Autor Cointelegraph By Brian Quarmby

Metaverse casino served emergency cease and desist to halt NFT sales

Metaverse casino served emergency cease and desist to halt NFT sales

Uverejnil používateľ | okt 21, 2022 |

A metaverse casino has been hit with simultaneous cease and desist orders from four state enforcement bodies across the United States, who have deemed the firm’s nonfungible tokens (NFTs) to be unregistered securities. Over two NFT collections offered by metaverse casino Slotie, the tokens are said to offer access to the metaverse casino, staking rewards, revenue split from its games, lotteries, and native token WATT. However, the regulators don’t appear pleased with how the platform has marketed the NFTs and its alleged lack of securities registration. On Oct. 20, Texas, Kentucky, New Jersey, and Alabama state securities boards submitted orders for Slotie to cease and desist its operations, citing the platform’s lack of state registration and the offering of unregistered securities via NFTs. “The actions accuse Slotie of issuing 10,000 Slotie NFTs that are similar to stock and other equities. The Slotie NFTs purportedly provide investors with ownership interests in the casinos and the right to passively share in the profits of the casinos,” an Oct. 20 statement by the Texas State Securities Board reads.The agencies also accused the organization — which it believes to be based in the country of Georgia — of providing misleading promotional information and concealing key financial info among other accusations. The cease and desist order of the New Jersey Bureau of Securities argues that Slotie is offering securities that are not registered with the Bureau, “federally covered,” nor exempt from registration.It also accuses the platform of failing to provide all of the required disclosures of operating a gambling platform while also providing misleading information and failing to register as a broker-dealer. In particular, the filing questions Slotie’s claims that its initial collection of 10,000 NFTs sold out in under five minutes, and its second batch of 5,000 NFTs sold out in under two minutes, noting there is no “evidence on the blockchain” to back such claims.“In connection with the offer, sale, or purchase of securities, Slotie is making materially false and misleading statements and/or omitting to state material facts,” the filing reads.Related: Texas investigates FTX for securities violations after objecting to Voyager auctionAs per an Oct. 20 CNBC report, Texas state securities board director Joe Rotunda warned of metaverse-linked NFTs, noting that “NFTs that purport to provide passive income — often bear significant undisclosed risks,” adding: “These risks are often significant, and investing in virtual realities can leave investors virtually broke.”The pushback from U.S. state enforcement bodies adds to similar cease and desist orders against Web3 gambling projects Flamingo Casino Club and the Sand Vegas Casino Club earlier this year. Flamingo Casino Club in particular was accused by five U.S. state agencies in May of being an operation run by Russian scammers that allegedly faked a partnership with a physical casino and lied about buying Metaverse land from the hip-hop artist Snoop Dogg.The United States Securities and Exchange Commission (SEC) has also been looking into whether certain NFTs could be deemed as securities.In March, anonymous sources told Bloomberg that the SEC was investigating NFT creators and marketplaces regarding whether “certain nonfungible tokens […] are being utilized to raise money like traditional securities.”

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Twitter user saves cross-chain bridge from potential exploit

Twitter user saves cross-chain bridge from potential exploit

Uverejnil používateľ | okt 20, 2022 |

A cross-chain bridge between BitBTC and the Ethereum layer-2 network Optimism has been able to avoid a potentially costly exploit thanks to the work of an eagle-eyed Twitter user.The custom cross-chain bridge offers a ramp for users to send assets between Optimism’s network and BitAnt’s decentralized finance (DeFi) ecosystem, which includes yield services, NFTs, swaps and the BitBTC token, in which 1 million BitBTC represents 1 Bitcoin (BTC). The BitBTC bridge bug was highlighted by L2 network Abirtrum tech lead Lee Bousfield in an Oct. 18 Twitter post, warning that “BitBTC’s Optimism bridge is trivially vulnerable.”Bousfield said he published the Tweet as the “team has ignored my messages, so I’m going to publish the critical exploit here.”BitBTC’s Optimism bridge is trivially vulnerable. Their team has ignored my messages, so I’m going to publish the critical exploit here. https://t.co/onyN9SzBjt— Lee Bousfield (@PlasmaPower0) October 18, 2022According to Bousfield, the BitBTC bridge had a bug that would allow an attacker to mint fake tokens on one side of the bridge, and swap them for real ones on the other.“The Optimism L2 side of the bridge lets you withdraw any token, and it let’s that token pick the L1Token address passed to the L1 side of the bridge. However, the L1 bridge completely ignores what the L2 token was, and just goes ahead and mints the arbitrary L1 token!” he wrote, adding that: “That means an attacker could deploy their own token on Optimism, give themselves all the supply, and set that token’s L1 Token to the real BitBTC L1 address.”For the bug to be exploited successfully, Bousfield outlined that it would take “7 days to go through, during which the L1 bridge could be fixed via an upgrade.” Shortly after noting such, someone went on to test that theory, with an attacker attempting to withdraw “200 billion fake BitBTC from Optimism.” The attacker reportedly claimed that it was merea test.Bousfield also noted in a subsequent update around 10 hours later that the bug had since been patched after he managed to get in contact with the BitBTC team.Cointelegraph has reached out to the BitAnt team for confirmation on these details and will update the story if they respond. Related: Ethereum Alarm Clock exploit leads to $260K in stolen gas fees so farOptimism developer Kevin Fichter on Oct. 18 confirmed that the bug was on BitBTC’s side of things as it had used its own custom bridge as opposed to Optimism’s standard bridge it offers to partners. Fichter also noted that assets “other than BitBTC are not at risk,” adding that there was a lot of “time and energy placed into the standard bridge” and encouraged people to use the standard bridge “unless you know what you’re doing.”

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Ethereum Alarm Clock exploit leads to $260K in stolen gas fees so far

Ethereum Alarm Clock exploit leads to $260K in stolen gas fees so far

Uverejnil používateľ | okt 20, 2022 |

A bug in the smart contract code for the Ethereum Alarm Clock service has reportedly been exploited, with nearly $260,000 said to have been swiped from the protocol so far. The Ethereum Alarm Clock enables users to schedule future transactions by pre-determining the receiver address, sent amount, and desired time of transaction. Users must have the required Ether (ETH) on hand to complete the transaction and need to pay the gas fees upfront. According to an Oct. 19 Twitter post from blockchain security and data analytics firm PeckShield, hackers managed to exploit a loophole in the scheduled transaction process which allows them to make a profit on returned gas fees from canceled transactions. In simple terms, the attackers essentially called cancel functions on their Ethereum Alarm Clock contracts with inflated transaction fees. As the protocol dishes out a gas fee refund for canceled transactions, a bug in the smart contract has been refunding the hackers a greater value of gas fees than they initially paid, allowing them to pocket the difference. “We’ve confirmed an active exploit that makes use of huge gas price to game the TransactionRequestCore contract for reward at the cost of the original owner. In fact, the exploit pays 51% of the profit to the miner, hence this huge MEV-Boost reward,” the firm wrote. We’ve confirmed an active exploit that makes use of huge gas price to game the TransactionRequestCore contract for reward at the cost of original owner. In fact, the exploit pays the 51% of the profit to the miner, hence this huge MEV-Boost reward. https://t.co/7UAI0JFv72 https://t.co/De6QzFN472 pic.twitter.com/iZahvC83Fp— PeckShield Inc. (@peckshield) October 19, 2022PeckShield added at the time, it had spotted 24 addresses which had been exploiting the bug to collect the supposed “rewards.”Web3 security frim Supremacy Inc also provided an update a few hours later, pointing to Etherscan transaction history that showed the hacker(s) were so far able to swipe 204 ETH, worth roughly $259,800 at the time of writing. “Interesting attack event, TransactionRequestCore contract is four years old, it belongs to ethereum-alarm-clock project, this project is seven years old, hackers actually found such old code to attack,” the firm noted. 2/ The cancel function calculates the Transaction Fee (gas uesd * gas price) to be spent with the “gas used” over 85000 and transfers it to the caller. pic.twitter.com/aXyad0oDPv— Supremacy Inc. (@Supremacy_CA) October 19, 2022

As it stands, there has been a lack of updates on the topic to determine if the hack is ongoing, if the bug has been patched, or if the attack has concluded. This is a developing story and Cointelegraph will provide updates as it unfolds. Despite October generally being a month associated with bullish action, this month so far has been rife with hacks. According to a Chainalysis report from Oct. 13, there had already been $718 million stolen from hacks in October, making it the biggest month for hacking activity in 2022.

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German crypto bank Nuri tells 500K users to withdraw funds ahead of shut down

German crypto bank Nuri tells 500K users to withdraw funds ahead of shut down

Uverejnil používateľ | okt 19, 2022 |

German crypto bank Nuri has told its 500,000 users to withdraw funds from their accounts as the firm prepares to shut down and liquidate the business, marking it as another victim of the 2022 bear market. Nuri first reported liquidity issues in August, after announcing that it had filed for insolvency amid the economic strains of Crypto Winter. It said at the time that business would continue as usual, as it worked on a restructuring plan and securing a buyout, however an acquisition has failed to materialize. In an Oct. 18 blog post, Nuri CEO Kristina Mayer noted that despite the company’s best efforts, it is unable to maintain its operations moving forward.Nuri is closing down its business operations. We ask our customers to withdraw their funds and assets as of 18.12.2022. Thank you for having been part of the Nuri community! Here is a letter of our CEO Kristina Walcker-Mayer: https://t.co/gdOOeoOKDs— Nuri (@NuriBanking) October 18, 2022Unlike bankrupt crypto lender Celsius which locked user withdrawals before everything went south, Nuri is encouraging users to withdraw all of their assets before the Dec. 18 deadline. “Customers have access and will be able to withdraw all funds until the aforementioned date. All assets in your Nuri account are safe and unaffected by Nuri’s insolvency. Trading will be possible until 30/11/2022,” the post reads. Mayer explained that “this year, the challenges have become insuperable due to the tough economical and political environment of the past months, which kept us from raising new funds or finding an acquirer,” and added: “On top, the insolvency of one of our main business partners worsened the situation significantly and put us over the edge. As a result, Nuri had to file for temporary insolvency in August this year.”While Mayer didn’t specifically name its insolvent business partner, Celsius appears to be the prime candidate as it had partnered with Nuri to offer Bitcoin (BTC) interest accounts to its customers. These accounts were halted when Celsius went towards bankruptcy. Mayer also noted that the company is still bullish on the potential of blockchain-based financial services.Related: Texas authorities object to Voyager’s disclosure statement in its current form“We still believe in innovative financial technology and are convinced that blockchain, cryptocurrency and decentralized finance will offer opportunities that add true value to the lives of people. Still, financial innovation should be safe, understandable and easy to use for as many people as possible,” Mayer wrote.

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'Cryptoqueen' associates face German court for role in $4B OneCoin scheme

'Cryptoqueen' associates face German court for role in $4B OneCoin scheme

Uverejnil používateľ | okt 19, 2022 |

Three associates of fugitive OneCoin founder Ruja Ignatova, known colloquially as the “Cryptoqueen,” have faced a German court over allegations of fraud, money laundering and banking crimes. Appearing in court on Oct. 18, a Munich-based lawyer connected to Ignatova is alleged to have transferred $19.7 million via the Cayman Islands on her behalf to purchase two London apartments. Additionally, a husband and wife are facing charges over allegedly handling $315.4 million worth of payments from OneCoin customers, as per a Bloomberg report. Ignatova launched OneCoin back in 2014 under the guise of a cryptocurrency and trading project, however according to enforcement agencies such as the Federal Bureau of Investigation (FBI), it was soon found to be a pyramid scheme roping users in with fictitious business and technical claims that were untrue, such as a token mining structure that was non-existent. According to the FBI, the project defrauded more than 3 million investors out of roughly $4 billion, with prosecutors noting in the German court that: “In reality, the ever-growing value was a fake and the mining process was only simulated by the software.” Ignatova’s whereabouts have been unknown since 2017, her last known location was reported to be in Athens, Greece.In June the FBI added her to its top ten most wanted list, offering up $100,000 for information leading to her arrest. Apart from being wanted for over $4 billion worth of fraud, her company has also been accused of bribing presidents in Serbia and Bulgaria by economist and crypto proponent Angelina Lazar. The latest three OneCoin figures to face prosecutors adds to the action taken against another alleged accomplice Christoper Hamilton, accused of laundering $105 million through the scheme in 2014.In August 2021, a judge in the United Kingdom approved the extradition process for Hamilton to face changes in the United States and it was reported he was extradited at the start of September. Related: Crypto ATMs emerging as popular method for crypto scam payments — FBICryptoqueen’s brother Konstantin Ignatov took over the reins of OneCoin at one point, and pleaded guilty to several money laundering and fraud related charges in 2019, while two of his associates were the subject of a class action suit that was brought to trial in March 2020.The case of the missing Cryptoqueen has remained a subject of keen interest to date, with journalist and author Jamie Bartlett hosting a popular podcast on the topic via the BBC that has published 11 episodes so far. Bartlett also published a book on the entire ordeal in June called The Missing Cryptoqueen: The Billion Dollar Cryptocurrency Con and the Woman Who Got Away with It, providing a public discussion on the book at the Red Line Festival in South Dublin on Oct. 16.

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