Ripple Chairman Falls Victim to $112.5m XRP Hack as Crypto Space Faces Heightened Security Breaches
Summary:
Chris Larsen, Ripple's Chairman, confirmed losing 213 million XRP tokens valued at roughly $112.5 million to hacking. The crypto space suffered more security breaches, with the Web3 ecosystem recording $38.9 million losses in January 2024. Meanwhile, Terraform Labs, facing a lawsuit from the U.S. Securities and Exchange Commission, views its bankruptcy situation as potentially beneficial in appealing the lawsuit.
The Chairman of Ripple, Chris Larsen, fell victim to a cyber-attack, losing approximately 213 million XRP tokens, reveals blockchain investigator ZachXBT. Throughout January 2024, the Web3 environment lost an estimated $38.9 million due to several security breaches. Amid these developments, Terraform Labs claims that its current insolvency condition could assist in countering a lawsuit by the U.S Securities and Exchange Commission (SEC).
Chris Larsen, the Chairman of Ripple, confirmed the unauthorized intrusion into his personal XRP holdings after losing roughly $112.5 million in tokens, as disclosed by ZachXBT. Larsen reacted to ZachXBT's finding by acknowledging the breach of his personal XRP accounts, adding that they had swiftly identified the issue, informed exchanges to suspend the compromised accounts, and engaged law enforcement.
Following the announcement, the price of XRP briefly dipped before a rapid rebound. It was a stark reminder of the recurring security issues and thefts that plague the digital currency sector. Over 600 significant breaches were reported by PeckShield in 2023, leading to losses of approximately $2.61 billion. The silver lining, however, is the recovery of over $674 million.
According to the decentralized finance (DeFi) security startup, Quantstamp, multiple attacks, including smart contract hacks and scams, led to losses of $38.9 million in Web3 projects in January 2024. The most heavily impacted smart contract protocols include Radiant Capital, Gamma Strategies, Wise Lending, Socket, and Goledo Finance.
Bankrupt Terraform Labs, owned by Do Kwon, believes that its decision to apply for Chapter 11 bankruptcy protection could support its appeal against an SEC lawsuit. Chris Amani, CEO of Terraform Labs, stated in a filing on January 30 that the usual regulation for appealing against an SEC ruling requires posting a supersedeas bond equal to 110% of the total judgment. Bankruptcy protections could negate the need for such a bond.
Terraform Labs aims to argue in their appeal that its crypto-assets are not legally considered securities, thus the SEC's enforcement action is outside their jurisdiction. The success of such an argument, according to Amani, would effectively eradicate the most substantial claim against Terraform Labs and would be a massive leap towards compensating creditors. Terraform Labs filed for bankruptcy on January 21 in a Delaware Bankruptcy Court.
Concurrently, the SEC is making attempts to dismiss a case it initiated against a crypto firm named Debt Box following possible sanctions for inaccuracies in case details.
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Published At
1/31/2024 10:40:35 PM
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