Cointelegraph By Samuel Haig
China’s Nervos Network has launched a $5 million fund to support projects building decentralized exchanges, lending platforms, and other DeFi protocols.
According to a Feb. 10 announcement from Nervos, the fund will be used to provide cash grants and direct support to fintech and blockchain entrepreneurs.
In particular, Nervos is looking to back Defi teams building trustless decentralized exchanges, synthetic asset solutions, identity protocols, lending solutions, prioritizing projects striving for interoperability across multiple blockchain networks.
Grant applicants building on the Nervous blockchain will also be eligible to receive hands on support from Nervos’ core developer team.
Nervos is a Chinese-based open-source public blockchain that enables layer-two scaling solutions and is aiming to build an “universal, Internet-like public network.”
Nervos described the fund as a response to “backlash and controversy” regarding the centralized finance sector. In recent weeks, a retail-driven short-squeeze targeting the stock of struggling game retailer GameStop saw Robinhood and other mainstream trading platforms suspend trade in the shares.
Kevin Wang, co-founder of Nervos, said:
“People are becoming increasingly interested in blockchain and crypto because of the barriers in traditional finance, but users need to be able to easily transact on the blockchain for the space to grow and scale.”
Nervos also emphasized the “antiquated” systems underpinning legacy trading systems, such as centralized governance and inefficient settlement processes.
Nervos launched it’s CKB blockchain in 2019 with a focus on scalability. The project sought to target DeFi and asset tokenization from inception, and launched its CKB foundation to support developers working to improve the security, decentralization, and speed of the DeFi ecosystem.
Last year saw Nervos emphasize interoperability, launching a bridge between Ethereum and the CKB network in December, and a “universal passport” allowing developers to program for multiple blockchain through a single interface in the same month.
Nervos was also among the initial cohort of permissionless blockchains to integrate with China’s Blockchain Service Network last year.
French utility giant pursues carbon neutrality as Hedera node operator
Cointelegraph By Greg Thomson
French utility giant Électricité de France has joined the Hedera Governing Council as a node operator. EDF, which is among the top five global utility firms, represents the first from its industry to join the council and will use the technology as part of its aim to achieve carbon neutrality by 2050.
The Hedera network is a public, enterprise-grade blockchain that is owned and governed by private entities. EDF joins the likes of IBM, Google, Boeing as node operators, with each having an equal vote in the future direction of the software. Each member can serve for a maximum three-year term, with the possibility of serving for two consecutive terms. The creator and proprietor of Hedera’s Hashgraph algorithm, Swirlds, retains a permanent seat on the council.
EDF’s wholly-owned subsidiary, Exaion, which already runs a Tezos (XTZ) node in France, will leverage the Hedera network as part of its blockchain-as-a-service offerings. Hedera’s proof-of-stake network is expected to form the energy-efficient basis of EDF’s exploration into becoming carbon neutral.
Gilles Deleuze, principal researcher in systems risk assessment at EDF R&D, said distributed ledger technology would spur the development of greenhouse gas certificates, decentralized electricity systems, and more:
“In the near future, distributed computing will support increasingly decentralized electrical systems, complex supply chains and exchanges of digital assets, energy certificates, GHG credits, and more. Multiple pieces of the distributed ledger technology ecosystem will form the puzzle pieces that make this vision a reality.”
Deleuze said EDF would leverage tokenization on Hedera (the Hedera Token Service) to create a “carbon offset and credit system” in line with the company’s goal of cutting CO2 emissions.
“We believe in partnering with industry leaders like Hedera Hashgraph to explore innovative technologies and organizational modes, build value-creating ecosystems, develop use cases for the energy domain and EDF’s operations, and develop Exaion’s potential to deliver blockchain/DLT and high-performance computing services,” Deleuze said.
Lionel Chocron, chief product officer at Hedera Hashgraph, said that the maturation of distributed ledger technologies was pushing companies to explore decentralized solutions, stating:
“Today’s most forward-thinking organizations recognize that the maturation of distributed computing requires the use of multiple technologies and efforts to deliver on the services their customers want.”
The proprietary nature of Hedera lays the foundation for its “no hardfork guarantee,” promising long-term stability for businesses and enterprises which use its technology. In January, Australian payment giant Eftpos became a Hedera node operator. More recently, Hedera made inroads to Africa after the continent’s largest bank joined the governing council.
Banksy art burned and tokenized
Cointelegraph By Greg Thomson
An original artwork by anonymous British street artist Banksy has been burned and turned into a nonfungible token. The NFT will be auctioned next week on the blockchain-based Rarible platform, where users can create and purchase rare tokenized artworks.
The original Banksy in question is a satirical piece entitled “Morons,” which depicts buyers at an art auction bidding on a piece emblazoned with the words “I can’t believe you morons actually buy this shit.” The piece received certification from Pest Control — the only body authorized to authenticate original Banksy artworks.
“Morons” was sold at Christie’s auction house in London in late 2019, where it fetched $32,500 from an anonymous, independent buyer.
The burning of the piece took place at an unknown location in Brooklyn, New York, and was livestreamed via the recently created Twitter account BurntBanksy. The burning was reportedly carried out by a group of cryptocurrency enthusiasts in association with executives from the blockchain project Injective Labs.
The tokenization of the authenticated piece took place without input from the pseudonymous Banksy. However, other prominent artists have seen fit to dip their toes into the crypto world of late, as witnessed recently when famed British artist Damien Hirst announced he would accept bids for his work in Bitcoin (BTC) and Ether (ETH).
The NFT market became an industry unto itself toward the end of 2020, as almost $9 million in token sales was recorded in December 2020 alone. But that was just a sign of things to come, as NFT sales exploded moving into 2021, helped by the validation of several high-profile celebrities such as YouTuber Logan Paul and entrepreneur Mark Cuban.
On Sunday, acclaimed Canadian musician and artist Grimes launched an NFT collection titled “WarNymph”, which went on to sell for a collective $5.8 million. The NBA recently embarked on a joint venture with CryptoKitties creator Dapper Labs to launch NBA Top Shot — an NBA-themed digital token marketplace that has reportedly generated $230 million in sales since launch.
The “Morons” piece is not the first Banksy to be destroyed on purpose. In 2018, Banksy’s “Girl With Balloon” automatically self-destructed shortly after selling for $1.4 million at Sotheby’s. The artist later revealed that he had installed an automatic shredder in the painting’s frame in case it ever went to auction. In an ironic twist of fate, the destroyed Banksy is now thought to be more valuable than the original piece ever was.
The “Morons” NFT will be auctioned on Rarible on Tuesday next week. All proceeds from the auction will be donated to charity. The successful bidder will be entitled to receive the certificate of authentication from Pest Control; however, this too will be burned if it is not claimed within two weeks of the sale.
In an art industry fraught with fakes and forgeries, “Morons” may now be the most authentic, most secure Banksy piece in the world. Once logged on the blockchain, the possibility of it being forged, altered or manipulated in any way is close to zero.
Given Banksy’s rejection of the bloated, materialistic art world, what would he think of the current mania surrounding NFTs? Keep an eye on your local graffiti spots. The answer may be forthcoming.
How crypto fraud and security breaches are investigated
Cointelegraph By Connor Sephton
It’s every exchange’s worst nightmare: Falling victim to a security breach. An incident can disrupt a trading platform’s operations for weeks, affect customer confidence and damage a carefully cultivated reputation — even causing crypto markets to fall in some cases.
Crypto companies have been ramping up their security measures in recent years, determined to ensure that malicious actors don’t get an opportunity to infiltrate their systems. This has prompted hackers, scammers and fraudsters to rely on more sophisticated techniques.
One crucial weapon has emerged that helps trading platforms take speedy action in the event that their infrastructure is compromised: Analytics software. But how do these companies go about their investigations whenever a breach is reported? What are the tools that can be relied upon to follow a thief’s tracks?
This is a step-by-step guide to investigating crypto fraud, security breaches and ransomware.
Hunting the hackers
Irrespective of whether cryptocurrencies are stolen through fraudulent activities or scams — with ransomware becoming an increasingly popular method for swindling victims — investigation techniques often follow a similar pattern.
The first step is to identify a criminal’s crypto address as soon as possible. This information can then be passed on to analytics software companies, which can immediately tag the address as high risk. Doing this quickly can ensure that the entity is easier to track. There can be times when there’s little information about an address hash, but this doesn’t mean that there’s a dead end. That’s because transaction and date filtering can be used instead.
Next, it’s a race against time to start tracking bad actors who may begin to obfuscate the funds that they have misappropriated. They may start sending transactions to other exchanges or use mixing services and darknet entities. Although this commonly happens immediately after crypto has been taken, it can sometimes take months or years for obfuscation to commence — when a criminal may think no one is looking. Analytics providers can offer transaction alerts to ensure that victims can be immediately notified when funds flow to or from an address.
These transaction alerts need to be acted upon as a matter of urgency, as work begins to follow the trail. A crucial step involves notifying exchanges that might end up receiving some of this crypto to ensure they are able to block stolen funds that flow into their accounts. Visualization tools can play a role in illustrating how misappropriated assets are distributed — and show the addresses that may be directly or indirectly connected to the criminal.
An investigation in action
Crystal Blockchain has shared an example of how investigations work in practice. The analytics software provider recently played an instrumental role in examining the aftermath of a hot wallet security breach that affected Eterbase in September 2020, which Cointelegraph reported on at the time.
Immediately after the theft took place, Eterbase sprang to action by publicly announcing the address that was used by the Bitcoin thief. This enabled Crystal to immediately tag this wallet as a high-risk entity.
Quickly, it became possible to piece together information about this address — including statistics on further transactions and connections. It soon emerged that this suspicious wallet had connections to 16 other addresses.
Through Crystal’s All Connections tool, it was revealed that this address had indeed received funds from Eterbase, as well as other exchanges, which had been sent on to a plethora of unnamed entities.
The company said it was able to look further than a one-hop distance — and include indirect connections in its results. From here, it was established that 80% of the total funds that were stolen had been sent to a mixing service.
Eterbase went live once again on Jan. 15 — with its team asking exchange users to stop using old crypto deposit addresses that belonged to their accounts. In an update at the end of January, the company said that an official investigation is still ongoing — and it stressed that affected users who are eligible for a refund will receive one as soon as possible.
Crystal Blockchain says crypto crime is growing in parallel with the crypto markets. The company recently released a map of security breaches and fraud within the digital assets sector over the past 10 years.
The interactive timeline tracks the number of incidents in every year since 2011, and also provides a total figure for the funds that were stolen. Its data suggests that $1.48 billion was taken across 28 incidents in 2020.
Users who visit this article can also use a spinning globe to find out the total volume of funds that have been stolen in countries around the world — with the hardest-hit nations colored in the darkest shade of red.
According to Crystal, the most common locations for exchange breaches include the U.S., the U.K., South Korea, Japan and China. The largest-ever crypto security breach remains the incident involving the Japanese exchange Coincheck in 2018, overtaking the Mt. Gox incident back in 2014.
Disclaimer. Cointelegraph does not endorse any content or product on this page. While we aim at providing you all important information that we could obtain, readers should do their own research before taking any actions related to the company and carry full responsibility for their decisions, nor this article can be considered as an investment advice.
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