Week in review: Bitcoin tops $40,000 as Wormhole hackers siphon off more than $319 million

Bitcoin price breached the $40,000 mark, Wormhole cross-chain bridge exploit drained over $319 million, and in Russia the State Duma named the minimum tax for miners, among other events of the week.

Bitcoin price climbs above $40,000

On Friday, February 4, the price of the leading cryptocurrency breached the $40,000 mark for the first time since mid-January 2022.

At the time of writing, Bitcoin was trading near $41,380.

In Fundstrat noted that in the coming months Bitcoin prices, with a good probability, could reach a local bottom, though investors should tread carefully.

The flagship pulled the rest of the market along. According to CoinGecko, all top-10 cryptocurrencies by market cap finished the week in the green.

According to CoinCodex, the week’s biggest gainer among digital assets was the Telos native token. The price of TLOS rose by 74%.

The biggest decliner among major tokens was the governance token Spell Token (SPELL) from the Abracadabra lending protocol, whose price fell by 15%.

Hackers siphoned more than $319 million from Wormhole cross-chain bridge pool

In the night of February 3, the Wormhole cross-chain protocol on Solana was subjected to a hacker attack. The attackers exploited a vulnerability and withdrew 120,000 WETH (more than $319 million at the time) from the pool.

Developers said they had closed the vulnerability and sent additional ETH to the pool to support liquidity. Later it emerged that funding was provided by trading firm Jump Trading. In 2021, the latter acquired the infrastructure firm Certus One, which is behind the protocol’s development.

Russia to prepare scenarios for cryptocurrency regulation by February 11

The projects for regulating cryptocurrency markets by February 11 will include an assessment of their potential consequences. The government reportedly leans toward the Finance Ministry’s stance rather than the Bank of Russia’s.

Rosfinmonitoring expressed readiness to align regulation with FATF standards, and Bank head Herman Gref supported a ban on crypto payments within the country. He added that there is no need to ban stablecoins or derivatives on such assets, or to impose restrictions on crypto ownership.

According to media reports, Deputy Prime Minister Dmitry Chernyshenko instructed to include in the crypto industry regulation roadmap issues related to the legal status of mining, and to form a working group with industry representatives.

The Russian Chamber of Commerce and Industry proposed to treat mining as entrepreneurship. Its head Sergey Katyrin argues this would remove mining from the “grey zone,” ensure tax payments to the budget, and reduce tensions over illegal electricity use.

Katyrin said it would be prudent to study the experience of countries where “cryptocurrency is a digital representation of value and is not a means of payment, and where exchanging cryptocurrency for goods is treated as a barter transaction.”

State Duma names minimum taxes for miners

The personal income tax on profits from miners converting cryptocurrency into traditional finance cannot be less than 15%, stated Vladimir Gutenev, head of the Industry Committee of the State Duma.

Meanwhile, he said, the minimum profit tax rate for companies or individual entrepreneurs mining cryptocurrency as a business should be no less than 6%.

What else happened in Russia:

• In 2021, electricity consumption by residents of Irkutsk Oblast grew fourfold due to miners.
• Major Bitcoin exchanges expressed willingness to open branches in Russia. Among them are Binance, Huobi and AAX.
• The issuer of Norilsk Nickel’s tokens — the Russian tokenisation platform Atomyze — obtained the Bank of Russia’s first license for issuing digital financial assets.

Belarus proposes allowing funds to buy digital assets, while Kazakhstan extends electricity cuts for miners

The Belarusian Ministry of Finance has prepared a set of legislative changes that, in particular, will allow investment funds to invest in digital assets. Professional market participants will also gain the right to become residents of the High Tech Park.

KEGOC sent a letter to local miners informing of the extension of electricity-supply restrictions to February 7.

94,643 BTC moved from Bitfinex after 2016 hack

On February 1, the coins stolen from Bitfinex in 2016 moved. Analytical services logged more than 20 transactions totaling 94,643 BTC. At current prices, these assets are worth over $3.6 billion.

MicroStrategy buys another 660 BTC for $25 million

The business analytics software firm MicroStrategy purchased 660 BTC for about $25 million. The average price was about $37,865, said CEO Michael Saylor.

In total the company holds 125,051 BTC worth about $4.8 billion at current prices. It spent about $3.78 billion on the purchases (average price $30,200).

Saylor said MicroStrategy’s shares are the best alternative to a Bitcoin ETF, as there is no fee for buying and holding the securities, and as an operating company it can generate additional earnings per share.

Binance Smart Chain developers outline plans for 2022

The Binance Smart Chain team named scalability a priority for 2022. Developers will focus not only on improving the main chain but also on expanding the ecosystem with cross-chain and multi-chain solutions.

To this end, the plan includes implementing the infrastructure levels BSC Application Side Chain (BAS) and BSC Partition Chain (BPC). BAS will allow developers and node operators to run sidechains, while BPC will provide another subspace with a new set of validators, computational engine and ledger.

Silvergate Capital buys Meta’s Diem stablecoin project

The Diem Association announced the sale of Silvergate Capital Corporation’s intellectual property and other assets related to the management of Meta’s Diem payment network. Financial terms were not disclosed. Earlier reports suggested a $200 million price.

This week Meta reported quarterly results, after which shares jumped by 24%.

Also on ForkLog:

• Sen. Ted Cruz uncovered investments in Bitcoin.
• Another solo miner mined a Bitcoin block.
• Reddit cofounder raised $500 million across two crypto funds.
• Changpeng Zhao warned Binance customers of a large-scale phishing campaign.

What else to read

In January, cryptocurrencies and the stock market fell amid the Fed’s tightening rhetoric and geopolitical tensions. Despite this, NFT trading on OpenSea neared a record $5 billion, and the company was valued at $13.3 billion.

We analysed the main on-chain indicators and DeFi dynamics in the monthly analytical report.

Sponsor of the Bitcoin Industry in Numbers — the global blockchain ecosystem Binance.

In 2021 the GameFi sector became one of the main drivers of growth in the crypto market. ForkLog looked into, whether you can make money in P2E games, why guilds are needed and what problems existing projects face.

In ForkLog’s educational cards we considered what a decentralized autonomous organization (DAO) is.

In traditional digests we have collected the main weekly events in cybersecurity and artificial intelligence .

We invite you to revisit the most significant recent news from the venture capital sector with our Institutionalist Newsletter.

Read ForkLog’s bitcoin news in our Telegram — cryptocurrency news, prices and analysis.