 50% to a trading price of $0.57, the stablecoin showed some signs of recovery back to a price of $0.9. 

In response, the Acala team has paused some functions on the network, such as swapping, cross-chain communications (xcm), and other functions related to its Honzon protocol after receiving urgent governance votes. 

The team has also asked that users who received the erroneously minted stablecoin return it to a publicly shared address, announcing that every address that received any stablecoin from the hack is known.


  1. Curve Finance Experiences DNS Front-End Attack

DeCrypt – August 12th, 2022

The domain name of Curve Finance was exploited last week, leading to a loss of at least $620,000 (362 ETH) from affected users.

The hacker managed to control the platform's front-end and replaced the usual protocol with a malicious smart contract that siphoned any approved funds to the hacker’s designated wallet. A sideline observer pointed out that the bad smart contract was deployed 2 weeks before the attack.

Shortly after the exploitation, the Curve Finance team quickly 

 regarding the incident.


  1. Justin Sun and Sam Bankman-Fried in Talks to Buy 60% of Houbi Global 

CoinDesk – August 12th, 2022 at 2:30pm EST

Leon Li, the founder and biggest shareholder of Huobi Global Exchange, is looking to sell his stake in the company to a clutch of investors, which reportedly named Sam Bankman-Fried from FTX and Justin Sun from the Tron ecosystem among the biggest bidders.

Investors can scoop up to 60% of Houbi’s share from Li, netting him more than $1B and appraising the company at $2B to $3B in the process. If it goes through, the deal will instantly set a new record for the biggest M&A in the crypto industry.

Huobi is currently ranked as the 7th biggest exchange by volume, facilitating almost $1 billion in value traded every 24 hours. The company also owns operating licenses in many countries around the world, which are considered invaluable assets for crypto exchanges.

Sam Bankman-Fried and Justin Sun have not yet commented on the topic. However, according to Bloomberg, “a deal could be completed as soon as the end of this month.”


  1. Nomad Bridge’s Exploit: $88M Stolen From “Second-hand Hackers”

CoinDesk – August 11th, 2022 at 11:11am EST

In a blog post, Coinbase shared a post-mortem of the recent hack that removed almost $190M from the Nomad Bridge. The analysis reveals an interesting insight into the incident: 88% of the malicious actors involved in the hack simply copied the attacker’s code and modified the token name and recipient address.

The report pointed out that the majority of the damage was done by two original addresses that drained almost all $WETH, $WBTC, and $CQT in the vault.

However, it appears that this exploitation was incredibly simple to replicate. “All you had to do was find a transaction that worked, find/replace the other person’s address with yours, and then re-broadcast it.”

Hundreds of other addresses ended up copying the hacker’s code and drained other valuable assets from the bridge. The most popular token stolen by these “second-hand hackers” was $USDC.

Around ⅓ of the stolen funds continue to sit untouched, while around ½ of the $190M has already moved to other destinations on the blockchain.