Orbit Bridge loses $82 million due to hacker attack, BTC plummets, spot ETF approval window closes | Weekly review

This week, Orbit Bridge suffered an $82 million attack, while Bitcoin (Bitcoin) plummeted on FUD upgrade after retesting $45,000. At the same time, the approval window for spot BTC ETFs is getting closer.

Orbit loses $82 million due to hacker attack

• On December 31, 2023, a member of the cryptocurrency community called public attention to the possible exploitation of the bridge protocol native to the Orbit blockchain network, with multiple assets in the bridge’s contract being exhausted.

• Shortly after issuing the initial alert, the Orbit Chain team confirmed reports of an attack on the bridge. Data confirms that the protocol lost up to $81.5 million across multiple cryptocurrencies due to the hack.

• In its disclosure, the Orbit team emphasized that they are evaluating the cause of the hack and working with law enforcement on the matter. The report shows that its operating model is similar to the trend of North Korean hackers.

CoinsPaid hacked, North Korea in focus

• Days after the Orbit Bridge breach, Estonia-based crypto payment protocol CoinsPaid suffered its second hacker attack in six months. The breach resulted in a $7.5 million loss across multiple crypto assets including BNB and Ethereum (ETH).

• As hacking incidents continue to increase, a report from TRB Labs this week focused on North Korean hackers who were responsible for multiple attacks recorded last year. The report states that these hackers stole $600 million in cryptocurrency from hackers last year and accounted for one-third of all hacks in 2023.

Discussions surrounding spot BTC ETFs are growing

• In anticipation of the approval of a spot BTC ETF, industry commentators continue to predict that BTC’s price is about to explode. This week, an adviser to VanEck, one of the asset managers looking to launch the product, disagreed with that consensus.

• In a detailed X disclosure on December 31, Gabor Gurbacs cited gold as an example, arguing that the cryptocurrency community is overestimating the potential impact of spot BTC ETFs on Bitcoin prices. He said the expected Bitcoin price explosion may not materialize.

• Vetle Lunde, senior analyst at K33 Research, had a similar view. Lund’s outlook, however, leans bearish, as market observers expect the BTC ETF’s approval to trigger a news frenzy of selling, causing the price of Bitcoin to fall.

• Speculation about an ETF product being approved emerged earlier this week, with some market observers backing the claim. Fox reporter Eleanor Treat refuted those claims, noting that a decision won’t be made this week.

• Although optimism about ETF approval remains high, this week Better Markets CEO Dennis Kelleher urged the US SEC to reject applications for spot BTC ETFs, arguing that these products may expose investors to market manipulation and fraud in the crypto space.
• John Reed Stark, a former SEC executive and cybersecurity expert, echoed Kelleher’s comments in a lengthy and scathing social media post.

Spot BTC ETF registration update

• There have also been some updates this week on multiple filings for spot Bitcoin ETFs. On January 3, reports confirmed that Fidelity Investments, one of the asset management companies participating in the ETF competition, submitted Form 8-A to the SEC in the hope of registering its Fidelity Wise Origin Bitcoin Fund as a publicly traded security.

• Shortly after, asset managers VanEck and Grayscale filed similar Form 8-A documents with the SEC for their respective BTC ETF products. These documents will allow companies to register their products as securities for trading on public exchanges upon approval.

• Additionally, Ark 21Shares and Valkyrie filed their own Form 8-A documents on the same day as Grayscale and VanEck. The growing number of Form 8-A applications has further fueled optimism that the product will be approved soon.

• Interestingly, in a show of support for the Bitcoin community, VanEck this week announced plans to donate 5% of its Bitcoin ETF proceeds to support Bitcoin Core developers, specifically Bitcoin Brink, a non-profit organization dedicated to the development of the Bitcoin protocol. .

Bitcoin plunges after retest

• Meanwhile, as these ETF discussions and updates continue, the market maintains the optimism surrounding Bitcoin, leading to a gradual but steady increase in price. BTC eventually rebounded to a high of $45,879 on January 2, retesting $45,000 for the first time since April 2022.

• However, the rally was short-lived as ETF talk soured. Crypto services provider Matrixport first asserted that Bitcoin could hit $50,000 in January, solidifying the bullish outlook for the cryptocurrency’s premier crypto asset.

• Nonetheless, following the release of this report, Matrixport stated in a paper on January 3 that the SEC would reject all BTC ETF applications in January, with eventual approval in the second quarter of 2024. The Matrixport team noted that they expect BTC to drop to $36,000 to $38,000 as a result of this.

• Bitcoin plummeted on January 3, hitting a low of $40,750 before making a comeback. The asset eventually closed down 4.68% on January 3, dragging the entire cryptocurrency market with it. This resulted in nearly $700 million in liquidations in the perpetual market.

• BTC has recovered from this plunge and is currently trading at $44,349, up 5.2% for the week. Amid the recovery, BitMEX founder and former CEO Arthur Hayes released a report suggesting that BTC may be in for a healthy correction due to certain macro events on the horizon.
• BitMEX was also part of the team responsible for launching approximately $45,000 worth of physical Bitcoin into space using a United Launch Alliance (ULA) Vulcan rocket. Lift-off is planned for January 8, and the expected date of arrival at the moon is February 23.

• Meanwhile, an unidentified Bitcoin whale transferred $1.19 million worth of BTC to the wallet of Bitcoin founder Satoshi Nakamoto, commonly known as the Genesis wallet. The development has sparked speculation among cryptocurrency proponents.

Nigeria pushes for cNGN, SEC insists BUSD is a security

• This week, a number of incidents surrounding cryptocurrency regulation and enforcement surfaced. The apex bank of Nigeria, the most populous black nation, released a report this week providing rules for the country’s banks on the operation of cryptocurrency accounts.

• The report comes shortly after the country lifted its blanket ban on cryptocurrency trading. This week, the central bank also approved the proposed cNGN project, which is scheduled to start next month.

Meanwhile, in the United States, the Securities and Exchange Commission continues to press ahead with its enforcement actions. Recall that the judge agreed with the argument in the Terraform Labs case that the Terra ecosystem tokens were securities. The agency cited this ruling to argue that BUSD is also a security in the Binance case.

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