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Report: Wash trading accounts for 95% of LooksRare trading volume Apr 05, 2022

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When LooksRare started operating in January, it came with the promise of challenging OpenSea’s dominance in the NFT space. But three months down the line, it seemed to have developed a reputation for wash trading. According to CryptoSlam and cited by Bloomberg, about $18 billion or 95% of trading volume on the platform is wash trading. Wash trading is an act where a trader sells an asset belonging to them to another wallet controlled by them. It is usually an attempt to inflate the price of the asset and also give the impression of demand. But that’s not the only reason why LooksRare traders are doing it. LooksRare incentives indirectly promote wash trading The prevalence of wash trading on the marketplace is due to the incentives attached to active trading on the platform. While the concept of wash trading is frowned upon by many, there are no regulations that prevent it. But even if the intention of the wash traders is to earn tokens and not pump prices, there’s no doubt that the act masks the true state of things in the NFT scene. This has led many to describe it as market manipulation. According to David Silva, a lawyer with experience in crypto matters, it doesn’t matter whether it is stocks, bonds, or NFT, “Wash trading is a form of market manipulation in which an investor simultaneously sells and buys the same instrument to create misleading, artificial activity in the marketplace.” However, it appears that LooksRare’s attempt to wrestle some of the NFT market shares from OpenSea is gaining some traction. A senior data analyst at DappRadar, Pedro Herrera, noted that organic trading on LooksRare has increased as its lower fees and rewards are bringing in new users. But OpenSea remains the most prominent platform with about 10 times more daily users than LooksRare. Decline in NFT trades not affecting corporate interest Despite OpenSea still maintaining its dominance, the overall NFT trading volume has declined over the past two months. Since it hit a record of almost $5 billion in monthly trading volume in January, transactions have dropped significantly, and so has the number of new investors entering the space. The trading volume in March was around $2.5 billion. However, the decline in interest hasn’t discouraged corporate investors from getting into the metaverse space. Companies like JP Morgan and HSBC now have virtual venues on the blockchain. Other companies such as Meta and Google have also revealed plans to integrate NFTs into their products.

Liverpool Football Club’s foray into NFTs branded a disaster Apr 05, 2022

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Premier League football club Liverpool is reeling after its six-day Sotheby’s auction ended on Monday, having sold just 9,721 out of an available 171,072 NFTs. The LFC Heroes Club Collection is described as cartoon avatar depictions of the Liverpool squad. Token holders are granted “access to a range of ongoing benefits.” “Holders have access to a members-only LFC Discord community chat channel where they can interact with other passionate LFC Heroes Club members. Additional benefits include virtual hang-outs, competitions, guest appearances, updates from the LFC Foundation and LFC retail discounts.” In addition, a percentage of the proceeds will go to the LFC Foundation. This independent charity provides support in the local area (and beyond) for sports activities, health and wellbeing, and youth interventions, among other aims. In recent times, gamers have made it clear they don’t welcome NFTs due to the potential monetization strategies they offer game developers. Based on the poor uptake of the LFC Heroes Club Collection, sports fans hold a similar view. LFC Heroes Club NFTs The LFC Heroes Club Collection was available as part of a two-tier auction. The “Legendary” auction featured 1/1 NFTs of the 23 squad members plus first-team manager Jürgen Klopp. All 24 Legendary lots were sold, with Mohamed Salah fetching the highest price, at $88,200. Followed by Lot 1: Jürgen Klopp raising $81,900. The “Hero Limited Edition” auction made up the remaining 171,048 NFTs. This range also features the squad, but each NFT varies according to the background color and “Match Mode, Fresh Mode and Super Mode traits.” The asking price for Hero Limited Editions was $75. And with 9,697 sold, revenue generated comes in at $727,275. Of which 10% will go to the LFC Foundation. The revenue generated by the Legendary auction comes to $745,290. Of which 50% will go to the LFC Foundation. All in all, LFC Heroes Club earned Liverpool Football Club a total of $1,472,565 ($1,027,193 after charitable contributions). This falls way short of the projected sales figure of $11.2 million. What does the community say? Liverpool Football Club was keen to stress that the LFC Heroes NFTs operate on the energy-efficient Polygon blockchain, making the Collection environmentally friendly. “We have chosen to mint all LFC Heroes Club NFTs on Polygon, one of the most energy-efficient blockchains. Creating an NFT on Polygon has the same carbon impact as sending just 2.5 emails, which means LFC NFTs consume 99.95% less energy than projects on Ethereum.” However, in conjunction with the charitable element, this wasn’t enough to rouse sufficient interest in the project. The Director of Centre for the Eurasian Sport Industry, Professor Simon Chadwick, claims that single buyers purchased multiple NFTs, making the sales figures even worse than initially thought. It appears that although just under 10,000 Liverpool NFTs have been bought, the number of buyers is significantly less than 10,000. In several instances, single buyers have bought multiple NFTs, further calling into question the number of people in total who have made a purchase Professor Simon Chadwick (@Prof_Chadwick) April 4, 2022 Football Journalist David Lynch said the club had been weighing up the pros and cons of releasing an NFT collection for some time. But in the end, they opted to go, ahead despite the drawbacks, for reasons of financial gain. Liverpool have spent a long time assessing external sentiment around NFTs in recent months and were warned about potential harms to investors/the environment but proceeded anyway. Presumably the financial gain outweighs any backlash as far as they’re concerned. David Lynch (@dmlynch) March 24, 2022 An examination of grassroots sentiment shows there is enormous skepticism towards digital assets. Common themes include NFTs being a vehicle for tax evasion, copying pictures is the same as owning the NFT, and this being a money grab for Liverpool Football Club.

Musk buys $2.9B stake in Twitter, what does this mean for Dogecoin? Apr 05, 2022

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Elon Musk bought a 9.2% stake in Twitter for $2.9 billion, making him the platform’s biggest shareholder. Recently, the Tesla CEO had slammed Twitter on the grounds of it “failing to adhere to free speech principles.” As a response to the problem, Musk teased the possibility of starting his own social media platform or even buying Twitter. However, few imagined he would follow through with either of these ideas. Nonetheless, analysts expect this acquisition of a stake in Twitter to be the start. What’s more, with Musk being a fan of Dogecoin, should we expect a collaboration between the two? How might Dogecoin fit in? Crypto markets are mainly flat today. However, among the large caps, Dogecoin posted the second-biggest gains in the last 24-hours, at +5%. NEAR Protocol leads the pack with +5.7% gains. Musk disclosed his crypto holdings to CNBC last year, saying he owns Bitcoin, Ether, and Dogecoin. On his reason for liking Dogecoin, he said: “That’s why I decided to support Doge — it felt like the people’s crypto.” Given Dogecoin’s response to the news, it’s clear that markets expect Musk to utilize $DOGE on Twitter in some capacity. But will that ever happen? Before the acquisition stake, as Musk was canvassing opinions on how to tackle Twitter censorship, one user posted a tongue-in-cheek comment saying Dogecoin, for sure, will be used as a tipping mechanism. To which Musk replied, “100.” “One of the best things about Elon Musk either buying Twitter or starting his own platform is you know there would be a Dogecoin tip jar!“ The initial use case of $DOGE was as an internet tipping currency. But as pointed out by this eight-year-old Reddit post, there are three barriers to preventing this from happening. One, tipping in meaningful increments, two, making Dogecoin easier to send and receive, and three, having a social media platform on board. “create widgets/apps that allow content creators on blogs/tumblr/twitter/etc to be tipped for their work at the click of a button.” What’s next for Musk and Twitter? Speaking to CNBC Squawk Box, Dan Ives, Analyst at Wedbush Securities, speculates that Musk may “take a more aggressive stance on Twitter,” which could eventually lead to a complete takeover of the company. Commenting on the situation, crypto influencer Layah Heilpern points out it reflects poorly on the Western world that Musk is single-handedly trying to “save freedom of speech.” Technically we are relying on @elonmusk to save Freedom of Speech. Quite incredible what western society has come to. Layah Heilpern (@LayahHeilpern) April 4, 2022 As an indication that he intends to shake things up at Twitter, Musk posted a humorous tweet asking whether users want an edit button. But Dogecoin holders want more information on Musk’s plans for the meme coin going forward.

NGRAVE’s crypto security study shows 54% of hard wallet owners’ keys are vulnerable Apr 05, 2022

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Seven out of 10 crypto investors own a hardware wallet, out of which, 54% keep their backup phrases on paper, while 50% of these investors keep their full backup in one place, according to a survey by Ngrave. NGrave‘s 2022 Crypto Security Self-Audit report reveals that 50% of hardware wallet owners’ keys would be compromised if someone were to find their backup. The company’s CEO Ruben Merre commented on the report and said: “The results of our annual Security Self-Audit show that there are glaring gaps in the methods investors are using to ensure the security of their assets, especially at a time when high-profile and high-valueN breaches are becoming increasingly common.” He further elaborated: “It is clear that there is much to be done to secure the crypto assets of investors the world over, if the industry is to avoid the hacks that we have seen in recent months.” As attacks on wallets remain to be a serious problem for crypto holders, the community has been working on new methods to prevent irreversible losses and increase wallet security. Other Findings The study included over 2000 unique respondents from 87 countries, mainly Europe and North America. The numbers showed that almost half of the participants hold less than $20,000 in their portfolio, while one out of five investors has more than $100,000. 66% of the participants indicated that they prefer to buy and hold instead of trading. Merre referred to this percentage and said: “The behaviour of crypto investors remains stable compared to 2021. Given the nature of the survey, an overrepresentation of nontrader profiles was expected and confirmed.” When it comes to storage, the numbers indicate that 76% of the respondents have a part of their portfolio stored on an exchange, and almost all of them (92%) use a two-factor authentication method.

Bitcoin briefly jumps above $47K after MicroStrategy buys 4,167 BTC Apr 05, 2022

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MicroStrategy’s spree of adding bitcoin to its balance sheet continues without rest. Announced in a tweet by the company CEO Michael Saylor, the IT-services company bought another 4,167 bitcoin (BTC). As reported by CryptoSlate on March 30, the purchase was expected after MicroStrategy announced the company had borrowed $205 million to buy more bitcoin. Aside from Saylor’s tweet, the company also, as required, filed a Form 8-K with the U.S. Securities and Exchange Commission, SEC. MicroStrategy’s 129,218 bitcoin hoard MicroStrategy announced securing a loan with Silvergate Bank. Under the agreement, $205 million was issued, with bitcoin held by the subsidiary firm MacroStrategy (note: macro, not micro) collateralizing the deal. The press release also mentioned the payment of costs related to the loan and “general corporate purposes.” As per Saylor’s tweet, the company did not use the entire amount of the loan to buy bitcoin as MacroStrategy roughly $190 million at an average price of $45,714 per BTC. MicroStrategy first bought bitcoin in August 2020 and this latest purchase strengthens its position as the largest known corporate holder of bitcoin, which it has achieved through a mix of self-funding and borrowing. MicroStrategy’s bitcoin holdings now total 129,218 bitcoin acquired for $3.97 billion at an average price of $30,700 per bitcoin. Self-funding bitcoin buys from company reserves is one thing. But eyebrows were raised in July 2021 when the firm announced it was going through with a complex corporate bond to acquire more. This saw MicroStrategy borrow $400 million to buy Bitcoin. Bitcoin bounced over $47,000 on the news On the news of MacroStrategy’s purchase, the market price of bitcoin briefly bounced above $47,000 and is at press time trading around $45,800. The price of bitcoin has been fairly level the past week, after a dip down to $44,350 on April 1st, holding itself in a corridor between $46,000 and $ 47,000. According to crypto analysts IntoTheBlock, on-chain data shows that retail customers are accumulating bitcoin. Addresses holding 0.1-1 BTC have increased their balance by 1.47% in just 30 days. Moreover, since the January lows, all the clusters of addresses holding below 1 BTC have increased their holdings up to 5.51%. Since the all-time high at $60,044 set on November 10th, 2021, bitcoin is down 32.3%.

User loses $570,000 worth of Mutant and Bored Ape NFTs to ‘fake verification’ scam Apr 05, 2022

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A pseudonymous user, known as “s27,” today lost roughly $570,000 worth of non-fungible tokens (NFTs) after exchanging his Bored Ape Yacht Club (BAYC) #1584 and two Mutant Ape Yacht Club (MAYC) tokens for fraudulent NFTs deceptively disguised as genuine. The exchange was first spotted by crypto enthusiast Quit thanks to his Discord server configured to track ape listings that are at least 5% below their floor price in Ethereum (ETH): “The pings are rare, but when they happen it generally means one of two things: somebody is panic selling, or somebody is compromised. When I saw the notification for #1584, I instantly knew it was the latter.” Indeed, according to NFT marketplace OpenSea’s records, BAYC #1584 as well as MAYC #13168 and MAYC #13169 were transferred from s27 to another address today — literally for free. Further, Quit discovered that not only did s27 transfer his valuable NFTs to a scammer, but he was also the initiator of the trade. As it turned out, s27 used Swap.Kiwi, a blockchain service that allows collectors to swap certain NFTs for others — preferably of equal or greater value — just like trading cards. But as usual, there was a catch. Do your own research Investigating further, Quit has tracked down the scammer’s NFTs that s27 received after the swap was made. All of them appeared as genuine BAYC tokens — but only at first glance. 6/ Well, the hacker used that to his advantage. Here are the apes that s27 received in return:://t.co/pIgu3mRGVY You'll see that each has the green check added directly to the image. quit (@0xQuit) April 5, 2022 In reality, the “green checkmark” Swap.Kiwi uses to verify that tokens are really authentic can be easily counterfeited via a simple image editor — and that’s exactly what the scammer did. Essentially, he downloaded some “jpegs” depicting a few expensive BAYC apes and added a fake watermark so that they would appear like the real deal when displayed on Swap.Kiwi. Of course, a deeper look into the scammer’s wallet would reveal that his tokens are anything but genuine, although a lot of crypto users oftentimes neglect such procedures, sadly. Shortly after receiving the BAYC and two MAYC NFTs, the scammer sold them for 98.85 ETH (currently around $350,00), 23 ETH ($81,000), and 25.25 ETH ($90,000) — worth a total of $521,000 at press time. However, these listings were lower than their corresponding floor prices, placing s27’s potential loss in the ballpark of $570,000, according to Quit. 9/ So what can you, the tradoooor, do to protect yourself? Well, there are a few things. If it sounds too good to be true, it probably is.– Close your DMs. Negotiate in public.– Always assume everybody is out to get you. They probably are.– Independently verify EVERYTHING quit (@0xQuit) April 5, 2022 Meanwhile, NFT holders are seemingly becoming the prime target for scammers of all sorts who, in their turn, keep coming up with increasingly inventive schemes for their endeavors. As CryptoSlate reported, crypto users discovered a new wave of Discord NFT scams just yesterday, April 4. And it is very unlikely that bad actors are planning to dial down their activity any time soon.

German authorities shut down world’s largest darknet market Hydra Apr 05, 2022

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Germany’s Central Office for Combating Cybercrime (ZIT) and the Federal Criminal Police Office (BKA) have successfully seized the server infrastructure of the world’s largest illegal darknet marketplace Hydra. Per a press release published by the BKA today, the law enforcement agencies have also confiscated approximately €23 million worth of Bitcoin. “Among other things, there is a suspicion of the commercial operation of criminal trading platforms on the Internet, the commercial procurement or granting of an opportunity for the unauthorized purchase or the unauthorized sale of narcotics as well as commercial money laundering.” What is Hydra? Launched around 2015, Hydra was hitherto the most prominent Russian darknet market and “likely the largest darknet market in the world”—despite operating mostly in CIS countries, according to crypto intelligence firm Ciphertrace. Namely, the marketplace served customers in Russia, Ukraine, Belarus, Kazakhstan, Azerbaijan, Armenia, Kyrgyzstan, Uzbekistan, Tajikistan, and Moldova. In total, around 17 million customers and over 19,000 seller accounts were registered on the marketplace. Hydra ran out of heads Naturally, trades on Hydra — the lion’s share of which reportedly involved illegal narcotics — were conduсted using cryptocurrencies such as Bitcoin, the BKA pointed out, adding: “According to ZIT and BKA estimates, ‘Hydra Market’ was probably the illegal marketplace with the highest turnover worldwide. Its sales amounted to at least 1.23 billion euros in 2020 alone. In particular, the Bitcoin Bank Mixer, a service for obfuscating digital transactions provided by the platform, made crypto investigations extremely difficult for law enforcement agencies.” Following Hydra’s closure, a special banner was placed by the agencies on its website, notifying users that “the platform and the criminal content have been seized by the Federal Criminal Police Office on behalf of Attorney General’s Office in Frankfurt am Main in the course of an international coordinated law enforcement operation.” As CryptoSlate reported, despite being of Russian origin, Hydra wasn’t actually used to evade the western sanctions that followed the country’s armed conflict with Ukraine, according to blockchain data platform Chainalysis. And now it never will be, apparently.

Trading volume drops as 30% capital gains tax on crypto goes into effect in India Apr 05, 2022

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The new crypto tax regime in India has finally gone into effect, and it appears to be affecting the trading volume in the country. Media reports from the country suggest that trading volumes on crypto exchanges have dropped by an average of 15% within the first three days of the month. Not only that, but crypto exchanges operating within the country have also seen their domain traffic drop by 40%. India crypto exchanges trading volume suffers Co-founder of Crypto India, Aditya Singh, confirmed these reports on Twitter. He posted graphs showing a significant dip in the trading volume of 4 of India’s top exchanges. Indian Exchanges saw Volume drop after New Crypto tax rules became applicable on 1st April. Aditya Singh (@CryptooAdy) April 2, 2022 The trading volume of WazirX, the country’s biggest exchange, dropped from $208 million to less than $100 million before the month even started. The drop in trading volume doesn’t come as a surprise, given the hefty tax imposed on crypto. Indians will have to part with 30% of their profits with the new tax law. In addition, another tax will come into effect next month, which will deduct 1% on every crypto transaction from the source. Already, crypto stakeholders are predicting that the 1% tax on every transaction will affect liquidity within the sector. They claim that this tax will limit the number of trades as investors who are high-frequency traders will cut down on their trades. The rule also prevents tax write-offs for losses made on trades which means investors would be more likely to run at a loss. Stakeholders lambast the new tax regime Many predict that such a tax regime could push many crypto traders and companies to leave the country. According to Nischal Shetty, CEO of WazirX, the 1% tax-deductible at source (TDS) is “the worst-case scenario for the industry.” The executive director of policy at CoinDCX, Manhar Garegrat, also stated that “There will be no liquidity left in the markets” if TDS comes into effect. “Trades placed by buyers will not get executed as efficiently as they do today, and such inefficiency will eventually dwindle the whole ecosystem,” he added. Major exchanges want to invest in India While crypto stakeholders are worried about an exodus, major exchanges like Coinbase and FTX are showing interest in investing in the crypto space of the Asian country. Earlier today, Coinbase revealed that it plans to invest $1 million into crypto and Web3 projects initiated in the country. Another report revealed that FTX could be set to invest in India’s Mobile Premier League (MPL), which intends to launch NFTs and a play to earn based game before the end of the year. This shows that despite the government’s best effort at making the industry unattractive to investors, some stakeholders still believe there is ample opportunity for them in the country.

Singapore tightens laws for crypto companies in a cautious bid to embrace the industry Apr 05, 2022

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Singapore’s parliament has passed an omnibus bill that will expand the powers of its primary market watchdog and introduce tighter regulation for crypto companies in the country. Passed on Tuesday, April 5th, the law is the government’s latest effort to tighten its grip over the booming crypto industry. Singapore’s lawmakers, however, maintain a crypto-friendly outlook and are set on continuing on a regulatory path that will make Singapore the capital of Asia’s blockchain and crypto industries. Singapore’s market watchdog gains more control over the crypto industry First introduced in February 2022, the Financial Markets and Services Bill was designed to bring digital token services in Singapore in line with new standards set by the Financial Action Task Force (FATF), an intergovernmental organization fighting money laundering. The legislation will require virtual asset service providers—or cryptocurrency companies—which only do business overseas to be licensed. Companies headquartered in Singapore and not servicing customers in the state weren’t subject to anti-money laundering and terrorism financing laws. Alvin Tan, Singapore’s state minister of trade, said this created a regulatory gap where such companies presented “reputational risks” for Singapore. He explained that overseas companies that offer crypto services in Singapore are subject to the country’s laws even though they aren’t physically operating in the country. And while most parliamentarians welcomed the new bill, some raised concerns that it could lead to crypto service provers being “double regulated,” or subject to different legislation in different jurisdictions. The same parliamentarians also said that the bill does little to mitigate consumer risks due to the speculative nature of cryptocurrencies. The Monetary Authority of Singapore (MAS), the country’s leading market watchdog, said that it would keep a close eye on the adoption of cryptocurrencies to determine whether further user protection measures are needed. On the other hand, Tan maintains his position that laws don’t offer foolproof protection against investment losses, saying that consumer education and awareness remain the best weapons for fighting that kind of risk. Nonetheless, the new bill gives MAS the power to impose harsher penalties if companies fail to maintain the security of their platforms. The bill sets the maximum penalty for a breach of security at $740,000, a significant increase from the current liabilities administered by MAS. MAS will also have the power to issue prohibition orders against individuals deemed unfit to perform critical roles, activities, and functions in the financial and crypto industries. “The financial penalty, coupled with the flexibility to impose additional supervisory actions strike a balanced approach, signals the importance of having robust technology risk management, without being overly excessive for smaller financial institutions,” Tan told The Business Times.

Crypto users report new wave of Discord NFT scams Apr 05, 2022

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Scammers have reportedly found a new way to compromise users’ Discord accounts — including those on servers related to cryptocurrencies and non fungible-tokens (NFTs) — by hijacking QR codes used for logging in. According to pseudonymous crypto enthusiast Serpent, malicious actors — disguised as Discord’s verified bot called Wick—are now reaching out to users to offer a collaboration, potential employment, or some other enticing opportunities. But there’s a catch — to continue the discussion, scammers ask users to verify via a QR code. New NFT discord scam going around, this time using QR codes. Pretty terrible scam, but this is how it works 🧵👇 Serpent (@SerpentAU) April 4, 2022 This is because Discord has an option to log in using a special QR, bypassing two-factor authentication. In reality, however, “scammers are using Chrome drivers to open the login page, get the QR code image, then send it to the Discord bot, asking people to verify themselves,” Serpent explained. If a user scans such a code, bad actors can instantly log into their account and snatch their Discord token, a unique series of numbers and letters that is created when people connect to the app. If this happens, users need to reset their passwords as soon as possible. Why is it dangerous? While access to a Discord account won’t directly endanger someone’s crypto or NFTs, such security breaches are still dangerous and can enable to all manner of cyberattack vectors. 5/ Thank for coming to my ted talk. Stay safe & stay vigilant, threat actors are everywhere these days and they try to scam us 24/7. Double check everything you see and ask yourself: “Is this safe to click” -K3rnel🤍 K3rnelPan1c.eth (@Krn3lPanic) March 14, 2022 For example, malicious QR codes can be used to add new—and potentially suspicious—contacts to users’ lists. Further, such codes also allow to connect victims’ devices to the hacker’s network, automatically initiate phone calls as well draft emails and send text messages. Not to mention that such QR codes can reveal users’ locations and initiate fraudulent payments. Things we can no longer do: 📍open dms on discord 📍scan QR codes📍click unknown links📍use discord 📍click on google drive links📍do art commissions for strangers 📍store nfts on hot wallets📍 ______________________ Ƨ 👁 and 776 others (@stellabelle) April 4, 2022 As CryptoSlate reported, cyberattacks have been picking up steam on Discord lately. Notably, not only regular users but major crypto companies are being hacked as well. On April 1, for example, the Discord server of the famous Bored Ape Yacht Club NFT collection was compromised by hackers. STAY SAFE. Do not mint anything from any Discord right now. A webhook in our Discord was briefly compromised. We caught it immediately but please know: we are not doing any April Fools stealth mints / airdrops etc. Other Discords are also being attacked right now. Bored Ape Yacht Club (@BoredApeYC) April 1, 2022 At the time, the hacker gained access to the Discord server that hosts Bored Ape Yacht Club, Mutant Ape Yacht Club, and Mutant Ape Kennel Club—all three NFT collections from Yuga Labs. Apart from Yuga Labs, Discord servers of other NFT projects, such as Nyoki Club and Shamanzs NFT, were also hacked that day.

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