The decentralized finance space has seen some major developments this past week, and the US Commodity Futures Trading Commission (CFTC) is taking a closer look to explore potential issues in this fast-evolving space.
This week there was news of a notorious phishing scammer putting an end to his illicit activities, and an arrest by French police in connection with a major DeFi exploit. Along with this, a layer 2 scaling protocol released decentralized ID to the public, and DeFi market values are tested with bearish dips.
CFTC Examines the DeFi Scene
The US Commodity Futures Trading Commission is set to take an in-depth look at decentralized finance this week at the CFTC’s inaugural technology advisory meeting with panels exploring “issues in decentralized finance.” It is important for the CFTC to understand the financial risks posed by DeFi platforms, especially with their rapid growth and lack of standard legal and regulatory frameworks.
CFTC research indicates that regulators are paying more attention to the industry and taking it more seriously as the sector continues to gain traction. The financial watchdog will most likely ensure that the DeFi space is compliant with regulations, oversee the proper handling of client funds, and examine the potential of DeFi solutions to provide client protection.
The Crypto Black Hat Calls It Quits
In another significant development, notorious cryptocurrency scammer “dragamonkeys”, who was behind the high-value Web3 thefts, declared that it would shut down its operations. The scammer claimed to have “packed up the store” and “will move on to something better.”
The monkey wringer who claims to be “only 14 years old” clarified on his Telegram channel that he would immediately stop all his activities, destroy all data and files related to his identity theft and phishing operations and that he would not be returning.
The scammer also offered some advice to “young cybercriminals,” advising them to stay away from “the pursuit of easy money” and only pursue this path with “the highest level of dedication.”
Polygon’s Zero-Knowledge Decentralized Identity
It’s been almost a year since Polygon, a Layer 2 scaling protocol for Ethereum, announced the development of a zero-knowledge decentralized identity solution, and now this product is finally released to the public.
The purpose of Polygon ID is to solve the problem of digital trust. It uses zero-knowledge proofs, a cryptographic technique, which allows users to verify their identity online without having to pass their sensitive data to a third-party service.
Platypus Finance Exploit Arrest and Compensation
In another development related to exploitation, Platypus Finance suffered exploitation of 9.1 million dollars on February 16 of this year. This led French police to arrest two suspects and seize a total of €210,000 worth of cryptocurrency. The investigations were mainly supported by the cryptocurrency exchange and ZachXBT Binance on-chain research.
The Platypus Finance team created a portal that allows users to see how much the platform owes them after the exploit. The portal contains several sections that provide compensation details and information to help users understand how much they are owed after the attack.
In conclusion, this week’s Finance Redefined newsletter has been filled with interesting developments that further explore the intricacies of the DeFi arena. As the space continues to grow and mature, it’s important to keep up with more updates.
By Audy Castaneda
