The news sparked rumors about Coinbase, including that they might be facing a liquidity crisis or insolvency. Others dismissed those rumors as unfounded, and normal behavior for a company facing a market downturn. Coinbase CEO Brian Armstrong tweeted that Coinbase was "well capitalized".
Coinbase plans to shut down its affiliate-marketing program, sparking rumors of an impending crisis
A leaked email revealed that Coinbase is planning to temporarily end its affiliate-marketing program, which pays influencers to convince their followers to sign up. Some influencers were earning $40 for each person they pulled on to the platform in early 2022, though the rewards had reportedly dwindled to as low as $2/person more recently. In the leaked email, Coinbase stated that they would be shutting down the program on July 19 "due to crypto market conditions and the outlook for the remainder of 2022". They also said they planned to re-enable the program at some point in 2023.
Boneheads rug pull for $3.1 million
Crypto sleuth zachxbt has accused the NFT project "Boneheads" of rug pulling only weeks after the project minted in August 2021. Although they promised physical collectibles, more NFT collections, merch giveaways (including, of all things, rugs), and other perks, they never followed through.
zachxbt traced the funds to various centralized crypto exchanges, and also found that some of the money had been used to purchase other pricey NFTs including Bored Apes, CryptoPunks, and others. He also identified two individuals he suspected were behind the pseudonymous creators of the project, who had mysteriously begun posting luxury trips, designer purchases, and an expensive Mercedes after the project mint.
After zachxbt's thread, the project tweeted for the first time in a very long time, writing "for the 2736463266474th time, itz not rug đȘ, just a very deliberately slow creative process, lots of pivots..." However, the project never followed through on their promised new deadline. The social media account showing evidence of the alleged creator's lavish spending was also deleted.
Betty Boop launches "Boop & Frens" NFT project
The studio behind Betty Boop decided there was no better time to launch a Betty Boop NFT collection than during a period of record low interest in NFTs (or, more likely, they started the project during the NFT craze and decided they'd sunk too much money into it to pull the plug). The Betty Boop Twitter account announced Boop & Frens, an 8,888-piece NFT collection.
Reception on Twitter was brutal, with one person commenting, "And that's another one for Beloved Icons Ruined By Pyramid Scheme Bingo". Another described the decision to launch an NFT project as "jumping on the bandwagon while it's actively collapsing". The reception on Discord was also tepid, with only 130 people joining the server in the two days following the announcement.
OpenSea NFT marketplace lays off 20% of employees
OpenSea, the largest NFT marketplace, announced that they would be laying off around 20% of their employees, or around 60 people. CEO Devin Finzer blamed "crypto winter" for necessitating the decision, a common phrase that has been referenced by multiple CEOs who have announced layoffs in the past two months.
John McAfee associate fined $376,000 for pump & dump scheme and undisclosed promotion of ICOs
In October 2020, the SEC filed charges against anti-virus software magnate, two-time Libertarian presidential candidate, and all-around shady character John McAfee, as well as his bodyguard, Jimmy Watson Jr. They alleged that the two had promoted several initial coin offerings (ICOs) without disclosing that they were being paid to do so. The SEC also charged the pair with participating in a pump and dump scheme, where they secretly bought large amounts of a cryptocurrency token before hyping it on Twitter (where McAfee had millions of followers), then selling the tokens as the price increased.
McAfee died by suicide in June 2021 in a Spanish prison, shortly before he was due to be extradited to the United States on tax evasion charges. His death kicked off a tornado of conspiracy theories by QAnon followers.
Now, the SEC has wrapped up the investigation, finding his partner in crime responsible for the undisclosed promotion and pump and dump scheme. In addition to a $376,000 fine, Watson is prohibited from any professional cryptocurrency trading.
Celsius files for bankruptcy
One month after pausing customer withdrawals, crypto lending firm Celsius Network filed for Chapter 11 bankruptcy. Celsius had recently hired a new group of restructuring lawyers from Kirkland & Ellis, the same group counseling Voyager Digital in their bankruptcy proceedings announced on July 6.
- "Crypto Lender Celsius Files for Bankruptcy After Cash Crunch", Bloomberg
- "Troubled Crypto Lender Celsius Hires New Restructuring Lawyers", The Wall Street Journal
Citizen Finance claims to have been hacked for around $100,000
Citizen Finance, a multichain platform that has something to do with NFTs and blockchain gaming, claimed to have suffered an attack by an outside party who obtained access to a private key for the BNB and Polygon chains. The attacker then used their access to transfer 244 BNB (~$55,000), 57,637 MATIC (~$32,300), and 7,000 USDC for a total windfall of around $94,300. The theft also caused the value of the CIFI token to plummet more than 50%.
As with many of these attacks, it's not immediately clear if there was truly an outside party who gained unauthorized access, or if the "attack" was actually a rug pull or an inside job. The project tweeted on July 16 that they were "continu[ing] to investigate" and had hired outside security firms to try to help them identify the hacker and recoup lost funds.
More than $8.17 million stolen in phishing attack targeting Uniswap users
In a successful, broadly-targeted phishing campaign, more than 70,000 addresses connected to Uniswap were airdropped tokens that baited users into approving transactions that allowed attackers to control their wallets. After some initial confusion that there might be a vulnerability in Uniswap itself, it was determined that the thefts were being perpetrated through the airdrop, which also linked users to a website that resembled the authentic Uniswap site. Users were tricked into signing the contract, and cryptocurrency and NFTs were stolen from wallets.
One single wallet targeted by the phishing attack lost more than $6.5 million worth of Ether and Bitcoin, and another targeted by attackers lost around $1.68 million worth of those currencies.
Vauld is short around $70 million
Crypto lending firm Vauld, which suspended withdrawals and announced they were considering restructuring on July 4, have disclosed to their creditors a shortfall of around $70 million. They explained this was due to mark-to-market losses relating to the declining pricess of Bitcoin, Ether, and Polygon, as well as exposure to the now-collapsed Terra stablecoin UST. They also attributed some of the shortfall to longterm loans that can't be called back for another 3â11 months.
Several weeks prior, Vauld had cut 30% of staff, slashed executive salaries, and began various other cost-cutting measures.
Rival firm Nexo has said it is considering acquiring Vauld, though some have expressed skepticism that Nexo is in a position to afford such an acquisition.
Report claims that Binance served Iranian customers in violation of sanctions
The latest Reuters investigation into Binance has alleged that the company processed transactions for Iranian users, despite U.S. sanctions and the company's claim to be compliant with them. Iranian traders interviewed by Reuters stated that they were able to take advantage of Binance's poor KYC checks to use the service despite the sanctions.
The usage of the exchange by residents of sanctioned countries could draw the attention of US regulators. It's also the latest in several investigative reports by Reuters into Binance, in addition to a June report that the exchange facilitated $2.35 billion in illicit transfers from 2017â2021, and an April report that Binance supplied the Putin regime with information about crypto donors to opposition leader Alexei Navalny.