The “sickening” loss of $90 million of Bitcoin from cold storage weighs heavily on sentiment, as the Clarity Act stalls with just five days left to hold a Senate vote.
After $90 million in Bitcoin was drained from Coldcard wallet users, small hodlers desperately sought refuge on centralized exchanges and via alternative custody methods. Bitcoin transfers below 1 BTC climbed to their highest daily level since 2022 on Friday, with 39,600 BTC moved, according to data shared by CryptoQuant head of research Julio Moreno on Saturday.
The figure was just 300 BTC below the 39,900 BTC transferred on Nov. 16, 2022, days after FTX filed for bankruptcy.
Galaxy Research, the research arm of crypto investment company Galaxy Digital, reported Saturday that the third wave of attacks on users of the hardware wallet on the weekend brought estimated losses to 1,367 BTC ($88.6 million) across 4,585 addresses.
Alex Thorn, Galaxy Digital’s head of firmwide research, warned in an X post on Sunday that the attack was still ongoing and urged users to move funds from Coldcard-generated addresses immediately if they had not already done so. The exploit reportedly targets a flaw in the Coldcard seed generation process, that did not employ a genuinely random number generator.
President Donald Trump is considering a revised ethics proposal for the Clarity Act that was devised by Senator Thom Tillis and Senator Ruben Gallego. The original proposal Trump signed off on would have prevented elected officials from endorsing or profiting from crypto projects and would have been enforced by the Department of Justice. The Democrats don’t trust the DoJ and want the State Attorney Generals to enforce it.
The compromise proposal would allow the State AGs to sue the DoJ if it does not properly enforce the rules, rather than allow them to sue elected officials *cough, Trump* directly.
With just five days left on the clock, the chances of any kind of Senate vote on the legislation are receding, much less the multiple separate votes required to pass the bill. Trump’s $1.4 billion in crypto profits are a particular sticking point, with Senate Minority Leader Chuck Schumer introducing a bill (with little hope of passing) called the Anti-Corruption Bureau Creation Act that targets “executive branch corruption.”
Ethics isn’t the only outstanding issue, with the banks still up in arms over paying any kind of yield on stablecoins, and law enforcement groups divided over the impact of the Blockchain Regulatory Certainty Act. Designed to protect blockchain developers, some argue it would thwart investigations into money laundering and fraud.
Changes to the BRCA proposed by the National Association of Assistant US Attorneys and the National District Attorneys Association look dead in the water. White House crypto advisor Patrick Witt scoffed at the proposals and the claim they resulted from “productive negotiations.””This is not even close,” he said.
Nobody is making much money in crypto right now it seems, at least according to this week’s corporate earnings reports for the second quarter.
Coinbase generated roughly $1.2 billion in net revenue, down 19% from a year earlier. It reported a net loss of $359 million, significantly wider than analysts’ expectations for a $122 million loss. Transaction revenue, subscription and services revenue, and adjusted EBITDA all fell short of consensus estimates.
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