With a staggering $1 billion in crypto gone missing in 2023, how is on-chain data and blockchain analysis painting a nuanced picture of hackers’ motives while helping to recover stolen riches? Get the inside scoop on how these digital tools keep you one step ahead in the crypto game.
The world of decentralised finance (DeFi) and Web3 is like the Wild West of the internet—fast, thrilling, and downright risky. Just this year, a jaw-dropping $1 billion vanished into thin air or landed in the wrong hands. Yep, you read that right, according to the DefiLlama.
But don’t worry, it’s not the end of the world. A new league of digital guardians is rising to the occasion. From folks who specialise in decentralised IDs to the Sherlock Holmes of smart contract audits, there’s a whole squad working around the clock to keep this virtual playground safe.
Oh, and let’s not forget our notorious villains. Meet the Lazarus Group, North Korea’s own state-backed hacking squad. These guys have siphoned off a staggering $291 million this year alone. They even pulled off a Hollywood-style heist on CoinEx, swiping more than $55 million. It’s like a cyber-thriller unfolding in real-time, reminding us that this new frontier is exciting but still has its fair share of bad actors.
According to a 2023 Chainalysis report, illicit crypto inflows are down 65% compared to where they were at the same time in 2022.
What’ crypto and blockchain security?
Let’s spice things up a bit! Imagine your digital wallet gets hacked, and your crypto goes poof—vanished! What do you do? Enter blockchain analysis, the detective work for the crypto world. Even big companies sometimes drop the ball when it comes to dodging digital theft, so knowing a thing or two about this can be your own superhero cape.
So, what is blockchain analysis? It’s like being a digital Sherlock Holmes, digging through transaction histories to find where the stolen crypto went. Here’s a quick rundown:
Transaction tracing: Think of this as following a breadcrumb trail. Analysts keep an eye on every movement of the stolen cryptocurrency.
Address clustering: This is like connecting the dots. They group together related wallet addresses to see where the stolen money might have been moved.
Behavioural analysis: Ever notice someone acting sketchy? It’s the same here. By looking at transaction patterns, analysts can spot anything that seems off and might point to theft.
Pattern recognition: This is about learning from the past. Analysts use old data and known tricks hackers have used before to catch new threats faster.
Regulatory vigilance: The government is stepping in, too. They’re making rules stricter to make sure people can’t use crypto for shady stuff like money laundering.
Team effort. It’s not a one-man show. Often, these analysts team up with the police, crypto exchanges, and other big players to either freeze the stolen money or get it back.
Everything you need to know is on the blockchain
When a cryptocurrency hack goes down, it’s not just a “whodunit,” but also a “how-can-we-fix-it,” and our digital Sherlock Holmes has a trusty toolkit for just that. Enter blockchain analysis, the magnifying glass for all those cryptic crypto transactions.
But wait, there’s another star in this crime-busting duo—Open-source intelligence, or OSINT for short. Imagine it as the Watson to blockchain analysis’s Sherlock. OSINT dives deep into the digital world, sifting through clues using nifty tools like Etherscan, Nansen, Tenderly, Ethective, and Breadcrumbs. It’s like the Swiss Army knife of cyber-sleuthing.
Mash up the keen eye of blockchain analysis with the broad reach of OSINT, and what do you get? A turbocharged, crime-solving engine that not only pins down the bad guys but also has a good shot at getting back that stolen loot.
So, the next time you hear about a crypto heist, remember: our digital detectives are on the case, armed with blockchain analysis and OSINT, making the virtual world a little safer, one solved case at a time.
Tracking down the crypto hacker
Get this—sometimes crypto villains have a change of heart! Take the Curve Finance exploit, for example, where the baddie walked away with $61 million in digital dough.
Plot twist: the hacker returned nearly $9 million not because they were scared of getting caught, but because they wanted to keep the systems they hacked into running smoothly. Yeah, it sounds like something out of a comic book, but this is real life, and it shows how complex the ethics of the crypto world can be.
What helped crack the case?
It’s all thanks to the digital fingerprints left on the blockchain.
On-chain data is like the DNA test of the crypto world. It gives us a crystal-clear view of who did what, when, and where. It’s like a treasure map that helps you understand how to keep your assets safe and sound while steering clear of the digital booby traps.
So whether you’re a casual enthusiast or a crypto guru, this ever-evolving landscape is full of opportunities and threats. Just remember, knowing is half the battle, and in this high-stakes game, knowledge can be your superpower.
There’s a growing momentum for crypto adoption in Europe, from stablecoins to digital euros. European agencies and companies are taking steps to make the digital financial landscape more accessible and regulated.
ESMA crypto guidelines
On October 20, two major European financial agencies released a paper to discuss new rules regarding how individuals interact with crypto assets. These are called the European Banking Authority (EBA) and the European Securities and Markets Authority (ESMA). These rules are aimed at checking if the people running and investing in crypto-related companies are qualified for their roles.
The guidelines offer a common way for regulators to decide if these people are suitable for giving permission to launch new crypto assets or services. This includes making sure they have the necessary knowledge, skills, and time commitment for their roles.
The new guidelines aim to make the cryptocurrency market more trustworthy and consistent. They are open for public feedback until January 22, 2024.
Looking ahead to new rules that will be in place by June 30, 2024, the EU’s banking authority has also suggested that companies dealing with stablecoins should start following certain best practices for managing risks and protecting consumers. These initial suggestions were shared with the public on July 12 to clarify what will be expected under the upcoming crypto regulations.
Digital Euro project
In February 2023, a Finnish firm called Membrane Finance launched a stablecoin tied to the euro. The CEO, Juha Viitala, believes this regulated coin, called EUROe, will help more people in Europe to increase their money using decentralised financial apps (DeFi).
On October 18, the European Central Bank said they’re entering the “preparation phase” for their digital euro project. This stage will take two years and will be about setting the final rules and choosing who will issue the digital euro.
Transaction anonymity of digital Euro
On October 18, European privacy agencies released a statement about the digital euro, a new type of money suggested by the European Commission in July 2023. These agencies gave advice on how to better protect people’s personal information.
For example, they said that rules around how much digital euro one person can have need to be clearer. Right now, the European Central Bank and national banks can see all of a user’s information through one access point, and the agencies think that needs to be reconsidered. They believe there are technical ways to store this data without centralising it.
They also said that the current plans for spotting fraud could be too intrusive and suggested finding less invasive methods. The agencies strongly recommend setting up a privacy limit for small, everyday transactions that don’t need to be tracked for anti-money laundering reasons.
Meanwhile, the European Central Bank said it’s moving ahead with its digital euro project. After two years of studying the idea, they are now going to spend another two years finalising the rules and picking who will be in charge of issuing this digital money.
Private stablecoins vs Central Bank Digital Currencies (CBDCs) in Europe
Here’s a comparison between private stablecoins and Central Bank Digital Currencies (CBDCs) in the European context:
Private Stablecoins like EUROe
Issuers. Issued by private companies, such as Membrane Finance in Finland.
Regulation. While they aim to be regulated, the guidelines are not always as stringent as those for traditional currencies.
Accessibility. Generally, it is easier to acquire and use, especially for those familiar with cryptocurrencies and decentralised finance (DeFi) platforms.
Purpose. Often aimed at facilitating trade and investment in the DeFi ecosystem.
Trust. Reliance is primarily on the issuing company and its ability to maintain a 1:1 peg with the euro.
Anonymity. The level of transaction privacy depends on the issuing company’s policies and technology.
Central Bank Digital Currencies like the Digital Euro
Issuers. Issued by a country’s central bank, in this case, the European Central Bank (ECB).
Regulation. Heavily regulated and backed by the government, making them a more “official” form of currency.
Accessibility. Likely to be more universally accessible but may require more stringent identity verification.
Purpose. Aimed at a wider array of applications, including retail payments, cross-border transactions, and even government disbursements.
Trust. Backed by the government, thereby considered more secure and stable.
Anonymity. Subject to government regulations, including Anti-Money Laundering (AML) and Counter-Terrorism Financing (CTF) laws, meaning less potential for anonymity, especially for large transactions.
Explore the cutting-edge developments in the world of digital currencies, from China’s groundbreaking digital yuan hub to the impending launch of Japan’s DCJPY. Discover how Finland is embracing the digital euro, and witness JPMorgan’s successful cross-border payments pilot with First Abu Dhabi Bank.
China Unveils Shenzhen Hub for Digital Yuan CBDC Innovation
China has launched an industrial park in Shenzhen aimed at fostering the development of the digital yuan ecosystem.
This groundbreaking initiative, reported on Oct. 11 in Chinese media, marks the establishment of the first-ever park dedicated to the central bank digital currency (CBDC), also known as the e-CNY.
Situated in Shenzhen’s Luohu district, adjacent to Hong Kong, the industrial park is commencing its operations with nine initial residents.
Reports indicate that the district government has introduced ten strategic initiatives to accelerate the growth of the digital yuan ecosystem. These initiatives encompass the advancement of payment solutions, smart contracts, hard wallets, and the promotion of the digital yuan.
In an effort to incentivise new residents, the government is offering compelling benefits, including up to three years of rent-free accommodation.
Commercial banks that choose to establish a presence in the park can receive incentives of up to 20 million yuan ($2.7 million), while startups may be eligible for support of up to 50 million yuan ($6.9 million).
The total government support allocated for this endeavour amounts to 100 million yuan ($13.7 million). Additionally, favourable loan terms are being extended to participants.
Notably, among the inaugural residents of the park are prominent entities such as Hengbao, Wuhan Tianyu Information, and Lakala Payment. Hengbao and Tianyu are engaged in the production of payment cards, among other endeavours, while Lakala Payment operates as a payment processor and collaborates with Visa.
The Shenzhen Digital RMB Industrial Park officially launched operations on Wednesday, according to a press briefing held in the southern Chinese metropolis of Shenzhen https://t.co/Pi3Z6bjUvppic.twitter.com/SehYDnhoUu
China has implemented numerous strategies to stimulate the adoption of the digital yuan, which is currently in the pilot phase.
This initiative spans 26 cities participating in the pilot program, and the central bank digital currency (CBDC) is already accepted by 5.6 million merchants—a number that is expected to steadily increase, thanks to government support and technological advancements.
Notably, the digital yuan app recently introduced a feature allowing tourists to link their Visa and Mastercard accounts, further enhancing its accessibility. Despite these efforts, the adoption rate is still perceived as sluggish, with 261 million digital yuan wallets created as of 2022.
Japan to launch its digital currency in 2024
In a significant development, the DCJPY, a digital currency backed by the Japanese yen, is set to launch in July 2024. This ambitious project is spearheaded by DeCurret Holdings, a digital currency and electronic payments firm, as detailed in their white paper released on October 12.
The DCJPY Network, outlined in the white paper, will comprise two key zones: the Financial Zone and the Business Zone.
The former will facilitate banks in minting digital currency deposits on the blockchain, while the latter will be dedicated to conducting transactions.
Additionally, the Business Zone will serve as a platform for the issuance of nonfungible tokens, security tokens, and governance tokens.
Aozora Bank, a commercial institution with 19 branches in Japan, is poised to become the principal issuer of DCJPY.
The digital currency will be fully backed by Japanese yen deposits.
In 2021, DeCurret reported the formation of a consortium consisting of 70 Japanese companies that will participate in the DCJPY Network. While the white paper doesn’t disclose specific participant names, DeCurret boasts the support of 35 shareholding companies, including prominent names such as Japan Post Bank, Mitsubishi, and Dentsu Group.
In related news, the Bank of Japan, in May 2023, disclosed the results of the second phase of its central bank digital currency experiment and is on track to make a final decision on issuing a “digital yen” by 2026.
Simultaneously, Binance and Mitsubishi UFJ Trust and Banking Corporation are actively exploring the issuance of Japanese yen and other foreign currency-denominated stablecoins within the country.
First Abu Dhabi Bank Successfully Concludes Cross-Border Payments Testing on JPMorgan Onyx
In a significant milestone, First Abu Dhabi Bank (FAB) has wrapped up its cross-border payments testing on JPMorgan’s Onyx platform. This achievement follows a similar pilot conducted by Bank ABC in Bahrain.
JPMorgan, known for its cutting-edge blockchain solutions, has also introduced its Tokenization Collateral Network on the Onyx platform.
The blockchain-based cross-border payments pilot project between JPMorgan’s Onyx Coin Systems and FAB was executed seamlessly, with response times meeting expectations, according to an official statement.
Notably, the FAB pilot concluded shortly after a successful test in Bahrain, where Bank ABC trialed the Onyx system and subsequently initiated a limited launch of services.
JPMorgan’s permissioned distributed ledger, launched in 2020, has been gaining substantial traction in recent months. Tyrone Lobban, the Head of JPMorgan Onyx Digital Assets and Blockchain, disclosed that the platform currently processes a daily volume ranging from $1 billion to $2 billion.
Moreover, Onyx has expanded its reach beyond the Middle East, serving as a platform for euro-denominated payments in Europe since June.
During the same period, it also facilitated interbank United States dollar settlements in India through collaboration with a consortium of six banks.
On October 11, JPMorgan’s groundbreaking Tokenization Collateral Network, operating on the Onyx blockchain, recorded its first public trade.
In this instance, money market fund shares were tokenised and securely deposited at Barclays Bank to support a derivatives exchange between JPMorgan and BlackRock.
The finance industry has witnessed increased interest in tokenisation, with Mastercard testing its Multi Token Network in June and Citigroup introducing Citi Token Services in September.
This collaborative effort, concluded in June, was initiated by the Monetary Authority of Singapore and the Bank for International Settlements. It focused on creating a liquidity pool of tokenised bonds and deposits for lending and borrowing purposes.
Finland Forges Ahead with Instant Payments and Digital Euro Initiatives
The Bank of Finland (BOF) is taking active steps to foster innovative payment solutions.
BOF, under the guidance of Tuomas Välimäki, a BOF board member and a member of the Governing Council of the European Central Bank (ECB), has announced its role in coordinating the development of a Finnish instant payment system aligned with European standards.
Välimäki emphasized the significance of the digital euro, referring to it as the most prominent project within the European payment sector. He highlighted the potential of a digital euro, stating, “The possible introduction of a digital euro would give consumers the option of paying with central bank money wherever electronic payment is accepted.”
The Bank of Finland, in collaboration with the European Payments Council, is actively engaged in crafting this Finnish instant payment solution.
It’s worth noting that this solution will be based on credit transfers, eliminating the reliance on traditional payment card infrastructure.
In February 2023, a Finnish company named Membrane Finance took a significant step by launching a fully reserved stablecoin backed by the euro, known as EUROe.
Membrane Finance CEO Juha Viitala expressed optimism about EUROe’s potential to encourage more Europeans to explore decentralised finance (DeFi) applications and enhance their financial well-being.
On October 18, the governing council of the European Central Bank (ECB) initiated the “preparation phase” for the digital euro project, a two-year period aimed at finalising regulations for the digital currency and selecting potential issuers.
Finland’s proactive stance in embracing instant payments and exploring the digital euro reflects the country’s commitment to staying at the forefront of modern payment solutions.
While Ethereum staking is on the rise, it brings with it the challenge of increased centralization. Even Ethereum co-founder Vitalik Buterin acknowledges this as a core issue, suggesting that a comprehensive solution may be decades away.
The growth in Ethereum staking has surged since the Merge update.
But this has led to two issues: the network becoming more centralized and people earning less from staking.
The team at JPMorgan, headed by top executive Nikolaos Panigirtzoglou, cautioned investors about these rising concerns related to Ethereum’s increasing centralization.
The leading five easy-staying services—Lido, Coinbase, Figment, Binance, and Kraken—hold more than half of all staked Ethereum.
According to Dune Analytics, over 31% of all ETH staked belong to the Lido pool.
While people in the crypto world have viewed Lido as a better option than centralized services like Coinbase or Binance, the reality is different.
Even decentralized platforms like Lido still have a lot of control concentrated in a few hands. For example, one Lido node operator alone manages over 7,000 sets of validators, holding 230,000 Ether.
This concentration of power occurs because Lido’s decision-making is controlled by a small number of wallet addresses in their decentralized organization, known as a DAO.
While there was a general market proposal to limit each staking service to no more than 22%, Lido’s DAO voted against it in June 2023. In general, a DAO is a self-governing platform, but in this case, its decision to not limit its Ether staking is making the entire Ethereum ecosystem more centralized and, thus, more vulnerable.
Having too much control in one place poses a risk to the Ethereum network. A small group of major stakeholders or node operators could become a weak point in the system, or even collaborate to gain unfair advantages.
In addition to concerns about centralization, the Ethereum network has also seen staking yields go down since the big updates like the Merge and Shanghai.
The average block rewards have dropped from 4.3% to 3.5%, and overall staking yields have gone from 7.3% to around 5.5%.
It’s not just JPMorgan ringing the alarm bells about Ethereum’s growing centralization after the Merge, which was launched on September 15, 2022. This update is viewed as a stumbling block to Ethereum’s goal of being fully decentralized, and it has also led to reduced earnings from staking.
Even Ethereum’s co-founder, Vitalik Buterin, acknowledges the issue. In September 2023, he admitted that tackling the problem of node centralization in Ethereum is a big challenge, and finding an ideal solution could take up to two more decades.
Simplify node operations on Ethereum
Ethereum co-founder Vitalik Buterin says that making it simpler and less expensive to operate nodes is crucial for addressing the Ethereum network’s centralization issue.
Right now, most of the nearly 6,000 active Ethereum nodes are hosted by centralized services. The top service used it Amazon Web Services, posing a vulnerability for the network.
While speaking at Korea Blockchain Week, Buterin identified six critical challenges to overcome to ensure Ethereum stays decentralized over time.
One major aspect is making it technically easier for people to operate nodes. “Statelessness is a key technology to make this possible,” he added.
As of now, running a node requires hundreds of gigabytes of data storage.
With stateless clients, however, you could operate a node without needing almost any storage space at all. This statelessness means eliminating the need for centralized services to verify network activities.
According to the Ethereum Foundation, true decentralization can only happen when running an Ethereum node becomes accessible and affordable.
Buterin emphasized that statelessness is a significant part of Ethereum’s future plans. Major progress towards this goal is expected in upcoming phases called “The Verge” and “The Purge.”
He mentioned that the long-term vision is to have fully verified Ethereum nodes that are so streamlined you could literally run one on your phone.
Buenos Aires plans to issue blockchain-based identity documents, including birth and marriage certificates, while Brazil aims to make its new blockchain-powered national ID program available across the country. Both initiatives signify a major leap in government services and personal data security.
More than 214 million people in Brazil are about to start using blockchain technology for their digital IDs, according to a recent announcement by the government. The states of Rio de Janeiro, Goiás, and Paraná will be the first to start rolling out these blockchain-based identification documents.
They’re using a special, secure system created by Serpro, Brazil’s national data service. The plan is to have this technology available across the entire country by November 6, 2023.
Alexandre Amorim, the head of Serpro, explained that blockchain was chosen for this project because it’s a secure and decentralised way to manage digital IDs.
Blockchain technology is key in making personal data more secure and in reducing fraud, creating a safer digital environment for people in Brazil.
The use of the b-Cadastros blockchain platform improves the safety and trustworthiness of the National Identity Card project.
According to the government, this project is important for tackling organised crime and encouraging different parts of the government to collaborate. It also makes it easier for people to get government services and helps simplify record-keeping.
In recent years, Brazil has been trying to standardise the way IDs are issued across its nearly 30 states. This new technology will help safely share data between the Federal Revenue Agency and other government departments, as stated in the announcement.
Emissão da Carteira de Identidade Nacional (CIN) conta agora com a segurança do Blockchain. Saiba o que muda no documento e confira todos os detalhes que tornam a nova carteira de identidade dos brasileiros mais segura do que nunca!https://t.co/G2MigNkG1J
Another big change happening in the country is the introduction of a new digital currency by the central bank.
The government recently shared more details about this project in August and has renamed the digital currency to “Drex.”
Past reports suggest that the central bank aims to make it easier for businesses to get funding through a special system linked to Drex. A local developer found that the code for Drex allows a central body to either freeze money or lower account balances.
Notably, Buenos Aires in Argentina has announced a similar plan that lets people get their identity documents through a digital wallet.
Blockchain-based in Buenos Aires, Argentina
Buenos Aires, Argentina’s capital, is also taking a big step to include blockchain technology in its administrative processes.
Starting in October, people living in the city will be able to get their identification documents through a digital wallet, as revealed in a September 28 announcement.
Initially, you’ll be able to get documents like birth and marriage certificates, proof of income, and school records on this blockchain system. The plan also includes adding health records and payment information down the line.
The city aims to have a detailed plan for expanding this blockchain service throughout the country by the end of 2023.
The technology backbone of this project comes from QuarkID, which is a digital identity system created by the Web3 company Extrimian.
QuarkID wallets use zkSync Era, a special feature built on the Ethereum network that helps it run more efficiently. This feature uses something called zero-knowledge rollups, which lets one person show another that something is true without having to share any detailed information about what that ‘something’ is.
¡Hola Buenos Aires! Welcome to the ZK Nation 🇦🇷
Buenos Aires is teaming up with @Quark_ID to issue digital identification services to millions of citizens in the city, with zkSync Era serving as the anchor blockchain for the program.
“This marks a huge leap forward in making government services in Latin America safer and more efficient,” said Guillermo Villanueva, the CEO of Extrimian.
The information in these digital wallets will be controlled by the individual, meaning people can decide how and when to share their credentials, whether it’s with the government, businesses, or other people. zkSync Era will serve as the foundation for QuarkID, making sure everyone’s credentials are accurate and secure.
Diego Fernandez, who leads innovation for Buenos Aires, added, “This makes Buenos Aires the first city in Latin America, and among the first globally, to adopt and champion this new technology. We’re setting an example for how other countries in the region can use blockchain technology for the good of their citizens.”
Officials in Argentina are looking into another digital ID project called Worldcoin. In August, they revealed that they’re examining potential privacy issues tied to how Worldcoin gathers, stores, and uses people’s information. The project is also facing questions in Europe and Africa since it went global in July. Created by Sam Altman, who is also a co-founder of OpenAI, Worldcoin uses eye scans to confirm the identity of its users.
After attempting to acquire FTX Europe to boost its international derivatives business, Coinbase pivoted to offer perpetual futures to qualified customers in and outside the U.S.
Coinbase, a major platform for trading cryptocurrencies, twice considered buying FTX Europe after it went bankrupt in November 2022. Their aim was to expand their services related to financial derivatives abroad.
Despite these efforts, they’ve decided to back out of the acquisition. Coinbase looked into this deal two times: once right after FTX Europe’s financial troubles in November 2022, and again in September 2023.
A Coinbase representative verified this, stating they’re continually exploring ways to grow their business globally.
Other companies like Crypto.com and Trek Labs are also reportedly interested in FTX Europe. FTX initially spent close to $400 million to set up its European division.
FTX Europe was unique in that it was based in Cyprus and was the only company to offer certain trendy financial products like perpetual futures.
A perpetual future is a type of derivative financial instrument often used in cryptocurrency markets. Unlike regular futures that have an expiration date, perpetual futures go on indefinitely until you decide to close the position. They’re designed to mimic the price of an underlying asset, like Bitcoin, without actually requiring you to own it. Traders use perpetual futures for various reasons, such as hedging against price changes or trying to profit from market movements. Traders can benefit from perpetual futures whenever the markets move, regardless of the direction, up or down.
If Coinbase had gone through with buying FTX Europe, they could have made more money from fees, especially since this type of trading is becoming more popular, even when the overall crypto market isn’t doing so well.
In fact, Coinbase made $707 million in the second quarter of 2023, though their earnings from regular trades dropped by 13% from the last quarter.
Meanwhile, globally, the trading of these financial contracts on centralised platforms went up by almost 14% in June to a staggering $2.13 trillion.
Binance led the way in this kind of trading, followed by OKX. Even Bitcoin futures trading saw a boost, especially on the CME exchange.
Coinbase now offers perpetual futures
As for Coinbase, they’ve already dipped their toes into this market in the U.S. and now just got the green light from authorities to offer this type of perpetual futures to non-U.S. qualified customers.
In the U.S., the green light from authorities allows Coinbase to offer Bitcoin and Ether futures contracts via its derivatives platform called FairX, which is overseen by the Commodity Futures Trading Commission. According to what Coinbase said when they announced this, these types of contracts make up nearly three-quarters of all crypto trading globally, making it a key entry point for traders.
Coinbase has announced its next steps in its “Go Broad, Go Deep” strategy, aiming to work closely with global regulators to shape a crypto-friendly framework.
They’ve expanded access to perpetual futures contracts to qualified customers outside the U.S., reinforcing their mission to update the global financial system.
This move comes at a time when other crypto exchanges face increasing regulatory challenges. Perpetual futures are highly sought-after, making up about 75% of global crypto trading. Coinbase sets itself apart by offering these contracts within strict compliance rules. They’ve already seen over $5.5 billion in trading volume from institutions as of the second quarter. Their exchange follows regulations set by the BMA and offers multiple layers of user protection.
What makes Coinbase unique is its emphasis on security and compliance. They guarantee a 1:1 hold on customer assets, and their financials are publicly audited. They’re also backed by a well-funded Insurance and Liquidity Support Program using the stablecoin USDC, rather than risky exchange tokens. Additionally, they have an experienced risk management team and don’t engage in market-making themselves.
