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Why traders are not worried that the KuCoin hack will drop Ethereum price

Why traders are not worried that the KuCoin hack will drop Ethereum price

Analysts say that the unknown hacker behind the KuCoin breach is selling the stolen ERC-20 tokens on Uniswap. Although selling tokens on the Ethereum-based decentralized exchange allows the hacker to obtain Ether (ETH), it doesn’t mean it’s laundered.

All transactions made on the Ethereum blockchain network are traceable using blockchain explorers, meaning even if the tokens are converted to Ether, the stolen amounts would still leave traces. This means exchanges can (and probably will) suspend any exchange address that is associated with the tainted funds.

The 1-day chart of Ether

The 1-day chart of Ether. Source:

Attempting to sell tens of millions of dollars worth of traced funds immediately after a breach is risky. All major exchanges are on alert, and in this specific case, Tether (USDT) froze the funds linked to the KuCoin hack.

As Cointelegraph previously reported, Bitfinex and Tether chief technical officer Paolo Ardoino said Tether froze $33 million worth of USDT but Ardoino emphasized in a follow-up statement that there are stringent guidelines that must be followed to freeze funds. He explained:

“Tether can decide to freeze funds in 2 situations: – law enforcement / regulator request – funds are sent to unrecoverable addresses (completely at tether discretion) This ability does not entitle crypto users to participate to stupid scams or paying less attention.”

With Tether actively tracking the funds and major exchanges, like Binance and Bybit contacted by KuCoin, it has become increasingly difficult to sell the funds. KuCoin CEO Johnny Lyu said:

“We are in contact with many major crypto exchanges such as Huobi, Binance, OKEx, BitMax, and Bybit, as well as blockchain projects, security agencies, and law enforcement to work on this. Some effective measures have been taken, and we will update with more details soon.”

The hacker sold the ERC-20 tokens to obtain ETH, but the transactions and Ethereum addresses can be traced using Etherscan.

Since existing major decentralized exchanges do not have privacy solutions, the ERC-20 tokens would leave traces for exchanges to follow. For this reason, many analysts are not worried that the movement and market sale of Ether tokens will place pressure on Ether price.

According to Ardoino, selling the stolen ERC-20 tokens on a decentralized exchange like Uniswap carries interesting repercussions.

He suggested that in the future, decentralized exchanges implement privacy solutions like confidential transactions to appeal to users. Ardoino said:

“This might have interesting repercussions. While we’re staring at laundering while it happens on a transparent DEX, couple of considerations arise for me: Will liquidity providers be tainted? Privacy is key, probably the next DEX should use confidential transactions.”


Ethereum long-term Price Analysis: 28 September

Ethereum long-term Price Analysis: 28 September

Ethereum’s long-term outlook seemed bearish, at the time of writing. In fact, the price might drop by 20-30% as this bearish pattern develops on the charts. Interestingly, this might coincide with Bitcoin’s movements as well.

Here, it should be noted, however, that this is all happening on a weekly time frame, and hence, it could be months before Ethereum’s price actually breaks out of the pattern.

The rising wedge is a bearish pattern and has an obvious breakout towards the bottom. However, since the said pattern formed on the weekly time frame, the breakout, should it go to the full extent, will be devastating. Perhaps, this might, as mentioned, coincide with Bitcoin filling the CME gap. Additionally, Bitcoin too formed a similar rising wedge pattern on the daily timeframe.

Although ETH has a long way to go before it breaks out, the implications are bearish nonetheless. At press time, the price seemed to have finished its bout with the bottom of the wedge and was hinting at heading higher. However, it could also re-test the bottom of the wedge again.

After its re-test, if any, the price will be bullish and might surge about 15-20% until it hits $445. Hereon, the price will be heading towards the breakout, with targets at $432, $369, $312, and $288. If the selling pressure continues, ETH might even wick down to $263.

The $312-level coincides with the 20-Week moving average [Yellow], a bounce from here corresponds to a healthy uptick. The opposite, however, would be disastrous as the price rarely dips below the 20 WMA in a bull market.

If the 20 WMA fails, then the last line of defense will be the 50-Week moving average [blue] at $263.

Ultimately, ETH is expected to head 20% higher from the press time price, before dropping ~40% from the peak. The bullish scenario was supported by the Stochastic RSI which hinted at a potential bullish crossover soon.

Likewise, the RSI indicator seemed to be finding support at the 57-level, which will help ETH’s bullish case.


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Ethereum Fees, CBDC In Bahamas, Filecoin's Liftoff, Ebang's Crypto Bang + More News

Ethereum Fees, CBDC In Bahamas, Filecoin’s Liftoff, Ebang’s Crypto Bang + More News

Get your daily, bite-sized digest of cryptoasset and blockchain-related news – investigating the stories flying under the radar of today’s crypto news.

  • Long-suffering ethereum (ETH) users have cause to celebrate, while DeFi enthusiasts will be dismayed to hear that the craze may be subsiding – after median transaction fees on the Ethereum blockchain network dropped again. Per BitInfoCharts statistics, the median Ethereum transaction fee currently stands at USD 1.3 – down from staggering median fees of USD 8.48 recorded on September 2.
  • But it may well be too early to call time on DeFi, with one project showing signs of rude health: The lending platform Aave has debuted a governance platform that it said will allow its community vote on whether they wish to upgrade its LEND to AAVE. In a blog post, the London-based Aave (formerly ETHlend) stated that the proposal would seek to “make AAVE the new governance token of the Aave Ecosystem,” proposing rates of 100 LEND tokens to 1 AAVE.
  • The announced Spadina Ethereum 2.0 will go live on September 29 at noon UTC. Spadina is a mainnet-configuration test network, which will run for three days, and in parallel to Medalla, which was launched in August, said ETH 2.0 developer Danny Ryan. The main objective is to give developers another chance “to go through one of the more difficult and risky parts of the process – deposits and genesis – before we reach mainnet. If all goes well, it should give us greater peace of mind before we jump into the real deal later this year,” Ryan wrote.
  • The Bahamas is set to pip leading economies such as China, the United States and EU nations to the digital currency post as it releases a central bank digital currency (CBDC) late next month. In an official release, the Central Bank of The Bahamas stated that it will “gradually release a digital version of the Bahamian dollar nationally, outside of the pilot regions of Exuma and Abaco, through authorized financial institutions” on October 20. The central bank has dubbed the new token the Sand Dollar – and full rollouts across the public and private sectors are slated for 2021.
  • Decentralized storage network Filecoin, one of the top ICOs of 2017, said that it estimates to launch its mainnet around October 15 and after a few days of monitoring and problem solving they will hold “Filecoin Mainnet Liftoff: a week of events from October 19-23 celebrating Filecoin’s mainnet launch.”
  • Major professional services firm EY has launched its EY OpsChain Network Procurement, a solution built on the EY OpsChain platform that allows companies to run private, end-to-end procurement activities on the Ethereum blockchain. The beta version of this solution is now available free for individual users, said the company.
  • Regulated financial institution for digital assets Nexo has become an official credit partner to the Litecoin Foundation. The goal of the partnership, said the emailed press release, is to bring greater access to financial services to both of their communities, as well as to promote crypto and blockchain adoption as the way to have a fairer finance marketplace.
  • What future awaits cryptocurrencies?
  • Ebang, Nasdaq-listed Bitcoin (BTC) mining hardware manufacturer, confirmed that they are at an initial preparatory stage of launching “blockchain-enabled financial business by establishing cryptocurrency exchange(s) and online brokerage(s) and by combining the blockchain-enabled financial businesses with the traditional ones to capture the entire value chain of the blockchain industry.” As previously reported, the company is planning to launch an offshore exchange for digital assets in 2020. Meanwhile, in the first half of this year, total revenues of the company dropped by 50.6% to USD 11m, compared to the same period in 2017. Net loss decreased by more than 60% to USD 7m.
  • Bitfinex Derivatives has announced the launch of perpetual contracts for Europe 50 (EUROPE50IXF0:USTF0) and Germany 30 (GERMANY30IXF0:USTF0), both of which went live on September 28. According to the emailed announcement, each contract will offer users up to 100x leverage and will be settled in tether (USDT). Markets will remain open over the weekend, but price limits will be put in place to increase price stability, said Bitfinex.
  • Wave Financial Group, a digital asset investment manager, said it partnered with Singapore based digital securities firm InvestaX in order to attract a broader investor base for its Wave Kentucky Whiskey 2020 Digital Fund. Wave plans to complete the fund raise for this year’s fund “soon.”
  • Source:

    Author: News Bureau

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