HTX bounces back following DDoS attack

Asian fund acquires majority stake in The BlockIn the wake of certain difficulties experienced following the FTX collapse, prominent crypto publication The Block has secured its future through a strategic sale to Singapore-based venture capital group Foresight Ventures.Taking to the X platform on Monday, The Block’s CEO Larry Cermak announced the acquisition, with Foresight Ventures taking a majority stake in the publication. The deal results in a valuation of the US media group at $70 million. Cermak stated:”This [transaction] gives The Block a fresh start ahead of the bull market and provides us with more capital to build out new exciting products and expand our footprint into Asia and the Middle East.”Cermak also thanked New York-based investment bank Moelis & Company for its help in running the process.Photo by Kelly Sikkema on UnsplashFTX controversyThe sale should allow the firm to move on from a difficult situation which saw it implicated in the activities of convicted fraudster and former FTX CEO Sam Bankman-Fried (SBF). The fallout from the collapse of the FTX exchange in November of last year included the revelation that The Block had relied on undisclosed loans from SBF to sustain its operations.Michael McCaffrey, the former CEO of The Block, resigned last December after it was disclosed that he had borrowed $43 million from SBF’s Alameda Research, a crypto trading company. This financial arrangement was allegedly aimed at supporting the media company and facilitating property acquisitions.Following the conviction of SBF on charges of fraud and money laundering in New York earlier this month, The Block faced challenges and turned its focus towards building a more robust institutional customer base. The media group has been actively engaged in compiling industry deals and offering subscription-based news services.McCaffrey had taken loans totaling $27 million to buy out shareholders and support the media group, with an additional $16 million used for property acquisition in the Bahamas. The financial arrangement with Alameda was undisclosed to the broader team at The Block, as revealed by Bobby Moran, the company’s chief revenue officer at the time.It’s still unclear if McCaffrey has repaid these loans to the FTX Debtor that is currently managing the FTX business. FTX filed for Chapter 11 bankruptcy in November 2022 and with that, it is in the process of being restructured.$56 million investmentAs part of the deal, Foresight Ventures will invest $56 million, securing an 80 percent stake in The Block, according to a source cited by the Financial Times (FT). The investment is a strategic move, especially considering the recent slowdown in venture capital investment in the crypto market.While investors injected approximately $30 billion into crypto projects in both 2021 and 2022, the figure plummeted to $7 billion by the end of September of this year, according to PitchBook.Foresight Ventures CEO Forest Bai confirmed to the FT that The Block will continue to operate as an independent business. Bai stated: “We think The Block is one of the crown assets in the crypto media space. Our view is that the media aspect will continue to drive education and adoption in the space.”

Almost 60K Korean Crypto-Holding Households Owe $389M in Unpaid Social Insurance PremiumsThe National Health Insurance Service (NHIS) in South Korea is intensifying its efforts to collect overdue premiums. Many high-income individuals who can afford to pay premiums for social insurance, including health insurance, have been neglecting their dues.Photo by Hush Naidoo Jade Photography on UnsplashVirtual assets for seizureAccording to the documents submitted on October 18 by the NHIS to lawmaker Jung Choun-sook, a member of the National Assembly’s Health and Welfare Committee, the NHIS is actively identifying a range of assets, including copyrights and virtual assets, that can be seized from these individuals. The NHIS aims to recover overdue premiums through stringent measures such as confiscation and government auctions. This move is designed to deter high-income earners from neglecting their obligations, ensuring fairness for those who consistently pay their premiums.Almost 60,000 crypto-holding householdsThis year, the NHIS discovered that 59,513 households, despite owning virtual assets, had outstanding social insurance premiums amounting to KRW 525 billion ($389 million). The NHIS has initiated collection efforts. In 2021, the insurance agency identified 5,336 households with virtual assets that had unpaid social insurance premiums totaling KRW 62.2 billion. Of this, the NHIS successfully collected KRW 6.92 billion, representing 11.13% of the total arrears.On this matter, lawmaker Jung highlighted that the government should strive to bolster the NHIS’s financial health. She underscored the importance of identifying concealed income sources or assets, like cryptocurrency holdings, of premium defaulters to ensure the collection of their overdue premiums.

Report: Can Bitcoin Replace Gold As a Safe Asset?In light of the substantial increase in Bitcoin (BTC) prices this year, a report from KB Financial Group in South Korea examined the potential for BTC to replace gold as a safe asset.©Pexels/Michael SteinbergThe study delves into the factors behind the recent BTC price surge and emphasizes the need for caution when considering BTC as an alternative to traditional safe assets.3 drivers behind BTC surgeFrom January 1 to March 31 this year, BTC experienced an impressive return of 71%. This surge can be attributed to three main factors: an anticipated increase in liquidity due to market expectations of unchanged or falling interest rates; central banks supplying liquidity to mitigate risks in the traditional banking system; and concerns over the potential delisting of cryptocurrencies should the US court’s decision on the Ripple-SEC case classify XRP, Ripple’s native token, as securities, prompting investors to shift their focus to BTC.The report suggests that the current BTC boom is more likely a result of short-term arbitrages and social conformity, given the greater information asymmetry in the crypto market, which lacks the disclosure system present in traditional stock markets.Persisting risk factorsLast month, blockchain tracker Whale Alert spotted a transfer of 11,125 BTC from an anonymous address to Binance. The primary reason for moving assets from a private address to an exchange address is to sell them, indicating that investors should keep a watchful eye on Bitcoin trading volumes, particularly for any signs of large sell-offs.Data from the crypto data analysis platform Glassnode revealed that the percentage of the BTC supply that was active over a year ago reached an all-time high of 68% in late March. Historically, such an increase has been associated with falling BTC prices.This year, the BTC supply is set to grow due to the US government’s liquidation of seized BTC. As detailed in a March 31 Cointelegraph article, the US government seized 51,352 BTC in a case related to Ross Ulbricht, the creator of the online black market Silk Road. The government has already sold 9,861 BTC, with the remaining amount expected to be liquidated in four additional portions throughout the year.Binance, the world’s largest crypto exchange by trading volume, has been struggling to find banks in the US to store client funds after crypto-friendly banks Silvergate and Signature closed their doors.Need for cautionAlthough various media sources often portray BTC as a safe asset, the report advises caution in accepting these claims. Although some liken BTC to “digital gold,” the two assets share little in common beyond their finite and scarce nature. In fact, gold and BTC diverge significantly in terms of social consensus, intrinsic value, price volatility, and investor protection.Gold serves as a highly liquid asset with applications in both jewelry and industrial goods, in addition to its role as an investment vehicle. In contrast, BTC’s intrinsic value is still debatable. The price volatility of BTC is also a concern, as evidenced by its 71% spike in the first quarter of 2023, compared to gold’s modest 8% increase. Additionally, gold investment products are regulated by law, whereas BTC is not. The report thus recommends treating BTC as a high-risk product and incorporating it into a diverse investment portfolio.It is worth noting that since the outbreak of the COVID-19 pandemic, the crypto market has demonstrated a stronger correlation with the global stock market in response to negative signals. This trend can be partially attributed to the growing presence of institutional investors in the crypto market, who often sell risky assets first to secure liquidity in the face of unexpected shocks.