A little-known cryptocurrency called Syscoin reluctantly stole the spotlight today. The price of Syscoin spiked from 0.00003 BTC to 96 BTC, followed by a precipitous crash, and an attack on the Syscoin chain itself. The exchange Binance (which lost funds to the attack) responded cheekily by announcing a cold storage system called SAFU, an acronym known around the Internet to mean "Situation All Fucked Up."
Right after the incident, the Syscoin team launched an investigation and requested exchanges to halt trading the coin.
We are investigating a possible issue on the Syscoin blockchain, nothing is confirmed but we have asked for exchanges to halt trading while we investigate.— Syscoin (@syscoin) July 3, 2018
#Syscoin Binance hack in steps:— Ʀu฿en (@Ruben_Rotterdam) July 3, 2018
1. Mine alot of $SYS
2. Send $SYS to Binance
3. Set very high sells vs. $BTC
4. Hack Binance API
5. Use $BTC of Binance users that use API to buy $SYS
6. Take over $SYS mining power to prevent rollback of chain
7. Hope to get $BTC out of Binance
Concurrently, Binance announced an update to reset their existing API keys. This not the first time Binance API keys have been hacked.
"To protect the future interests of all users, Binance will create a Secure Asset Fund for Users (SAFU). Starting from 2018/07/14, we will allocate 10% of all trading fees received into SAFU to offer protection to our users and their funds in extreme cases. This fund will be stored in a separate cold wallet."
1/ As we've been looking into the recent network congestion / high gas prices, one of the more interesting things to come to light involves a random exchange (whom we will not name as this is likely part of their "PR strategy")— MyCrypto.com (@MyCrypto) July 3, 2018
"The same concepts of supply and demand that informed the Bloomberg article were used in turn by Kraken to argue they promote stability in tether prices. They can also be used to point out the inherent vulnerabilities in a fixed pegged currency, crypto or not."
News & Commentary
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