Kraken Considers Dropping Tether in Europe Amid Market Dips on Binance and Memecoin Exploit
Summary:
US cryptocurrency exchange Kraken is reportedly considering discontinuing support for Tether (USDT) in Europe. In the last six months, over 80% of tokens listed on Binance have decreased in value from their original listing price. A former employee of memecoin tool pump.fun is accused of exploiting the system for almost $2 million.
Kraken, a US-based cryptocurrency exchange, is contemplating the cessation of Tether (USDT) support in Europe. Over the past half-year, approximately four-fifths of tokens posted on Binance's crypto exchange have experienced a drop in value from their initial list prices. In relation to this, a former employee of pump.fun, a Solana memecoin tool, is implicated in a heist.
According to reports, ahead of the establishment of the Markets in Crypto-Assets Regulation (MiCA), Kraken is "actively examining" strategies for compliance. The Global Head of Regulatory Strategy for Kraken, Marcus Hughes, revealed to Bloomberg that they are exploring several possibilities, not exclusively restrictions associated with Tether. Hughes mentioned that they are preparing for any future scenario, even conditions where it becomes untenable to list tokens such as USDT.
Tether CEO, Paolo Ardoino, has publicly disapproved of MiCA in the past. Ardoino noted that Tether had no intentions of falling under its regulation. He stated that very few banks in Europe are willing to take on this kind of business, making it quite challenging.
An observation by Flow, a researcher in cryptocurrency and macroeconomics, highlighted that more than 80% of tokens listed on Binance in the past six months are currently worth less than their listing prices. From the 31 tokens studied, only five increased in value, with Memecoin (MEME), Ordi token (ORDI), Jupiter based on Solana (JUP), Jito (JTO), and Dogwifhat (WIF) among the names.
Pump.fun, a platform for memecoin creation, claimed that an ex-employee exploited their system for nearly $2 million using a "withdraw authority," gained from a "privileged position" within the company. The theft, amounting to $1.9 million, was from the total $45 million held in pump.fun's bonding curve contracts. Pump.fun was forced to halt all trading temporarily.
The accused individual allegedly used flash loans from a lending protocol, Raydium, to borrow Solana (SOL), which they then utilized to purchase as many coins as possible. Once these coins reached 100% on their respective bonding curves, the accused could access the liquidity of the bonding curve and repay the flash loans, according to pump.fun's report.
Published At
5/17/2024 11:03:07 PM
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