Illustration by Mitchell Preffer for Decrypt
With crypto prices cooling by double-digit percentages over the week as Autumn approaches, it’s fair to say that any respite from crypto’s ongoing winter this year has been fleeting.
A recent wave of high-profile attacks and bankruptcies has put the industry on red alert. It’s not just thieves and insolvent crypto lenders raising alarm, it’s also western governments—specifically the United States and the Netherlands and their policies on Tornado Cash, a transaction privacy tool that works by mixing users’ crypto up in a common pool before sending it off to its intended destination.
Last week, the U.S. Treasury Department decided to ban American citizens from using Tornado Cash or transacting with Ethereum addresses linked to Tornado’s community. By that Friday, the Netherlands’ Fiscal Information and Investigation Service (FIOD) arrested a “suspected” Tornado Cash developer. The crypto community and privacy advocates decried the move as a declaration of war on coders.
Neeraj Agrawal, director of communications at crypto think tank Coin Center, announced that his organization is challenging the U.S. Tornado sanctions in court.
Sam Canavos, a legal fellow at DeFi Education Fund, reached out to the FIOD for more information about the Tornado developer’s arrest and shared the responses he has received.
The DeFi Education Fund followed up with a tweet the next day saying that the statement by the FIOD “raises more questions than it answers.”
🚨 New info from the Netherlands agency that arrested tornado cash developer Alexey Pertsev
We wanted to get this *troubling* statement from the FOID out there (which raises more questions than it answers) while we’re chasing down more info + assessing next steps
h/t @sccanavos pic.twitter.com/qbJK4F49vR
— DeFi Education Fund (@fund_defi) August 17, 2022
In a similar story, Chinese blockchain journalist Colin Wu tweeted that crypto exchange FTX had frozen the account of a user who sent crypto to another blockchain privacy mixer called Aztec Network. FTX CEO Sam Bankman-Fried responded by stressing that, to his knowledge, no accounts have been frozen.
To be clear–this is getting garbled. We are constantly monitoring transactions for AML compliance, and do enhanced due diligence on certain transactions, but that does not mean that any accounts were frozen. https://t.co/FVOGHUa4TJ
— SBF (@SBF_FTX) August 19, 2022
Aztec Network responded later in the week by saying that it is “taking active measures” to ensure that the service isn’t used by money launderers and other criminals.
Counterfeit announcements
On Tuesday, internet security researchers at ESET Labs tweeted about a phony Coinbase job offer. The PDF file is really a trojan horse deployed by North Korean state-sponsored cyber criminal hacking group Lazarus.
On Thursday, Twitter user @tier10k posted a warning that a fake Securities and Exchange Commission missive wasalso making the rounds online.
Finally…
The Ethereum Name Service started the week by announcing that over the last three months, the number of registrations for .ENS domain names has doubled. Ethereum Name Service allows people to register memorable domains for their crypto wallets, instead of being limited to the unwieldy string of random numbers and letters that typically represents a blockchain address.
We are about to surpass 2,000,000 ENS registrations.
We passed 1,000,000 about 90 days ago, which took five years.
Congrats to the ENS community.
— ENS Domain Broker (@ensdomainbroker) August 15, 2022
On Wednesday, Twitter user @mochains shared news of new crypto regulation in Canada. According to the announcement he shared, Canadian authorities have selected Bitcoin, Ethereum, Litecoin and Bitcoin Cash as “unrestricted cryptocurrencies.” All other crypto will beis subject to a $30k cap per annum.
new regulatory changes in Canada for crypto
you are allowed to buy as much btc/eth/ltc/bch as you want but any other crypto has a limit of 30k net buy per year
bruh.. pic.twitter.com/Emqf75aCrN
— mo (@mochains) August 17, 2022
Later that day, Twitter CEO Brian Armstrong fielded an important question.
It’s a hypothetical we hopefully won’t actually face. But if we did we’d go with B i think. Got to focus on the bigger picture. There may be some better option (C) or a legal challenge as well that could help reach a better outcome.
— Brian Armstrong – barmstrong.eth (@brian_armstrong) August 17, 2022
Also that day, Ukraine’s Vice Prime Minister Mykhailo Federov, shared a balance sheet revealing what his country has spent its crypto donations on since the beginning of Russia’s invasion.
With $54 M raised by @_AidForUkraine, we’ve supplied our defenders with military equipment, armor clothes, medicines and even vehicles. Thanks to the crypto community for support since the start of the full-scale invasion! Donation by donation to the big victory. Report below. pic.twitter.com/lifHAP8R4f
— Mykhailo Fedorov (@FedorovMykhailo) August 17, 2022
Tesla CEO Elon Musk jokingly announced he’s buying Manchester United. MicroStrategy CEO Michael Saylor has a better idea.
Lastly, Bitcoin hodler Hodlonaut wants you to help him defend his claim that Dr. Craig Wright, a man who claims to have invented Bitcoin, is not the Satoshi he says he is.
Recently, the UK High Court ruled that Dr. Wright put forward false evidence as part of his latest defamation court battle against crypto podcaster Peter McCormack, who, like Hodlonaut, has repeatedly called Wright a liar. McCormack was asked to pay Wright £1 ($1.18) in damages.
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Source: https://decrypt.co/107901/this-week-on-crypto-twitter-tornado-cash-crackdown-north-korean-hackers-fake-coinbase-jobs
