FTX Transfers $8.3M One Day Prior To Amended Proposal Deadline

Here are some of the major developments in the world of crypto over the past few days.
some of the major developments from the world of crypto
some of the major developments from the world of crypto

A total of $8.3 million worth of virtual currency was transferred from two wallets belonging to the bankrupt FTX exchange and its sister trading company, Alameda Research. According to a May report, more than $2 million worth of 860 Tether Gold (XAUT) was transferred from an FTX-linked address to algorithmic trading firm Wintermute, while a total of more than $6.3 million was transferred from an Alameda-linked wallet, equivalent to 2,027 Ether (ETH), to two unknown addresses, as reported by PeckShield.

The amended plan may provide FTX creditors with more insight into how their lost funds will be compensated. The final deadline for appeals is June 5th. The collapse of FTX and its more than 130 subsidiaries is considered one of the most notorious black swan events in the cryptocurrency industry, resulting in users losing at least $8.9 billion worth of funds. The crash triggered the industry's longest crypto winter, with Bitcoin (BTC) prices falling from $63,477 to $16,000.

FTX's revised plan could shed more light on how customers will be compensated, but some creditors are expecting negative news. Popular FTX creditor Sunil, who is part of the FTX Customer Ad Hoc Committee, the largest group of over 1,500 FTX creditors, has asked users to reject future plans that are likely to benefit the debtor. The legal proceedings could take years to reach a conclusion, similar to the long-running case against cryptocurrency exchange Mt. Gox, which was the victim of a notorious hacker attack in 2014.

CFTC Chair Anticipates More Enforcement Actions Against Crypto Firms in Next 2 Years

U.S. Commodity Futures Trading Commission (CFTC) Chairman Rostin Behnam says that as long as the market attracts investor attention, the country's regulators will continue cracking down on crypto companies. Speaking at the 2024 Global Conference on May 6, Behnam said that despite the bad events that caused the market decline and the bankruptcy of several companies in 2022, the crypto market will continue to grow and attract investors and entrepreneurs.

Mr. Behnam agreed with the moderator that it is the right thing for US lawmakers to include crypto companies in their regulatory framework. House members are awaiting a vote on a bill introduced in committee in July 2023 that would clarify the SEC and CFTC's role in digital assets. Regulators have pending cases against U.S. crypto companies such as Kraken, Binance, and Coinbase, and issued a Wells Notice (usually a precursor to enforcement action) to Robinhood Crypto on May 4th.

Behnam said in October that about one-third of all enforcement actions taken by the CFTC against crypto companies occurred in 2023. In November, the CFTC reported filing 47 lawsuits in the digital asset space, including cases against former FTX CEO Sam Bankman-Fried and former Celsius CEO Alex Mashinsky. The committee was also involved in a $4.3 billion settlement between Binance and U.S. authorities in November.

Polygon Launches Testnet for Miden, Its ZK-Rollup Ethereum Scaler

Polygon, a developer of Ethereum Layer 2 solutions, has launched an alpha testnet for its latest zero-knowledge (ZK) rollup solution called Miden, as the competition to scale Ethereum intensifies. In a post on May 6th, Polygon announced that the Polygon Miden Alpha Testnet is now open for developers to begin testing. Miden, like other ZK rollups, uses a type of cryptography that allows data to be verified or proven without revealing its contents to the rest of the network.

Miden also introduces additional features such as private accounts, enabling private tokens and transactions where only the hash of the account is stored on-chain. It also leverages parallel transaction execution, allowing transactions to be processed concurrently, resulting in much higher throughput and reduced blockchain node state bloat compared to the Ethereum mainnet.

Other planned key features for Miden include customizable smart contracts and custom node scripts, allowing users to create their own using Miden's virtual machine (VM) or programming languages such as Rust. Miden enters the market in direct competition with other alternatives such as StarkWare's layer 2 scaling network and rollup technology stack, StarkNet, and Matter Labs' zkSync Era. Despite the testnet launch, Polygon's native token, Polygon MATIC, did not show significant movement, falling 3.7% on the day to trade at $0.704 at the time of writing.

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