Crypto.com accidentally sends 320k ETH to Gate.io, recovers funds days after

November 13, 2022 Coin Telegraph

Crypto.com CEO confirmed the return of the funds and reassured the investors that new processes and features were implemented to prevent a reoccurrence.

The fall of FTX highlighted the importance of proof of reserves in averting risks and improving investor confidence, urging leading crypto exchanges to publicly list down their cold and hot wallet addresses. When trying to confirm the availability of funds on Crypto.com, cold store information revealed a suspicious transfer of 320,000 Ether (ETH) to a wallet address linked to Gate.io on Oct. 21, 2022.

*On chain data confirms the transfer of 320,000 ETH from Crypto.com to Gate.io. Source: Etherscan*

Community member @jconorgrogan raised concerns about the transfer of 320,000 ETH from Crypto.com’s cold wallet to Gate.io, considering that the former claims that 100% of user-owned cryptocurrencies are held offline in cold storage in partnership with hardware wallet provider Ledger.

As discussions picked up steam, Kris Marszalek, the CEO of Crypto.com, revealed that the funds — representing 82% of Crypto.com’s ETH holding in the cold storage at the time of writing — were sent accidentally to Gate.io:

“It was supposed to be a move to a new cold storage address, but was sent to a whitelisted external exchange address.”

However, Marszalek confirmed that Gate.io returned the funds to Crypto.com’s cold storage and reassured the investors that new processes and features were implemented to prevent a reoccurrence.

And why https://t.co/bVgf3bBSGR would send back to https://t.co/2vZHyCacXG 285K ETH 5-7 days later? pic.twitter.com/GhH6QGXntd
— Conor (@jconorgrogan) November 12, 2022

While on-chain data confirms that Gate.io returned 285,000 ETH back to Crypto.com, Marszalek stated that all funds were returned. Further investigation showed that the missing 35,000 ETH was sent to a different address, which is yet to be confirmed by the crypto exchange.

It’s not the first time Crypto.com made headlines for an accidental transfer. Back in August 2022, it was found that Crypto.com accidentally sent AUD $10.5 million (worth over $7 million) to Melbourne-based investors, which was supposed to be an AUD $100 ($67) refund. The incident occurred back in May 2021 but was not discovered until an annual audit in December 2021.

Marszalek promised to publish Crypto.com audited proof of reserves on November 10 while highlighting the importance of transparency and user’s safety.

We share the belief that it should be necessary for crypto platforms to publicly share proof of reserves and https://t.co/pFc4Pz9nFR will be publishing our audited proof of reserves.
— Kris | Crypto.com (@kris) November 10, 2022

With most crypto businesses willing to share their proof of reserves, investors now have the opportunity to confirm the existence of their funds, which ultimately prevents business owners from misusing the cold storage funds.

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Mt. Gox wallet transfers 6,800 BTC as ex-CEO plans to redistribute $6B

April 2, 2022 Coin Telegraph

Mt. Gox wallet transfers 6,800 BTC as ex-CEO plans to redistribute B

Bitcoin Wallet

Former CEO Mark Karpeles disclosed that the exchange had roughly 200,000 BTC in possession during the company’s closure, out of which the trustee sold 50,000 BTC for $600 million in the past.

A cold wallet belonging to the infamous Bitcoin (BTC) exchange Mt. Gox transferred 6,800 BTC to an unknown wallet just days after the former CEO Mark Karpeles revealed plans to redistribute BTC worth $6 billion to its creditors.

Mt. Gox was a Tokyo-based Bitcoin exchange that shut down in Feb. 2014 after a hack that compromised 850,000 BTC. In a recent interview, Karpeles disclosed that the exchange had roughly 200,000 BTC in possession during the company’s closure, out of which the trustee sold roughly 50,000 BTC for $600 million in the past.

According to Karpeles, the remaining 150,000 BTC currently held by Mt. Gox has grown in value over the years — and is worth over $6 billion. After this revelation, the former CEO confirmed plans to redistribute the money and settle scores with the creditors.

6,800 #BTC (318,980,017 USD) transferred from #MtGox Cold Wallet to unknown wallethttps://t.co/sYczH1c8ho
— Whale Alert (@whale_alert) April 1, 2022

Five days after Karpeles’ interview, Crypto Twitter’s @whale-alert highlighted that 6,800 BTC, worth nearly $319 million, were transferred to an unknown wallet from a cold wallet belonging to the now-defunct Mt. Gox exchange.

Details about the 6,800 BTC transfer between Mt. Gox and unknown wallet. Source: WhaleAlert

Despite being non-operational for over 8 years, the Mt. Gox team has previously shared a rehabilitation plan to compensate creditors. However, the 6,800 BTC transfer signals a possible commencement of the plan.

While crypto businesses continue to adopt various security measures to fend off attacks, bad actors have kept up with the change to lure in unwary investors.

Warning @BearsRare
Discord has unfortunately been compromised. Please DO NOT click any links, connect your wallet and block all incoming DMs in our discord. Our team are working on the situation as we speak
— Rare Bears (@BearsRare) March 17, 2022

On Mar. 18, the recently launched nonfungible token (NFT) project, Rare Bears, confirmed a successful phishing attack — resulting in a loss of nearly $800,000 in NFTs.

As Cointelegraph reported, the hacker was able to compromise a moderator’s account on Discord and posted phishing links that ultimately drained user wallets. The Rare Bears team was eventually able to remove the compromised account and secure the server from further attacks.

Did rapper YG just flex a $30M Bitcoin stack in his new music video?

March 25, 2022 Coin Telegraph

Bitcoin

YG is seen in the music video holding a Ledger cold storage USB close to a smartphone which has a screen bearing a wallet app with more than $30.6 million worth of BTC in it.

Keenon Dequan Ray Jackson, the rapper who goes by the name YG appears to show off a fat $30 million stack of Bitcoin (BTC) in his latest music video.

The reveal appears to either be an eye-watering — but possibly fake — flex, or a crafty bit of product placement, as a cold storage device from crypto wallet provider Ledger is featured prominently in the video. The social team from Ledger was on it immediately too:

We see you! @YG knows how to secure those bags of #bitcoin … not your keys, no your coins.
— Ledger (@Ledger) February 11, 2022

In one of the scenes of the music video for the song titled “Scared Money” featuring J. Cole and Moneybagg Yo, YG is seen holding a Ledger wallet close to a smartphone which has a screen bearing a wallet app with more than $30.6 million worth of BTC in it.

While the image could have easily been faked, rappers are well known for flaunting their wealth and success, especially so in this song which has a theme focused on spending money, investing and wearing half a million dollars worth of jewelry around one's neck.

YG is quite the BTC proponent, as he has mentioned owning digital gold in multiple other songs such as “Big Bank” from 2018, and also in an interview with RollingStone from mid-2021.

During that interview YG said that he liked the simplicity of hodling crypto as he could invest his money into the asset class without being distracted from his music career. He drew comparisons to the real estate market, where he would have to spend a lot time working and learn to do it successfully.

“I f*ck with Bitcoin. [...] I got Ethereum recently and I got Dogecoin recently but I’ve had Bitcoin for about three years. [...] Bitcoin came around and it was like ‘what?’ and I can just do it and it turns into that?” he said in reference to the booming price of the asset last year.

In a Reddit post on the r/Bitcoin Reddit community earlier today, users were questioning YG’s mammoth BTC stack, with AvoidMyRange stating that “the chance of all these ending at 0 and the cents ending in .00 is incredibly low. This is obviously fake.”

“It is fake because that isn’t even the layout of the ledger app,” user AKeveryday responded.

Other users saw the funny side of YG’s music-based BTC antics, with Redditor Lexstell11 doing the math on the lyrics from the Big Bank song when BTC was priced around the mid $7,000 range.

“In YG’s song Big Bank, he says ‘I might buy her red bottoms with the crypto- 3 coins that’ll pay your whole semester…’ the song was released on 5/25/2018 when BTC was $7,459 at close. So presumably YG paid $132,000 by today’s conversion for a girl's semester at what I’m assuming was University of Phoenix. I think about this a lot.”

Crypto has attracted a strong cohort of rappers over recent years, with icons such as Jay Z and NFT-bull Snoop Dogg both making heavy plays in the sector. Other well-known figures to jump on the gravy train include Meek Mill who snapped up Dogecoin amid the hype last year, Nas who tokenized his music as NFTs earlier this year, and Post Malone who featured a Bored Ape Yacht Club NFT in one of his recent music videos.

Cold Storage