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December Week 3. What Happened? For Bitcoin and altcoins, the month of December has always been filled with gloom. But not for us. All the events of this week and potentially for the entire December are highly significant.
Bitcoin Ordinals (December)
On December 9, the U.S. National Vulnerabilities Database (NVD), identified ‘Bitcoin Ordinals’ as a cyber security risk, warning people against this vulnerability. Being added to NVD implies that a certain cyber security gap has been detected and confirmed. This database is managed by the National Standards and Technology Institute (NIST) that comes under the U.S. Department of Commerce. Earlier, Bitcoin Core developer Luke Dashjr, had pointed out that the vulnerability exploited in Bitcoin Core client by Ordinals is associated with a specific identifier, CVE-2023–50428.
According to SlowMist, one of the founders of Cosmos, Bitcoin Ordinals has a moderate risk level in the National Vulnerabilities Database. This can be explained as “up to version 26.0 of Bitcoin Core and up to version 25.1.knots 20231115 of Bitcoin Knots, the size limit of data carriers can be bypassed by hiding data as code (for example, using OP_FALSE OP_IF), and this has been exploited by Ordinals in 2022 and 2023.”
Crypto is Now an Asset
Rostin Behnam, Chairman of CFTC, highlighted the ambiguities in the regulation of the crypto industry, emphasizing that most cryptocurrencies are considered commodities under existing laws. Gary Gensler, Chairman of SEC, stated that they will adopt an unbiased approach in the approval process of a physically-backed Bitcoin ETF, with currently 8 to 12 applications, and will evaluate with a fresh perspective, taking into consideration the opinion of the D.C. Circuit Court.
You may be interested in: The Latest Status in Bitcoin and Cryptocurrencies! – December 17
Tether Sanctions
Stablecoin provider Tether froze 41 wallets associated with the U.S. Treasury Department’s specially designated persons list on December 9. Tether, which characterizes this move as “preventive measures,” published a blog post on the subject. According to on-chain data, some wallets have used the Tornado Cash privacy mixing service in the last six months.
Tether CEO Paolo Ardoino stated, “By voluntarily freezing the newly and previously added wallet addresses to the SDN list, we will further strengthen the responsible use of stablecoin technology and create a safer stablecoin ecosystem for all users.” Also, it was shared that Tether froze 161 more Ethereum wallets on December 11, and currently, there are no USDTs in 150 of them.
The remaining 11 wallets hold more than 3.5 million USDT in total, with the largest amount being approximately 3.4 million USDT. While two other wallets are trading with about 20,000 USDT and another with nearly 60,000 USDT, one wallet is holding only 0.16 USDT. These developments show that Tether’s steps focusing on security and responsibility are continuing.
SEC Still Puts Pressure on Binance
Despite Binance reaching a $4.3 billion settlement with the Department of Justice and other U.S. authorities, the SEC decided to continue with its lawsuit against Binance, even though it is not part of the agreement. Binance and its former CEO CZ, who filed a lawsuit on Friday, asserted that the statements in the Justice Department agreement should be taken into account by the federal court evaluating their requests to dismiss the SEC’s lawsuit.
Binance and CZ had filed a petition to dismiss SEC’s lawsuit, but the SEC stated that the agreement made with the U.S. government is outside the scope of the lawsuit.
The IRS and FTX Dispute
In their recent petition to the Delaware bankruptcy court, FTX’s lawyers moved to get a clear response to the tax debt claims alleged by the Internal Revenue Service (IRS). While FTX claims that it doesn’t have a tax debt, the IRS brings up an amount that could reach up to $24 billion, including claims of back payments, employment taxes, and penalties directed towards FTX for the period from 2018 to 2022.
This claim is the latest claim arise during a stage where the tax office’s detailed investigation is ongoing. The IRS had initially made a claim of $44 billion in April but reduced this figure to $43 billion in September and further reduced to $24 billion in November.
LedgerConnect Attack
On the evening of the 14th day of December, LedgerConnect suite was hit by an attack that affected SushiSwap, Zapper, Revoke.cash, Kyber Network, Balancer, and a number of other decentralized applications (dApps). The attack caused significant damage to the dApps, and operators decided to circumvent or disable frontend interfaces following the attack.
While it’s noted that one of Ledger’s modules has been jeopardized by a supply chain attack, its full extent remains unknown. It’s emphasized that there are various dApps that rely on the malicious library, ledgerhq/connect-kit, and users are recommended to be careful when interacting with dApps and to check wallet signing requests.
Ledger stated that it identified the malicious version and is working to replace the damaged files of Ledger Connect Kit. Users are advised not to interact with any DApps for the time being, and Ledger confirms that user devices and Ledger Live are safe.
What Happens This Week
In the 3rd week (18-22) of December, no economic data that could critically impact global markets will be disclosed. However, some economic data in the U.S. could create volatility in the markets and on Bitcoin.
- Growth data for the 3rd quarter of the U.S.
- Personal Consumption Expenditures
Personal Consumption Expenditures is a data report that the U.S. Federal Reserve follows as inflation. PCE holds an important place for the FED. Therefore, these data should be monitored.
In addition to these:
- The ICON project will launch its mainnet on December 18.
- BakerySwap will start its first BRC-20 launchpad project on December 19.
- Polygon will make a significant announcement on December 20.
- The Beta Finance project will launch the Omni network on the BNB Chain.
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