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Cardano Founder Likened Ardana’s Halt To The Infamous Mt. Gox

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Ardana, a Defi project on the Cardano blockchain ruffled a few features when it blamed the underlying network for “not being ideal” for any protocol development.

The project which touted itself as Cardano’s Defi hub announced halting its operations because of issues related to “funding and project timeline uncertainty.”

The platform which raised $10 million said that the remaining funds and treasury balances will be held by Ardana Labs until another dev team comes forward to continue the work.

The statements invited ire from many, including Cardano founder Charles Hoskinson who likened the “blame game” to Mark Karpeles blaming the Bitcoin protocol for Mt. Gox.

In 2014, Mt. Gox which held over 70% of all bitcoin transactions worldwide, abruptly suspended trading. The then CEO Mark Karpeles and his team issued a press release blaming the Bitcoin protocol itself.

While making the comparison, Hoskinson did not seem to agree with Ardana’s claim of fund inadequacy as it was hardly a year back since the funding round took place.

The investment was led by the now-defunct 3AC and included Cardano’s early-stage investment fund cFund, whose investor was none other than Hoskinson himself.

Just as users were coming to terms with the news, two other Cardano projects Orbis and Indigo met their untimely demise.

Two Other Cardano Projects Down in The Dumps

Orbis, a layer 2 scaling solution notified the Cardano community that it too was ending development citing “constrained funding and uncertain conditions.”

What caught community members’ attention was the project’s last-minute attempt to secure funds through an NFT sale before ceasing operations. Many believed that this was a classic rug pull, while others reiterated that failed projects are not rug pulls.

The next in line of fire was Indigo, a Cardano-based stablecoin project. Unlike the previous two, Indigo did not shut shop but its token launch INDY was marred with malicious activity.

After INDY went live on Nov 22, its price hit ATH 12 from the listing price of 9.5 ADA. The tokens were airdropped to the community members but the intense selling pressure send the price down to 7.7 ADA.

On-chain sleuths found that a single wallet dumped 35k INDY tokens for about $70k leading to the INDY falling back to 5.7.

Upon further investigation, the wallet holder turned out to be a former core team member who had a fallout with Indigo and so dumped the tokens he received early as a gift.

10,000 Bitcoin Linked to Mt. Gox Hack on the Move

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On November 23, a total of 10,000 Bitcoin, which are currently worth over $165 million, were transferred from a crypto wallet that belonged to the defunct cryptocurrency exchange BTC-e to various exchanges, individual wallets, and other sources.

While this pullout is the largest made by BTC-e since April 2018, a Chainalysis report on November 23 suggested that BTC-e and WEX, an exchange that is believed to be BTC-e’s successor, both sent small amounts of BTC to the Russian electronic payments service Webmoney on October 26 before making a test payment on November 11 and sending out an additional 100 BTC on November 21.

10,000 Bitcoin moved to personal wallets

9,950 BTC of the total sent amount is believed to still be in individual wallets, with the remaining BTC being transferred through middlemen and ending up at four deposit addresses on two significant exchanges.

Ki Young Ju, co-founder, and CEO of the blockchain analytics company Cryptoquant confirmed the findings and pointed out that 0.6% of the funds were sent to exchanges, which might be sell-side liquidity.

Young Ju shared images of the transfer and noted that the BTC had been in the wallet for more than seven years in a tweet on November 24.

Additionally, Young Ju called for the account to be suspended for questionable activity and disclosed that 65 BTC had been moved to the cryptocurrency exchange HitBTC.

A Tokyo-based cryptocurrency exchange called Mt. Gox once handled more than 70% of all Bitcoin transactions. After being hacked in 2014 and has thousands of Bitcoins stolen, the exchange soon declared bankruptcy.

After claims that BTC-e was engaged in money laundering, including the use of cryptocurrency taken during the Mt. Gox exchange hack, the Federal Bureau of Investigation (FBI) shut down BTC-website e’s and seized funds in 2017. BTC-e had US-based servers.

BTC-e reportedly held “a substantial amount of Bitcoin” at the time of its shutdown, and in April 2018 it moved more than 30,000 BTC out of its service wallet.

The owners of BTC-e made an effort to maintain their anonymity, but it is believed that Alexander Vinnik is the main operator and has been involved in legal disputes for the past five years.

According to a 2017 WizSecurity report, BTC-e and Vinnik were directly involved in the theft of user funds and bitcoin from Mt. Gox, with the latter being forced to halt trading and shut down its website as a result of the losses.

Mt. Gox Bitcoin Distribution Update Released

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Mt. Gox trustee has released a new update regarding the distribution. Nobuaki Kobayashi, the trustee for the long-defunct crypto exchange Mt. Gox, provided details on the distribution plan for creditors on Wednesday. The restricted reference period begins on September 15th, according to the documentation.

It is forbidden to assign, transfer, succeed, provide as collateral, or dispose of rehabilitation claims in any other way during this phase. Kobayashi said that the deadline for creditors to submit claims for money lost when the first cryptocurrency exchange failed in 2014 was September 15.

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Mt. Gox Bitcoin Distribution Update Released 2

When Mt. Gox repayment?

The Rehabilitation Plan, which was authorized by nearly 99% of the eligible users affected by the case, outlines the restricted period’s duration and specifies that it would be followed by the first full repayment to creditors.

The file also noted that the trustee might not be able to decide whom to reimburse if notification of transfer is made during the restricted period.

Twitter speculations regarding a 137,000 BTC dump earlier this week caused pressure on the cryptocurrency markets. Later, creditors denied the rumors that circulated on social media.

One of them warned against trusting Twitter “influencers” and stated that they had no intention of selling bitcoin.

Creditor Eric Wall used Twitter to refute the baseless accusations and to explain why Bitcoin holders should disregard this myth and block anyone who is spreading it there:

One of the first exchanges for cryptocurrencies, Mt. Gox formerly enabled more than 70% of all transactions carried out inside the blockchain ecosystem. Following a significant attack in 2011, the website allegedly became insolvent and dissolved in 2014.

The impact affected roughly 24,000 creditors and cost 850,000 BTC. The exchange’s trustee stated in November 2021 that the repair proposal was pending before a Japanese court. It is one of the last stages in a protracted procedure that started in 2018 with a petition to pay creditors.

Bitcoin Community Rattled By Mt. Gox Dumping $140K BTC

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Bitcoin [BTC] has struggled to maintain the $20k mark on Aug. 27 as unconfirmed rumors of Mt. Gox dumping $140k BTC have sparked a massive sell-off.

Crypto Twitter is rife with doomsday predictions that Bitcoin will fall back in the range of $10-$12k. Some pointed out that the release would coincide with unlocking the post-merge staked eth.

“They just want to maximize the chaos,” one of those tweets claimed.

The now-defunct Mt. Gox abruptly suspended all trading in 2014 after losing $460 million to hackers and another $27.4 million missing from its bank accounts.

Following a lengthy legal procedure, the stolen funds were subsequently recovered from the exchange, and the appointed rehabilitation trustee, Nobuaki Kobayashi, announced on July 6 that he was ‘preparing to make repayments to creditors.”

The report went on to say that “in the documentation at the time, Kobayashi gave ‘the end of August as a reference period during which some initial payments might begin:

“Following discussions with the Court and in accordance with the Rehabilitation Plan, the Rehabilitation Trustee plans to set the Assignment, etc. Restriction Reference Period from approximately the end of August this year until all or part of the repayments made as initial repayments is completed for safe and secure Repayments.“

Mt. Gox Creditors Say No Bitcoin Dumping

And soon rumors began to float on Twitter that 137,000 Mt. Gox bitcoins would be released on August 28. However, several users who claim to be creditors of Mt.Gox chose to dispel the banters of the supposed dump.

One of them tweeted that they don’t have any intention of selling BTC and cautioned against believing in ‘influencers’ on Twitter.

Creditor Eric Wall, also took to Twitter to disband the unfounded claims and explained why Bitcoin investors should be ignoring this rumor and blocking all those on Twitter who are spreading it:

Another Twitter user said that those FUDs are being spread to maximize social engagement.

“Apparently, the 140,000 Mt. Gox Bitcoin coins are NOT being released tomorrow. These are rumors being repeated by large accounts for engagement with no actual factual basis. I looked for a source to verify these claims and there isn’t one”, he said.

Missing Mt. Gox Bitcoin Worth $6 Billion May Soon Return Home

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Mt. Gox’s missing Bitcoins are expected to be distributed by the Japanese trustee for the fallen cryptocurrency exchange. In an exclusive interview with Jake Adelstein for Forkast, former CEO Mark Karpeles explains.

The world’s largest Bitcoin exchange at the time was hacked in 2014, and half a billion dollars worth of cryptocurrency was stolen.

Karpeles has returned, and in a bittersweet turn of events, he is establishing a firm based on the lessons he has learned.

UNGOX intends to be the first global rating agency for cryptocurrency exchanges, with Karpeles hoping to turn it become the Moody’s of the cryptocurrency sector.

Karpeles is also releasing an Mt. Gox non-fungible token (NFT) alongside the launch of the firm to prove that he’s learned from his mistakes. The NFT will allow previous clients lifelong free access to the new website and service.

The Mt.Gox incident in a nutshell

On July 18, 2010, Mt. Gox, one of the earliest Bitcoin exchanges in the world, began automated trading. It used to account for more than 80% of all Bitcoin trading volume.

The firm filed for bankruptcy on Feb. 28, 2014, after discovering it had been hacked and losing the majority of its assets.

However, the exchange had about 200,000 bitcoins before it went bankrupt.

These have gained in value tenfold after the bankruptcy, implying that creditors may be able to recover more value from the disaster than they lost during the bankruptcy.

While the trustee sold around 50,000 bitcoins for $600 million a few years ago, the remaining bitcoins are now worth over $6 billion and are expected to be distributed soon, according to Karpeles.

If it happens, it will be a pleasant conclusion for Mt. Gox and its creditors, as well as Karpeles. Karpeles’ story may not have ended well; he might have spent ten years in prison for crimes he didn’t commit.

Mt. Gox going bankrupt

The Japanese authorities had launched an inquiry into the exchange even before Mt. Gox went bankrupt on Feb. 28, 2014, with 850,000 bitcoins reported lost (200,000 of which were subsequently recovered by Karpeles).

Karpeles had nothing to do with the lost bitcoins and had never sought to damage the firm or steal cash, according to one of the presiding judges at the trial.

His only transgression was the installation of a program that attempted to recover lost BTC that the company had been saddled with since its acquisition in March 2011.

Stolen Mt. Gox Bitcoin Claimed by Craig Wright

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Craig Wright, the self-proclaimed Bitcoin founder, has again boldly declared that he is the mastermind behind the 2011 stolen Mt. Gox Bitcoin totaling 79,956 BTC worth around $751 million in the current market. One of the addresses involved during the high-profile heist famous as the address “1Feex,” still contains bitcoins from the incident.

‘1Feex’ contains Stolen Mt. Gox Bitcoin

The controversial bitcoin figure wrote a letter through his law firm, SCA Ontier, addressed to Blockstream, the firm for Bitcoin network services. Wright alleges in the letter that he possesses more than two Bitcoin addresses. One was the 1 feex address believed to contain the BTC stolen from Mt Gox.

Over the years, with the motive to prove that he is the pseudonymous creator of Bitcoin Satoshi Nakamoto, Wright has laid claim to many addresses. Wright has claimed ownership of the early Bitcoin addresses in defense of his dubious claims that contain significant amounts of money.

The feex address is a perfect match for Wright’s early addresses claiming ownership, as it originally received funds back in March 2011 with a balance of 79,900 BTC. Wright has implied himself as a participant in the Mt. Gox heist by claiming the popular address, even though the letter does not mention Mt. Gox anywhere.

Does Craig Wright ever stop?

In the past, Craig Wright has claimed bitcoin addresses that owners have come out to disapprove of him by using their keys to sign cryptographic messages. Wright alleges in his letter that during a robbery he lost his keys to the 1feex back in February this year. This means that he can not use the address to sign cryptographic messages nor to transact.

Stolen Mt. Gox Bitcoin

Craig Wright’s involvement in such a high-profile crime will only tarnish his already deplorable reputation in the cryptocurrency sector. Some industry players have suggested that Craig Wright be prosecuted for laying claim to stolen funds, but it’s unclear how to do that in practice.

There is actually not one lawsuit in the recent past that was ruled in support of Craig Wright. Despite this, he still tries tirelessly to prove that he is the Bitcoin creator. Expect more drama from Craig Wright soon

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Mt Gox Ready to Settle Creditor Claims with Over $593 Million of BTC and BCH

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After five years of waiting are users about to get their funds back?

The troubled bitcoin exchange, Mt. Gox is eventually settling the creditor accounts in cryptocurrency or cash. According to Nobuaki Kobayashi, the rehabilitation trustee of exchange, plans are in place to compensate the victims as he has already approved 803,521 BTC, 792,296 BCH, and $38,165,664 as well as other amounts in different fiat currencies.

The Plan

For users, the wait has been not only long but also painful since thieves stole around 850,000 BTC (which is worth billions today).

Currently, the trustee says, the cryptocurrencies needed to be paid out are worth $593 million whereby they have 141,686 BTC, 142,846 BCH, and $629,594 in cash. Further, he believes that they will retrieve more of the bitcoins that were stolen hence increase the number of coins at their disposal.

Nature of Settlement

There’s also hope that the estate will succeed in its attempt of retrieving money that is believed to be owed to them by other parties such as former CEO Mark Karpeles as well as Mt. Gox majority owner Tibanne Co.

The obvious issue, however, is the fact that there isn’t enough cryptocurrency secured still in their disposal to cover the approved claims for both BTC and BCH.

Subsequently, there is not enough fiat currency that will cover the crypto pro in cash with the current valuations. Besides, Kobayashi hasn’t clearly indicated how the funds will be allocated when the payouts start finally.

Are Bitcoin Fork Prices at Danger?

A lot of creditors have their concerns over the distribution as they watch on the possible problem of distributing coins which have been forked from bitcoin since the collapse, such as bitcoin gold and many others listed.

They view the addition of these cryptocurrencies to be challenging to handle as well as making it difficult to organize private keys for the coins. The suggestion is to sell the keys after BTC and BCH have been circulated or simply relocate to a safe place.

Image courtesy of PixaBay.

Disclaimer: The presented information is subjected to market condition and may include the very own opinion of the author. Please do your ‘very own’ market research before making any investment in cryptocurrencies. Neither the writer nor the publication (TronWeekly.com) holds any responsibility for your financial loss.

Cryptocurrency Market Stays Strong Despite Greater Turmoils Than FTX Collapse: Chainalysis

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Chainalysis, a blockchain analysis company, compared FTX’s bankruptcy to the collapse of Mt. Gox to assess how it will affect the ecosystem.

It came to the conclusion that FTX represented a relatively lesser portion of the cryptocurrency market than Mt. Gox did at the time and that the market would recover more powerfully than ever.

Eric Jardine, research lead at Chainalysis, first compared the market shares of the two companies in a thread on Twitter on November 23. He discovered that Mt. Gox averaged 46% of all exchange inflows in the year before its 2014 collapse, compared to FTX’s average of 13%, which ran from 2019 to 2022.

According to Jardine, when Mt. Gox failed in 2014, centralized cryptocurrency exchanges (CEXes) were the only players in the market. By late 2022, however, decentralized exchanges (DEXes), such as Uniswap and Curve, had seized roughly half of all exchange inflows.

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Exchange inflows of CEXes compared to DEXes between 2013 to 2022. Source: Chainalysis

However, Jardine points out that while Mt. Gox’s cryptocurrency market share was progressively declining, FTX’s was slowly increasing, and that business trajectories are important to take into account, adding,

“Mt. Gox was becoming one exchange among many during a period of growth for the category, taking a smaller share of a bigger pie. FTX on the other hand was taking a bigger share of a shrinking pie, beating out other exchanges even as its raw tx volume declined.”

Bigger Part Of Cryptocurrency Ecosystem Collapse

Despite this, Jardine determined that Mt. Gox was a more significant component of the crypto ecosystem at the time of its collapse than FTX because it was a “linchpin of the CEX category at a period when CEXes dominated.”

The recovery of the cryptocurrency market following the collapse of Mt. Gox is then examined by Jardine, who discovered that activity quickly resumed after a year or so of stagnation in on-chain transaction volume.

After losing 850,000 Bitcoin in a hack in February 2014, Mt. Gox stopped trading, shut down its website, and requested bankruptcy protection.

Customers who deposited holdings on the exchange have still not received their money back, however, the Mt. Gox Trustee declared on October 6 that creditors had until January 10, 2023, to choose a form of payment for the allegedly held 150,000 BTC.

Edward Snowden Predicts Bitcoin Could See A Repeat Of March 2020

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Bitcoin might be stuck in a rut, but Edward Snowden believes that BTC might see a possible repeat of March 2020 when the coin lost more than 50% of its value due to the outbreak of the coronavirus before pumping to $65k in May 2021 and tapping an all-time high of $69k in November.

“…For the first time in a while, I’m starting to feel the itch to scale back in’, Snowden said indicating that the bottom is near but warned of further trouble.

A price chart that Snowden included with his tweet depicts the last time he made a comparable Bitcoin prediction close to the bottom of a bear market.

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Edward Snowden Predicts Bitcoin Could See A Repeat Of March 2020 6

The ex-NSA and CIA agent followed up with more tweets, saying, “When most people say “this is not financial advice,” they’re lying, but this is actually not financial advice, since I have zero financial education and no idea what I’m doing”.

Snowden who is closely associated with the creation of zcash, a leading privacy-protecting cryptocurrency has numerous times expressed his fascination for the dominant asset.

The IT specialist has been on the run since releasing the NSA papers in 2013, seeking asylum in Russia. In October 2020, Vladimir Putin gave him unlimited permanent residency and on September 26, 2022, he was granted Russian citizenship.

He has been a fervent supporter of Bitcoin throughout, and in December 2020, when the decentralized finance [DeFi] token first topped $20,000, its all-time high [ATH], he was among the well-known figures supporting it.

Not only Snowden, but many industry bigwigs such as Elon Musk too recently threw their weight behind BTC. As reported by TronWeekly, Musk believed that BTC’s days are not over despite a “long winter”.

Bitcoin’s Fall Is Nothing Extraordinary- Expert

BTC dropped by 25% in days as a result of the bankruptcies affecting FTX, Alameda Research, and probably other significant crypto firms.

Even for trading analysts such as Stockmoney Lizards, BTC will bounce back from the FTX implosion just like it has from other setbacks which it termed as “Black swan Events”.

An accompanying chart highlighted similar “black swan” moments in the past, dating back to the 2014 Mt. Gox breach.

Two other notable events were the hack of the exchange Bitfinex in 2016 and the March 2020 COVID-19 market crash.

Bitcoin: MicroStrategy [MSTR] Eyes More BTC In Latest Filing

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Word’s biggest holder of Bitcoin, business intelligence firm MicroStrategy [MSTR] has remained unperturbed by the market upswings as it looks to stockpile more BTC. A filing with the SEC revealed that the firm has signed a deal with investment bank Cowen & Co. to sell $500 million in Class A stock.

While there isn’t any specific date for the potential sales, the US-based software firm stated that it plans to direct the net proceeds to purchase additional Bitcoins.

We intend to use the net proceeds from the sale of any class A common stock offered under this prospectus for general corporate purposes, including the acquisition of bitcoin, unless otherwise indicated in the applicable prospectus supplement.

The firm also took note of the BTC price volatility and the resultant implications of its move.

“Future fluctuations in Bitcoin trading prices may result in our converting Bitcoin purchased with the net proceeds from this offering into cash with a value substantially below the net proceeds from this offering,” the company wrote.

In August, MicroStrategy co-founder Michael Saylor stepped down from his role as chief executive officer title to focus more on his Bitcoin advocacy efforts.

Interestingly, that was the same day the Tysons Corner, a Virginia-based entity also co-founded by Saylor in 1989 reported a loss of more than $1 billion due to the second-quarter plunge in the price of the cryptocurrency.

That being said, Saylor continues to serve as executive chairman.

A few days ago, there were rumors of MicroStrategy moving over 200k BTC to exchanges.

More trouble for Bitcoin?

A popular influencer CryptoVinco was among the first people to make the claim on Twitter along with a screenshot of a series of transactions carried out by the whale address.

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Bitcoin: MicroStrategy [MSTR] Eyes More BTC In Latest Filing 8

The pseudonymous influencer asked the community to expect a market “bloodbath” when MicroStrategy sells off the BTC. Twitteratis gave mixed reactions as some users disagreed with CryptoVinco saying that the address does not belong to MicroStrategy.

On the price front, Bitcoin bounced back by 16%, as the largest cryptocurrency by market cap traded above $20,000 earlier this week. However, investors put out a word of caution saying this could just be a typical “short covering and a squeeze”.