Binance CEO CZ Alerts Users of Phishing Attacks Following Kroll Data Leak

Changpeng Zhao, widely recognized as CZ, the CEO of Binance, has recently brought to light a concerning issue on his Twitter platform. Users of notable cryptocurrency exchanges FTX, BlockFi, and Genesis are reportedly under the threat of new phishing attacks. This surge in malicious activities is believed to be directly linked to the Kroll data leak. Intriguingly, this leak seems to have its roots in a SIM swap conducted on an employee.

In his tweet, CZ stated, “New rounds of phishing attacks already underway for the poor users of FTX, BlockFi, Genesis, as a result of the Kroll data leak, which seems to be a result of a SIM swap on an employee.🤷‍♂️ Learn to protect yourself. Learn about phishing attacks👇” . 

Phishing attacks, which are deceptive maneuvers by malicious entities aiming to extract sensitive information by mimicking trustworthy sources, have been on the rise. This recent wave of attacks emphasizes the critical importance of cybersecurity awareness and the necessity for users to remain alert against potential threats.

In a bid to educate users, CZ shared an article detailing the nature of phishing. Phishing is a cyber attack where attackers pose as reputable entities to deceive individuals into revealing sensitive data. These attacks often use fraudulent emails directing users to deceptive websites. Within the cryptocurrency realm, attackers may spoof genuine sites, altering wallet addresses to misdirect funds.

Key phishing methods include clone phishing, spear phishing, and pharming. Users are advised to be skeptical of unexpected emails, verify content, avoid clicking on email links, and never share private keys. With the irreversible nature of cryptocurrency transactions, vigilance is paramount.

With the cryptocurrency sector’s exponential growth, the security and confidentiality of user data have never been more crucial. Users are encouraged to stay updated and exercise prudence when navigating digital platforms.

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Court approves BlockFi’s disclosure statement conditionally

BlockFi Inc. and its affiliates announced that the United States Bankruptcy Court for the District of New Jersey conditionally approved the company’s Disclosure Statement on August 2, 2023. The approval is part of BlockFi’s Chapter 11 Plan, aimed at maximizing recovery for clients and ensuring the quickest possible distributions.

The plan, recommended by both BlockFi and the Official Committee of Unsecured Creditors, is set to bring the Chapter 11 cases to a fair conclusion, returning client funds as quickly as possible. All parties entitled to vote on the plan must do so by the September 11, 2023, voting deadline.

Mark Renzi of Berkeley Research Group, BlockFi’s Chief Restructuring Officer, stated, “BlockFi’s mission through this process has been to maximize recoveries for our creditors, and conditional approval of our Disclosure Statement moves us one step closer to accomplishing that goal.”

The plan includes provisions for returning digital assets held in BlockFi Wallet Accounts to clients and safely and securely returning non-Wallet assets to creditors. It also outlines a wind-down of the company’s affairs. Clients who do not opt out of a voluntary third-party release will be offered releases from all claims and causes of action BlockFi may have against them, except for those whose withdrawals from BlockFi Interest Accounts or BlockFi Private Client Accounts on and after November 2, 2022, are greater than $250,000.

Under the plan, BlockFi will not claw back amounts under $250,000 that clients properly transferred before the Platform Pause on November 10, 2022. Clients with claims under $3,000, or those electing to reduce their claim to $3,000, will be included in a Convenience Claim Class and will receive a one-time cash distribution from the BlockFi Estate. Creditors in this class will receive a one-time distribution of 50% of their claim in cash.

If the plan is confirmed, BlockFi will focus on pursuing claims and causes of action in litigation against several entities, including Alameda, FTX, 3AC, Emergent, Marex, and Core Scientific, to maximize recoveries for clients. The success or failure in these matters could make a difference to client recoveries of over $1 billion.

BlockFi’s eligible creditors have the opportunity to vote in favor of the plan and will receive detailed voting instructions and additional information. The deadline for votes to be counted is September 11, 2023, at 4:00 p.m. prevailing Eastern Time. BlockFi encourages all clients, including those not eligible to vote, to read the Disclosure Statement and other materials in their Solicitation Packages to learn more about the plan.

Advisors to the company during this process include Haynes and Boone LLP, Kirkland & Ellis LLP, and Cole Schotz P.C. as legal counsel; Moelis & Company as investment banker; and Berkeley Research Group as financial advisor. C Street Advisory Group, LLC is serving as strategy and communications advisor, and Joel Edwards of EY Bermuda Ltd and Eleanor Fisher of EY Cayman Ltd are serving as Joint Provisional Liquidators of BlockFi International Ltd, a Bermuda-incorporated entity.

About BlockFi

BlockFi is a bankrupt crypto lender and which filed for Chapter 11 bankruptcy on November 28, 2022, encompassing all eight of its companies. A simultaneous petition for bankruptcy was submitted to the Supreme Court of Bermuda by BlockFi International.

BlockFi sought permission from a U.S. bankruptcy court to enable customers to withdraw digital assets stored in BlockFi wallets. Filed on December 19, the lender referred to this as an “essential step” in its Chapter 11 proceedings. Hearings were scheduled for January 9 in the U.S. and January 13 in Bermuda.

On April 22, 2023, BlockFi was granted an extension until May 15 to submit a bankruptcy exit plan. The company’s controversial decision to offer high-yield crypto-backed accounts led to regulatory scrutiny and legal battles, including a cease-and-desist order from the SEC in January 2022.

A report submitted on July 14, 2023, to the United States Bankruptcy Court for the District of New Jersey revealed that BlockFi’s failure was attributed to fundamentally flawed business models and ignored risk warnings. CEO Zac Prince allegedly dismissed concerns over lending assets to Alameda Research, leading to a $217 million loan despite warnings. BlockFi had $1.2 billion in assets tied to FTX and Alameda Research at the time of bankruptcy in November 2022.

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BlockFi’s Collapse Tied to Ignored Risks with FTX and Alameda Research

A preliminary report titled “Why Did BlockFi Fail?” submitted to the United States Bankruptcy Court for the District of New Jersey on July 14, 2023, has shed light on the reasons behind the failure of BlockFi, a prominent crypto lending firm. The report was filed by the Official Committee of Unsecured Creditors and involves several entities associated with BlockFi.

According to the report, BlockFi’s failure can be attributed to fundamentally flawed business models, unreasonable risk-taking, and ignored concerns from the management team. The document also provides a timeline of events leading up to BlockFi’s collapse and discusses the key individuals and entities involved in the case.

Zac Prince, the CEO of BlockFi, allegedly disregarded recommendations from the company’s risk management team over lending assets to Alameda Research. The risk management team had reported on the “high risks” associated with lending assets to Alameda, but Prince allegedly dismissed these concerns. By August 2021, BlockFi had lent Alameda $217 million, despite the risk management team’s warnings about potential risks if the FTX Token (FTT) used to secure the loans needed to be liquidated.

The report also reveals that BlockFi had roughly $1.2 billion in assets tied to FTX and Alameda Research when the firm filed for bankruptcy in November 2022. At the time of its Chapter 11 filing, BlockFi admitted it had “significant exposure” to FTX and its associated entities. FTX US had received a $400 million credit line from BlockFi in July 2022, furthering financial ties between the two firms amid a crypto winter.

The report suggests that while Alameda/FTX’s downfall may have triggered BlockFi’s downfall, BlockFi’s demise was rooted in business practices and decisions well preceding Alameda/FTX’s bankruptcy filing.

In response to the report, a BlockFi spokesperson said the firm disagreed with the report, alleging that the committee behind the report “cherry-picks statements out of context, errs on other matters, and does not deliver the objective analysis promised.”

The document also delves into the promises made to customers, the company’s corporate guidelines, the failures of oversight functions, and investment failures. The report’s findings highlight the importance of robust risk management and the potential consequences of ignoring such systems in the rapidly evolving crypto industry.

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BlockFi Granted Extension to Submit Bankruptcy Exit Plan

BlockFi, a leading lender of digital assets, filed for bankruptcy in November 2022, and has been granted an extension until May 15 to submit an exit plan, according to a New Jersey bankruptcy judge. The crypto firm is exploring a potential sale of company assets or the possibility of getting an outside backer to support a restructuring deal, as per the company’s lawyer Joshua Sussberg.

The bankruptcy code requires debtors to propose a Chapter 11 plan within the first 120 days of filing, which meant that BlockFi was required to present a plan by March 27. However, on March 21, the company filed a request to prolong the deadline for its Chapter 11 plan by 90 days to June 26. The company’s lawyers argued that “much work remains” due to the scale and complexity of the Chapter 11 cases. Judge Michael Kaplan, the bankruptcy judge handling the case, deemed it worthwhile to extend the deadline to ensure the smooth continuation of the case, albeit a shorter extension than the one requested by BlockFi.

The company is estimated to owe up to $10 billion to over 100,000 creditors. A committee of BlockFi customers argued they should be allowed to take control of the bankruptcy case so that cryptocurrency held on the platform can be returned to creditors immediately. Committee lawyer Robert Stark told Kaplan that BlockFi creditors aren’t sophisticated lenders, but individual mom-and-pop retail customers, “many of whom have lost their life savings.” The committee cited the lack of a workable business for reorganization and the potential sale of the platform, which Stark referred to as a “bundle of sticks.”

Although Kaplan rejected the committee’s appeal, he granted an extension that was “modest” according to Sussberg, who stated that the company would have a plan ready for unsecured creditors to evaluate within two weeks. The crypto firm’s lawyers have indicated that they are exploring all possible avenues, including a sale of assets, to emerge from bankruptcy as a more robust entity.

BlockFi’s financial woes stem from the company’s controversial decision to offer high-yield accounts backed by cryptocurrencies like Bitcoin and Ethereum. However, the firm’s aggressive growth strategy was met with regulatory scrutiny, with several states such as New Jersey, Alabama, and Texas ordering the company to cease operations in their jurisdictions.

In January 2022, the US Securities and Exchange Commission (SEC) issued a cease-and-desist order against BlockFi, alleging that the firm’s interest accounts were unregistered securities. The SEC’s lawsuit is ongoing, with BlockFi seeking to have the case dismissed.

In conclusion, the extension granted to BlockFi provides the company with additional time to devise a plan to emerge from bankruptcy as a viable entity. However, the company faces several challenges, including regulatory scrutiny, legal battles, and the loss of customer confidence. Only time will tell whether BlockFi can overcome these hurdles and regain its position as a leading player in the cryptocurrency lending space.


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Bhutan Sovereign Investment Fund Invests Millions in Crypto

The Kingdom of Bhutan’s sovereign investment arm, Druk Holding and Investments (DHI), has quietly built up a crypto portfolio worth millions of dollars without disclosing it to the public. DHI is a commercial arm of the royal government of Bhutan and is estimated to manage around $2.9 billion in assets.

According to a report released by Forbes, DHI’s crypto investments were brought to light following the crypto contagion in 2022 when companies like Celsius and BlockFi filed for bankruptcy. A Celsius filing showed that DHI withdrew over $65 million and deposited almost $18 million in crypto.

BlockFi lawyers filed a complaint against DHI to reclaim outstanding assets, alleging that the fund defaulted on its $30 million loan in March. BlockFi claimed that DHI refused to repay the loan in full after liquidating the 1,888 Bitcoin (BTC) collateral, worth $76.5 million at the time.

DHI CEO Ujjwal Deep Dahal said in a statement to Forbes that the issue with BlockFi is confidential and highlighted that the “matter with BlockFi has been settled.” However, the exact terms of the settlement were not disclosed.

Celsius and BlockFi were two of the most prominent bankruptcy filings within the crypto space in 2022. On July 14, crypto lending platform Celsius filed for Chapter 11 reorganization, also known as a bankruptcy filing. Since then, the embattled crypto lender has been dealing with bankruptcy proceedings and is working on a restructuring plan. On Nov. 28, BlockFi also filed for bankruptcy after being affected by the infamous collapse of the FTX exchange.

Bhutan is a small landlocked country in South Asia, located in the eastern Himalayas. The country is known for its Gross National Happiness index, which measures the well-being of its citizens instead of just economic growth. Bhutan has been gradually opening up to the world in recent years, with a focus on sustainable development and environmentally friendly policies.

The news of Bhutan’s crypto investments is a reminder of the increasing interest in cryptocurrencies among governments and institutional investors. While many countries have been skeptical of cryptocurrencies and have implemented strict regulations, others have embraced them as a way to diversify their portfolios and hedge against inflation.

In recent years, countries like China, Russia, and Iran have explored the use of cryptocurrencies for international trade, while other countries like El Salvador and Ukraine have adopted Bitcoin as legal tender. The growing interest in cryptocurrencies from governments and institutional investors is expected to continue in the coming years, as the crypto market matures and becomes more mainstream.

In conclusion, Bhutan’s sovereign investment fund’s decision to invest millions in cryptocurrencies highlights the increasing interest in digital assets among governments and institutional investors. While the exact size and composition of DHI’s crypto portfolio remain undisclosed, the news is a reminder of the growing importance of cryptocurrencies in the global financial system. As the crypto market continues to evolve and mature, it is likely that more countries and institutional investors will follow Bhutan’s lead and invest in digital assets.


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Defunct Crypto Lender BlockFi Has $227 Million in Uninsured Funds with Troubled Silicon Valley Bank

Air pollution is a significant public health concern worldwide, and recent studies have found high levels of air pollution in major cities around the world. The issue is particularly prevalent in developing countries, where industrialization and urbanization have led to increased emissions from transportation and manufacturing.

One sector that has emerged in response to this problem is the clean energy industry, which seeks to reduce emissions and promote sustainability. Clean energy encompasses a range of technologies, including renewable energy sources like solar and wind power, as well as energy-efficient products and services.

Despite the growth of the clean energy industry, however, air pollution remains a major challenge in many parts of the world. In particular, major cities are often hotspots for pollution, due to factors like high population density, heavy traffic, and industrial activity.

One company that has been impacted by this issue is BlockFi, a defunct crypto lender that has $227 million in uninsured funds allocated to a money market mutual fund (MMMF) offered by Silicon Valley Bank (SVB). SVB was shut down by the California Department of Financial Protection and Innovation on March 10, with no specifics offered at the time of the closure.

The funds in question are not FDIC-insured, not insured by any federal government agency, and “not guaranteed by the bank.” While investors are issued fund shares in exchange for their capital, the risk to BlockFi in this instance is most likely the fund’s performance, rather than anything related to SVB’s financial woes.

The recent Silvergate bankruptcy has also impacted the crypto market, causing prices to tumble since the crypto-friendly bank’s financial woes came to light at the beginning of March. One firm that has been directly impacted by the SVB closure and the Silvergate bankruptcy is USD Coin (USDC) issuer Circle.

As of January 31, $8.6 billion, or roughly 20% of Circle’s reserves, were held in several U.S. financial institutions, including SVB, Silvergate Bank, and Bank of New York Mellon. While the exact value held in SVB and Silvergate is unclear, Circle has stated that it and USDC will continue to “operate normally” as it awaits “clarity on how the FDIC receivership of SVB will impact its depositors.”

Overall, the issue of air pollution in major cities and the ongoing challenges faced by the clean energy industry highlight the need for continued innovation and investment in sustainable technologies. As for the impact of the SVB closure and the Silvergate bankruptcy on the crypto market, it remains to be seen how these developments will play out in the coming weeks and months.


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BlockFi Will Submit Assets And Liabilities For Bankruptcy On January 11

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In a recent announcement, the cryptocurrency lending company BlockFi stated that it will provide information regarding its assets and liabilities, in addition to the payments that it received prior to its bankruptcy filing in November.

BlockFi stated that it had provided its stakeholders with a presentation in which it detailed its intentions for future court filings and provided a breakdown of the bankruptcy proceedings. BlockFi also provided a breakdown of the bankruptcy proceedings.

The lending company claims that shortly after the company’s initial bankruptcy hearing in November, it made contact with 106 potential buyers. On January 30, the company will ask the court for permission to proceed with the bidding process and will ask for approval from the court regarding the bidding process. Both of these requests will be made in relation to the bidding process.

To be more specific, the company stated that no members of the BlockFi management team had withdrawn any cryptocurrency from the platform since October 14 and that none of them had “made a withdrawal bigger than 0.2 BTC in value at any time” since August 17. This information was provided in a blog post that was published on the company’s website.

In addition, the company stated that following the acquisition of a revolving credit line for $400 million from FTX US in July, it had increased basic wages and paid retention incentives for specific personnel.

On January 11, BlockFi announced that it planned to provide a summary of its financial affairs, in addition to providing an account of its assets and liabilities.

The announcement was made after the United States Department of Justice informed the judge overseeing the bankruptcy of BlockFi that it had seized more than 55 million shares of Robinhood. At the time of publication, these shares had a value of approximately $450 million. The criminal case against the cryptocurrency exchange FTX and the executives of the company resulted in the seizure of the shares.

The next scheduled meeting for the public hearing regarding the FTX bankruptcy case is scheduled for the 11th of January. On the other hand, an all-encompassing hearing for BlockFi is scheduled for the 17th of January.


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Investors Sell FTX, Celsius, BlockFi, Voyager

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Some investors who hold claims on FTX, Celsius Network, BlockFi, and Voyager Digital are attempting to sell such rights to other parties so that they don’t have to wait for the lengthy bankruptcy process that these companies will have to go through. This is done so that the investors don’t have to wait for the companies to be forced to file for bankruptcy.

There are at least hundreds of investors who have been negatively impacted by the recent failures of cryptocurrency platforms FTX, Celsius, BlockFi, and Voyager and do not wish to wait for a drawn-out bankruptcy process that does not guarantee that they will even be able to get anything back, according to the information that was provided by the startup company Xclaim, which specializes in the trading of cryptocurrency claims. Xclaim is a company that specializes in cryptocurrency claims trading.

In spite of the possibility that they would incur some financial losses as a direct result of this transaction, the investors have decided to put their claims up for auction in the hope of turning a profit of some sort from the current predicament.

There were over 10,000 claims that had been posted, with 9,072 claims having been posted on Celsius Network, 93 claims having been posted on Voyager, 67 claims having been posted on FTX, and 23 claims having been put on BlockFi.

Matt Sedigh, the man who founded Xclaim, recently gave an interview to the Wall Street Journal in which he stated that his company has been taking calls from creditors located all over the world.

According to the executive, two thirds of the claims that were submitted came from creditors located in China, Hong Kong, and Taiwan, respectively.

It has come to the attention of certain debt investors and hedge funds that they may be interested in purchasing claims.

There have been a number of companies, including Contrarian Capital Management, Invictus Global Management, and NovaWulf Digital Management, that have acquired parts of the claims.

During this period, Celsius is making preparations to introduce a motion that will extend the deadline for users to submit their claims. This motion will allow for more time for consumers to submit their claims.

According to recent allegations, former FTX CEO Sam Bankman-Fried is believed to have cashed out a total of $684,000 in the time after he was released on bond.


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BlockFi Petitions To Restore Wallet Users’ Frozen Crypto


The cryptocurrency lending platform BlockFi has submitted a request to a bankruptcy court in the United States for permission to recover customers’ crypto assets that were stored in BlockFi wallets.

The defunct cryptocurrency lending platform BlockFi has submitted a petition to a bankruptcy court in the United States, demanding permission to enable its customers to withdraw digital assets that are now stored in wallets provided by BlockFi.

The lender sought the court for power to recognize customer withdrawals from wallet accounts that have been blocked on the platform since November 10. The application was filed on December 19 with the United States Bankruptcy Court for the District of New Jersey.

Additionally, authorization is requested in the court proceedings to update the user interface in order to accurately represent transactions since the stoppage in platform operations.

BlockFi referred to the move as a “essential step toward our aim of recovering funds to customers via our chapter 11 proceedings” in an email that was addressed to users who were impacted and extensively circulated.

According to BlockFi, the stop that has been placed on the processing of withdrawals and transfers from BlockFi Interest Accounts will not be lifted as a result of this action.

The online lending platform has also made it clear that it intends to seek similar remedies from the Supreme Court of Bermuda in relation to BlockFi Wallet Accounts that are stored at BlockFi International Ltd.

According to the paperwork filed with the court, there will be a hearing on January 9 to determine whether or not the application will be granted.

On January 13, the Supreme Court of Bermuda is going to hold a separate hearing on wallet accounts that are maintained at BlockFi International Ltd.

On November 11, BlockFi recommended that customers refrain from depositing funds into their BlockFi wallets or Interest Accounts, citing a lack of clarity on FTX as the reason for the request.

On November 28th, BlockFi submitted their application for Chapter 11 bankruptcy, which included all eight of its companies.

On the very same day, a petition for bankruptcy was submitted to the Supreme Court of Bermuda by BlockFi International.


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