From Terra to FTX, 2022 has given us many weird crypto stories. While investors have been enduring a bear market that saw the crypto industry sink below the $1 trillion market capitalization mark, adoption in the space has been growing, and old mysteries were finally solved.
From the incredible short squeeze of a bankrupt company’s token to old anti-crypto arguments used by a major central bank, we’re getting weird with five stories the best fiction writers couldn’t dream up.
“Comedic rapper” charged over Bitfinex hack
Back in 2016, popular cryptocurrency exchange Bitfinex suffered a major security breach that saw attackers steal 119,756 Bitcoin (BTC), worth approximately $72 million at the time. It was one of the largest crypto hacks in history, and although Bitfinex continued operating, its reputation was damaged for years to come.
This year, Heather Morgan, known by her rap name “Razzlekhan,” and her husband Ilya Lichtenstein were arrested by the Federal Bureau of Investigation for allegedly conspiring to launder crypto connected to the Bitfinex hack.
During a court appearance in New York, the pair proclaimed their innocence and were released on multimillion-dollar bonds. The weird part of this story is the details surrounding Morgan’s work as a “comedic rapper” and social media influencer. One of her songs even says it is dedicated to “the entrepreneurs and hackers, all the misfits and smart slackers.”
Morgan, who calls herself the “crocodile of Wall Street,” was labeled a master of “deceit and deception” by federal authorities. While her home was being searched, Morgan allegedly asked federal agents for permission to retrieve her cat from under the bed and, while doing so, tried to lock her phone.
Morgan and Lichtenstein reportedly traveled to Ukraine in 2019 to attain false identities and create fake passports, and have “established financial accounts” in Ukraine and Russia.
She was a regular contributor to Forbes. The day before the Bitfinex hack, she posted a picture next to Lichtenstein with a caption saying she will “always love getting into trouble w/ this crazy guy.”
Bitfinex announced it had been hacked on August 2, 2016. https://t.co/Y7sJ7ZUrKB On Aug. 1, 2016, Heather Morgan posted a photo with Ilya Lichtenstein and the caption: “I will always love getting into trouble w/ this crazy guy.” pic.twitter.com/EjVmRtiYof
— Jack Morse (@jmorse_) February 9, 2022
Commenting on Morgan and Lichtenstein’s arrest, Dymtro Volkov, head of global innovations at crypto exchange CEX.io, told Cointelegraph that with the proper technical resources, “it is possible to track the flow of most funds moving on a blockchain network” and that “hiding a huge amount of stolen funds is actually quite a complex task.”
Notably, the pair isn’t being charged with the hack but laundering the stolen funds. The sordid details of the story have even caught the interest of filmmakers. Hulu is producing a true-crime limited series about Morgan’s life, and Netflix has ordered a docuseries on the story.
Bankrupt Celsius Network’s CEL token surges 4,000%
Shortly after cryptocurrency lending platform Celsius Network filed for bankruptcy, the price of its native utility token, CEL (CEL), jumped by more than 4,100%. In only two months, the price climbed from a bottom of $0.093 to a near $4 high.
The surge came amid rumors that Ripple, a company engaged in a legal battle with the United States Securities and Exchange Commission, could take over Celsius’ assets. Other rumors suggested Goldman Sachs planned to acquire Celsius for $2 billion.
FTX is still sucking up CEL liquidity.
550k CEL moved from OkeX to FTX 25min ago.#CelShortSqueeze is quietly doing its thing behind the scenes. #celsius #CelsiusNetwork pic.twitter.com/T2l4pbrUfO
— CryptoChris (@Chris52508387) July 17, 2022
Traders organized a massive short squeeze. Short squeezes occur when an asset’s price rises suddenly, forcing short sellers to buy back the asset at a higher price to close their positions.
The short squeeze was possible because a freeze on Celsius token transfers significantly reduced the circulating supply of CEL.
At the time of the short squeeze, Cointelegraph reported that FTX had about 5.1 million CEL tokens, amounting to 90% of the total circulating supply on exchanges.
It’s currently believed traders on FTX pulled off the short squeeze, but deleted tweets suggest that the origins of the movement may not be fully understood, and some believe Alameda Research was directly involved. We do know that at least some traders are still trying to get a CEL short squeeze going again, even after the token dropped to $0.50.
Binance’s letter of intent
Binance’s surprising letter of intent to acquire the collapsing FTX exchange is another weird story of 2022. At the time, many…
cointelegraph.com