Daily Crypto News Digest

Tokonomo Daily Crypto News Digest – June 14th

An Individual Utilized a Flash Loan of $200 Million From MakerDAO With The Intention of Generating a Mere $3 in Profit

On Wednesday, an automated arbitrage bot engaged in a flash loan activity by borrowing $200 million worth of the DAI stablecoin from MakerDAO.

The bot managed to generate a profit of $3.24 after considering transaction fees.
This was made possible by leveraging MakerDAO’s ‘DssFlash’ contract, which enables users to borrow DAI without incurring any fees, as per information provided by crypto data provider Arkham Intelligence.

A flash loan is a type of loan that is acquired and repaid within a single blockchain block, without the need for upfront collateral.
In this particular case, the bot borrowed 200 million DAI tokens and provided them to the Aave DAI market, using them as collateral to borrow $2,300 worth of wrapped ether (WETH).

The obtained WETH was then used to purchase Threshold Network (T) on the Curve platform before being swiftly sold on Balancer in multiple transactions within a single block.
The total profit prior to factoring in fees amounted to $33, but after taking into account transaction and protocol fees, nearly $30 was deducted, resulting in a net profit of $3.24.

It is worth noting that flash loans have previously been exploited for malicious purposes, leading to significant losses exceeding $10 million on decentralized finance (DeFi) platforms such as Platypus and 0VIX.

Binance CEO Responds Firmly to Speculations About Exchange Trading Bitcoin for BNB Coin

Binance CEO Changpeng “CZ” Zhao has denied the rumors suggesting that the largest cryptocurrency exchange, Binance, has been selling Bitcoin (BTC) in order to prevent the value of their BNB coin from dropping below specific levels.

In a tweet posted early on Wednesday, CZ clarified that Binance has not sold any BTC or BNB and even mentioned they still hold a quantity of FTT.
He indicated that the rumors might be fueled by short interest among members of the Crypto Twitter community.

The rumors gained traction after popular traders @JW100x and @52kskew shared tweets on Tuesday, highlighting short-term price correlations between BTC sell-offs and BNB purchases.
These tweets collectively garnered over 3 million views, according to Twitter data.

One tweet from @52kskew stated that USDT reserves have been aggressively invested in BNB since May 27th.
BNB was allegedly sold for BUSD to minimize volatility in BTC, with BUSD then being used to stabilize BTC’s downside volatility by exchanging it for USDT.

In another tweet, @JW100x explained that as spot Bitcoin is sold, BNB is purchased to defend against liquidation at the $220 mark, but this strategy also limits the potential upward movement of Bitcoin.
@JW100x described the situation as a precarious house of cards.

CoinGecko data indicates that BNB prices have risen by 6.6% in the past 24 hours, while Bitcoin has experienced marginal declines.

EigenLayer, a DeFi platform, Has Introduced Its Restaking Protocol on The Ethereum Mainnet

According to a press release, EigenLayer, a decentralized finance (DeFi) platform based in Seattle, has successfully implemented its restaking protocol on the Ethereum mainnet.

The protocol enables individuals staking ETH to restake on EigenLayer by depositing liquid staking tokens such as Lido stETH (stETH), Rocket Pool ETH (rETH), and Coinbase Wrapped Staked ETH (cbETH).

EigenLabs, the developer behind EigenLayer, completed a series of investment rounds and raised a total of $64.5 million at a valuation of $500 million.
One notable investment was a $50 million Series A round in March.

The restaking protocol has established specific participation parameters for liquid restaking and native restaking.

Liquid restaking permits a maximum of 3,200 units for each liquid staking token and a maximum deposit of 32 tokens per address.
On the other hand, native restaking will be temporarily paused once 9,600 ETH has been added.

Liquid staking has gained prominence since Ethereum’s transition from proof-of-work to proof-of-stake in September.

As per DefiLlama‘s data, a total of $16.92 billion is currently staked across the top five liquid staking protocols on Ethereum.
Restaking involves utilizing staked ETH on other protocols in exchange for protocol fees and rewards.

The Insolvent Cryptocurrency Exchange Bittrex U.S. is Scheduled to Permit Withdrawals Beginning on Thursday

According to information received by CoinDesk, the U.S. branch of Bittrex, a cryptocurrency exchange, is scheduled to allow customer withdrawals starting Thursday.

This decision comes as a result of a ruling from a Delaware bankruptcy court.

Bittrex had filed for bankruptcy in May and encountered opposition from the U.S. government, which claimed that the exchange owed millions of dollars for sanctions violations.

In the ruling issued by Judge Brendan Shannon on Tuesday, Bittrex U.S. and its affiliates were authorized to enable customers with uncontested, noncontingent, and liquidated claims to withdraw their cryptocurrency assets and fiat currency from the trading platform.
The ruling does not determine ownership of the assets or prioritize customer claims over the government’s, and there is a possibility of future clawback.

Patty Tomasco, a partner at the law firm Quinn Emmanuel representing Bittrex, stated that the platform would be operational for withdrawals on Thursday, June 15.

Bittrex experienced substantial withdrawals when it announced plans to close its U.S. operations in March, leading to the bankruptcy filing on May 8.
As of May 10, the company reported holding $300 million in customer cash and cryptocurrency in its U.S. arm.

Despite the typical transaction freeze during bankruptcy proceedings, the company argued that it wanted customers to have access to their funds without prolonged legal battles.

Similar to other crypto exchanges like Binance and Coinbase, Bittrex had faced allegations from U.S. regulators for violating federal law by operating an unregistered securities exchange.

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