Home General Investments Crypto’s Cursed Week: Robinhood Fined, Coinbase Investigated, Hackers Steal Millions

Crypto’s Cursed Week: Robinhood Fined, Coinbase Investigated, Hackers Steal Millions

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Crypto’s Cursed Week: Robinhood Fined, Coinbase Investigated, Hackers Steal Millions

It has already been a tough week for crypto. But all of this could be the temporary discomfort of a revolutionary new industry that is still maturing. Here’s what you need to do.

The problems in the crypto industry continue to pile up. Amid government crackdowns, multi-million dollar thefts, bankruptcies, and the decline of some of the world’s leading digital currencies, crypto has found itself in a moment of judgment that seems to be getting worse by the day. day.

In the first two weeks of July, Voyager Digital and Celsius Network filed for Chapter 11 bankruptcy. Customers of both companies could potentially suffer financially. Later that month, it was revealed that the The U.S. government had launched investigations in Coinbase and Kraken for allegedly allowing US customers to sell unregistered securities as digital assets and for allegedly violating US sanctions law, respectively.

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Crypto has been taking L after L lately. (Credit: Adobe Stock)

August brought further damage to the reputation of crypto.

On Monday, the US Securities and Exchange Commission (SEC) – which is also the agency leading the Coinbase investigation – announced that 11 people had been charged over their connections to a “crypto pyramid and Ponzi scheme”. called Forsage who raised a surplus of $300. min.

Also on Monday, hackers stole nearly $200 million from Nomad, a service that allows users to move crypto assets between blockchains. The company acknowledged in a tweet late yesterday that it was “aware of the incident involving the Nomad Token Bridge”, and followed up with a tweet this morning that said the company was “working around the clock to address to the situation and [has] notified law enforcement… Our goal is to identify the accounts involved and trace and recover the funds.

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It was then revealed this morning that the New York State Department of Financial Services – the state’s top financial regulator – had fined the crypto arm of Robinhood, a $30 million online financial services. The NYDFS alleges that Robinhood Crypto LLC violated New York’s cybersecurity and anti-money laundering rules.

Also from New York: That state’s Attorney General Leticia James also announced yesterday that her office wants to hear from “any New Yorkers cheated or affected by the cryptocurrency crash,” according to a statement. James’ office “is interested in hearing from New York investors who have been locked out of their accounts, unable to access their investments, or misled about their cryptocurrency investments.”

Crypto may be down, but it’s not out

Despite all this negative news, we should always keep in mind that crypto is probably here to stay.

The market may be going through a valley right now, but that could also be interpreted as the growing pains of a transformative new technology that is still trying to come to terms with the existing social, political and financial order.

It can be easy, amid all the recent sensationalist press, to believe that crypto is a failed experiment, an elaborate get-rich-quick scheme that is now flaring up in a big way. But the reality is of course a bit more complicated. The vast majority of crypto companies have not gone bankrupt and most crypto investors have not lost their fortunes. The tension between government officials and some crypto companies in the United States is arguably the inevitable result of two powerful forces having a much-needed conversation about what the future will look like and what the rules should be for the two to co-exist. peacefully and productively.

Crypto and Web3 are not one

It is also important to clarify: crypto and Web3 are not synonymous.

The former’s reputation has taken a beating lately, but that shouldn’t seriously affect your opinion of the latter. Web3 should be seen as a blockchain-centric ecosystem of technologies, of which crypto is just one part. The current crypto crisis certainly raises important questions about the security of using decentralized blockchains as a means of sharing sensitive information, but that does not necessarily mean that the so-called “metaverse”, NFTs or any other technology emerging associated with Web3 is going anywhere soon.

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