Latest news with #Chainalysis
Yahoo
11 hours ago
- Business
- Yahoo
The U.S. government's new strategic reserve: Billions in seized crypto
President Donald Trump signed an executive order in March that boosted the spirits of cryptocurrency investors - and created a digital money mystery. Trump directed the treasury secretary to create two national stockpiles of crypto assets, putting digital currencies alongside gold, foreign currencies and other assets in the U.S. reserve. Subscribe to The Post Most newsletter for the most important and interesting stories from The Washington Post. The assets are to include crypto seized by federal agencies in criminal or civil proceedings. But the government has not disclosed how much bitcoin, or which other crypto coins, it holds. New data on what crypto cash the U.S. government has seized may now provide some answers. It suggests the crypto reserves will together hold more than $21 billion in cryptocurrency. Trump ordered the creation of a Strategic Bitcoin Reserve, which Trump described as 'a virtual Fort Knox for digital gold,' and a separate U.S. Digital Asset Stockpile to hold other cryptocurrencies. The stockpile will be funded with whatever crypto assets the Treasury holds other than bitcoin, leaving the stockpile's composition to be largely determined by a mixture of chance and criminal conduct. That unconventional method for selecting government financial holdings had the benefit of making the reserves cost-neutral for the taxpayer. It also provided a way to estimate what exactly might go into the two pools before results are released from an official accounting of U.S. crypto holdings that is underway. Because government seizures are disclosed in court documents, news releases and other sources, crypto-tracking firms can use those notices to monitor which digital assets the U.S. government holds. Chainalysis, a blockchain analytics firm, reviewed cryptocurrency wallets that appear to be associated with the U.S. government for The Washington Post. The company estimated how much bitcoin it holds, and the other crypto tokens in its top 20 digital holdings as of May 13, by tracking transactions involving those wallets. The United States' top 20 crypto holdings according to Chainalysis are worth about $20.9 billion as of 3 p.m. Eastern on May 28, with $20.4 billion in bitcoin and about $493 million in other digital assets. It has been scooped up from crimes such as stolen funds, scams and sales on dark net markets. Those estimates put the U.S. government's top crypto holdings at less than the approximately $25 billion worth of oil held in the U.S. Strategic Petroleum Reserve. Their value is nearly double the Fed's listing for U.S. gold holdings, although that figure uses outdated pricing and would be over $850 billion at current prices. The Treasury declined to comment on U.S. government crypto holdings. Before Trump's order established the crypto reserves, the U.S. government had not had a cohesive plan for handling its digital assets, said Eric Jardine, cybercrimes research lead at Chainalysis. It had regularly off-loaded pieces of its digital holdings through asset sales and restitution to crime victims, he said, apparently in part because crypto wasn't an asset it was considered strategic. The crypto tokens headed for the U.S. Digital Asset Stockpile according to the Chainalysis list include ethereum, the world's second-largest digital asset, and a string of other crypto tokens with punier name recognition. They include derivatives of bitcoin and ethereum that mirror those cryptocurrencies' prices, several stable coins designed to be pegged in value to the U.S. dollar, and 10 tokens tied to specific companies, including the cryptocurrency exchanges FTX, which imploded in 2022 after defrauding customers, and Binance. The 20 tokens on the list are generally those with the largest market capitalizations in the $1.3 trillion crypto industry. Trump's March 2 Truth Social post that announced his intention to establish the reserves said they would include XRP, Solana and Cardano, causing their prices to jump, but none feature in Chainalysis's estimate of the top 20 tokens held by the government. Trump's order said creating the reserves would centralize disparate government crypto caches and that 'there is a strategic advantage to being among the first nations to create a strategic bitcoin reserve.' Economists have warned that national reserves of cryptocurrency are likely to benefit only existing investors in the coins selected for inclusion, who could reap profits if the U.S. government's endorsement causes prices to increase. There is broad support for the digital reserves from the crypto industry, which Trump has embraced. Lawsuits and investigations into crypto firms by federal regulators have melted away since his return to office. Last week, the president dined with top investors of a meme coin named after him that generates profits for Trump and his family. Sergey Nazarov, co-founder of Chainlink, a crypto infrastructure company, said in an interview that the bitcoin reserve provides the industry a reputational boost, signaling the U.S. government considers crypto a safe-haven asset, like gold, currencies and government bonds. Nazarov was not aware his company's own crypto token, LINK, appears to have a good shot at landing in the Digital Asset Stockpile until The Washington Post informed him. He called the coin's potential inclusion 'a generally positive thing.' Chainalysis estimates the government holds about $1.5 million worth of the token, which has a market capitalization of over $10 billion, placing it among the top 20 crypto tokens by value. Not everyone in the crypto community favors the U.S. government anointing cryptocurrency as a strategic national asset. 'The original spirit' of crypto, Vitalik Buterin, a co-founder of ethereum, said in a March interview with The Washington Post, 'is about counterbalancing power,' including government and corporate power. Bitcoin, the first widely adopted cryptocurrency, was created during the Great Recession of 2007-2009, amid deep skepticism about traditional finance. Buterin is excited about the idea of governments embracing certain aspects of crypto technology. But the movement becoming too closely associated to 'one particular government team or even a particular corporate team,' he said, could violate crypto's original mission of decentralization and openness. Austin Campbell, a professor at New York University's business school and a principal at crypto advisory firm Zero Knowledge, sees hypocrisy in crypto enthusiasts cheering the government's strategic reserves. The bitcoin community in particular 'has historically been about freedom from sovereign interference,' he said. Campbell argues the U.S. government could put seized crypto coins - and its gold - to better use, by filling in some of the national debt or reducing spending. He would not oppose a crypto reserve, he said, if the United States were running a budget surplus. Trump's use of an executive order bypassed congressional debate on crypto reserves but state lawmakers attempting to establish similar reserves have gotten mixed results. New Hampshire and Arizona's governors this month signed bills paving the way for state crypto reserves. Other states - including Florida, Oklahoma and Wyoming - have rejected or postponed similar bills. One common concern has been that cryptocurrencies are more volatile than many conventional financial assets. A 2024 Pew Research Center report found that 17 percent of Americans have invested in, traded or used crypto. Among Americans ages 18 to 29, the figure was 29 percent. Some younger investors even consider highly speculative meme coins to be their generation's best shot at the American Dream. One challenge to consumer adoption of crypto has been the need to invent tools and services to make it easy to manage digital assets. Owning crypto depends on a private cryptographic key a few dozen characters long - making it easy to transfer funds but also to lose them or get scammed. Some crypto enthusiasts and institutions store bitcoin in special devices not connected to the internet, to stop hacks. The U.S. government has lost some of its seized crypto dating back to the takedown of the Silk Road dark net marketplace in 2013. 'The government has built better and better processes of managing crypto assets over time, but there have still been some mistakes,' Chainalysis CEO Jonathan Levin said in an interview this month. The Department of Justice announced in July 2024 that it had awarded a five-year contract to Coinbase, a leading crypto exchange, to provide crypto custody and trading services for its cryptocurrency assets. The company declined to comment further on the U.S. crypto reserves. Levins predicts there will now be 'a greater level of sophistication' applied to managing and securing the government's reserves. GRAPHIC Related Content Despite ceasefire, India and Pakistan are locked in a cultural cold war Columbia protester Mahmoud Khalil's detention ruled likely unconstitutional The D.C. plane crash took her mom and sister. She turned to her piano.
Mint
4 days ago
- Business
- Mint
Why are North Korean hackers such good crypto-thieves?
FEBRUARY 21st was a typical day, recalls Ben Zhou, the boss of ByBit, a Dubai-based cryptocurrency exchange. Before going to bed, he approved a fund transfer between the firm's accounts, a 'typical manoeuvre" performed while servicing more than 60m users around the world. Half an hour later he got a phone call. 'Ben, there's an issue," his chief financial officer said, voice shaking. 'We might be hacked…all of the Ethereum is gone." Independent investigators and America's Federal Bureau of Investigations (FBI) soon pointed the finger at a familiar culprit: North Korea. Hackers from the hermit kingdom have established themselves as one of the biggest threats to the crypto-industry—and as a crucial source of revenue for Kim Jong Un's regime, helping it to weather international sanctions, to pamper its elites and to fund its missile and nuclear-weapons programmes. In 2023 North Korean hackers made away with a total of $661m, according to Chainalysis, a crypto-investigations firm; they doubled the sum in 2024, racking up $1.34bn across 47 separate heists, an amount equivalent to more than 60% of the global total of stolen crypto. The ByBit operation indicates a growing degree of skill and ambition: in a single hack, North Korea swiped the equivalent of $1.5bn from the exchange, the largest-ever heist in the history of cryptocurrency. North Korea's plunder is the payoff from a decades-long effort. The country's first computer-science schools date back to at least the 1980s. The Gulf War helped the regime recognise the importance of networked technology for modern warfare. Talented maths students were put into special schools and given reprieves from mandatory annual countryside labour, says Thae Yong Ho, a senior North Korean diplomat who defected in 2016. Originally envisaged as a tool for espionage and sabotage, North Korea's cyber-forces began to focus on cybercrime in the mid-2010s. Mr Kim is said to call cyberwarfare 'an all-purpose sword". Stealing crypto involves two main phases. The first is breaching a target's systems—the digital equivalent of finding an underground passageway to a bank's vaults. Phishing emails can insert malicious code. North Korean operatives pose as recruiters and entice software developers to open infected files during fake job interviews. Another approach involves using fake identities to get hired at remote IT jobs with foreign companies, which can be a first step to accessing accounts. 'They've become really good at finding vulnerabilities through social engineering," says Andrew Fierman of Chainalysis. In the ByBit case, hackers compromised the computer of a developer working for a provider of digital wallet software. Once stolen, the cryptocurrency has to be laundered. Dirty money is spread across multiple digital wallets, combined with clean funds and transferred between different cryptocurrencies, processes known in the industry as 'mixing" and 'chain hopping". 'They're the most sophisticated crypto launderers we've ever come across," says Tom Robinson of Elliptic, a blockchain-analytics firm. Finally, the stolen funds need to be cashed out. A growing array of underground services, many linked to Chinese organised crime, can help with this. Fees and interdictions by law enforcement reduce the overall take, but North Korea can expect to receive 'definitely 80%, maybe 90%" of the funds it steals, says Nick Carlsen, a former FBI analyst now with TRM Labs, a blockchain-intelligence firm. North Korea has several strengths. One is talent. This could appear counterintuitive: the country is desperately poor and ordinary citizens have severely restricted access to the internet or even computers. But 'North Korea can take the best minds and tell them what to do," says Kim Seung-joo of the school of cybersecurity at Korea University in Seoul. 'They don't have to worry about them going to work at Samsung." At the International Collegiate Programming Contest in 2019, a team from a North Korean university came eighth, beating those from Cambridge, Harvard, Oxford and Stanford. Those talents are also exploited. North Korean hackers work around the clock. They are unusually brazen when they strike. Most state actors seek to avoid diplomatic blowback and 'operate like they're in Ocean's 11: white gloves, get in without anyone noticing, steal the crown jewel, get out without being noticed," says Jenny Jun of the Georgia Institute of Technology. North Korea does not 'place a premium on secrecy—they're not afraid to be loud." For the North Korean regime, stolen crypto has become a lifeline, especially as international sanctions and the covid-19 pandemic crimped their already limited trade. Crypto-thievery is a more efficient way to earn hard currency than traditional sources, such as overseas labourers or illegal drugs. The United Nations Panel of Experts (UNPE), a monitoring body, reported in 2023 that cyber-theft accounted for half of North Korea's foreign-currency revenue. North Korea's digital plunder last year was worth more than three times the value of its exports to China, its main trade partner. 'You take what took millions of labourers, and you can replicate that with the work of a few dozen people," says Mr Carlsen. Those funds prop up the regime. Hard currency is used to purchase luxury goods to keep elites in line. It also probably funds weapons. The majority of North Korea's stolen crypto is thought to flow into its missile and nuclear-weapons programmes. Cryptocurrency investigators are getting better at tracking stolen funds along the blockchain. Mainstream cryptocurrency exchanges and stable-coin issuers often co-operate with law enforcement to freeze stolen funds. In 2023 America, Japan and South Korea announced a joint effort aimed at countering North Korean cybercrime. America has sanctioned several 'mixing" service providers that North Korea has used. Yet authorities remain a step behind. After America sanctioned North Korea's favoured mixers, the hackers switched to others offering similar services. Tackling the problem requires multilateral efforts across governments and the private sector, but such collaboration has been fraying. Russia used its UN veto to gut the UNPE last year. President Donald Trump's cuts to American development aid have hit programmes aimed at building cyber-security capacity in vulnerable countries. By contrast, the North Korean regime is throwing ever more resources at cybercrime. South Korea's intelligence services reckon its cybercrime force grew from 6,800 people in 2022 to 8,400 last year. As the crypto-industry expands in countries with weaker regulatory oversight, North Korea has an increasingly 'rich target environment", says Abhishek Sharma of the Observer Research Foundation, an Indian think-tank. Last year, Mr Sharma notes, North Korea attacked exchanges based in India and Indonesia. North Korea is already known to be making use of artificial intelligence in its operations. AI tools can help make phishing emails more convincing and easier to produce at scale across many languages. They can also make it easier to infiltrate companies as remote tech workers. Bad days like Mr Zhou's may become increasingly typical.
Arabian Post
4 days ago
- Business
- Arabian Post
Octa Broker Insights: Navigating Cryptocurrency Markets with CFDs in 2025
KUALA LUMPUR, MALAYSIA – Media OutReach Newswire – 26 May 2025 – As global crypto markets show increased volatility, traders rethink their risk exposure. One vivid option is contracts for difference (CFDs). Kar Yong Ang, a financial market analyst at Octa broker, shares three reasons crypto traders should adopt CFDs and migrate from traditional exchanges. This year began with a harsh reminder that even the biggest crypto platforms remain vulnerable. In February, the global exchange Bybit was hit by a cyberattack that drained roughly $1.5 billion worth of Ethereum, one of the largest crypto thefts ever recorded. Just a few months later, Coinbase disclosed a serious breach affecting customer data, with expected costs nearing $400 million. These aren't isolated cases. According to Chainalysis, crypto hacks surged by over 60% in Q1 2025 alone, with nearly $2.3 billion in total value lost to protocol exploits, phishing scams and key mismanagement. Against this backdrop, crypto contracts for difference, or CFDs, are being increasingly seen as a safer, more flexible way to access digital assets. ADVERTISEMENT 1. Safety first: why crypto CFDs are more secure A CFD is a financial instrument that enables speculation on the price movement of an asset without owning it outright. When trading crypto via CFDs, there is no need to buy the coin itself. Instead, traders enter a contract to benefit from the price difference between entry and exit. This means: there is no need to open or manage a digital wallet, private keys are not required, the risk of direct asset theft from exchanges or wallet breaches is eliminated. Unlike on-chain trades or exchange-based holdings, CFD traders do not need to worry about hot wallet attacks, faulty smart contracts, or failed withdrawals. Trades are protected by the broker's infrastructure, subject to financial regulations and operational transparency. Besides this, they are executed with full visibility on spreads, fees, and leverage, which contrasts the often opaque practices of smaller crypto exchanges. The absence of wallet management also reduces the risk of human error, such as misplacing private keys or falling victim to phishing attacks. 2. One account, many markets Another compelling reason why crypto traders are moving to CFDs is diversification. Where crypto exchanges limit access to tokens and stablecoins, CFD platforms provide exposure to a broad spectrum of assets, including: major fiat currency pairs (e.g., USDIDR, EURJPY), global indices like the S&P 500 or Nikkei 225, commodities such as gold and crude oil, and, of course, digital assets like Bitcoin, Ethereum, Solana, and more. For example, Octa, a global broker with a track record since 2011, offers crypto CFDs on more than 30 popular digital assets. This cross-asset access helps build more balanced portfolios and allows traders to hedge their crypto positions with traditional markets, all from one account. ADVERTISEMENT 3. Low capital, high flexibility CFDs are leveraged instruments. This means that with a relatively small deposit (known as margin), traders can open larger positions — something not feasible on most spot exchanges where one must buy the full asset upfront. For retail investors in Southeast Asia who want to participate actively in global markets, this lowers the barrier to entering the crypto market significantly. Octa broker, for instance, provides flexible leverage and low spreads on crypto CFD pairs, offering 24/7 access with no need for an e-wallet or blockchain knowledge. The shift for CFDs is accelerating among crypto traders in 2025 What was once seen as a tool for forex traders has rapidly become mainstream among crypto investors, especially those looking for better security, multi-asset diversification, competitive costs, less operational risk, and 24/7 access to crypto markets, without being 'on-chain'. The shift is not ideological; it's rational. In a year defined by security lapses and operational uncertainty across global crypto exchanges, CFDs are emerging as the more professional, institution-grade route for digital asset exposure. ___ Disclaimer: This content is for general informational purposes only and does not constitute investment advice, a recommendation, or an offer to engage in any investment activity. It does not take into account your investment objectives, financial situation, or individual needs. Any action you take based on this content is at your sole discretion and risk. Octa and its affiliates accept no liability for any losses or consequences resulting from reliance on this material. Trading involves risks and may not be suitable for all investors. Use your expertise wisely and evaluate all associated risks before making an investment decision. Past performance is not a reliable indicator of future results. Availability of products and services may vary by jurisdiction. Please ensure compliance with your local laws before accessing them. Hashtag: #Octa The issuer is solely responsible for the content of this announcement. Octa Octa is an international CFD broker that has been providing online trading services worldwide since 2011. It offers commission-free access to financial markets and various services used by clients from 180 countries who have opened more than 52 million trading accounts. To help its clients reach their investment goals, Octa offers free educational webinars, articles, and analytical tools. The company is involved in a comprehensive network of charitable and humanitarian initiatives, including improving educational infrastructure and funding short-notice relief projects to support local communities. In Southeast Asia, Octa received the 'Best Trading Platform Malaysia 2024' and the 'Most Reliable Broker Asia 2023' awards from Brands and Business Magazine and International Global Forex Awards, respectively.
Crypto Insight
4 days ago
- Business
- Crypto Insight
Wallet intelligence shapes the next crypto power shift
Opinion by: Scott Lehr, adviser to In the world of cryptocurrency, knowledge isn't just power — it's a weapon. The recent collapse of Mantra's OM token, which saw a 90% drop in value within hours, underscores how wallet intelligence can be leveraged with devastating effects. Wallet intelligence is the real-time analysis of blockchain data to extract insights from wallet behaviors, transaction patterns, and asset flows. Firms like Chainalysis and Arkham Intelligence have turned raw onchain activity into high-resolution surveillance, enabling everything from compliance monitoring to predictive trading. This level of insight gives a strategic advantage to those who can access it. Power like this, however, has consequences. There is a new battlefield on the blockchain, and you might be in danger. The downside of transparency As blockchain transparency advances, the pseudonymity that once protected users rapidly dissolves. Every transaction leaves a breadcrumb trail — one that sophisticated actors can follow. Wallet intelligence is increasingly used by regulators, exchanges, and analytics firms to enforce compliance and track illicit activity. It also opens the door to abuse: centralized surveillance, profiling, and preemptive censorship. OM's collapse exposed the dangers The April collapse of OM offers a case study of how these dynamics play out. Although not conclusively proven, reports suggest that a single trader initiated a massive short on Binance's perpetual market, allegedly exploiting market liquidity to trigger a cascade of liquidations. At the same time, Mantra's token was held in a highly centralized fashion — 90% of OM supply sat with insiders. Combine that with low liquidity and poor transparency around OTC deals, and you get a chain reaction that wiped out millions in market cap and investor trust. The FTX fallout and the power of wallet intelligence We saw echoes of this dynamic during the collapse of FTX. While regulators and internal auditors failed to sound the alarm, early warnings came from parts of the crypto community — analysts and observers who flagged questionable ties between Alameda Research and FTX. But the full extent of the misconduct wasn't revealed until a leaked balance sheet and a cascade of withdrawals forced the truth into the open. After the collapse, wallet intelligence became critical. Blockchain investigators and independent sleuths traced the movement of billions in customer funds, exposing how deeply intertwined — and misused — those assets were. The fallout didn't just destroy value. It shattered trust and proved that, in the right hands, blockchain transparency can uncover truths that centralized actors try to bury. The growing threat of surveillance capitalism This is the new battlefield. Wallet intelligence enables actors to front-run movements, manipulate price action, or influence reputational narratives by selectively exposing wallet data. In the wrong hands, it becomes a weapon capable of destabilizing protocols, shaping regulatory pressures, or undermining the decentralization of crypto. What happens when blockchain data stops protecting users and starts profiling them? The centralization of these tools and data pipelines poses a systemic risk. A small number of firms with privileged access and institutional relationships now have disproportionate influence over which transactions get flagged, which wallets get blocked, and which behaviors are interpreted as 'suspicious.' That isn't decentralization. It's surveillance capitalism with a blockchain veneer. What the crypto community must do now The implications for markets are significant. As wallet intelligence tools become more influential, expect heightened regulatory scrutiny, targeted enforcement, and volatility driven by actors who can read the tape before the rest of the market sees it. In the wrong context, transparency without guardrails can morph into tyranny. Wallet intelligence is here to stay — but how it's governed, who gets access, and whether it reinforces or undermines decentralization will determine whether it serves the ecosystem or destabilizes it. Blockchain users: Stop assuming decentralization means safety. Know how your data is being tracked, interpreted, and possibly weaponized. Regulators must understand this technology before attempting to regulate it—or risk empowering the wrong actors. Developers should push for decentralized wallet intelligence platforms that return data power to the network, not a few firms. Protocols should bake privacy into their architecture without sacrificing accountability. In this next era of crypto, what you don't know about your own wallet might be exactly what someone else is using to move against you. Opinion by: Scott Lehr, adviser to Source:
Business Mayor
6 days ago
- Business
- Business Mayor
Hong Kong passes stablecoin bill as more governments recognize the digital asset
Global Economy May 23, 2025 The Tether (USDT) stablecoin logo. Costfoto | Nurphoto | Getty Images Hong Kong passed a stablecoin bill on Wednesday to expand its cryptocurrency licensing regime as more governments recognize the digital asset. Unlike volatile digital assets like bitcoin, the value of stablecoins is tied to a real-world asset like fiat currencies or commodities like gold. The new law — focused on fiat-referenced stablecoins — will require stablecoin issuers to obtain a license from the Hong Kong Monetary Authority and comply with a range of requirements, including proper management of asset reserves and segregation of client assets. It will 'enhance Hong Kong's existing regulatory framework on virtual-asset (VA) activities, thereby fostering financial stability and encouraging financial innovation,' the central banking body said. It added that it would conduct further consultations on the detailed regulatory framework. The Hong Kong government said in a statement that the stablecoins policy is expected to come into effect this year, with 'sufficient time' allowed for the industry to understand the requirements. In 2023, Hong Kong introduced its virtual asset licensing regime, which requires cryptocurrency firms with an official presence in the city to apply for licenses and meet specific standards and requirements to offer digital assets to retail investors in the city. However, the existing policy did not include stablecoins in its purview. 'Hong Kong's new stablecoin policy sets a global benchmark by mandating full reserve backing, strict redemption guarantees, and HKMA oversight,' YeFeng Gong, risk and strategy director of HashKey OTC, told CNBC. HashKey OTC is a trading arm of the HashKey Group, which has a licensed crypto platform in Hong Kong. The policy 'ensures institutional-grade reliability for traders while positioning Hong Kong as a leader in compliant digital finance,' he added. Crypto adoption and legitimacy The move from Hong Kong comes just days after the U.S. Senate advanced the GENIUS Act, which would establish the first regulatory framework for issuers of stablecoins if implemented. A push to regulate stablecoins has been intensifying globally, with other jurisdictions having also implemented their own regulatory frameworks, including the European Union, Singapore, the United Arab Emirates and Japan, blockchain intelligence firm Chainalysis said in a report on Wednesday. Chengyi Ong, head of Asia-Pacific policy at Chainalysis, told CNBC that the latest regulations are expected to help with crypto adoption and legitimacy. '[Stablecoins] form the backbone of the crypto ecosystem, but their stability also opens the door to their use in overcoming frictions dogging traditional finance, such as slow cross-border payments and settlement,' Ong said. 'This potentially transformative utility is what has driven governments around the world, from Europe to Asia, to take steps toward regulatory regimes that will facilitate the emergence of high-quality stablecoins,' she added. According to Chainalysis, the total market cap of stablecoins is around $232 billion as of this month. READ SOURCE
