The cringy couple behind the 2016 Bitfinex hack

Plus, Wells Fargo believes crypto is nearing "hyper adoption"

Inside.com Part of   Network February 08, 2022

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The United States Department of Justice has seized $3.6B in bitcoin tied to the 2016 Bitfinex hack. Two individuals, Ilya Lichtenstein and Heather Morgan, were arrested in New York and charged with conspiracy to commit money laundering and conspiracy to defraud the United States. How the DOJ pulled it off: The DOJ received a search warrant for a file saved to Lichtenstein's cloud storage account. Authorities decrypted the file, which contained a list of 2,000 virtual currency addresses, along with corresponding private keys. Special agents then used those private keys to seize the remaining balance of ~94,636 BTC. More: The arrests correspond to a series of transactions of the Bitfinex hack-tied bitcoins on Feb. 1, 2022.   These transactions turned out to be the DOJ seizing the funds. Bitfinex is working with the DOJ to establish rights to the stolen bitcoins. The exchange also outlined in a whitepaper that within 18 months of the date it receives the recovered bitcoins, it will use an amount equal to 80% of the recovered net funds to repurchase and burn outstanding UNUS SED LEO tokens.  This caused $LEO to rally as much as 60% Tuesday. In related news: People have uncovered a slew of cringy videos produced by Heather Morgan that also include Ilya Lichtenstein. Here are some favorites: Link Link Link

Acting Chairman Martin Gruenberg of the Federal Deposit Insurance Corporation (FDIC) announced that evaluating crypto-asset risks is on its list of priorities for 2022. The FDIC stated that the rapid integration of digital assets into the traditional financial system could pose significant risks. More: In Oct. 2021, former FDIC chair Jelena McWilliams said the agency was focused on establishing clear guidelines to govern the intersection of banking and crypto. In the announcement, Gruenberg put the responsibility in the hands of the federal banking agencies to carefully consider the risks posed by crypto products. Gruenberg also expressed that the banking agencies must provide robust guidance to the banking industry on the management of the consumer risks posed by crypto-assets. Analyst's Take:  Whenever "crypto," "risks," and "[insert federal agency]" get thrown together in anything, people tend to get a little uneasy. But as someone who deeply desires for this technology to succeed, you must understand that a close evaluation of its consumer risks is a necessity for mass adoption. Why? Because there are significant consumer risks involved in interacting with crypto assets. Just last week, $500,000 disappeared after someone made a simple error of sending wETH back into a wrapping address. The simple fact of the matter is that traditional financial institutions see crypto products for what they are: a significant financial opportunity. Their use and sale of these products will only grow and, along with it, increased evaluation of their risks. But it's important to understand that this isn't necessarily a bad thing.

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Wells Fargo claims crypto is nearing a phase of "hyper adoption" akin to the internet in the '90s. The bank stated that it believes cryptocurrencies are viable investments today despite still being in the early stage of their investment evolution. More: Wells Fargo added that it still doesn't recommend crypto mutual funds, ETFs, grantor trusts, or individual cryptocurrency speculation. Instead, Wells Fargo recommends investors wait for the industry to mature or to make crypto investments through professional investment managers. The bank is ''hopeful" that 2022 will bring with it greater clarity on regulation. In its statements, Wells Fargo is drawing on research that compares crypto adoption from 2014 to now with internet adoption from 1993 to 2000. This research puts the adoption of crypto happening today on par with, if not ahead of, the adoption of the internet in the '90s.

OpenSea has once again delisted the CryptoPunks v1 collection following an alleged Digital Millennium Copyright Act takedown notice brought forth by LarvaLabs. The CryptoPunks v1 collection was thrust into existence along with the iconic CryptoPunks v2 collection due to a smart contract bug. More: Larva Labs is the developer of both the CryptoPunks v1 collection and v2 collection. For years OpenSea had a ban on CryptoPunks v1 due to questions over authenticity. Recent listings of the collection on Looks Rare and v1punks.io led OpenSea to rescind its ban. Zoom Out: CryptoPunks V1 holders are locked in a heated battle to affirm the authenticity of the collection. If v1 is deemed to be authentically CryptoPunks like v2, it could pose significant financial consequences as much of CryptoPunks' value comes from its fixed supply of 10,000. If the CryptoPunks v1 collection is legitimized, it could dilute the brand and lead to a rapid decline in price. Watch Read

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Aave debuted its much anticipated decentralized social media protocol Monday: Lens Protocol. The project will help make it easier for developers to build Web3 social platforms while drawing on a shared base of users. More: Composable, non-custodial, and permissionless profile NFTs are the backbone of the Lens Protocol. These profile NFTs can store posts, publications, and follower history along with revenue-sharing features for content hosted on IPFS and built-in governance for groups of mutual followers. The protocol is live on the Polygon Mumbai testnet.  A grants program for any developers looking to build on the protocol is live. Sometime in Q1 2022, Aave will release a social app designed to demonstrate how the platform can be used.

Web3 Tweet: RAC on NFTs.

Quick Hits 3D is the future of online shopping. With unlimited3D.com from Threedium, you can publish and share 3D & AR to the web with ease.* Sotheby's is auctioning off a bundle of 104 CryptoPunks. Disney is hiring a metaverse designer. NY FED economists don't believe stablecoins are the future of payments. Crypto's market cap recaptured $2T. U.S. Congressman Warren Davidson (R-Ohio) calls Tether a "time bomb." If you think time in the market outweighs timing the market, this finance app is for you.* *This is a sponsored post.

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Trevor Grant is an entrepreneur, investor, and writer based out of Chicago, Illinois. His primary area of interest is web3 venture capital, social tokens, and infrastructure. Other pursuits include screenwriting, yoga, and traveling. He holds a BS in biomedical engineering.   Connect with him on Twitter @trevorisonline Editor Aaron Crutchfield is based in the high desert of California. Over the last two decades, he has spent time writing and editing at various local newspapers and defense contractors in California. When he's not working, he can often be found looking at the latest memes with his kids or working on his 1962 Ford.

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