A series of bad news darkened the cryptocurrency market

 After the Luna incident in May, a series of crypto funds declared default or were attacked, causing the cryptocurrency market to stall.


A series of attacks in a month

On June 6, DeFi Elrond decentralized financial platform was attacked by hackers, starting the "dark" month after the Terra incident. Specifically, Elrond was exploited by a hacker who took advantage of a vulnerability in the smart contract (smart contract) to exploit and collect more than $ 1.6 million in EGLD project management tokens. After that, this hacker continued to "discharge" the remaining tokens and earned $ 5.6 million.

A series of bad news in the month made the cryptocurrency market continuously go down. Photo: Eko
A series of bad news in the month made the cryptocurrency market continuously go down. Photo: Eko

On June 8, another platform, Osmosis, had a lending hole. If a user adds a certain amount to the liquidity pool on the platform, they will receive an additional 50% of the assets. After being shared by an account on Reddit, many people took advantage of the vulnerability, causing about 5 million USD in damage.

On June 9, Optimism - a layer 2 blockchain project on the Ethereum network, once appreciated by the "father" of Ethereum Vitalik Buterin - was also hacked. From a vulnerability related to money transfer, crooks have exploited 20 million OP tokens of the project worth more than 20 million USD. However, the hacker then keeps only 10% as a reward. This money was dispersed through the Tornado Cash mixer.

On June 24, Harmony - a California-based cryptocurrency company - confirmed that the system was attacked by hackers via the Horizon cross-chain bridge. The incident caused a series of tokens held by the platform, including Ethereum, Tether (USDT) and USD Coin (USDC) worth more than $100 million.

Cross-chain bridges are currently one of the top attack targets for crypto criminals. According to Elliptic data, in the first 6 months of the year, more than a billion dollars were stolen through this method, of which the largest scale was the Ronin bridge of the game Axie Infinity, causing more than 600 million USD in damage.

Celsius Network stops trading

In early May, two tokens belonging to the Terra ecosystem, Luna and stablecoin UST, collapsed. The incident caused a chain of dominoes, when a series of Terra-related ecosystems were also affected. On June 13, Celsius Network - one of the world's largest crypto lending and borrowing platforms, where users can send and receive interest in cryptocurrencies - caused a stir when it announced that it did not accept requests to transfer or withdrawals for an indefinite period.

The announcement then left millions of people who had deposited money on the platform, as they were unable to take their money. In May, Celsius Network said there were 1.7 million users of the platform with more than $12 billion in deposits, mostly retail investors.

Besides, the announcement of Celsius Network also directly caused the Bitcoin price to plummet. As of the afternoon of June 18, Bitcoin dropped below $ 20,000 / dong while Ether also sometimes lost $ 1,000 / dong. In total, the price of these two cryptocurrencies with the highest capitalization in the world has fallen to "catastrophic" levels, losing 54% and 70% of their value compared to the same period last year.

Three Arrows Capital (3AC) defaults

In late June, digital asset brokerage Voyager Digital announced that 3AC failed to repay a $350 million loan in USD-pegged stablecoin USDC and 15,250 Bitcoins worth about $323 million at current prices. This is considered a shocking incident, because 3AC has made many large value investments in digital assets. Last year, the fund made headlines when it bought nearly 39 million shares issued by the Grayscale Bitcoin Trust (GBTC), thereby amassing about $1.3 billion in Bitcoin, making it the largest cryptocurrency purchase ever recorded.

The default of this hedge fund has been rekindled for a long time. According to the FT, 3AC is no longer able to repay the debt of the crypto lender BlockFi and Genesis (USA). Not only that, 3AC was one of the companies that poured money into Luna and UST, making the crisis more serious.

According to experts, 3AC has borrowed large sums of money from various companies and invested in many digital asset projects. Therefore, when it defaulted, the crisis spread throughout the market.

So far, cryptocurrency exchange Blockchain.com and exchange Deribit - two of 3AC's creditors - are seeking to liquidate assets mortgaged by the company in a court in the British Virgin Islands, and Time to cooperate with the authorities to investigate 3AC. "We believe that 3AC has deceived the crypto industry. They will be held accountable to the fullest extent of the law," a Blockchain.com representative told Bloomberg.

Meanwhile, according to Fortune, Su Zhu, co-founder of 3AC is said to be trying to sell his Singapore mansion to deal with the crisis. The house was purchased by him last December for about $35 million.
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