Crypto Three Things (8/2)

Tuesday, Aug 2nd 2022

Commentary

SEC charges Forsage, Vauld granted a break, Nomad loses $200M

 “Look at the view. You’ll never be disappointed.”- Anna Quindlen


1) SEC charges 11 in $300M Ponzi scheme: A “massive” cryptocurrency pyramid scheme was knocked down by the Securities and Exchange Commission, the agency reported Monday. Forsage raised more than $300M illicitly from millions of retail investors. The firm’s four Russian founders and several more were charged with promoting the program and aggressively recruiting others to participate.

Titan’s Takeaway: This fresh charge highlights the increased involvement from financial watchdogs in the digital asset industry. The more light there is in the space, the fewer fraudulent practices there will be.  

2) Vauld granted 3-month creditor protection: The Singapore High Court granted the troubled crypto lender three months to provide more details on cash flows and asset valuations before its 147,000 creditors could resume legal proceedings. Vauld held more than $330M in client funds before freezing withdrawals in July. The company is in talks for a potential acquisition by rival lender Nexo.

Titan’s Takeaway: Some breathing room will give Vauld time to get its priorities in order, and with a potential acquisition on the cards, we’re rooting for locked-out clients to see their funds again.  

3) Nomad bridge suffers $200M hack: Crypto criminals exploited a security vulnerability in Nomad’s cross-chain bridge, draining virtually all of the platform’s funds. The company said it’s working “to identify the accounts involved and to trace and recover the funds.” Ironically, Nomad, a cross-chain interoperability protocol, raised $22.4M in April to tackle the growing need for securely moving crypto assets between blockchains.

Titan’s Takeaway: The cyberattack addresses serious security flaws in cross-chain token bridges – a heavily exploited aspect in the crypto ecosystem. With rising demand for swapping blockchains, developers must ensure a safe environment.


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