This Week in Crypto: HMSTR Airdrop Drama, Kamala Harris on Crypto and AI, BingX Hack
This week brought turmoil and development across the crypto space. A $42 million hack at BingX rattled the market, raising questions about security vulnerabilities in major exchanges. Meanwhile, Hamster Kombat’s controversial airdrop sparked outrage after millions of players were disqualified from receiving tokens.
These developments highlight the industry’s promise and perils as it continues to evolve and capture the attention of regulators and innovators.
BingX Restores Services After $42 Million Crypto Hack
On September 20, crypto exchange BingX suffered a hack. This incident resulted in an over $42 million loss in digital assets.
The breach initially revealed suspicious transactions totaling $13.6 million. As further investigation unfolded, the losses escalated to over $26 million, eventually totaling $42 million.
The stolen assets included a wide range of cryptocurrencies, notably 4.44 million USDT ($4.4 million), 1 million WUSD ($1 million), 608,660 USDC ($608,660), and 9.38 BTCB ($590,000). PeckShield and other security experts confirmed that the attackers transferred the funds to a wallet address identified as ‘0xF7e8.’ On-chain data also revealed that these bad actors quickly exchanged the stolen assets for Ethereum (ETH) and BNB.
Despite the heavy losses, BingX Chief Product Officer Vivien Lin assured users that the firm would cover the full amount with its capital reserves.
“Our technical team detected abnormal network access, suspecting a hacker attack on BingX’s hot wallet. We immediately started our emergency plan, including the urgent transfer of assets and withdraw suspension. There has been minor asset loss, but the amount is small and still being calculated,” Lin wrote on X (Twitter).
Following this incident, BingX has resumed its service. Withdrawals for major assets like Bitcoin (BTC) and USDT resumed on September 21, with full deposit services restored by September 22.
Hamster Kombat’s HMSTR Airdrop: Controversy Unfolds
Hamster Kombat, a popular tap-to-earn game on Telegram, faced a massive backlash this week after disqualifying over 63% of its players from the highly anticipated HMSTR token airdrop. Set to launch on September 26, the airdrop aimed to distribute 60 billion tokens to 131 million qualified players from the game’s first season.
However, the controversy began when Hamster Kombat implemented last-minute anti-cheat measures. This new approach resulted in the ban of 2.3 million accounts for allegedly exploiting the game’s reward system.
Many players who had invested significant time to accumulate Points Per Hour (PPH) were suddenly disqualified. The decision led to outrage on social media.
The controversy deepened as the HMSTR token’s price faced significant volatility after trading began on major exchanges. It started trading at $0.014 but quickly fell by 20% to $0.011 within hours. As market sentiment declined further, the price continued its downward trend, reaching approximately $0.0068506.
HMSTR Price Performance. Source: BeInCrypto
Regardless of the backlash, Hamster Kombat developers remain confident that their anti-cheat system will ensure a fair distribution of rewards. While the token’s value has dropped significantly, developers remain optimistic about its long-term prospects.
Kamala Harris Supports Crypto and AI in Campaign Speech
Vice President Kamala Harris shook up the tech and crypto industries this week with her first direct endorsement of cryptocurrencies as part of her presidential campaign. Speaking at a fundraising event in New York, Harris emphasized the importance of fostering innovation in AI and digital assets, positioning them as crucial to maintaining America’s global competitiveness.
“We will partner together to invest in America’s competitiveness, to invest in America’s future. We will encourage innovative technologies like AI and digital assets while protecting our consumers and investors,” she stated.
This statement marks a significant shift in Harris’ policy platform, aligning her with key figures in the crypto industry, such as Ripple co-founder Chris Larsen, who has publicly endorsed her campaign. Larsen, a proponent of blockchain regulation, believes Harris’ stance could help push forward much-needed regulatory clarity in the digital assets space.
Binance Denies Alleged Data Breach Involving 13 Million Users
This week, rumors swirled around Binance, one of the largest global crypto exchanges, regarding a potential data breach affecting 13 million users. Reports surfaced on dark web forums claiming a group of cybercriminals, known as “Greavys,” has access to sensitive user information. This information includes names, email addresses, phone numbers, and residential details.
The alleged data was offered for sale via Telegram channels, fueling concern within the Binance community. However, Binance swiftly responded to these claims, denying any data breach.
“Our security team has thoroughly investigated the matter, and there is no evidence of a data leak. We remain committed to protecting our users’ information,” a Binance spokesperson explained in a statement to BeInCrypto.
CZ Prepares for Early Release After Serving Time for Binance-Related Charges
Changpeng Zhao (CZ), co-founder and former CEO of Binance, is scheduled for early release from federal custody after serving a four-month sentence. CZ was imprisoned for violating the Bank Secrecy Act, with charges stemming from Binance’s failure to enforce adequate know-your-customer (KYC) measures.
Originally, CZ’s release was scheduled for September 29. However, due to federal rules that allow for early release when the official date falls on a weekend, recent reports suggest he will be released earlier, on September 27.
CZ initially faced a possible 36-month sentence. Yet, his sentence was significantly reduced through a settlement with the US Department of Justice (DOJ).
Despite his legal troubles, CZ remains a highly influential figure in the crypto industry. Many within the industry anticipate that he will return to focus on new ventures in blockchain, artificial intelligence, and biotech.
While marred by legal issues, his legacy at Binance is still widely regarded as pivotal to the growth of global crypto liquidity. Ki Young Ju, CEO of CryptoQuant, commented on CZ’s impact.
“Don’t underestimate CZ. He deserves respect for his contributions. While Binance faced challenges, CZ’s achievements far outweigh his mistakes,” Ju said.
