LEO trades at 60% premium on hopes of hacked BTC recovery, says analyst

Bitfinex's exchange token, LEO, is trading at a 60% premium to its fair value, driven by expectations that the exchange will recover Bitcoin stolen in a 2016 hack to fund token buybacks and burns. According to The Block, Vetle Lunde, head of research at K33, explained that in 2022, the U.S. government seized 94,636 BTC from the proceeds of the 2016 Bitfinex hack. This amount constitutes approximately 30% of the U.S. government's Strategic Bitcoin Reserve (SBR), which currently holds around 328,372 BTC. Lunde noted that while a court has suggested the seized BTC could be returned in-kind to the hack victims, nothing has been confirmed. Bitfinex has previously pledged to use 80% of any recovered stolen BTC for buybacks and burns. Lunde concluded that the market's hope for this recovery and subsequent buyback is what has created the current 60% premium on LEO's fair value.