This week in the crypto world, we saw a hacked exchange screw its customers, several crypto companies fined, and a million dollars in stolen bitcoins recovered.
WazirX Rolls Back on Full Payout Promise
It wasn’t a great week for WazirX customers. The exchange, which lost half its holdings when it was hacked in July, rowed back its claim that it was going to pay out users in full. The exchange had initially said that it could afford to repay half the lost funds, before an outcry led to its co-founder, Nischal Shetty, changing plans and promising a full payout.
However, its own legal team admitted this week that it doesn’t have the fund to back up the promise, and the payouts are more likely going to be in the 40% region.
Yikes.
Crypto Companies Cough Up
Several crypto companies and related entities were fined for various infractions this week. First, crypto custody firm Galois Capital agreed to a $225,000 penalty from the Securities and Exchange Commission after it admitted to storing customers funds everywhere but in its own vaults (including on FTX); then Robinhood agreed to a $3.9 million settlement with the California Attorney General after an investigation revealed that the company prevented customers from withdrawing their crypto assets from 2018 to 2022; and finally, Uniswap Labs was hit with a $$175,000 fine from the Commodity Futures Trading Commission for offering unregistered, illegal derivatives.
And I bet none of them was allowed to pay in crypto, either.
$1 Million in Bitcoin Stolen in 2020 Recovered
There is at least one happy man in Scotland this week after over 20 bitcoins worth over one million dollars were recovered having been stolen from its owner. In March 2020, a gang entered the victim’s home and forced him to transfer the bitcoins, then worth $145,000, to themselves, but police traced the funds and seized them in 2022.
While the recovery is good news for the victim, there is a catch: he was denied the possibility of having the bitcoins returned to him in that form, with the court ruling that they must be liquidated at the price when they were stolen and the cash given to him. This means that the victim received the $145,000 March 2020 valuation rather than the value of the coins today, which is to today worth almost ten times that.
