Catégorie : Crypto News

It’s been a big week of DeFi news for the Donald Trump-backed crypto venture, World Liberty Financial (WLFI). Earlier this week, the project expanded its portfolio with $5 million worth of investment in three major assets: Ethereum (ETH), Chainlink (LINK), and Aave (AAVE).

The acquisitions include 2,631 ETH at $3,801 each, 41,335 LINK at $24.2, and 3,357 AAVE at $297.8, according to on-chain analytics platform Lookonchain.

The purchases mark WLFI’s first foray into LINK and AAVE, diversifying its growing treasury. In fact, since the investment, LINK has soared to a 3-year high amid growing open interest in futures contracts.

What’s more, the project’s community has now approved a proposal to launch an instance of the Aave v3. It will initially support borrowing and lending for Ethereum (ETH) and Wrapped Bitcoin (WBTC), and stablecoins Tether (USDT) and USDC.

The arrangement will see AaveDAO receive 7% of the circulating supply of WLFI tokens. The DAO will also receive 20% of all fees generated by the new instance, the proposal said.

Meanwhile, World Liberty Financial is already leveraging Chainlink for data accuracy and cross-chain connectivity. Last month,  its governance community proposed launching an Aave v3 protocol on Ethereum.

“I think it is a play at supporting the assets that their DeFi platform will be using, Nicolai Sondergaard, a research analyst at Nansen, told Decrypt. “Chainlink will provide the interoperability infrastructure, and the project is launching on Aave v3, which is on Ethereum.”

The news about World Liberty Financial’s purchases and new Aave v3 instance come as DeFi tokens are seeing impressive gains. LINK and AAVE have surged by 23% and 44% in the past week, respectively. Meanwhile, Ethereum made its own run and nearly retook $4,000 on Thursday, according to CoinGecko data.

The World Liberty Financial protocol now holds over $50 million in ETH and approximately $74 million in cryptos, including wrapped Bitcoin (wBTC) and stablecoins such as USDC and USDT, as per data provided by blockchain intelligence service Arkham Intelligence.

Arthur Azizov, CEO of B2BINPAY, noted the importance of Ethereum to projects like World Liberty Financial: “Ethereum powers a wide range of dApps across gaming, gambling, socializing, NFTs, and DeFi,” Azazov told Decrypt. “With constant innovation and new projects emerging on its platform—even Tether Treasury printing billions of USDT on Ethereum—its token price is likely to continue rising. I expect Ethereum to reach $7,000 in 2025.”

Initially unveiled by Donald Trump’s son Eric Trump in August 2024, World Liberty Financial is billed as a “one-stop shop” for crypto borrowing and lending services.

President-elect Donald Trump’s embrace of crypto has been one of the more unexpected narratives of his re-election campaign.

Once a vocal critic of Bitcoin, Trump has pivoted to champion the crypto industry, pledging to fire SEC Chair Gary Gensler, reform crypto regulations, and even free Silk Road founder Ross Ulbricht.

Since Trump’s re-election, he has doubled down on his pro-crypto stance, appointing several crypto advocates to high-profile positions. These include the new SEC Chair Paul Atkins and Florida Congressman Matt Gaetz as the next Attorney General.

Edited by Stacy Elliott.

Major United States-based Bitcoin automated teller machine (BTM) company Byte Federal has suffered a major data breach.

A Thursday filing with Maine’s attorney general shows that Byte Federal’s breach allowed the attacker to access the personal data of 58,000 customers, including 111 Maine residents. The company noticed the attack on Nov. 18, more than a month after it occurred on Sept. 30.

Venket Naga, co-founder and CEO of security-focused data storage service Serenity, told Decrypt that the incident shows the dynamic nature of constantly expanding cybersecurity threats. According to him, crypto industry firms “must adopt adaptive frameworks that evolve with emerging risks, posing risks to both the physical and underlying infrastructure involved with blockchain.”

CoinATMRadar data shows that Byte Federal operates 1,356 Bitcom ATMs in the United States. This is equivalent to about 4.3% of all crypto ATMs in the country.

The attack was reportedly a consequence of a third-party service being exploited. After detecting the incident a month later, Byte Federal decided to shut down its platform and reassured users that no funds were lost.

A joint statement from smart contract auditors at crypto cybersecurity firm Hacken Ataberk Yavuzer and Olesia Bilenka explains that the “incident occurred due to an unpatched or outdated GitLab system.” It goes on to add that “inadequate server segmentation” could be what allowed attackers to access sensitive customer data.

“It is very likely that the GitLab repositories contained sensitive credentials to access Byte Federal’s databases, which include name, birthdate, address, phone number, email address, government-issued ID, social security number, transaction activity, and user photograph information,” the auditors highlighted.

Despite the breach, the company noted that it found no evidence that customer data was actually misused or accessed. “Nonetheless, we are taking precautionary measures to ensure the security of your data and to help alleviate any concerns you may have.” the letter to customers read.

Byte Federal also noted it’s working with an independent cybersecurity team on a forensic investigation of the incident and might pursue legal action.

Byte Federal said it applied a hard reset to all customer accounts and sent a notice concerning the incident. The company also changed internal passwords, the password management system, tokens and keys to prevent further breaches.

The company urged customers to reset their login credentials. It warned that users may be asked to verify their personal information—providing more confidential data to a firm that just experienced a potential data leak.

“The Byte Federal incident is yet another example of how forcing commercial activities to retain their customers’ data is the worst practice concerning their privacy,” an anonymous former Bitcoin ATM operator told Decrypt. They wanted to withhold their identity because they chose to shut down their service rather than comply with know-your-customer rules.

“In the case of cryptocurrencies, these data breaches are even more dangerous for users because they associate their personal information with a specific type of financial activity, making them easy targets for theft and fraud,” the former Bitcoin ATM operator added.

Edited by Stacy Elliott.

Neon Machine, the studio behind the Avalanche-based extraction shooter Shrapnel, revealed exclusively to Decrypt that it has made several leadership changes, including appointing a new CEO, ahead of the game’s free-to-play launch in 2025.

Ken Rosman, a 30-year veteran of the video game industry who spent many years at Microsoft’s Xbox division working on games like Halo Wars and Sunset Overdrive, has taken over Neon Machine’s chief executive role and will help shepherd Shrapnel toward its full public rollout.

Neon Machine co-founder and former CEO Mark Long has transitioned to the role of an advisor and will continue to support the studio amid the leadership shift. In a statement, Long noted Rosman’s history of shipping and supporting live operations on high-profile games.

“When we started Shrapnel in 2020, we had a dream to break the mold of the traditional game development cycle and design a blockbuster-quality shooter where players shape the game and truly own their creations,” Long said. “Now that we are getting close to launching Shrapnel, it’s time for new leadership.”

While Rosman will head Neon Machine on the whole, Dave Johnson will lead the Shrapnel project, and Don Norbury—CTO at Neon Machine and previously Shrapnel studio head—will oversee the company’s Moonshot suite of Web3 game development tools.

When asked what prompted the leadership shifts, a Neon Machine spokesperson mentioned the need for a studio to remain adaptable during a game’s lengthy development cycle.

“To launch, a game team needs extreme focus on execution,” the spokesperson said. “For us, this includes global live-ops, retention mechanics, evolution of features in the game and marketplace, new partnerships, and more.”

“Ken is one of the best in the business at this kind of disciplined execution, having proven himself running AAA studios and shipping AAA games for decades,” the rep added. “Mark is still advising, and Ken already has the whole team feeling positive and working hard toward our launch goals.”

Amid the leadership shakeup, Neon Machine told Decrypt that it is raising new funding in a round led by the Blizzard Avalanche Ecosystem Fund. Griffin Gaming Partners and Polychain Capital are also involved.

The studio plans to reveal full details on the raise in the first quarter of 2025. Neon Machine announced its last fundraise in October 2023, with a $20 million round led by Polychain.

Shrapnel is a first-person shooter for PC that revolves around securing and extracting resources while engaging in competitive online matches. Released in early access on the Epic Games Store in February, Neon Machine previously allowed players to buy access and participate in limited-time events as the game continues to evolve.

The game is being built around assets on the Avalanche blockchain, where Neon Machine has launched a dedicated instance called an L1 (formerly subnet) for the game. A SHRAP token is already live, and the game will include NFTs that represent unique assets, including player-designed items in the game.

Neon Machine’s leadership changes also come amid an ongoing legal battle with once-majority shareholder Cort Javarone, CEO of investment firm 4D Factory, who studio founders alleged in November 2023 had staged a “coup” to take over the studio.

Javarone, for his part, alleged that studio leadership had gone rogue and refused to work with the board.

Neon Machine declined comment this week on the current status of the lawsuit, but said that it hopes to have an update in the first quarter of 2025.

“It is not a distraction to the team’s focus on building the best game possible,” a studio spokesperson said.

Edited by Sebastian Sinclair

Editor’s note: This story was updated after publication to correct Rosman’s career length, as well as to clarify that Neon Machine stopped selling extraction packs to gain early access to Shrapnel.

Four years ago, he was just another callow entrepreneur, hacking away in a makeshift bathroom office at his passion project—a prediction market that would blend gambling with real world events. This year that project, Polymarket, emerged as one of the most interesting and potentially valuable use cases in the burgeoning crypto industry.

Shayne Coplan’s blockchain-based prediction platform captivated bettors and spectators alike this year. With each twist and turn in the 2024 U.S. presidential race, it attracted legions of new eyeballs and users, who ultimately foresaw key events like President Joe Biden’s withdrawal from the Democratic ticket and Donald Trump’s White House victory.

For Coplan, a 26-year-old New York native, navigating Polymarket’s rise into the mainstream wasn’t always easy. Even today, despite its enormous success, allegations of wash trading and market manipulation dog the platform, and a recent FBI raid of his apartment, in which his phone and computer were confiscated, have yet to be resolved.

Still, as Coplan told Decrypt, “it’s too easy to get lost in the sauce. Through all the chaos, the only way to navigate is to stay centered and pragmatic.”

While crypto entered the political realm in unprecedented ways this year, through political spending efforts and promises made by the President-elect, Polymarket’s place in that dynamic was unique. The platform attracted notable attention from outside the crypto space as a disruptive data source, showcasing this year’s political drama in real-time, despite the critics.

Speculation and crypto go hand-in-hand, but Polymarket distilled those forces into a tool that offered the world genuine insight. It gave crypto, long in search of a use case beyond Bitcoin’s store of value, the potential to attract the masses. And though it’s not a Main Street application yet, with a pro-crypto Administration about to take office in the U.S., Coplan’s startup appears well positioned to be the frontrunner among crypto startups. For these reasons, Coplan is Decrypt’s 2024 Person of the Year.

Who is Shayne Coplan?

Coplan founded Polymarket in 2020, but his passion for crypto developed long before that. Growing up on Manhattan’s Upper West Side, he said he first became interested in crypto at the age of 14, drawn to the multi-trillion industry while it was in its infancy.

At 16, he participated in Ethereum’s presale, purchasing the second-largest cryptocurrency by market capitalization for around $0.30. He was then a student at The Beacon School, a highly selective high school in New York’s Hell’s Kitchen neighborhood.

Coplan was always interested in seeing the world through the lens of probabilities. At Messari’s crypto conference this year, for example, he described an interest in data-driven websites such as 538 as foundational in building that worldview.

“I was always seeking out where I could see percentage likelihood,” Coplan recalled. “A lot of the time I saw that on weird, barebones 1999 html websites that were using some sort of model that was just some guy’s thing. But the fact that you could look at the probabilities was cool.”

While Coplan would later enroll at New York University to study computer science, the entrepreneur left after only one semester. He put his studies indefinitely on pause to pursue prediction markets, hammering out Polymarket’s design during the COVID-19 pandemic.

Though Coplan left the academic world behind to pursue his dreams, he’s no stranger to how it operates. Coplan said his mother is an NYU professor, while his father teaches at another university in New York City.

In 2020, Polymarket raised $4 million in a seed round led by Polychain Capital, according to Cryptorank. This year, it raised another $70 million across Series A and Series B funding rounds, including investments from Ethereum co-founder Vitalik Buterin and Peter Thiel’s Founders Fund.

As expected, with the U.S. post-election frenzy dying down, Polymarket’s betting activity dropped, but it still appears to be holding its own. Polymarket’s daily trading volume, for example, has averaged around $50 million in December, down from its November peak of more than $85 million, but substantial nevertheless.

The number of monthly active traders peaked at 293,705 in November and dropped to 116,370 for December so far.

Betting on political events may be Polymarket’s bread-and-butter, but the platform hosts over 500 markets that ponder everything from existential questions, such as whether a nuclear weapon will be detonated in 2024, to parsing Taylor Swift’s love life. 

The road to relevance

Though Polymarket has become a go-to prediction market across the globe, the platform’s success wasn’t immediate. In its first three years, that key stat of monthly active users never climbed past approximately 5,700, according to the Dune dashboard. 

In April 2024, the platform was doing a scant $38 million in monthly volume. By the beginning of September, monthly volume had exploded to more than $500 million.

“Most ideas don’t instantly become overnight successes,” Coplan said. “You only lose when you give up.”

Needless to say, Coplan stuck with it, and created an innovative framework for betting on virtually anything. Notably, the platform currently charges users no fees and appears to be foregoing revenue in a bid to dominate the global market for prediction markets.

People participate in Polymarket’s contests by purchasing shares, which fluctuate between $0.00 and $1 depending on what market participants see as most likely. For example, shares priced at $0.66 would indicate a 66% chance of an event happening. (For a detailed breakdown, check out Decrypt’s guide for how prediction markets like Polymarket work.)

The run up to the U.S. general election proved to be the best possible marketing for Coplan’s project. Months before Polymarket predicted the President-elect, a debate between President Joe Biden and Trump created the pretext for a momentous shift in the Democratic ticket. Polymarket’s traders saw blood in the water, and a market betting that Biden would drop out before the election spiked following his disastrous performance against Trump. Even as Biden insisted he was in it for the long haul, Polymarket traders were relentlessly skeptical. 

Eventually, the Polymarket consensus was validated.

“Polymarket called it. Before anywhere else,” Coplan said on X, calling the market prediction a “historical W.” “Trust the markets,” he added.

That early success attracted plenty of media attention (not all of it good) and that created a kind of ouroboros, with news coverage bringing in new users, and new users bolstering the nascent betting markets. Which was of course Coplan’s primary objective. He liked to showcase Polymarket’s iOS App Store rankings, highlighting its rank among established, mainstream apps such as YouTube and WhatsApp. 

Shoutouts online from tech CEO Elon Musk and the integration of Polymarket’s data into Bloomberg’s Terminal, furthered Polymarket’s entrance to the mainstream. Polymarket got a boost in credibility when Nate Silver, the renowned statistician and journalist, joined Polymarket as an advisor in July.

“Politics aside, many of the people I looked up to from afar growing up have reached out to say they’re huge fans of Polymarket,” he said. “It’s a priceless feeling.”

By the time Election Day had come in November, more than 200,000 people a month were using Polymarket, per a Dune dashboard. As Americans went to the ballot box, the platform’s open interest—representing the total value of outstanding bets—totaled $463 million. 

Polymarket’s U.S. general election market, which effectively became the platform’s namesake, ultimately generated over $3.6 billion in trading volume.

But money aside, the election tended to validate Polymarket’s ability to provide accurate information that goes above and beyond media spin, said Coplan.

“Every single person who follows politics learned firsthand that Polymarket is a more accurate way to follow politics than traditional news and the pollsters,” he said. “People will not forget that in years to come.”

What’s next?

While Polymarket has become a cultural phenomenon, the platform has faced regulatory scrutiny in the U.S., alongside its competitors. The Commodity Futures Trading Commission (CFTC), for example, brought an action against Polymarket for failing to register its services with the regulator in 2022. The platform officially became off-limits for U.S. citizens, while Polymarket reached a $1.4 million settlement with the CFTC.

Likewise, the CFTC tried to block political event contracts from another U.S.-based prediction platform, Kalshi, this year, which also focused on November’s elections.

The agency raised concerns about the potential of political event contracts to undermine the integrity of U.S. elections. But a federal court’s decision in September found that the CFTC’s proposed ban on Kalshi’s contracts exceeded its authority, setting the stage for new entrants in the prediction space such as the trading app Robinhood and the brokerage firm Interactive Brokers. 

The CFTC meanwhile indicated that it plans on appealing the court’s Kalshi ruling, though the Trump Administration could well derail that action.

More troubling for Coplan was that shortly after Trump’s win, his New York apartment was raided by the FBI. At the time, a Polymarket spokesperson claimed the raid was an act of “political retribution” for predicting the outcome of the 2024 race.

Bloomberg News later reported, however, that the FBI’s raid was related to a Department of Justice investigation. The publication, citing a person familiar with the subject, said authorities were investigating Polymarket for allowing U.S. users to bet on the platform, despite the earlier CFTC settlement. The site is currently “geofenced,” meaning that users from U.S.-based IP addressees are automatically blocked from betting. However, that’s easy to circumvent via VPN services, which mask one’s IP address.

France’s national gaming regulator also started to look into Polymarket after a French trader won an estimated $47 million on $45 million in bets, which mostly centered on whether Trump would get reelected. Polymarket decided to block the betting market for French-based users.

As Polymarket navigates the post-election world, its relationship with regulators worldwide could prove key in building past this year’s surge in activity and new users. Still, Coplan said he enters 2025 optimistic, and he’s emboldened by his platform’s demonstrable success as a far better alternative to conventional polls.

“It’s moments like election night which set the precedent that Polymarket is more accurate than legacy alternatives,” Coplan said. “Trust must be earned, and it was.”

Certainly, the future looks brighter. With an incoming administration that’s likely to clarify regulations that pertain to crypto and prediction markets, Polymarket’s founder is upbeat. 

“The incoming administration looked heavily at Polymarket forecasts throughout the election cycle, which is incredible news,” he said. “The first step is understanding why these markets are so valuable, which has been accomplished. The natural next step is to embrace it.”