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Algo Capital Loses Crypto Funds After CTO’s Phone Is Hacked

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Algo Capital Loses Crypto Funds After CTO’s Phone Is Hacked

Algo Capital, an investment firm focused on the Algorand blockchain, lost a few million dollars in USDT and ALGO tokens after its chief technology officer’s phone were breached, Crypto Global News  Team has learned.

According to a source familiar with the matter, Algo Capital reported to its limited partners Friday that Pablo Yabo, its CTO, had his mobile compromised which allowed attackers to seize control of an Algo hot wallet administered by Yabo. As a result of the breach, roughly $1 million to $2 million in the cryptocurrencies were taken, according to an email from CEO David Garcia.
“Yes, there was a security breach,” CEO David Garcia stated in an email. “We communicated to all the Algo Capital VC Fund Limited Partner’s and updated them about the incident.”

The network itself remains unscathed. The Algorand team is aware of the breach suffered by the investment firm, the source said.

Algo Capital has raised $200 million for its Algo VC Fund, with the cash intended to support projects in the Algorand economy. Algo Capital founder and managing partner Arul Murugan said in an August 2019 statement that:

“Our investment approach specifically targets companies that are creating the next great blockchain applications and infrastructure solutions, and as a result, helping to speed blockchain adoption and bring millions of new users into the Algorand network.”

The investment firm is a separate entity from the Algorand Foundation and Algorand LLC, which oversee the blockchain’s actual development. Pablo Yabo has resigned his position, according to the email sent to partners. Further security measures have been taken by the firm. The majority of the firm’s funds were held in cold wallets that were not compromised.

The firm is taking full responsibility for the loss and committed to reimburse the full amount within 20 months. “We are engaging with certain key organizations and security services to collaborate and address this issue which has become a common industry problem,” Garcia wrote.

The Algorand blockchain itself was first envisioned by MIT professor Silvio Micali in 2017 as a possible solution to the scaling issues other blockchains face. Under its consensus mechanism, the network randomly selects the machines which add the next blocks to the blockchain, as a variant of the proof-of-stake mechanism.

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Fidelity Investments Launches Crypto Custody Service

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Fidelity Investments Launches Crypto Custody Service
Fidelity Investments Launches Crypto Custody Service

American financial services company Fidelity Investments has fully launched its cryptocurrency custody service. Abigail Johnson, CEO of Fidelity Investments, revealed the development in an interview with the Financial Times published on Oct. 18. Johnson said that the company is ready to roll out its crypto custody business following a year-long preparation and accumulation of clients.

Last fall, Fidelity specifically indicated that it would provide an enterprise-grade crypto custody service to hedge funds, family offices, and financial advisors. Johnson called that kind of service nascent and not developed, but noted its potential, saying:

“There are people out there with significant amounts of wealth in cryptocurrencies, probably Bitcoin, and they’re looking for somebody to hold those coins for them because in the event of their passing — which is going to happen at some point or another — you’ve got to have a plan to be able to get those coins to somebody else.”

Speaking about Coinbase’s custody offering, Johnson argued that Coinbase “is still a company that most people had never heard of, and they don’t have the existing relationships with the independent advisers.”

As previously reported, Coinbase Custody was initially announced in November 2017 and launched in July 2018, to provide robust security of crypto assets, which according to Coinbase has been institutional investors’ “‘number one concern.” As of August, Coinbase Custody claimed to store assets on behalf of more than 120 clients in 14 different countries.

Recently, Kathleen Murphy, personal investing president of Fidelity Investments, said that the firm does not offer cryptocurrencies on retail trading platforms to protect its clients. When asked when she expects users to trade crypto “in a meaningful way” on Fidelity’s platform, Murphy replied:

“You know, we’re really careful about that. So while we embrace crypto in terms of trying to understand it and be innovative and thoughtful… We’re also very careful about where we offer those types of things, so they’re not offered broadly on the retail platform. We want to be very careful about making sure that investors who really aren’t institutional investors […] don’t make a mistake with cryptocurrency.”

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Bitfinex Files for Subpoena in Bid to Recover $880 Million in Frozen Funds

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Bitfinex Files for Subpoena in Bid to Recover $880 Million in Frozen Funds

Bitfinex has applied to a U.S. court to subpoena a former banking executive of a trusted company that the crypto exchange believes can help it recover over $850 million in frozen funds.

The exchange submitted a filing on Oct. 18 to a court in California for obtaining the permission to take the deposition testimony of Rondell “Rhon” Clyde Monroe, a former vice president of TCA Bancorp. It also seeks to obtain documentation of Monroe’s communication with Crypto Capital staffers.

Bitfinex alleges in the filing that Crypto Capital “has used one or more accounts held at TCA Bancorp to facilitate the transfer of funds” belonging to itself and believes Monroe has information and documents vital to their claims to over $850 million.

Bitfinex’s filing comes as part of the on-going proceedings where it seeks to recover $880 million of its funds held at its payment processor Crypto Capital that was said to be frozen by multiple government agencies.

Meanwhile, Bitfinex is also under investigation by the New York Attorney General’s Office for allegedly using a loan from its sister company Tether to cover up the frozen funds without disclosing to customers.

Bitfinex said in the filing that its relationship with Crypto Capital operated generally well until April last year when news emerged that funds at Crypto Capital had been seized by authorities in Poland due to money-laundering investigation.

Bitfinex said that in August 2018, Crypto Capital told it that about $500 million of its funds in both Poland and Portugal were being “held up” by regulators in the two countries. The exchange added that after being pressured to provide more information concerning the frozen banking accounts, Crypto Capital provided a reference letter signed by Monroe from TCA.

The letter presented the custody of a little over $300 million of Bitfinex’s funds at TCA on behalf of a customer called Global Trade Solutions AG (GTS), doing business as “Crypto Capital.”

As such, Bitfinex is applying to take deposition testimony of Monroe, as well as documentation of his communication with Ozzie Yosef, a principal at Crypto Capital; Yosef’s sister Ravid Yosef; Reginald Dennis Fowler, a sole shareholder of GTS; as well as Fowler’s son Trent Dennis Fowler, who is said to be the registered holder for at least one account used by Crypto Capital to receive deposits from Bitfinex customers.

Notably, Reginald Fowler and Ravid Yosef have been indicated by the U.S Department of Justice for alleged bank fraud charges in connection to a system for depositing funds to cryptocurrency exchanges.

Read the full application below:

APPLICATION TO CONDUCTDISCOVERY PURSUANT TO 28 U.S.C. §1782 MEMOANDUM OF POINTS AND AUTHOITIES

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Bitcoin News

Cryptocurrency And Blockchain News Update 21st October 2019

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HTC CELL PHONE CAN RUN A FULL BITCOIN NODE
Cryptocurrency And Blockchain News Update 21st October 2019

New York Court Postpones SEC Hearing About Telegram

The United States District Court for the Southern District of New York has postponed the hearing regarding the Securities and Exchange Commission’s injunction filing against Telegram Open Network (TON) and its Gram token to Feb. 18–19, 2020. Recently, the SEC has claimed that not only did Telegram violate the U.S. securities laws during its initial coin offering (ICO), but it also is seeking a preliminary injunction to prevent Telegram from further violations.

Tron CEO – Says He is Not Investing in Poloniex

Tron founder and CEO Justin Sun seemed to have refuted recent reports suggesting that he is leading an investment group behind the acquisition of cryptocurrency exchange Poloniex. In a recent statement Sun has claimed that he is “not buying anything,” noting that he is an investor and disclosing some of his crypto assets

Ethereum Based Token Created As An Incentive For Workers

Enterprise Ethereum Alliance has created a token system to encourage the active contribution of member organizations and their employees to the cooperative.  The tokens are powered by the EEA’s Off-chain Trusted Compute Specification and is said to be trustworthy enough for use both within and between different companies. The system was first demonstrated at the Devcon5 conference at the start of October in Osaka as part of an experiment conducted inside the EEA.

Bittrex Is Closing Operations In 31 Countries

Bittrex International, The Malta-based international unit of United States’ crypto exchange Bittrex, will cease operations in Venezuela and 30 other countries.  In an email to Venezuelan customers, Bittrex International announced that the exchange will halt account and trading access to users on Oct. 29, asking them to withdraw their funds with the exchange before that date.  But Venezuela is not the only country that is going to be parting ways with the exchange. Bittrex will be halting the service for, Afghanistan, Egypt, Bosnia and Herzegovina, Cambodia, the Central African Republic, the Democratic Republic of the Congo, Ivory Coast, Tunisia, Ethiopia, Uganda and Yemen, and others.

HTC Creates A Phone That Can Run A Bitcoin Node

The Taiwanese electronics giant HTC has launched its new smartphone which is called the Exodus 1s, This device enables users to run a full Bitcoin node on mobile. The phone was launched at a Lightning Conference in Berlin on Oct. 19 and started selling the first devices during the even using the Lightning payment network.

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