Bitcoin ETF IBIT Reaches $15.2 Billion Inflows, and other News

Audy Castañeda
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Bitcoin ETF IBIT Reaches $15.2 Billion Inflows, and other News

It is almost impossible to give a forecast of what could happen next week, due to geopolitical tensions that could lead to a war between Israel and Iran, in which the United States and some of its allies could become involved. Hence the situation is complex for the markets.

The world of Bitcoin spot ETFs on the stock market continues to make news, this time with BlackRock’s product IBIT. This variable income instrument closed this week with positive numbers in particular. In that sense, it surpassed the barrier of 15 billion dollars in capital inflows.

With this, the fund consolidates itself as the largest in this race and almost doubles its closest competitor, Fidelity’s FBTC. The latter has a total of 8.04 billion dollars in revenue streams. In total, the ETF market of the largest cryptocurrency has inflows of $12.5 billion. Grayscale’s massive GBTC outflows are discounted in this figure, according to data from Farside.

This week, a predominance of negative days over positive ones was observed. This phenomenon is likely linked to the recent year-on-year CPI inflation data in the United States. In the last year ending in March, inflation rose to 3.5% from 3.2% in February, raising concerns among investors.

Bitcoin ETFs Prepare for a New Week on the Stock Market

The good momentum of BlackRock’s Bitcoin ETF, IBIT, could continue into the next week. However, this is not a guarantee that this entire market will have positive results. Tensions in the Middle East could become a real nightmare for the markets.

If hostilities break out between Tehran and Tel Aviv, the United States could become involved on the side of the latter in an open war. Considering Iran’s size and capabilities, as well as its proximity to Russia, the conflict could significantly bleed the US economy in a long-running war. This possibility frightens investors with every reason.

Hence, this week nervousness could lead capital to continue abandoning risk assets. This last category includes stock market products such as ETFs. Similarly, the cryptocurrency spot market would also enter a phase of large-scale liquidations. From this it can be said that last Wednesday’s inflation data was a small element compared to the geopolitical issue.

However, under any circumstances, the IBIT Bitcoin ETF will remain the biggest player in this particular market.

Kiyosaki: Bitcoin Price Will Reach $2 Million

In other news, Robert Kiyosaki, the American businessman, investor, motivational speaker and writer of the famous book Rich Dad Poor Dad, shared the forecast of Cathie Wood, the CEO of ARK Investment Management, regarding the price of Bitcoin (BTC):

“Kathie Wood guarantees Bitcoin will hit $2.3 million per BTC. Do I believe her? Yes, I do. Kathie Wood is very smart. I trust her opinion.  Could she be wrong?  Yes. She could be.  So what? The more important question is “What do you believe?” What if Kathie is right?  What if Kathie is wrong?  And most importantly “How many Bitcoin do you own?”  If Kathie is right, I will wish I bought more. If she is wrong, I will be glad to own zero. Most people will own zero regardless if Kathie is right or wrong.”

Cathie Wood set a price target of $2.3 million in late February this year. This implied a potential upside of 3,600% from trading levels at the time.

Additionally, Kiyosaki praised Wood for her “courage to make mistakes and learn from them,” arguing that, “in the real world, the richest and happiest people are those who make mistakes and learn from them.”

By Audy Castaneda

Former Amazon Engineer Sentenced to Prison for Hacking Two DeFi Exchanges

Leonardo Perez
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Former Amazon Engineer Sentenced to Prison for Hacking Two DeFi Exchanges

Shakeeb Ahmed, former Amazon engineer, was sentenced to 3 years for hacking DeFi protocols. Ahmed exploited smart contracts, causing an exchange to close after draining funds. The court sentenced him to forfeit $12.3 million and pay compensation exceeding $5 million.

In a landmark legal action, former Amazon engineer Shakeeb Ahmed was sentenced to three years in prison for orchestrating hacks on two DeFi cryptocurrency exchanges, resulting in the theft of more than $12 million.

U.S. District Judge Victor Marrero handed down the ruling, marking a significant milestone in cryptocurrency-related law enforcement.

DeFi Hacker Sentenced to 3 Years in Prison

Shakeeb Ahmed used his extensive knowledge of reverse engineering and Blockchain audits to manipulate smart contracts on exchanges. US Attorney Damian Williams stated that this case represents the first conviction for hacking a smart contract:

“No matter how novel or sophisticated the hack, this Office and our law enforcement partners are committed to following the money and bringing hackers to justice. And as today’s sentencing demonstrates, prison time – and the confiscation of all stolen crypto – is the inevitable consequence of such destructive hacks.”

On July 2 and 3, 2022, Ahmed attacked the first exchange by injecting false price data, generating $9 million in inflated fees, which he then illicitly withdrew. In a subsequent communication with the exchange, Ahmed agreed to return the funds, except for $1.5 million, as long as the exchange did not report the hack to the police.

A few weeks later, on July 28, Ahmed exploited a vulnerability in Nirvana Finance smart contracts. This second hack drained Nirvana of approximately $3.6 million, almost all of its funds, forcing the platform to shut down. Ahmed rejected Nirvana’s large bounty offer and opted to keep the stolen assets.

Nirvana’s NIRV stablecoin lost its peg to the US dollar, and its native coin ANA fell 85% following news of the hack and closed shortly after. According to the SDNY statement, Ahmed laundered the hacked funds:

“Using token swap transactions; ‘bridging’ fraud proceeds from the Solana Blockchain to the Ethereum Blockchain; exchanging fraud proceeds into Monero […]; using offshore cryptocurrency exchanges; and using cryptocurrency mixers, like Samourai Whirlpool.”

A third exchange, Crema, was also noted to have been targeted in July 2022 using the same methods, but federal charges did not link it to that hack.

According to Inner City Press, Ahmed, who was released on bail, now works for a mental health company. That publication quoted him as saying: “I witnessed hacks, I found a way to exploit an exchange’s smart contracts. I went to therapy” during his trial.

Former Amazon Engineer Used Cryptocurrency Mixers for Hack

Ahmed used sophisticated laundering techniques to conceal the origin of the stolen funds. These included swapping tokens between blockchains, converting assets into the untraceable cryptocurrency Monero, and using offshore cryptocurrency exchanges and mixers.

In addition to the prison sentence, the court has ordered Ahmed to confiscate about $12.3 million in stolen assets. It must also compensate the affected exchanges with more than $5 million. He will also be imposed three years of supervised release after his incarceration. US Attorney Damian Williams said in a statement that Ahmed’s conviction was the first for hacking a smart contract.

By Leonardo Perez

Bitcoin ETF Will Never Be on Kiyosaki’s Potential Buy List

Audy Castañeda
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Bitcoin ETF Will Never Be on Kiyosaki’s Potential Buy List

The analyst expressed that he will never place capital in these investment instruments indexed to the spot price of the largest cryptocurrency.

Investor and popular author Robert Kiyosaki recently expressed his disdain for the US stock market’s Bitcoin spot ETFs. In his opinion, these assets are part of the group of equities that will collapse in the midst of the next crash that will cause financial chaos. The author of the best-selling book, Rich Dad, Poor Dad, is completely convinced that the financial world will suffer a total collapse.

In a scenario in which the 1929 crisis will remain in its infancy, buying variable income assets is absurd, according to the expert. It is worth mentioning that although these ETFs are pegged to Bitcoin, investors simply have exposure to the currency and not possession. In simple words, the coins are from the firm offering the ETF, while investors have shares that represent the asset itself.

During a possible financial collapse scenario, the companies that issue those ETFs could withhold users’ funds. Instead of investing in these products, the analyst recommends purchasing BTC directly on an exchange and then sending it to a cold or self-custody wallet.

Bitcoin ETFs Are Good Only for Institutions, Says Kiyosaki

In a post on his X account, Kiyosaki highlighted that Bitcoin ETFs are likely good for institutional investors. However, he emphasizes that entrepreneurs should stay away from Wall Street products as much as possible:

“Q:  Will you buy the Bitcoin ETF?

A:  No. Just as I own gold and silver coin and mines and own apartment houses I do not own gold or silver ETFs or REITS, real estate ETFS. ETFs are best for most people and institutions. Personally I am an entrepreneur and prefer to stay as far away from Wall Street’s financial products as possible (…)” 

He stated that under no circumstances does he own metals or housing ETFs. He does the exact same thing with his Bitcoin investments. “Packaging my own financial products is best for me because packaging my own securities requires me to be smarter than most ETF buyers. It is what is best for me. If I F’ up I have no one to blame but me,” he argued.

For years, this analyst has been a promoter of investments in assets, mainly reserve assets, instead of risky stocks. Although the latter cannot be ruled out, they must at least be carried out by taking the corresponding measures in terms of risk management.

Thus, the purchase of Bitcoin ETFs should be discarded in favor of self-custody, suggests Kiyosaki. In the case of BTC, when it is held in its own custody, it cannot be seized by the authorities, as could happen with homes. In the event of a financial implosion like the one the author expects, those who own assets of their own, specifically BTC, will be fully protected.

Kiyosaki’s Optimism Towards Bitcoin

Kiyosaki’s stance on Bitcoin ETFs comes amid a bullish outlook on the world’s leading cryptocurrency. In January, he predicted that the value of Bitcoin would rise to $150,000. He also revealed his purchase of 5 additional Bitcoin, valued at over $230,000 at the time of the spot ETFs approval.

Despite his bullish stance on Bitcoin, Kiyosaki’s latest tweet suggests a preference for direct asset ownership, distancing himself from Wall Street financial products.

Interestingly, Kiyosaki agrees with Ark Invest CEO Cathie Wood’s $2.3 million prediction for Bitcoin, advocating for bold investment approaches. He said: “Kathie Wood is very intelligent. I trust her opinion.”

By Audy Castaneda

$104M Crypto Firm Collapse: Australian Watchdog After Two Unlicensed Firms

Leonardo Perez
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$104M Crypto Firm Collapse: Australian Watchdog After Two Unlicensed Firms

The companies were allegedly involved in an elaborate scheme that resulted in investors losing A$160 million, worth $104 million.

According to local reports, the Australian Securities and Investments Commission (ASIC) has launched legal proceedings against two crypto companies and their directors for operating without a license in the country.

A company’s involvement in restructuring does not necessarily mean that companies have collapsed. ASIC said it was concerned the funds were at risk of being dissipated and that appointing a receiver was the best way to protect the assets.

While it continues to investigate, ASIC has not called for an outright ban on the companies, but only interim and final injunctions preventing them from operating without a license.

ASIC after Unlicensed Mining Companies

The Australian regulator launched civil proceedings against the NGS group companies and their directors, Brett Mendham, Ryan Brown and Mark Ten Caten. NGS Blockchain crypto mining companies include NGS Crypto, NGS Digital, and NGS Group.

ASIC alleges that NGS companies targeted Australian investors to purchase blockchain mining packages with a fixed rate return. The regulator also accuses the companies of allegedly encouraging investors to use self-managed super funds (SMSF) and convert the money into cryptocurrencies.

According to the NGS Crypto website, the company was formed in 2018 as a blockchain company. As part of the NGS Group, the company “aims to help members generate consistent returns.” The Australian regulator stated in its press release that these financial services are provided without proper licensing. Because of this, ASIC is seeking “provisional and final injunctive relief against the NGS Companies.”

ASIC Chairman Joe Longo urged Australian users to consider the risks involved in self-managing SMSFs before using the funds to invest in cryptocurrency-related investment products, such as those offered by the NGS Group. Additionally, the ASIC president warned the industry about the regulator’s standard for vetting crypto products:

“These procedures should also send a message to the cryptography industry that ASIC will continue to examine products to ensure they meet regulatory obligations to protect consumers.”

The Australian regulator asked the Federal Court to appoint liquidators responsible for the companies’ digital assets. The request was made because the regulator believed the investor’s assets were “at risk of being dissipated.”

On Wednesday, the court approved the request and prevented Mendham from leaving the country. Preliminary investigations revealed that more than 450 Australians invested 62 million Australian dollars, approximately $41 million, through the NGS companies.

Crypto Funds Targeted for Irregularities

Similarly, more than 100 investors are owed more than A$100 million, around $64.6 million, by the now-collapsed DCA Capital, Digital Commodity Assets and the Digital Commodity Assets Fund.

Recently, investigations began after investors exposed crypto funds operated by Ash Balanian, an alleged former NASA mission scientist. As a result, liquidators were appointed for the three companies managed by Balanian.

According to the report, the fund was aimed at wealthy investors and required a minimum deposit of A$50,000. Investors discovered irregularities in the management of the fund, prompting authorities to intervene. Many investors were concerned because they believed the funds did not comply with the required licenses and “failed to comply with the requirements of the managed investment plan.”

On Wednesday, Australia’s Federal Court ordered Balanian’s assets, worth A$55 million, to be frozen and the crypto fund manager to hand over his passport.

By Leonardo Perez

BlackRock Could Be a Pioneer in Regulated Stablecoins in the United States

Audy Castañeda
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BlackRock Could Be a Pioneer in Regulated Stablecoins in the United States

If this milestone is achieved, USDT dominance would have a contender for the first time.

The largest investment asset manager in the world, BlackRock, could become a pioneer in the regulated stablecoin sector in the US. Thus, the financial firm would be placed in a highly preferred position among institutional investors.

So far, the stablecoin market is made up of 97 assets encompassing a total of $157 billion in capitalization. Of that amount, the currency minted by Tether (USDT) occupies no less than $107.2 billion. This fact makes it the absolute queen of the sector and the great challenge for any issuer of similar assets.

However, this dominance of USDT in cryptocurrency trading is not protected by a role of total legalization, especially for institutional investors. In that sense, large capitals do not have the possibility of trading cryptocurrencies against a suitable stable currency. This gap could be filled by BlackRock’s hypothetical currency, which could be legalized in the North American market.

At the moment, Wall Street investors are progressively getting involved in the stablecoin sector. If regulators and large firms take action, large investors would have a private alternative to both the fiat dollar and a possible CBDC.

Is a Regulated Stablecoin Scenario Possible?

The fact that BlackRock is becoming a pioneer of regulated stablecoins is also met with some skepticism. As is widely known, the dollar lacks backing intrinsic value and its strength is based on user trust. Hence, the US imposed this currency as a universal means of payment for decades.

Thus, thinking that it will give up that position to a private currency is not the most feasible. Despite this, the actor moving in this direction is not just anyone, but BlackRock, the largest investment asset manager on the entire planet. Investor Ryan Sean Adams is emphatic on this issue. In his account on the social network X he expressed the following:

“Stablecoins will happen in the U.S. because BlackRock and the banks want them to happen. This could not be more obvious. The new BlackRock BUIDL fund on Ethereum is a high bandwidth pipeline between U.S. Treasuries and USDC. Pipelines will bring trillions onchain.

The USDC issuer Circle is (likely) will IPO soon. BlackRock has ownership in Circle. The banks will backdoor themselves into stablecoins – by acquiring/partnering/controlling crypto native companies – and they’ll lobby for stablecoin legislation and make it happen along the way.

The US does not have the political will to build a central bank digital currency. They’re create one de facto through private bank issued stablecoins on public crypto networks like Ethereum.

As long as we preserve open, non-permission, decentralized protocols like Ethereum at the bottom of the stack – then crypto wins. The liquidity and legitimacy from this will make crypto unstoppable.”

Although BlackRock has a USD-based token to manage its assets, it cannot be considered a stable currency in the strict sense of the word.

In any case, the conditions seem set for regulated stablecoins to enter the institutional scene through legal means. It remains to be seen whether the political authorities of the American nation are determined enough to maintain the omnipotence of the USD.

Overall, it appears that Blackrock’s new infrastructure, which combines the tokenized BlackRock USD Institutional Digital Liquidity Pool (BUIDL) and Circle’s USDC stablecoin, could play a key role in the future regulation of stablecoins in the United States and internationally.

By Audy Castaneda

Hedera: Digital Identity and Its Importance in the Metaverse

Leonardo Perez
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Hedera: Digital Identity and Its Importance in the Metaverse

According to the World Economic Forum, “The Metaverse, poised to redefine the internet, intertwines the digital and physical, emphasizing the pivotal role of “identity” in shaping immersive, human-centric experiences.”

The Hedera Hashgraph firm joins forces with the World Economic Forum to promote the development of digital identity in the Metaverse. In a recent report, some important roles of new technologies in people’s lives are detailed. Thus, security and privacy become the epicenter of attention.

The Metaverse is one of the most promising technologies in the long term. Although the concept is losing strength amid the recognized technological limitations to support it, it remains on the horizon. Dozens of large companies continue working on the creation of these new spaces for social interaction.

Thus, the need to prepare for when this technology takes over from the current ones is urgent, according to Hedera. In that sense, they consider that rapid progress must be made in the creation of mechanisms that allow people to have digital identities. The latter should have all the security and privacy protection possibilities provided by underlying technologies such as the Blockchain.

One of the points most emphasized in the report has to do with the complexity of creating digital identities. Going one step further and integrating it into a technology that does not yet exist becomes more complex, they argue.

“The exploration of Metaverse identity underscores the need for a human-first approach prioritizing equality, inclusivity, accessibility, authenticity, and trust. Through our work with the WEF, Hedera continues to uphold its role in advocating for responsible technology,” Hedera posted on X.

Secure Digital Identity is Fundamental, According to Hedera

As the Hedera report explains, creating a digital identity in the Metaverse is much more complex than in the real world. This is because it encompasses multiple factors that interact in complex scenarios of novel digital expressions, credentials and data generated by the underlying technologies of the Metaverse.

Likewise, representation in the Metaverse should go beyond graphic identities. The latter to safeguard social values ​​such as democracy and inclusion. It is worth noting that the Metaverse has an enormous wealth in the variety of identities. This covers factors such as avatar design to body-based certifications and virtual signatures.

These identities must be unique to guarantee the individuality of people in a virtual territory populated by millions of users. In addition, this guarantees unique experiences that help businesses in the offer of products, services and others.

As can be inferred from the Hedera report, the work to be done within the framework of digital identity is enormous. All of this must be undertaken immediately, considering that progress towards this technology continues despite the silence.

The WEF points out the following:

“As the Metaverse evolves, comprehensively understanding identity is crucial for its potential to revolutionize how people interact and express themselves digitally, facilitating a space that respects privacy, security and human rights.”

The Metaverse is a reality that is already being created and every year new developments are added that bring it closer.

Hedera has a Blockchain network and a native token that has been gaining prominence in the crypto market. At the close of this note, the price of that currency (HBAR) is $0.099 per unit. In year-on-year terms, its performance exceeds 51%.

Hedera acknowledges the need for “a human-first approach prioritizing equality, inclusivity, accessibility, authenticity, and trust” when exploring the Metaverse identity.  Through their work with the World Economic Forum, Hedera claims it will continue to “uphold its role in advocating for sustainable finance and responsible technology.”

By Leonardo Perez

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