🌉Wormhole Bridge $320M Hack - TWJ #76

Maybe centralized exchanges are the best bridges after all.

Feb 03, 2022

In today’s issue:

The crypto market is down with the global market cap sitting at ~$1.6-1.7 trillion. Maker (MKR) led the top 100 assets weekly performance. Global markets drop as Facebook (Meta) released a disappointing sales forecast.

In other news, Wormhole bridge experienced a $320M hack, the IRS won’t tax staking rewards, and Coinbase highlights massive institutional growth.

We’re continually improving our content, please reach out if you have ideas or would like us to recap another segment of the market.

- Curated by Marco Manoppo (@manoppomarco)

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📰Market News

⎆Wormhole Bridge $320M Hack

Wormhole, a protocol that enables users to bridge assets from the Ethereum blockchain to Solana blockchain and vice-versa, has suffered an exploit of 120,000 wETH, which is roughly worth $320M. The Wormhole team has since tweeted that ETH will be added to ensure that wETH backing is still 1:1 to ETH. The hacker offered to return the funds and explain the exploit details for a bug bounty of $10M.

⎆IRS Won’t Tax Staking Rewards

Excerpt from Forbes:

In court filings expected to be made public Thursday, the IRS declared it would refund $3,293 in income tax (plus statutory interest) to a Nashville couple who had paid the amount on 8,876 Tezos tokens they had obtained through staking.
According to a May 2021 civil lawsuit filed by the couple, Joshua and Jessica Jarrett, any tokens gained through proof-of-stake should be considered “new property” created by the taxpayer—and therefore not income which “comes in” to the taxpayer. In order to be taxed, tokens gained through staking (or any other newly created property) must be first converted into a “readily accessible form of wealth”.
Thus, the lawsuit claims, until the tokens are sold, no taxable event has occurred.

⎆Coinbase Highlights Massive Institutional Growth

Coinbase has been predominantly known to be a retail-drive crypto exchange but the firm has recently stated that its institutional side now makes up 50% of the firm’s business, up from 10% just three years ago. Brett Tejpaul, Head of Coinbase Institutional also stated that institutions’ stablecoins holdings grew from $10 billion three years ago to $150 billion as of today.