Nobody Cares: the Non-Fungible Thread

[Argent Stonecutter]

WTF SEC?

 

[GoblinCampFollower]

Last gasping breaths, or last gasping breaths?

Bitcoin price hits record $69K after SEC approvals fueled $7B in investments

SEC chair warns bitcoin is still "volatile" and linked to "illicit activity."

arstechnica.com

I'm sure a lot of this is driven by United paying their hackers ransom with it. I'm sure bitcoin will never die because it's useful to criminals and interesting to contrarian types. I still think it's a shitty long term investment and will crash all the time too. "The market can remain irrational longer than you can remain solvent."

 

[Noodles]

I'm sure a lot of this is driven by United paying their hackers ransom with it. I'm sure bitcoin will never die because it's useful to criminals and interesting to contrarian types. I still think it's a shitty long term investment and will crash all the time too. "The market can remain irrational longer than you can remain solvent."

Feels like ransoms could definitely artificially inflate things, and the random people may even be the ones selling the crypto. Ask for 500k in crypto, then flood your on the market at a mark up, and the random victim buys it up, not even knowing it came from you. Then they give it back.

 

[Dakota Tebaldi]

Incognito crypto drug marketplace rugs, then extorts users

Since March 5, those who used the Incognito Market darkweb narcotics marketplace have found themselves unable to withdraw the Bitcoin and Monero they had on the platform. It appeared the platform had exit scammed for somewhere between $10 and $30 million.

Making matters worse, on March 10 the website posted a message reading, "Yes, this is an extortion !!" They wrote that, although the platform promised to "auto-encrypt" messages between buyers and sellers, and auto-delete after an expiry date, messages were not encrypted or deleted. They demanded that users pay an additional $100 to $20,000 to have their information removed from the dataset, which they promised to release at the end of May. "Whether or not you and your customers' info is on that list is totally up to you."

The tactic is reminiscent of that of ransomware groups, which often demand double fees: one from victims of hacks first to regain access to their systems, and another in exchange for a promise to destroy stolen data.

 

[Free]

Bitcoin Fog operator convicted of laundering $400M in bitcoins on darknet

Roman Sterlingov will appeal, denouncing DOJ's crypto-tracing techniques.

arstechnica.com

A US federal jury has convicted a dual Russian-Swedish national, Roman Sterlingov, for operating Bitcoin Fog, "the longest-running bitcoin money laundering service on the darknet," the Department of Justice announced yesterday.

Sterlingov ran Bitcoin Fog from 2011 to 2021, moving over 1.2 million bitcoin (approximately $400 million) before he was arrested, the DOJ said. In the press release, Deputy Attorney General Lisa Monaco said that the DOJ was "relentless" in efforts to "painstakingly" trace bitcoin "through the blockchain to hold Sterlingov and his Bitcoin Fog enterprise to account."

Throughout the trial, Sterlingov maintained his innocence, accusing the US of relying on "junk science" to trace bitcoin using faulty blockchain analysis techniques, Wired reported.

 

[Dakota Tebaldi]

Yep they're also called "tumblers" and as I understand it, it works like this. Say you have like 100 bitcoin that you want to launder. Remember that each bitcoin has a unique identifier that allows you to trace its history from wallet to wallet, which undermines anonymity to an extent. Tumblers are an attempt to obfuscate this - you put your 100 bitcoin into the tumbler pool, and the tumbler issues a bunch of smaller transactions from the pool to your alt wallets that presumably you weren't stupid enough to ever connect back to your main wallet in some way. But since the tumbler is constantly issuing small transactions of various sizes to all kinds of wallets, not just yours, the "chain of custody" is broken - between all of your alt wallets you will get "100 bitcoins" back, but they won't be the exact same 100 unique bitcoins that you put into the pool, and it's hard to tell which alt wallets are getting the output from the main wallet's input.

But, that's the thing - it's hard to tell. Not impossible to tell, for someone who is diligent and persistent enough to go through the logs over a long enough time and math it all out.

 

[Soen Eber]

Yep they're also called "tumblers" and as I understand it, it works like this. Say you have like 100 bitcoin that you want to launder. Remember that each bitcoin has a unique identifier that allows you to trace its history from wallet to wallet, which undermines anonymity to an extent. Tumblers are an attempt to obfuscate this - you put your 100 bitcoin into the tumbler pool, and the tumbler issues a bunch of smaller transactions from the pool to your alt wallets that presumably you weren't stupid enough to ever connect back to your main wallet in some way. But since the tumbler is constantly issuing small transactions of various sizes to all kinds of wallets, not just yours, the "chain of custody" is broken - between all of your alt wallets you will get "100 bitcoins" back, but they won't be the exact same 100 unique bitcoins that you put into the pool, and it's hard to tell which alt wallets are getting the output from the main wallet's input.

But, that's the thing - it's hard to tell. Not impossible to tell, for someone who is diligent and persistent enough to go through the logs over a long enough time and math it all out.

That sounds like something a complete set of logs and AI can figure out in maybe an hour or less.

 

[Dakota Tebaldi]

lol...

Okay so, let me explain what exactly happened here.

First, for this to make sense you need to know what an "airdrop" is, if you're not familiar. In NFT-land, an airdrop is when some other party spontaneously sends one or more NFTs directly to your crypto wallet - that is, it's an NFT someone sent you that you didn't actually buy. Airdrops are possible because if you know someone's crypto wallet address, you can drop anything into it that you want at any time. Literally anything - some crypto money, or NFTs, or a virus that steals everything in their wallet, etc; the possibilities are endless! Anyway, airdropped NFTs are most often free gifts; they're given out in order to drum up publicly for someone's new NFT project, or as like a raffle prize to encourage people to join your Discord server. But some people can also give them as rewards...for participating in said Discord server, or for helping to hype a project, or for attending someone's crypto event, or whatever.

In NFT-bro terms, airdrops are really the greatest possible thing you can get; you get NFTs basically for free that could end up becoming extremely "valuable", meaning you've made money out of literally nothing (because that totally makes sense in NFT-land) and even if you don't, even if the free NFT never ends up being worth anything at all, well it's not like you lost anything because you didn't pay anything for it to begin with. So the prospect of airdrops that can end up printing magic money at no cost is what has NFT bros joining as many different shady NFT Discord servers as possible and hyping projects that there's no reason to believe would ever be successful.

Anyways; this group/guy/whatever calling themselves "Pacman" created an NFT marketplace called "Blur". It's not really different from any other NFT marketplace except for one key thing: the marketplace promises airdrops of NFTs to users based on their volume of trading. This incentivizes people to make as many trades as possible - all the way up to deliberately selling NFTs at a loss, gambling that the "value" of the tokens they get airdropped by the marketplace admin will be higher than the amount of money they lose by cutting the prices of the tokens they're trading. This has a knock-on effect where NFTs that enter the Blur marketplace steadily depreciate as traders trying to make trades for the sake of making trades rather than for the sake of making a profit continuously chip away at the prices to attract buyers as quickly as possible.

Once enough stupid ape jpegs are available at cut-rate prices, the prices of ALL stupid ape jpegs - even ones not being traded on Blur - go down along with them, because nobody's going to buy a random stupid ape jpeg for $4000 when they can get a different random one for like $100.

That's the long and short of what happened. The comedy where users of a cut-throat adversarial profit-at-all-cost tulip factory think that they can write a stern letter to convince another user to back down from their insanely profitable scam simply because that profit comes at the expense of other users who don't like that they're losing, is typical and a fun bonus.

 

[Free]

 

[Free]

Going "legit."

Ethereum ETF Approval Could Spur 60% Rally as ETH Buying Increases

Holders cumulatively bought over 100,000 ETH in spot markets on Tuesday, the highest daily level since September 2023.

www.coindesk.com

Approval of spot ether (ETH) exchange-traded funds (ETF) in the U.S. could drive a rally of as much as 60% in the second-largest cryptocurrency in the coming months, QCP Capital said in a Thursday broadcast on Telegram.

The forecast echoes the market reaction after spot bitcoin ETFs were approved in January, the Singapore-based firm said. Bitcoin rose to over $73,000 from $42,000 in the two weeks after the ETFs started trading on Jan. 11, CoinGecko data shows.

 

[Beebo Brink]

Crypto hacking thefts double to $1.4 bln in first half of 2024, researchers say | Reuters

LONDON, July 5 (Reuters) - The amount of cryptocurrency stolen in hacks globally more than doubled in the first six months of 2024 from a year earlier, driven by a small number of large attacks and rising crypto prices, blockchain researchers TRM Labs said on Friday.

Hackers had stolen more than $1.38 billion worth of crypto by June 24, 2024, compared with $657 million in the same period in 2023, TRM Labs said in a report.

The median theft was one-and-a-half times larger than the year before, the report said.

 

[Free]

Soon we'll have to post everything in the Techie-buzzword thread.

Ex-directors allege fraud at Tether-backed crypto group Northern Data

Two former executives of Northern Data, a German-listed crypto and AI infrastructure company backed by Tether, say they were sacked after raising concerns about alleged fraud they claim was being perpetrated by its chief executive and chief operating officer.

In a complaint filed last month at the California Central District court, Joshua Porter and Gulsen Kama allege that Northern Data was “falsely misrepresenting the strength of its financial condition to investors, regulators and business partners”, and “was knowingly committing tax evasion to the tune of potentially tens of millions of dollars.”

Northern Data has been making headlines for other reasons this week, with Bloomberg News reporting on Monday that the company has been investigating a US IPO for its AI cloud computing and data centre businesses.

 

[Free]

Just continuing to astound: Now we have health concerns from bitcoin mining.

‘We’re Living in a Nightmare:’ Inside the Health Crisis of a Texas Bitcoin Town

On an evening in December 2023, 43-year-old small business owner Sarah Rosenkranz collapsed in her home in Granbury, Texas and was rushed to the emergency room. Her heart pounded 200 beats per minute; her blood pressure spiked into hypertensive crisis; her skull throbbed. “It felt like my head was in a pressure vise being crushed,” she says. “That pain was worse than childbirth.”

Rosenkranz’s migraine lasted for five days. Doctors gave her several rounds of IV medication and painkiller shots, but nothing seemed to knock down the pain, she says. This was odd, especially because local doctors were similarly vexed when Indigo, Rosenkranz’s 5-year-old daughter, was taken to urgent care earlier that year, screaming that she felt a “red beam behind her eardrums.”

It didn’t occur to Sarah that these symptoms could be linked. But in January 2024, she walked into a town hall in Granbury and found a room full of people worn thin from strange, debilitating illnesses. A mother said her 8-year-old daughter was losing her hearing and fluids were leaking from her ears. Several women said they experienced fainting spells, including while driving on the highway. Others said they were wracked by debilitating vertigo and nausea, waking up in the middle of the night mid-vomit.

None of them knew what, exactly, was causing these symptoms. But they all shared a singular grievance: a dull aural hum had crept into their lives, which growled or roared depending on the time of day, rattling their windows and rendering them unable to sleep. The hum, local law enforcement had learned, was emanating from a Bitcoin mining facility that had recently moved into the area—and was exceeding legal noise ordinances on a daily basis.

 

[Free]

Craig Wright’s claim of inventing bitcoin may get him arrested for perjury

UK judge refers Wright to prosecutors, suggests arrest warrant and extradition.

arstechnica.com

A British judge is referring self-proclaimed bitcoin inventor Craig Wright to the Crown Prosecution Service (CPS) to consider criminal charges of perjury and forgery. The judge said that CPS can decide whether Wright should be arrested and granted two injunctions that prohibit Wright from re-litigating his claim to be bitcoin inventor Satoshi Nakamoto.

"I have no doubt that I should refer the relevant papers in this case to the CPS for consideration of whether a prosecution should be commenced against Dr. Wright for his wholescale perjury and forgery of documents and/or whether a warrant for his arrest should be issued and/or whether his extradition should be sought from wherever he now is. All those matters are to be decided by the CPS," Justice James Mellor of England's High Court of Justice wrote in a ruling issued today.

If Wright actually believes he is Nakamoto, "he is deluding himself," Mellor wrote.

 

[Free]

Foolish funging in honor of Trump. That Pharma Bro Martin Shkreli is behind the token's issuance just adds to the schadenfreudiness.

Trump-Themed ‘DJT’ Token, Issued by Martin Shkreli, Suddenly Dives 90%

A single wallet sold $2 million worth of the token earlier Tuesday, causing market capitalization to fall from $55 million to as low as $2 million almost instantly.

www.coindesk.com

Shkreli is apparently blaming Barron, Trump's son, for the price plunge.

 

[Kamilah Hauptmann]

Okay, Barron's 18 now, but still.

Mind you, Shkreli's quite the impressive sleaze.

 

[Free]

Well, when you look up 'sleaze' in the dictionary...

 

[Essence Lumin]

Foolish funging in honor of Trump. That Pharma Bro Martin Shkreli is behind the token's issuance just adds to the schadenfreudiness.

Trump-Themed ‘DJT’ Token, Issued by Martin Shkreli, Suddenly Dives 90%

A single wallet sold $2 million worth of the token earlier Tuesday, causing market capitalization to fall from $55 million to as low as $2 million almost instantly.

www.coindesk.com

Shkreli is apparently blaming Barron, Trump's son, for the price plunge.

This cybercoin stuff confuses me. First of all there is the story Free posted that was first published August 6.

Then there is this from June 18. And what about not being involved in securities without being in violation of parole?

https://x.com/adamscochran/status/1803256033571140093

 

[Free]

There might be one reason to cheer for "A.I."

It Has Never Been Less Profitable to Mine Bitcoin, JPMorgan Finds

When it comes to the profitability of mining Bitcoin, JPMorgan analysis suggests that it has never been more over.

futurism.com

It's not a great time to mine Bitcoin.

As Coindesk reports, an analysis from JPMorgan found that the computational power required to mine the elite cryptocurrency has outpaced its value thanks to investors chasing artificial intelligence gains and abandoning crypto in the process.

The result: Bitcoin mining profitability is at an all-time low, and it remains to be seen whether or not it will keep going lower.

 

[Dakota Tebaldi]

Cryptocurrency 'pig butchering' scam wrecks Kansas bank, sends ex-CEO to prison for 24 years

The massive embezzlement led to the collapse and FDIC takeover of Heartland Tri-State, one of only five U.S. banks that failed in 2023.

www.nbcnews.com

Shan Hanes was the CEO of Heartland Tri-State Bank, a small local bank based in Elkhart, Kansas, who stole some $47 million from his bank along with smaller amounts from other local organizations, using the funds to buy cryptocurrency that he believed he needed to pay in order to unlock a vastly larger sum of crypto that he had been told was waiting for him in an overseas bank. He was just sentenced to 24 YEARS in prison!

"Pig butchering" in this case is in a way kinda-sorta a crypto-coated Nigerian Prince scam. The scammers convince the target to start "investing" in crypto through them, and use a fake website that pretends to show the target's "account balance" which of course is gathering stupidly massive gains. However in order to unlock or "guarantee" those numbers, further investments are needed - again and again.

Heartland Tri-State was a very small bank - the $47m Hanes stole was like a third of its total holdings - but even so, Hanes was not some financially-illiterate poser. According to the article he was the chair of the state banker's association two years ago, and has been on the board of the national association. The guy was a traditional financial expert. And yet, he fell headlong into this scam, he didn't even snap out of it when a friend he tried to beg money from told him outright that he was being suckered.

The fraud resulted in the bank being shut down but FDIC fully covered everyone who had deposits at Heartland, so no depositors lost any money over this. Their accounts were safely transferred to another bank. But to help cover the insurance obviously, the FDIC took all of the bank's remaining assets and sold them to that other bank, which means Heartland Tri-State's investors lost all of their equity - some $9 million worth altogether, just poof-gone. And again this was a small local bank, not some Wall Street monolith, so those investors were just locals and small-business owners.

The article is worth the whole read, it details how this situation played out but more importantly it goes into the human cost of the situation.