Questions raised after Bithumb intern sent 15X more 'phantom' Bitcoin to users than it held. Plus, did a Hong Kong fund blow up? Asia Express
Viral theory points to Hong Kong fund's role in Bitcoin ETF sell-off, plus Bithumb"creates" tens of billions of BTC with the press of one fat finger.that a Hong Kong-based company is believed to have used cheap Japanese yen funding before being forced into liquidation across multiple markets.
, when Bitcoin slid to its lowest level of the week near $60,000. Liquidations on centralized cryptocurrency exchanges remained relatively muted despite the sell-off, which White said suggested stress from large IBIT holders. Franklin Bi, general partner at Pantera Capital, shared a similar theory explaining why it has largely flown under the crypto radar. , Bithumb reported holding approximately 42,031 Bitcoin. That figure is about 15 times less than the amount distributed during the incident. If the exchange did not accumulate 577,969 BTC after the filing, then Bithumb distributed more cryptocurrency to user accounts on its platform than it actually holds. Because some users were able to immediately sell the supposedly non-existent assets, the local industry has dubbed the incident Bithumb’s “phantom” Bitcoin case. Under South Korea’s crypto user protection law, exchanges are required to hold the assets deposited by customers. FSS governor Lee Chan-jin said regulatory action may be possible under existing rules. The regulator has since Ethereum whale Trend Research has sold off all of its Ether, leaving just $10,000 in USDC across wallets tracked by Arkham. As of last week’s Asia Express, Trend Research had already reduced its Ether exposure by 73,000 ETH, largely held as Aave wrapped Ether. Despite those sales, the firm still. Over the week, Trend Research continued selling Ether to unwind leveraged positions. By Sunday, its Ether balance fell to zero. Trend Research has been linked to Yi Lihua, also known as Jack Yi, the founder of Hong Kong-based crypto venture firm Liquid Capital. The firm first drew the attention of blockchain analysts in November after aggressively accumulating Ether. By the end of January, it held roughly 651,000 AWETH. Yi built the position through leverage. He purchased Ether on centralized exchanges, deposited it into Aave as collateral and borrowed stablecoins, which were then used to buy additional ETH. When Ether prices declined alongside Bitcoin and the broader crypto market, Trend Research was forced to unwind its position to repay its loans.“On the flip side, when crypto enters a bear market, it is often the best time to build positions, just as we benefited in the previous cycle by accumulating during the bear market,” Yi wrote. Japan’s Lower House snap election on Sunday handed a two-thirds super-majority to the Liberal Democratic Party under Prime Minister Sanae Takaichi, reducing uncertainty around ongoing crypto policy discussions. Those discussions include proposals to revise crypto tax treatment and to review whether digital assets should remain regulated under the Payment Services Act or The tax debate centers on how crypto gains are classified under the income tax system. Currently, most individual crypto gains are treated as miscellaneous income andJapan’s tax discussions are tied to broader questions about how crypto should be legally categorized. Moving crypto to the Financial Instruments and Exchange Act would place digital assets within the same legal framework that governs ETFs and other investment products, making crypto ETFs legally possible in Japan. Japan’s government has also signaled interest in developing market infrastructure that could support such products if permitted. Finance Minister Satsuki Katayama said in her New Year speech that Japan should pursue Yohan Yun is a Cointelegraph staff writer and multimedia journalist who has been covering blockchain-related topics since 2017. His background includes roles as an assignment editor and producer at Forkast, as well as reporting positions focused on technology and policy for Forbes and Bloomberg BNA. He holds a degree in Journalism and owns Bitcoin, Ethereum, and Solana in amounts exceeding Cointelegraph’s disclosure threshold of $1,000.Coinbase’s Wells notice hints at enforcement action on the horizon, Terraform Labs CEO Do Kwon arrested in Montenegro and FTX seeks to sell $95 million in Mysten Labs stocks.US gov’t won’t sell $590M Bitcoin on Coinbase. Does Harris plan to continue Biden’s crypto crackdown? Hodler’s Digest
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